Hawaiian Bank to Shut Mainland CRE Business

Central Pacific Bank, Honolulu, will close its four California commercial real estate loan offices and wind down its West Coast operations by 2012. "We have not made a loan in California in more than 18 months and have been diligent in reducing our loan portfolio there," said Ronald K. Migita, chairman, president and chief executive. "By the end of the third quarter, we've reduced our total loans and leases by $622.6 million, or 15.3% from a year ago, many of which were in California. Our mainland team continues to reduce our exposure in California as we shift gears to fully concentrate on the Hawaii market." He added Central Pacific has accelerated its efforts to reduce credit risk by pursuing loan sales, including potential bulk sales, in addition to loan restructuring and pay downs. As of Sept. 30, 2009, the bank's mainland construction and commercial real estate loans totaled $865.8 million. The offices are in Newport Beach, Pasadena, Rossville and San Diego. In the third quarter, its parent company Central Pacific Financial Corp. lost nearly $72 million.