City Bank seeks review of ruling

Advertiser Staff

CB Bancshares Inc., the parent company of City Bank, wants the state to reconsider its approval of a proposed takeover by its crosstown rival, Central Pacific Bank.

City Bank said yesterday that it has petitioned the Hawai'i Division of Financial Institutions to reconsider its Feb. 3 ruling, which was the final regulatory hurdle for the bank merger.

Commissioner Nick Griffin said at the time that he found no grounds for rejecting the proposed $300 million transaction. Griffin also said his decision was not open to appeal.

Even if the state's ruling stands, the takeover still needs the approval of shareholders of both companies.

City Bank said in a statement, it "is taking this action because ... it continues to be concerned about the detrimental effects a takeover could have on CB Bancshares' constituencies, including the citizens and communities of Hawai'i."

Combined, the two banks would become the fourth-largest financial institution in the state, after Bank of Hawai'i, First Hawaiian Bank and American Savings Bank.

Shareholder approval of the takeover is not certain. Under state law, Hawai'i companies incorporated before 1987 need approval of nearly three-quarters of shareholders.

City Bank said yesterday that it will hold an annual shareholders meeting April 29 at the City Financial Tower. Three new CB Bancshares directors will be elected.

City Bank said Central Pacific did not nominate candidates for the City Bank board of directors nor make any proposals for consideration.