Strong First Quarter Produces Earnings of $39.8 Million at Pacific Century Financial Corporation; Earnings per share up 13.6 percent year-over-year
HONOLULU--(BUSINESS WIRE)--April 19, 2000--Pacific Century Financial Corporation (NYSE:BOH) reported strong first quarter 2000 earnings of $39.8 million, up 12.3 percent from $35.4 million reported for the first quarter of 1999 and up 5.8 percent from $37.6 million reported for the fourth quarter of 1999. Diluted earnings per share were $0.50, up 13.6 percent from $0.44 reported for 1999's first quarter and up 6.4 percent from $0.47 reported for 1999's fourth quarter.
Tangible or economic earnings for the quarter were $43.9 million relative to $39.3 million reported for the same period last year. Tangible diluted earnings per share for the quarter were $0.55, up 14.6 percent from $0.48 reported for the first quarter of 1999.
Return on average assets for the quarter was 1.13 percent compared to 0.96 percent for 1999's first quarter. Return on average equity was 13.19 percent versus 12.00 percent for the same period last year. The efficiency ratio was 62.1 percent relative to 66.4 percent for the first quarter of 1999. On a tangible basis, return on average assets, return on average equity and the efficiency ratio for the first quarter were 1.26 percent, 17.54 percent and 59.7 percent, respectively.
"We're pleased to be able to demonstrate that the implementation of New Era Redesign initiatives is delivering the intended positive results," noted Lawrence M. Johnson, Pacific Century Chairman and CEO. "The improved performance clearly reflects the dedication and commitment of our staff."
The company saw improvement in non-interest expense in the first quarter, which stood at $126.1 million, down 6.5 percent from the first quarter of 1999 and down 3.9 percent relative to the fourth quarter of 1999. Factors contributing to the improvement in expenses include the implementation of New Era initiatives and the reduction in costs related to Y2K readiness.
Non-performing assets, exclusive of loans past due 90+ days ended the quarter at $136.4 million, compared to $149.9 million at the end of 1999's fourth quarter and $163.3 million at the end of 1999's first quarter.
"Our first quarter performance is an indicator of the momentum that's building in the company," said Johnson. "New Era implementation is solidly under way and on-track, and we are making steady progress at establishing a foundation for long-term growth and performance."
At March 31, 2000, total assets were $14.3 billion relative to $14.9 billion at the end of the first quarter last year. Reductions in investment securities and Asian exposure were primarily responsible for the decline in assets. Net loans ended the quarter at $9.3 billion versus $9.2 billion at the end of the first quarter of 1999. Total deposits were $9.1 billion compared to $9.4 billion for the period ended March 31, 1999. The decline in deposits was driven by a reduction in foreign time deposits due to banks (functionally a form of short-term borrowings), which offset net growth of $86.7 million in other deposit categories.
Hawaii's economy continues to gain momentum with the consensus forecast for real gross state product growth in 2000 of 2.5 percent, which is likely to be revised upward according to Hawaii's economists. Tourism is showing strength after the Y2K-related slowdown in visitors. In February 2000, total visitor arrivals and visitor days increased over last year by 4.2 percent and 7.1 percent, respectively. The state's Department of Business, Economic Development and Tourism noted that its index of Leading Economic Indicators rose for the ninth consecutive month in December 1999, suggesting a sustained period of higher economic activity for Hawaii.
In other news, Bank of Hawaii, Pacific Century's largest subsidiary, recently relocated and enhanced its Waikiki Branch, debuting an array of automated banking technology that is at the cutting edge of the industry. Clients can conduct their banking via "virtual" tellers, advanced-function ATMs, bank machines for businesses, and online and telephone banking kiosks. In addition, the branch offers personalized services through personal and business bankers, Asia Division personnel and a branch concierge. As part of a larger strategy, some of the new technology and service enhancements will be introduced to other branches in Hawaii.
Bank of Hawaii also recently launched its e-Bankoh for Business online banking service, which enables small businesses to access their accounts, obtain real-time balances and pay bills via the Internet 24 hours a day.
Further highlights on Pacific Century's performance are included in the attached "Comments on First Quarter 2000 Results."
Pacific Century Financial Corporation is a regional financial services holding company with locations throughout the Pacific region. Pacific Century and its subsidiaries provide varied financial service to businesses, governments and consumers in four principal markets: Hawaii, the West and South Pacific, Asia and selected markets on the U.S. Mainland. Pacific Century's principal subsidiary, Bank of Hawaii, is the largest commercial bank in the state of Hawaii.
