FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Current Report Pursuant to Section 13
of the Securities Exchange Act of 1934
Date of Report (Date Earliest Event reported)- February 6, 1996
Commission File Number: 2-67419
CB BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
Hawaii 99-0197163
(State of Incorporation) (IRS Employer Identification No.)
201 Merchant Street, Honolulu, Hawaii 96813
(Address of principal executive offices)
(808) 546-2411
(Registrant's Telephone Number)
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ITEM 5. Other events
Refer to attachments I, II, and III.
<PAGE>
Attachment I.
FOR IMMEDIATE RELEASE
Contact: Daniel Motohiro
(808) 546-2424
Wayne Miyao
(808) 546-8484
CB Bancshares, Inc.
CB BANCSHARES, INC. INITIATES COST REDUCTION PLAN:
--------------------------------------------------
Voluntary Separation Program Announced
HONOLULU, HI, January 31, 1996 -- CB Bancshares, Inc. (NASDAQ: CBBI) today
announced a major initiative in the first quarter of 1996 to improve operating
efficiency and decrease expenses. The cost reduction plan offers a voluntary
separation program to all employees.
James M. Morita, Chairman and Chief Executive Officer of CB Bancshares, Inc.,
said, "Despite ongoing attempts to improve our results through
consolidation and the sale of certain operations, the recent financial
performance of the company has been unacceptable. The Board of Directors of
CB Bancshares, Inc. has consequently approved a program to increase
profitability."
Mr. Morita continued, "The company must address an increasingly
competitive business environment in Hawaii and the technological changes
taking place in the delivery of financial services. The needs of all our
stockholders require a more efficient operating structure. We believe the
program announced today will help us accomplish the goal."
Fourth quarter and year-end results for CB Bancshares, Inc. are released in
February of each year.
CB Bancshares, Inc. provides a full range of banking products and services to
small-to-medium sized businesses and retail customers through its principal
subsidiaries, City Bank and International Savings & Loan Association. The
Company, with 24 branches on the islands of Oahu, Maui and Hawaii, is the
third-largest bank holding company headquartered in Hawaii with $1.5 billion
in assets, $1.1 billion in loans and $1.0 billion in deposits.
<PAGE>
Attachment II.
The following discussion of projected results from the implementation of the
Company's cost reduction plan are forward-looking statements, and as such, the
actual results could differ materially from those projected in such statements.
The CB Bancshares, Inc. voluntary separation program announced to employees on
January 31, 1996 offers all eligible employees the opportunity of electing to
terminate their employment. The company has the right to deny or delay an
employee's election. The voluntary separation program is the first phase of a
cost reduction program. If the response to Phase I doesn't achieve the
Company's goals by March 31, Phase II will be implemented. The second phase
will incorporate executive pay reductions of up to 10% and if necessary,
involuntary staff reductions.
The following table shows management's projections based on the described
assumptions.
Description Amount
----------- ------
Salaries (estimated) $1,000,000
Estimated benefits 250,000
----------
Estimated reduced labor costs 1,250,000
==========
Severance (estimated) 800,000
Outplacement service 225,000
----------
Estimated restructuring charges $1,025,000
==========
While management of the Company believes the projections described above are
reasonable based on current information, some assumptions may not materialize,
and unanticipated events and circumstances may occur, causing actual results to
vary from the projections described above. Factors which could cause the actual
results to differ from those described above include [unanticipated legal
action taken by employees (or third parties) in response to the Company's
program, material and unforeseen changes in the Company's current
operational needs, material changes in the Hawaiian economy impacting the
Company's current operational needs, or other unanticipated external
developments materially impacting the Company's operational and financial
performance.]
<PAGE>
Attachment III
FOR IMMEDIATE RELEASE
CONTACT: Daniel Motohiro
(808)546-2424
Wayne Miyao
(808) 546-8484
CB Bancshares, Inc.
HONOLULU, HI February 7, 1996....CB Bancshares, Inc., (NASDAQ: CBBI) reported
net income of $8.293 million for the year ended December 31, 1995, down from
the $11.071 million in the prior year. Earnings per share were $2.34 fully-
diluted, compared to $3.32 a year ago. In the fourth quarter, net income
decreased to $1.547 million, equivalent to $0.44 per share fully-diluted,
compared to $0.76 per share in the comparable quarter of 1994. The lower
earnings reflect the impact of Hawaii's continuing weak economy and the accrual
of certain non-recurring charges related to consolidations, certain loan loss
provisions and compensation costs.
In 1995, net interest income was $55.4 million compared with $54.9 million in
1994. Return on average assets for the year and fourth quarter of 1995 were
0.56% and 0.41%, respectively, compared with 0.95% and 0.76% in the prior year
periods. Return on average equity for the 12 months and fourth quarter of 1995
were 7.29% and 5.34%, respectively, against 10.92% and 9.81% in the 1994
periods. Allowance for loan losses was $14.6 million at December 31, 1995,
compared to $14.3 million last year. The Company's capital levels exceed all
regulatory requirements, with a equity to asset ratio of 7.74% at year end,
which compares to 7.72% last year.
