Posted on: Friday, March 21, 2003

Local banks report it's 'business as usual'

By Andrew Gomes
Advertiser Staff Writer

Some banks on the Mainland have been stocking up on cash as a precaution should customers make a run on ATM withdrawals in hysteria related to the war in Iraq, but Hawai'i's largest banks say there is no such need.

David Thomas, vice chairman of retail banking for Bank of Hawaii, said there were no significant increases in cash withdrawals right after the 1991 Gulf War, Y2K or Sept. 11, so he doesn't foresee a run on cash at the bank because the United States is at war with Iraq.

Brandt Farias, spokesman for First Hawaiian Bank, yesterday said he hadn't seen any cash withdrawal activity out of the ordinary.

Farias said the bank always has contingency plans for cash needs outside of the normal course of business, but doesn't anticipate needing to put those plans into action.

Thomas explained that Hawai'i banks tend to have more cash in circulation because of the large number of tourists who arrive and depart each day, which means there is less need to increase levels of cash on hand that some Mainland banks have recently accumulated.

Bank of Hawaii and First Hawaiian, the two largest banks in the state, said business yesterday was uneventful, with security measures and customer activity normal a day following the opening of the U.S.-led military campaign to remove the regime of Iraqi President Saddam Hussein.

"For us, it was pretty much business as usual, as tense as it is" with the war and its uncertain effect on the local economy, Farias said.

Both banks said they have programs to help customers should war-related economic effects lead to loan repayment trouble. Farias and Thomas said assistance, typically in the form of adjusting payments, is available on a case-by-case basis.

"We have not seen any increase in the frequency of delinquencies," Thomas said. "But we have an established program, and it's ready to kick in as needed."