Forward-Looking Statements
This press release and the attached comments contain forward-looking information. The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date made. Forward-looking statements are subject to significant risk and uncertainties, many of which are beyond the Company's control. Although the Company believes that the assumptions underlying its forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate and actual results may differ from those contained in or implied by such forward-looking statements for a variety of reasons. Factors which might cause such a difference include, but are not limited to, expected cost savings from New Era Redesign cannot be fully realized or realized within the expected timeframe; income or revenues from New Era Redesign are lower than expected or operating or implementation costs are higher; competitor pressures in the banking and financial services industry increase significantly, particularly in connection with product delivery and pricing; business disruption related to implementation of New Era Redesign programs or methodologies; inability to achieve expected customer acceptance of revised pricing structures and strategies; general economic conditions in the geographic areas where the Company operates are weaker than expected or other unanticipated occurrences which could delay or adversely impact the implementation of all or a part of New Era Redesign. The Company does not undertake and specifically disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.
Comments on First Quarter 2000 Results
Pacific Century Financial Corporation reported first quarter earnings of $39.8 million, up 12.3% from the same period last year and 5.8% higher than reported for the fourth quarter of 1999. Diluted earnings per share for the first quarter were $0.50, up 13.6% from the $0.44 reported in 1999's first quarter and up 6.4% from $0.47 reported in 1999's fourth quarter.
Tangible or economic earnings for the quarter were $43.9 million relative to $39.3 million reported for the like period last year. Tangible diluted earnings per share for the quarter were $0.55, up 14.6% from $0.48 reported for the first quarter of 1999.
Return on average assets for the first quarter was 1.13%, up from 0.96% in 1999's like quarter while return on average equity was 13.19%, up from 12.00% for last year's first quarter. On a tangible basis return on average assets and return on average equity for the quarter were 1.26% and 17.54%, respectively.
Total assets of $14.3 billion at March 31, 2000 were 4.5% lower than at March 31, 1999, reflecting a continuing emphasis to make the balance sheet more efficient. Year over year, $142.0 million in loan growth was more than offset by a $699.8 million decline in securities and other short-term earning assets. Deposits at March 31, 2000 were $9.1 billion, down $291.4 million from March 31, 1999. The decline in deposits was driven by a reduction in foreign time deposits due to banks (functionally a form of short-term borrowings), which offset net growth of $86.7 million in other deposit categories.
Pacific Century's New Era redesign program finished the second quarter of its four-quarter implementation timeline. We are pleased to report that New Era is demonstrating its intended impact on net income.
Net interest income on a fully taxable equivalent basis declined by 2.9% to $139.8 million from the same period in 1999. The decline was primarily the result of the reduction in average earning assets referred to above. Net interest margin for the quarter was 4.31%, up from 4.24% for the first quarter of 1999 and unchanged from 1999's fourth quarter.
The provision for loan losses totaled $13.5 million for the quarter, compared with $12.6 million in 1999's first quarter and $20.9 million in 1999's fourth quarter. The $13.5 million provision exceeded first quarter net charge offs by $2.2 million.
Non-performing assets (NPAs), exclusive of loans past due 90+ days ended the quarter at $136.4 million or 1.39% of total loans, down from $163.3 million at March 31, 1999 and down from $149.9 million at year-end 1999. During the quarter, approximately $5.0 million non-performing residential real estate loans were sold, contributing to the overall NPA decline.
Non-interest income, exclusive of securities transactions, totaled $63.6 million, up 7.3% from 1999's first quarter and down 0.7% from 1999's fourth quarter. Results reflected approximately $2.0 million in non-recurring other operating income during the quarter, compared with $4.3 million in non-recurring other operating income in 1999's fourth quarter. Results also reflected modest contributions relative to "New Era" idea implementation and the seasonal impact of income tax processing fees as a component of trust income.
Non-interest expense totaled $126.1 million for the quarter, down 6.5% from 1999's first quarter, and down 3.9% from 1999's fourth quarter. Comparing first quarter 2000 to first quarter 1999, the improvement is largely driven by reduced compensation expense and reduced other operating expenses related to New Era implementation and Y2K remediation costs. On a linked quarter basis, comparisons reflect non-recurring items previously noted that reduced fourth quarter 1999 compensation expense by approximately $2.3 million and increased other operating expenses by a similar amount.
During the quarter, Pacific Century repurchased approximately 510,000 shares of common stock, of which approximately 374,000 related to the company's October 1999 share repurchase authorization; while the remainder offset shares issued under the company's dividend reinvestment plan and various benefit plans. Pacific Century's board of directors amended the October 1999 authorization to allow for the quarterly repurchase of up to $6.0 million worth of Pacific Century stock; previously the authorization had been for up to 300,000 shares per quarter.
