Stale economy
hurts First Hawaiian

By Russ Lynch
Star-Bulletin

Shares of First Hawaiian Inc. slipped 50 cents today to close at $37 on the Nasdaq market after the company said that continuing flatness in Hawaii's economy caused a 2.7 percent decline in its second-quarter earnings.

The parent of First Hawaiian Bank, which also owns Pacific One Bank in the Pacific Northwest, reported a profit of $21.7 million for the three months through June 30, down from a profit of $22.3 million in the year-earlier quarter. Per-share earnings came to 69 cents, down from 70 cents in the 1997 quarter.

Today's stock price was more than $5 below its 52-week high of $42.38 on Dec. 4 but nearly $2 better than the low of $35.13 recorded June 15.

Despite the bad economic conditions, the bank said it was able to reduce its allowance for nonperforming loans and other nonperforming assets by 12 percent, to $86.1 million on June 30, compared with $97.8 million a year earlier.

The company reported June 30 assets of $8.2 billion, up 4.6 percent from $7.8 billion last year. Loans of $6.3 billion were up 4 percent from $6.03 billion and deposits of $6.2 billion were up 5.5 percent from $5.9 billion.

First Hawaiian has been diversifying to the West Coast to lessen the impact of Hawaii's economic woes.

On May 28, the company announced its biggest step in that direction, a pending merger with Bank of the West to create a $14 billion Western-regional financial services company.

The combined company, BancWest Corp., will be owned 55 percent by current First Hawaiian shareholders and 45 percent by Banque Nationale de Paris, Bank of the West's parent.