Central Pacific Nears Deal for Hawaiian Bank

Background

Central Pacific Financial Corp., Hawaii's largest bank, is nearing a deal to acquire Bank of Hawaii Corp., the state's second-largest bank. The deal, expected to close in early 2019, would create a combined entity with about $20 billion in assets, making it the largest bank in Hawaii and one of the largest banks in the Pacific.

Impact on the Hawaiian Banking Landscape

The merger would significantly consolidate the Hawaiian banking market, which is currently dominated by three major players: Central Pacific, Bank of Hawaii, and First Hawaiian Bank. The combined entity would control over 60% of the state's banking assets. This could lead to higher fees for consumers, reduced competition, and limited choices for customers.

Benefits for Central Pacific

For Central Pacific, the acquisition would provide several benefits. It would boost its market share, giving it a commanding lead in the Hawaiian banking market. It would also expand Central Pacific's reach into new markets, such as the Pacific Islands and Asia.

Concerns for Regulators

The merger is still subject to regulatory approval, and there are concerns among some regulators that it could create a monopoly in the Hawaiian banking market. The Federal Deposit Insurance Corporation (FDIC) has said it will carefully review the merger and consider its potential impact on competition and consumers.

What's next?

The merger is expected to close in early 2019, but it is still subject to regulatory approval and other closing conditions. If approved, it would create Hawaii's largest bank and one of the largest banks in the Pacific.