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Highlights (Unaudited)
Pacific Century Financial Corporation and subsidiaries (in thousands of dollars except per share amounts)
Earnings Highlights and Percentage Performance Ratios 2000 1999 Change Three Months Ended March 31 Net Income $ 39,765 $ 35,417 12.3% Basic Earnings Per Share 0.50 0.44 13.6% Diluted Earnings Per Share 0.50 0.44 13.6% Cash Dividends 13,541 13,691 Return on Average Assets 1.13% 0.96% Return on Average Equity 13.19% 12.00% Average Spread on Earning Assets 4.31% 4.24% Efficiency Ratio 62.06% 66.37% Summary of Results Excluding the Effect of Intangibles (a) Three Months Ended March 31 Net Income $ 43,889 $ 39,252 11.8% Basic Earnings per Share $ 0.55 $ 0.49 12.2% Diluted Earnings per Share $ 0.55 $ 0.48 14.6% Return on Average Assets 1.26% 1.08% Return on Average Equity 17.54% 16.21% Efficiency Ratio 59.73% 64.25%
(a) Intangibles include goodwill, core deposit and trust intangibles,
and other intangibles.
Statement
of Condition
Highlights
and Performance March 31 March 31 Percentage
Ratios 2000 1999 Change
Total Assets $ 14,250,386 $ 14,928,286 -4.5%
Net Loans 9,346,460 9,208,126 1.5%
Total Deposits 9,143,063 9,434,427 -3.1%
Total
Shareholders'
Equity 1,225,907 1,207,559 1.5%
Book Value Per
Common Share $ 15.39 $ 15.01
Loss Reserve /
Loans
Outstanding 2.05% 2.22%
Average
Equity /
Average
Assets 8.54% 7.98%
Common Stock
Price Range High Low
1999 $ 24.94 $ 17.38
2000 First Quarter $ 20.38 $ 14.35
Corporate Offices: Inquiries:
Financial Plaza of the Pacific David A. Houle
130 Merchant Street Executive Vice President, Treasurer
Honolulu, Hawaii 96813 and Chief Financial Officer
(808) 537-8288
Consolidated Statements of Condition (Unaudited)
Pacific Century Financial Corporation and subsidiaries
March 31 Dec. 31 March 31
(in thousands of dollars) 2000 1999 1999
Assets
Interest-Bearing Deposits $ 225,314 $ 278,473 $ 494,202
Investment Securities
- Held to Maturity
(Market Value of
$721,620, $787,720 and
$902,830, respectively) 732,344 796,322 894,502
Investment Securities
- Available for Sale 2,537,617 2,542,232 2,733,466
Securities Purchased
Under Agreements to Resell 902 -- 4,083
Funds Sold 42,208 52,740 111,894
Loans 9,779,633 9,717,556 9,637,661
Unearned Income (237,764) (242,503) (220,206)
Reserve for Loan Losses (195,409) (194,205) (209,329)
Net Loans 9,346,460 9,280,848 9,208,126
Total Earning Assets 12,884,845 12,950,615 13,446,273
Cash and Non-Interest
Bearing Deposits 491,218 639,895 617,362
Premises and Equipment 267,497 271,728 292,583
Customers' Acceptance
Liability 8,262 7,236 13,965
Accrued Interest Receivable 74,597 78,974 88,887
Other Real Estate 4,633 4,576 6,225
Intangibles,
including Goodwill 202,832 205,904 217,470
Other Assets 316,502 281,387 245,521
Total Assets $ 14,250,386 $ 14,440,315 $ 14,928,286
Liabilities
Domestic Deposits
Demand - Non-Interest
Bearing $ 1,708,635 $ 1,676,425 $ 1,676,816
- Interest Bearing 2,110,998 2,076,358 2,156,649
Savings 693,077 700,720 735,442
Time 2,759,319 2,761,650 2,539,649
Foreign Deposits
Demand
- Non-Interest Bearing 380,179 401,613 409,994
Time Due to Banks 398,176 597,675 776,257
Other Savings and Time 1,092,679 1,179,777 1,139,620
Total Deposits 9,143,063 9,394,218 9,434,427
Securities Sold Under
Agreements to Repurchase 1,806,197 1,490,655 2,090,663
Funds Purchased 511,440 839,962 775,577
Short-Term Borrowings 424,720 458,962 377,387
Bank's Acceptances
Outstanding 8,262 7,236 13,965
