Central Pacific Reports Second Consecutive Profitable Quarter

Crystal Rose (left) was appointed as Board Chair of the boards of directors of Central Pacific Financial Corp. and Central Pacific Bank and John Dean (right) appointed as President and CEO of Central Pacific Financial Corp. and Central Pacific Bank earlier this year. (PRNewsFoto/Central Pacific Financial Corp.)

By Sonia Isotov

Central Pacific Financial Corp., parent company of Central Pacific Bank, today reported net income for the second quarter of 2011 of $8.2 million, compared to a net loss in the second quarter of 2010 of $16.1 million, and net income in the first quarter of 2011 of $4.6 million.

“We are pleased to report our second consecutive profitable quarter,” said John C. Dean, President and Chief Executive Officer, in a written corporate statement today.  “Continued improvement in our asset quality led to a significant reduction in total credit costs, lower net charge-offs, and an overall decrease in our nonperforming assets during the quarter.  In addition to our ongoing efforts to further reduce our credit risk exposure and improve profitability, we are pursuing strategic growth opportunities in our core Hawaii market.”

Net income in the first quarter of 2011 included the impact of a previously reported one-time accounting adjustment totaling $85.1 million which resulted from the exchange of the Company’s preferred stock for common stock as part of its recapitalization in February 2011.

Other reported highlights for the quarter included:

• Total credit costs were reduced from a charge of $1.9 million in the first quarter of 2011 to a credit of $6.4 million in the second quarter of 2011.   Nonperforming assets was reduced by $35.6 million to $249.3 million at June 30, 2011 from $284.9 million at March 31, 2011.
• The Company’s capital ratios continue to exceed the minimum levels required for a “well-capitalized” regulatory designation.
• The regulatory Consent Order with the Federal Deposit Insurance Corporation and the Hawaii Division of Financial was lifted, and in place of the Consent Order, the Bank entered into a Memorandum of Understanding with its regulators effective May 5, 2011.
• A common stock offering totaling $20.0 million was completed on May 6, 2011.