LUCY PEMONI / STAR-BULLETIN First Hawaiian Bank Chief Executive Don Horner took over the reins of the state's largest bank the same week he lost his wife, Rowena, to her fight with cancer. "On the same day I lost my children's mom, my wife and my best friend," Horner says.

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A new Don

CORRECTION Tuesday, February 8, 2005 » First Hawaiian Bank Vice Chairman Tony Guerrero was misidentified as a vice president in a photo caption on Page D7 Sunday. The Honolulu Star-Bulletin strives to make its news report fair and accurate. If you have a question or comment about news coverage, call Editor Frank Bridgewater at 529-4791 or email him at corrections@starbulletin.com.

No one has to tell Don Horner about highs and lows.

In the span of less than a week last April, he took an emotional roller coaster ride that will last him a lifetime.

Don Horner » Age: 54 » Title: President and CEO, First Hawaiian Bank » Board memberships: First Hawaiian Bank, BancWest Corp. » Years with bank: 26 » Previous titles: Vice chairman and head of Retail Banking Group; president of subsidiaries First Hawaiian Leasing and First Hawaiian Creditcorp; credit analyst » Late wife: Rowena » Children: Matthew, 12; Luke, 8

Just four days after being formally named to succeed Walter Dods as chief executive of First Hawaiian Bank, Horner's 44-year-old wife, Rowena, lost her eight-year battle with cancer.

Yet, as the 54-year-old Horner reflects today on that period, he considers himself fortunate.

"I really feel I'm blessed with a very big family at work, and my kids, and I have a great infrastructure between church family, work family and school family," said Horner, who took control of the bank on Jan. 1.

If the charismatic Dods sometimes appeared larger than life during his 15-plus years at the bank's helm, Horner is the opposite with his analytical, soft-spoken, spiritual nature.

He gives some questions considerable thought, and delays his answers at times to clarify what is being asked. What gives him greatest pause, though, is talking about his wife and the void she left behind.

"If I have a major regret, obviously, as I said at the funeral, on the same day I lost my children's mom, my wife and my best friend," he said. "As I told employees, it was also tragic because they lost a great first lady. I think many hundreds and hundreds knew her well because of all kinds of things we did together over the years, and I think everyone understood that. But we bond together in tough times and good times and we move on. We're all ready to move on."

What Horner has moved on to is the top position at First Hawaiian, whose Honolulu-based parent, BancWest Corp., is the most profitable company in the state with nearly a half-billion in earnings and more than $50 billion in assets. BancWest also owns San Francisco-based Bank of the West.

"I'm bullish on '05 about the bank itself," Horner said. "The economy is strong, obviously. The balance sheet in the bank has over $1 billion of liquidity. So we very much have a capacity to continue to support the growth to come. We have a very strong (uninsured certificate of deposit) credit rating of A-plus. Certainly, the strongest in Hawaii."

Horner said he doesn't know if leaders are born or made, but that timing and luck often play a role in their climb to the top.

"I don't pretend to have any more qualities than a large number of my peers and subordinates," Horner said.

The job, he said, sort of evolved.

"In 25 years, I've never aspired for this job," said Horner, who also holds the title of president that he received in January 2003. "My style has always been I just do the best job I can and the job I've been assigned. And I enjoy it. I take one day at a time, so I see this as just another job."

Some job. As the CEO of First Hawaiian, Horner oversees a bank with $10.6 billion in assets, more than $140 million in earnings and 2,100 employees.

But Dods said Horner is more than prepared for the challenge.

"Don Horner came to us 26 years ago locally from Merrill Lynch, and every assignment we've ever given him he hit the ball out of the ballpark," said Dods, who retired as CEO of First Hawaiian and BancWest at the end of last year but has remained as nonexecutive chairman. "He's more than ready. People say you can never replace this guy or that guy, but Don Horner will set his own record and he'll do a great job at the bank."

Allen Doane, president and CEO of Alexander and Baldwin Inc., said Dods laid the groundwork for a successful transition.

"Walter's work to prepare Don was a textbook example of succession planning, and you really have to take your hat off to Walter to have given Don as many opportunities as he gave him to be ready," said Doane, a member of the board of directors at both First Hawaiian and BancWest. "I think no two people are alike, and there can never be a replacement for Walter. He has just a whole unique set of character attributes and skills that no one would want to try to duplicate.

"So Don is finding his own style, and it's a style that I and a lot of other people, including Walter, are quite confident is going to be successful."

Horner likes to tell the story about his early days at First Hawaiian when he was walking down the main branch of the old building after having left his stock broker job at Merrill Lynch. A friend suggested to him that some day he might make vice president.

"I remember vividly thinking what a ridiculous thought that was," Horner said. "There was no way I'd ever be a vice president at this bank. I'd never make that level. And I was on my way to my first interview with an assistant vice president and I recall well how intimidated and frightened I was to be sitting in front of an assistant vice president at First Hawaiian Bank."