Accrued Retirement Expense 40,851 40,360 40,519
Accrued Interest Payable 66,456 64,588 76,287
Accrued Taxes Payable 103,826 85,022 126,243
Minority Interest 4,269 4,435 4,849
Other Liabilities 109,669 114,890 105,176
Long-Term Debt 805,726 727,657 675,634
Total Liabilities 13,024,479 13,227,985 13,720,727
Shareholders' Equity
Common Stock ($.01 par
value), authorized
500,000,000 shares;
issued / outstanding;
March 2000
- 80,551,253 / 79,661,479;
December 1999 - 80,550,728 /
80,036,417; March 1999 -
80,537,756 / 80,398,067 806 806 805
Capital Surplus 345,863 345,851 344,955
Accumulated Other
Comprehensive Income (72,307) (66,106) (23,536)
Retained Earnings 967,308 942,177 888,367
Treasury Stock,
at Cost - (March 2000 -
889,774; December 1999 -
514,311 and March 1999 -
139,689 shares) (15,763) (10,398) (3,032)
Total Shareholders'
Equity 1,225,907 1,212,330 1,207,559
Total Liabilities and
Shareholders' Equity $ 14,250,386 $ 14,440,315 $ 14,928,286
Consolidated Statements of Income (Unaudited)
Pacific Century Financial Corporation and subsidiaries
3 Months 3 Months
Ended Ended
Mar 31 Mar 31
(in thousands of dollars
except per share amounts) 2000 1999
Interest Income
Interest on Loans $ 180,402 $ 176,000
Loan Fees 8,246 9,581
Income on Lease Financing 11,109 8,268
Interest and Dividends
on Investment Securities
Taxable 14,236 13,679
Non-taxable 279 276
Income on Investment Securities
Available for Sale 41,033 41,782
Interest on Deposits 3,764 8,226
Interest on Security Resale Agreements 10 101
Interest on Funds Sold 473 2,553
Total Interest Income 259,552 260,466
Interest Expense
Interest on Deposits 68,214 66,327
Interest on Security
Repurchase Agreements 22,953 24,416
Interest on Funds Purchased 8,527 12,768
Interest on Short-Term Borrowings 7,662 3,249
Interest on Long-Term Debt 12,688 9,862
Total Interest Expense 120,044 116,622
Net Interest Income 139,508 143,844
Provision for Loan Losses 13,522 12,590
Net Interest Income
After Provision for Loan Losses 125,986 131,254
Non-Interest Income
Trust Income 16,887 15,575
Service Charges
on Deposit Accounts 9,557 9,395
Fees, Exchange, and
Other Service Charges 21,626 21,998
Other Operating Income 15,575 12,355
Investment Securities Gains 282 1,847
Total Non-Interest Income 63,927 61,170
Non-Interest Expense
Salaries 47,547 50,842
Pensions and Other Employee Benefits 14,630 15,043
Net Occupancy Expense 11,816 12,268
Net Equipment Expense 12,067 12,127
Other Operating Expense 39,953 44,353
Minority Interest 69 207
Total Non-Interest Expense 126,082 134,840
Income Before Income Taxes 63,831 57,584
Provision for Income Taxes 24,066 22,167
Net Income $ 39,765 $ 35,417
Basic Earnings Per Share $ 0.50 $ 0.44
Diluted Earnings Per Share $ 0.50 $ 0.44
Dividends Declared Per Share $ 0.17 $ 0.17
Basic Weighted Average Shares 79,821,365 80,421,563
Diluted Weighted Average Shares 80,017,761 81,405,868
Pacific Century Financial Corporation and subsidiaries
Consolidated Statements of Shareholders' Equity (Unaudited)
Accumulated
Other
Compre-
(in thousands Common Capital hensive
of dollars) Total Stock Surplus Income
Balance at
December 31, 1999 $ 1,212,330 $ 806 $ 345,851 ($ 66,106)
Comprehensive
Income
Net Income 39,765 -- -- --
Other Comprehensive
Income, Net of Tax
Investment
Securities, Net of
Reclassification
Adjustment (7,630) -- -- (7,630)
Foreign Currency
Translation
Adjustment 1,429 -- -- 1,429
Pension Liability
Adjustments -- -- -- --
Total
Comprehensive
Income
Common Stock Issued
