Owner of Bank of West, Hawaii Firm to Merge

The parent of Hawaii’s oldest bank agreed to merge Thursday with the owner of California’s fifth-largest bank, BancWest Corp., in a $1-billion stock deal marking the latest in the wave of banking mergers.

The largest stock deal ever by a Hawaiian company would combine Honolulu-based First Hawaiian Inc., which owns the First Hawaiian Bank and Oregon-based Pacific One Bank, with the parent of Bank of the West.

San Francisco-based BancWest is owned by Banque Nationale de Paris, France’s second-largest banking group with more than $300 billion in assets.

Under the deal, Banque Nationale de Paris would receive about 25.9 million Class A shares of First Hawaiian stock in return for all of the stock of BancWest Corp. in a tax-free exchange. Based on the average stock price over the last 10 days, the price is about $1.01 billion.

Current First Hawaiian stockholders would own 55% of the common stock of the new company and Banque Nationale de Paris, which acquired Bank of the West in 1980, would own 45%.

The merger would form a regional bank holding company with assets of $14 billion that would be headquartered in Honolulu with an administrative headquarters in San Francisco. It would operate in Hawaii, California, Oregon, Washington and Idaho.

The merger is expected to close during the fourth quarter of this year.

The surviving company would be called BancWest Corp. and would have more than 200 branches in five Western states, the territory of Guam and Saipan. Both First Hawaiian Bank and Bank of the West would keep their present names. Pacific One Bank would be consolidated into Bank of the West.