Don't let Horner's "aw shucks" persona fool you. He's paid his dues during his 26 years at the bank. He started as a credit analyst with First Hawaiian in 1978 and moved up the ranks to positions such as president of subsidiaries First Hawaiian Leasing and First Hawaiian Creditcorp. He was named vice chairman and head of the Retail Banking Group in 1994 to oversee consumer and business banking in Hawaii, Guam and Saipan, and was tapped as president of First Hawaiian in 2003.

courtesy first hawaiian bank First Hawaiian Bank Chief Executive Don Horner, left, sang a Christmas carol with Vice President Tony Guerrero and employee Lily Tokuhara at First Hawaiian's annual party.

"The ship is moving in the right direction, and I think that even when you change captains, the ship continues to go," said Luke, who also is president of the Hawaii Bankers Association. "He's an operations person, so he brings the operating strength to the organization. But CEOs are thrust into positions where you get to the position because you can bring the team together, and I'm sure that Don can meet the challenge."

With Bank of the West CEO Don McGrath now doubling as the CEO of BancWest, Horner said BancWest's headquarters will be switching to San Francisco from Honolulu, possibly as early as this year. But even so, Horner said, the change in the corporation's headquarters will have no effect on First Hawaiian's employees or customers.

"There's no staff moving from Hawaii to the mainland and there's no economic impact and there's no decision impact as far as it involves First Hawaiian Bank," he said.

BancWest, formed in 1998 by the merger of First Hawaiian Bank and Bank of the West, is owned by French banking giant BNP Paribas. But Horner emphasized that First Hawaiian's decisions are made at the local level.

"First Hawaiian Bank is an independent corporation with an independent board with an independent state of Hawaii charter," he said.

Unlike Bank of the West, which has been growing partially through acquisitions, First Hawaiian Bank is setting its sights on internal growth.

"Our primary growth strategy is organic (internal)," Horner said. "What you find is 70 percent of households in Hawaii have a relationship with First Hawaiian. So our job primarily is to develop a deeper relationship with existing customers. We certainly are very aggressive, and every single loan officer has a prospect file of noncustomers. When I go on my visits to the branches, that's the first thing I ask for. But the real role of the banker is to take care of your existing customers."

First Hawaiian put together a team of eight managers 18 months ago to take care of the major business lines of the bank. Everyone of the managers was born and raised in Hawaii and has an average tenure of 20 years with the bank.

"I think we have a very seasoned group of individuals with a long tenure with the bank and, equally important, they have a sense of what is special about this place," Horner said.

"We have a lot of initiatives for '05, but I think what's important is to talk about some of the ... things ... important to (us) that are not going to change."

Among them are the relationship strategy that the bank put into place 12 years ago in which any customer who has $5,000 or more in the bank is assigned a banker who is the primary officer for that relationship. Another is the "flat organization," as Horner calls it, in which from the president's office to the customer there's a maximum of four steps.

Horner also said the risk management and credit culture of First Hawaiian has a history of being consistent.

"And consistency is what I think the community wants in good times or bad times," he said. "Frankly, there are two kinds of bankers. There's one banker who looks for a way to say 'no' and there's another banker who looks for a way to say 'yes.' So you start from a premise. We look for a way to say 'yes' within the confines of what we view as good credit judgment."

Hence, the bank's slogan, "The Power of Yes," which has been around in some form for more than 30 years.

Two growth areas that First Hawaiian is concentrating on now involve the credit card business and inventory financing for auto dealerships.

First Hawaiian, the largest credit card processor in Hawaii, processed just under $3.5 billion in the state in 2004, with about $3 billion of that coming from Visa and MasterCard. That's almost 27 percent of the Visa and MasterCard transactions in the state, up from 23 percent five years ago.

THE BANK also invested more than $1 million last year to upgrade its credit card system in order to improve response time and to make it redundant for safety reasons.

"We feel it's important to have a local processor in the state because Hawaii is very much a retail sales state," Horner said. "Local processing is a very important payment mechanism in the state."

First Hawaiian also is on the other side of the transaction because it issues credit cards that customers use.

In the car business operations, First Hawaiian serves as the "flooring" bank for all of BancWest so an auto dealer, like Cutter, can order a number of cars from Chevrolet and draws on a line of credit with the bank to pay for those cars.

Nearly one year after probably the most eventful week of Horner's life, it's business as usual.

Doane, for one, said he doesn't know how Horner does it.

"He has absolutely extraordinary character to have been through what he has been through in the last year, and at the same time, to have undertaken the new job that he has," Doane said. "I'm sure I couldn't have done it."

But Horner hasn't forgotten the outpouring of compassion he received from the bank's employees. In some ways, he said, the tragedy of his wife's premature death has brought him closer to his extended family.

"I still have under my desk literally several hundred to a thousand cards and things from employees that I still look over occasionally," he said. "It's made the relationship with my company family closer and many of those cards talk about similar challenges and tragedies -- either an auntie or wife, sister, mother or dad. So it puts a personal perspective on life."