22,377 Profit
Sharing Plan 361 -- -- --
33,932 Stock
Option Plan 398 -- 3 --
78,723 Dividend
Reinvestment Plan 1,123 -- -- --
525 Directors'
Restricted
Shares and
Deferred
Compensation Plan 9 -- 9 --
Treasury Stock
Purchased (8,337) -- -- --
Cash Dividends Paid (13,541) -- -- --
Balance at
March 31, 2000 $ 1,225,907 $ 806 $ 345,863 ($ 72,307)
Balance at
December 31, 1998 $ 1,185,594 $ 805 $ 342,932 ($ 22,476)
Comprehensive
Income
Net Income 35,417 -- -- --
Other
Comprehensive
Income, Net of Tax
Investment
Securities, Net of
Reclassification
Adjustment 1,131 -- -- 1,131
Foreign Currency
Translation
Adjustment (2,191) -- -- (2,191)
Pension Liability
Adjustments -- -- -- --
Total Comprehensive
Income
Common Stock Issued
81 Profit
Sharing Plan 2 -- 2 --
183,628 Stock
Option Plan 3,746 -- 1,860 --
65,874 Dividend
Reinvestment Plan 1,447 -- 137 --
1,241 Directors'
Restricted
Shares and Deferred
Compensation Plan 24 -- 24 --
Treasury Stock
Purchased (3,920) -- -- --
Cash Dividends
Paid (13,691) -- -- --
Balance at
March 31, 1999 $ 1,207,559 $ 805 $ 344,955 ($ 23,536)
(in thousands Retained Treasury Comprehensive
of dollars) Earnings Stock Income
Balance at
December 31, 1999 $ 942,177 ($ 10,398)
Comprehensive
Income
Net Income 39,765 -- $ 39,765
Other Comprehensive
Income, Net of Tax
Investment
Securities, Net of
Reclassification
Adjustment -- -- (7,630)
Foreign Currency
Translation
Adjustment -- -- 1,429
Pension Liability
Adjustments -- -- --
Total
Comprehensive
Income $ 33,564
Common Stock Issued
22,377 Profit
Sharing Plan (128) 489
33,932 Stock
Option Plan (362) 757
78,723 Dividend
Reinvestment Plan (603) 1,726
525 Directors'
Restricted
Shares and
Deferred
Compensation Plan -- --
Treasury Stock
Purchased -- (8,337)
Cash Dividends Paid (13,541) --
Balance at
March 31, 2000 $ 967,308 ($ 15,763)
Balance at
December 31, 1998 $ 867,852 ($ 3,519)
Comprehensive
Income
Net Income 35,417 -- $ 35,417
Other
Comprehensive
Income, Net of Tax
Investment
Securities, Net of
Reclassification
Adjustment -- -- 1,131
Foreign Currency
Translation
Adjustment -- -- (2,191)
Pension Liability
Adjustments -- -- --
Total Comprehensive
Income $ 34,357
Common Stock Issued
81 Profit
Sharing Plan -- --
183,628 Stock
Option Plan (1,195) 3,081
65,874 Dividend
Reinvestment Plan (16) 1,326
1,241 Directors'
Restricted
Shares and Deferred
Compensation Plan -- --
Treasury Stock
Purchased -- (3,920)
Cash Dividends
Paid (13,691) --
Balance at
March 31, 1999 $ 888,367 ($ 3,032)
Consolidated Average Balances and Interest
Rates Taxable Equivalent (Unaudited)
Pacific Century Financial Corporation and subsidiaries
Three Months Ended Three Months Ended
March 31, 2000 March 31, 1999
(in millions Average Income/ Yield/ Average Income/ Yield/
of dollars) Balance Expense Rate Balance Expense Rate
Earning Assets
Interest
Bearing
Deposits $ 206.5 $ 3.8 7.33% $ 466.6 $ 8.2 7.15%
Investment
Securities
Held to
Maturity
-Taxable 775.5 14.2 7.38 790.0 13.7 7.02
-Tax-Exempt 10.0 0.4 17.32 11.7 0.4 14.73
Investment
Securities
Available
for Sale 2,527.0 41.0 6.53 2,815.3 41.8 6.02
Funds Sold 35.0 0.5 5.56 208.2 2.7 5.17
Net Loans
-Domestic 7,897.9 166.7 8.49 7,778.2 158.3 8.25
-Foreign 1,586.1 24.9 6.30 1,713.7 25.9 6.15
Loan Fees 8.3 9.6
Total Earning
Assets 13,038.0 259.8 8.01 13,783.7 260.6 7.67
Cash and Due
From Banks 506.5 517.6
Other Assets 657.0 694.3
Total Assets $14,201.5 $14,995.6
Interest
Bearing
Liabilities
Domestic
Deposits
- Demand $ 2,115.6 12.3 2.33 $ 2,163.9 12.0 2.25
