Hawaii real estate by Bonnebaker

source:  Pacific Business News

Us. Department of the Treasury officially took their stake in Central Pacific Bank int he form of $135 million of senior prefered stock.  The hope is that this will stabilze their balance sheet to allow the bank to makes more loans here in Hawaii.

Central Pacific Financial Corp. on Friday sold 135,000 shares of senior preferred stock to the U.S. Department of Treasury, yielding a 5 percent dividend, plus a 10-year warrant to purchase up to $20.2 million, or 1,585,748 shares of the company’s voting common stock at an exercise price of $12.77 per share.

The sale came 30 days after the bank holding company announced it received preliminary approval to receive $135 million from the government’s Troubled Assets Relief Program, or TARP.

Central Pacific’s executives said the capital injection will be used to focus on commercial and retail lending.

From Central Pacific Bank:   press release dated December 10, 2008

As a participant, Central Pacific plans to issue $135 million in senior preferred stock, with related warrants to purchase up to $20 million in common stock, to the U.S. Treasury.

Central Pacific Bank through Central Pacific Home loans was one of the more aggressive lenders in Hawaii in recent years.  The deal with the U.S. Treasury will require them to to have their capital ratio at 9% in 120 days or less creating a more conservative bank.