- Savings 700.1 3.5 2.03 735.0 3.7 2.02
- Time 2,764.9 35.1 5.10 2,610.9 30.7 4.77
Total
Domestic 5,580.6 50.9 3.67 5,509.8 46.4 3.41
Foreign
Deposits
- Time Due
to Banks 487.8 7.0 5.79 652.9 8.6 5.36
- Other
Time and
Savings 1,121.6 10.3 3.70 1,160.1 11.3 3.95
Total Foreign 1,609.4 17.3 4.33 1,813.0 19.9 4.46
Total Interest
Bearing
Deposits 7,190.0 68.2 3.82 7,322.8 66.3 3.67
Short-Term
Borrowings 2,626.6 39.1 5.99 3,372.5 40.4 4.86
Long-Term Debt 773.0 12.7 6.60 651.8 9.9 6.14
Total
Interest
Bearing
Liabilities 10,589.6 120.0 4.56 11,347.1 116.6 4.17
Net Interest
Income 139.8 144.0
Interest
Rate Spread 3.45% 3.50%
Net Interest
Margin 4.31% 4.24%
Demand
Deposits
- Domestic 1,663.6 1,644.4
- Foreign 419.5 448.2
Total Demand
Deposits 2,083.1 2,092.6
Other
Liabilities 316.7 359.1
Shareholders'
Equity 1,212.1 1,196.8
Total
Liabilities
and
Shareholders'
Equity $14,201.5 $14,995.6
Provision for
Loan Losses 13.5 12.6
Net Overhead 62.2 73.7
Income Before
Income Taxes 64.1 57.7
Provision for
Income Taxes 24.1 22.2
Tax-Equivalent
Adjustment 0.2 0.1
Net Income $ 39.8 $ 35.4
Three Months Ended Twelve Months Ended
December 31, 1999 December 31, 1999
(in millions Average Income/ Yield/ Average Income/ Yield/
of dollars) Balance Expense Rate Balance Expense Rate
Earning Assets
Interest
Bearing
Deposits $ 268.4 $ 4.6 6.75% $ 385.0 $ 24.9 6.48% Investment
Securities
Held to
Maturity
-Taxable 794.4 14.6 7.27 805.2 57.8 7.18
-Tax-Exempt 11.6 0.4 14.34 11.7 1.7 14.41
Investment
Securities
Available
for Sale 2,590.0 41.8 6.40 2,698.8 168.0 6.23
Funds Sold 33.2 0.5 6.53 102.0 5.4 5.31
Net Loans
-Domestic 7,803.0 161.4 8.20 7,742.3 623.0 8.05
-Foreign 1,688.6 25.1 5.91 1,702.2 106.4 6.25
Loan Fees 9.8 39.9
Total Earning
Assets 13,189.2 258.2 7.77 13,447.2 1,027.1 7.64
Cash and Due
From Banks 519.3 486.6
Other Assets 650.8 649.1
Total
Assets $14,359.3 $14,582.9
Interest
Bearing
Liabilities
Domestic
Deposits
- Demand $ 2,110.5 12.1 2.28 $ 2,137.1 48.5 2.27
- Savings
- Savings 711.9 3.7 2.03 723.9 14.7 2.03
- Time
- Time 2,634.8 32.4 4.88 2,559.4 123.3 4.82
Total
Domestic 5,457.2 48.2 3.50 5,420.4 186.5 3.44
Foreign
Deposits
- Time Due
to Banks 625.6 8.7 5.50 641.4 33.7 5.25
- Other
Time and
Savings 1,171.7 10.6 3.60 1,165.7 41.0 3.52
Total Foreign 1,797.3 19.3 4.26 1,807.1 74.7 4.13
Total Interest
Bearing
Deposits 7,254.5 67.5 3.69 7,227.5 261.2 3.61
Short-Term
Borrowings 2,707.6 35.4 5.18 3,014.8 146.2 4.85
Long-Term Debt 747.4 12.1 6.45 685.9 44.3 6.46
Total
Interest
Bearing
Liabilities 10,709.5 115.0 4.26 10,928.2 451.7 4.13
Net Interest
Income 143.2 575.4
Interest
Rate Spread 3.51% 3.51%
Net Interest
Margin 4.31% 4.28%
Demand
Deposits
- Domestic 1,662.8 1,652.6
- Foreign 457.5 435.2
Total Demand
Deposits 2,120.3 2,087.8
Other
Liabilities 315.3 356.9
Shareholders'
Equity 1,214.2 1,210.0
Total
Liabilities
and
Shareholders'
Equity $14,359.3 $14,582.9
Provision for
Loan Losses 20.9 60.9
Net Overhead 61.7 288.2
Income Before
Income Taxes 60.6 226.3
Provision for
Income Taxes 22.8 92.7
Tax-Equivalent
Adjustment 0.2 0.6
Net Income $ 37.6 $ 133.0
Pacific Century Financial Corporation and subsidiaries
Consolidated Non-Performing Assets and Accruing Loans
Past Due 90 Days or More (Unaudited)
Mar 31 Dec 31 Sep 30 Jun 30
(in millions of dollars) 2000 1999 1999 1999
Non-Accrual Loans
Commercial and Industrial $20.1 $23.7 $31.7 $37.5
Real Estate
Construction 0.9 1.1 2.1 0.8
Commercial 18.2 19.0 20.8 17.2
Residential 23.2 29.7 33.1 35.2
Installment 0.5 0.5 0.7 0.8
Leases 3.7 3.9 4.8 4.4
Total Domestic 66.6 77.9 93.2 95.9
Foreign 65.2 67.4 55.7 47.5
Subtotal 131.8 145.3 148.9 143.4
Restructured Loans
Real Estate
Commercial -- -- -- --
Subtotal -- -- -- --
Foreclosed Real Estate
Domestic 4.3 4.3 5.6 5.8
Foreign 0.3 0.3 0.3 0.2
Subtotal 4.6 4.6 5.9 6.0
Total Non-Performing
Assets 136.4 149.9 154.8 149.4
Accruing Loans Past Due
90 Days or More
Commercial and Industrial 6.7 5.9 6.2 3.9
Real Estate
Construction -- -- 0.5 0.2
Commercial 2.1 1.9 2.4 0.2
Residential 5.0 4.0 2.8 3.7
Installment 4.7 4.5 4.5 5.2
Leases 1.4 1.2 0.2 --
Total Domestic 19.9 17.5 16.6 13.2
Foreign 3.2 1.0 5.0 8.2
Subtotal 23.1 18.5 21.6 21.4
Total $159.5 $ 168.4 $ 176.4 $ 170.8
Ratio of Non-Performing
Assets to Total Loans 1.39% 1.54% 1.59% 1.55%
Ratio of Non-Performing
Assets and Accruing Loans
Past Due 90 Days or More
to Total Loans 1.63% 1.73% 1.81% 1.78%
Mar 31 Dec 31 Sep 30 Jun 30 Mar 31
(in millions of dollars) 1999 1998 1998 1998 1998
Non-Accrual Loans
Commercial and Industrial $39.1 $28.2 $24.0 $23.7 $11.1
Real Estate
Construction 3.1 2.9 4.4 2.2 6.4
Commercial 18.7 5.4 6.7 3.4 2.2
Residential 37.6 36.4 35.9 35.2 36.7
Installment 0.5 0.8 0.9 1.9 2.3
Leases 4.5 0.7 0.8 -- 0.3
Total Domestic 103.5 74.4 72.7 66.4 59.0
Foreign 53.6 57.5 67.9 59.7 27.7
Subtotal 157.1 131.9 140.6 126.1 86.7
Restructured Loans
Real Estate
Commercial -- -- -- 1.6 1.6
Subtotal -- -- -- 1.6 1.6
Foreclosed Real Estate
Domestic 6.1 5.5 10.8 11.6 6.1
Foreign 0.1 0.1 0.1 -- --
Subtotal 6.2 5.6 10.9 11.6 6.1
Total Non-Performing
Assets 163.3 137.5 151.5 139.3 94.4
Accruing Loans Past Due
90 Days or More
Commercial and Industrial 4.3 0.4 7.3 2.4 2.2
Real Estate
Construction 0.2 0.4 0.6 4.2 --
Commercial 0.4 -- 0.8 0.9 5.8
Residential 3.5 4.5 4.8 2.4 3.8
Installment 6.9 7.3 6.6 6.4 7.7
Leases 0.1 0.3 0.1 0.9 0.1
Total Domestic 15.4 12.9 20.2 17.2 19.6
Foreign 6.3 7.9 7.1 4.9 4.8
Subtotal 21.7 20.8 27.3 22.1 24.4
Total $185.0 $158.3 $178.8 $161.4 $118.8
Ratio of Non-Performing
Assets to Total Loans 1.69% 1.40% 1.59% 1.47% 1.00%
Ratio of Non-Performing
Assets and Accruing Loans
Past Due 90 Days or More
to Total Loans 1.92% 1.61% 1.87% 1.71% 1.26%
Pacific Century Financial Corporation and subsidiaries
Summary of Loan Loss Experience
First Year First
Quarter Ended Quarter
(in millions of dollars) 2000 12/31/99 1999
Average Amount of
Loans Outstanding $ 9,484.1 $ 9,444.5 $ 9,491.9
Balance of Reserve
for Loan Losses
at Beginning of
Period $ 194.2 $ 211.3 $ 211.3
Loans Charged-Off
Commercial and
Industrial 1.4 18.5 7.8
Real Estate
Construction -- 1.4 --
Commercial 3.9 4.5 2.0
Residential 2.4 7.8 2.0
Installment 4.7 25.1 6.0
Leases -- 0.2 --
Total Domestic 12.4 57.5 17.8
Foreign 3.7 45.8 3.0
Total Charged-Off 16.1 103.3 20.8
Recoveries on Loans
Previously
Charged-Off
Commercial and
Industrial 1.7 14.0 8.0
Real Estate
Construction -- 0.1 --
Commercial 0.1 1.6 0.1
Residential 0.5 0.6 --
Installment 1.7 7.6 1.6
Total Domestic 4.0 23.9 9.7
Foreign 0.8 5.6 0.3
Total Recoveries 4.8 29.5 10.0
Net Charge-Offs (11.3) (73.8) (10.8)
Provision Charged
to Operating
Expenses 13.5 60.9 12.6
Other Net Additions
(Reductions)(a) (1.0) (4.2) (3.8)
Balance at End of
Period $ 195.4 $ 194.2 $ 209.3
Ratio of Net Charge
-Offs to Average
Loans Outstanding
(annualized) 0.48% 0.78% 0.46%
Ratio of Reserve
to Loans
Outstanding 2.05% 2.05% 2.22%
(a) Includes balance transfers, reserves acquired, and foreign
currency translation adjustments.
Pacific Century Financial Corporation and subsidiaries
Quarterly Summary of Selected Consolidated Financial Data
Mar. 31 Dec. 31 Sept. 30
(in millions of dollars 2000 1999 1999
except per share amounts)
Balance Sheet Totals
Total Assets $ 14,250.4 $ 14,440.3 $ 14,505.4
Net Loans 9,346.5 9,280.8 9,321.5
Deposits 9,143.1 9,394.2 9,290.4
Long-Term Debt 805.7 727.7 794.8
Shareholders' Equity 1,225.9 1,212.3 1,208.5
Quarterly Operating Results
Net Interest Income $ 139.5 $ 143.0 $ 143.5
Provision for Loan Losses 13.5 20.9 13.5
Non-Interest Income 63.9 69.4 71.4
Non-Interest Expense 126.1 131.2 155.6
Net Income 39.8 37.6 21.5
Basic Earnings Per Share $0.50 $0.47 $0.27
Diluted Earnings Per Share $0.50 $0.47 $0.27
Return on Average Assets 1.13% 1.04% 0.59%
Return on Average Equity 13.19% 12.29% 7.01%
Efficiency Ratio 62.06% 63.32% 72.44%
Normalized Efficiency Ratio (1) - - 61.98%
Excluding the Effects of
Intangibles (2)
Net Income $43.9 $42.3 $25.9
Basic Earnings Per Share $0.55 $0.53 $0.32
Diluted Earnings Per Share $0.55 $0.52 $0.32
Return on Average Assets 1.26% 1.19% 0.73%
Return on Average Equity 17.54% 16.69% 10.25%
Efficiency Ratio 59.73% 60.59% 70.04%
Normalized Efficiency Ratio (1) - - 59.57%
Jun. 30 Mar. 31
1999 1999
Balance Sheet Totals
Total Assets $ 14,551.5 $ 14,928.3
Net Loans 9,181.7 9,208.1
Deposits 9,286.2 9,434.4
Long-Term Debt 654.8 675.6
Shareholders' Equity 1,214.2 1,207.6
Quarterly Operating Results
Net Interest Income $ 144.4 $ 143.8
Provision for Loan Losses 13.9 12.6
Non-Interest Income 63.6 61.2
Non-Interest Expense 132.1 134.8
Net Income 38.5 35.4
Basic Earnings Per Share $0.48 $0.44
Diluted Earnings Per Share $0.47 $0.44
Return on Average Assets 1.05% 0.96%
Return on Average Equity 12.72% 12.00%
Efficiency Ratio 65.67% 66.37%
Normalized Efficiency Ratio (1) - -
Excluding the Effects of
Intangibles (2)
Net Income $42.3 $39.3
Basic Earnings Per Share $0.53 $0.49
Diluted Earnings Per Share $0.52 $0.48
Return on Average Assets 1.18% 1.08%
Return on Average Equity 17.01% 16.21%
Efficiency Ratio 63.53% 64.25%
Normalized Efficiency Ratio (1) - -
(1) Excludes impact of $22.5 million restructuring charge in 1999's
Third Quarter.
(2) Intangibles include goodwill, core deposit and trust intangibles,
and other intangibles.
*T
CONTACT: Pacific Century Financial Corporation
Stafford Kiguchi, 808/537-8580 (Media Inquiries)
Pager: 808/363-5383
skiguchi@boh.com
Sharlene Bliss, 808/537-8037 (Investor/Analyst Inquiries)
sbliss@boh.com