Hawaii's economy has struggled for the last several years. The recession in
Japan, and the structural changes in Hawaii's economy, contributed to the
cyclical downturn in Hawaii's economy. However, fourth quarter economic data
for 1995 show promise for an economic recovery and the prospects for the near
term are improving.
Last week, CB Bancshares announced a major initiative to improve operating
efficiency and decrease expenses in the first quarter of 1996 by offering a
voluntary separation program to all its employees.
CB Bancshares provides a full range of banking products and services for small-
to-medium size businesses and retail customers through its principal
subsidiaries, City Bank and International Savings & Loan Association. The
Company, with 24 branches on the islands of Oahu, Maui and Hawaii, is the third
largest bank holding company headquartered in Hawaii with $1.5 billion in
assets, $1.1 billion in loans and $1.0 billion in deposits.
<PAGE>
CB BANCSHARES, INC. AND SUBSIDIARIES (unaudited)
CONSOLIDATED CONDENSED BALANCE SHEETS
December 31, December 31,
(in thousands) 1995 1994
- - -------------------------------------------------------------------------------
ASSETS
Cash and due from banks $ 75,119 $ 48,753
Investment securities 240,834 266,990
Gross Loans 1,136,736 1,075,424
Less allowance for loan losses (14,576) (14,326)
- - -------------------------------------------------------------------------------
Net loans 1,122,160 1,061,098
Other assets 59,352 50,534
Goodwill 11,277 12,136
- - -------------------------------------------------------------------------------
Total Assets $1,508,742 $1,439,511
===============================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing $ 137,284 $ 135,368
Interest bearing 874,198 788,076
- - -------------------------------------------------------------------------------
Total Deposits 1,011,482 923,444
- - -------------------------------------------------------------------------------
Short-term borrowings 239,360 274,903
Other liabilities 33,271 16,795
Long-term debt 101,370 106,850
- - -------------------------------------------------------------------------------
Total liabilities 1,385,483 1,321,992
- - -------------------------------------------------------------------------------
Deferred gain 6,473 6,354
Total Stockholders' equity 116,786 111,165
- - -------------------------------------------------------------------------------
Total Liabilities and stockholders' equity $1,508,742 $1,439,511
===============================================================================
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CB BANCSHARES,INC. AND SUBSIDIARIES (unaudited)
CONSOLIDATED CONDENSED STATEMENT OF INCOME
<TABLE>
<CAPTION>
Quarter ended Year ended
December 31, December 31, December 31, December 31,
(in thousands, except per share data) 1995 1994 1995 1994
- - -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total interest income $ 28,784 $ 27,226 $ 112,916 $ 89,350
- - -------------------------------------------------------------------------------------------------------------------
Total interest expense 14,541 11,430 57,686 34,445
- - -------------------------------------------------------------------------------------------------------------------
Net interest income 14,243 15,796 55,230 54,905
Provision for loan losses (320) (839) (980) (1,964)
- - -------------------------------------------------------------------------------------------------------------------
Net interest income after provision for loan losses 13,923 14,957 54,250 52,941
Total non-interest income 3,392 1,624 10,447 9,161
- - -------------------------------------------------------------------------------------------------------------------
Total non-interest expense 13,991 12,157 50,563 44,374
- - -------------------------------------------------------------------------------------------------------------------
Income before income taxes 3,324 4,424 14,134 17,728
Provision for income taxes (1,777) (1,715) (5,841) (6,657)
- - -------------------------------------------------------------------------------------------------------------------
Net income $ 1,547 $ 2,709 $ 8,293 $ 11,071
===================================================================================================================
Per share data
Net income $ 0.44 $ 0.76 $ 2.34 $ 3.32
===================================================================================================================
</TABLE>
<PAGE>
CB BANCSHARES, INC. AND SUBSIDIARIES (unaudited)
SELECTED RATIOS AND OTHER DATA
(in thousands, except per share data)
Quarter Ended Year Ended
December 31, December 31,
1995 1994 1995 1994
OPERATING RATIOS:
Return on Average Assets 0.41% 0.76% 0.56% 0.95%
Return on Average Equity 5.34% 9.81% 7.29% 10.92%
Net Interest Margin 4.11% 4.84% 4.04% 4.96%
CAPITAL RATIOS:
Equity/Assets 7.74% 7.72% 7.74% 7.72%
PER SHARE INFORMATION:
Earnings per share $ 0.44 $ 0.76 $ 2.34 $ 3.32
Dividends per share 0.325 0.325 1.30 1.30
Book Value per share 32.89 31.30 32.89 31.30
Shares outstanding 3,551,228 3,551,228 3,551,228 3,551,228
CREDIT QUALITY DATA:
Non-performing loans $ 17,451 $ 13,312 $ 17,451 $ 13,312
Non-performing assets 19,166 15,184 19,166 15,184
Loan loss reserve 14,576 14,326 14,576 14,326
AVERAGE BALANCES:
Loans, net $1,132,594 $1,045,009 $1,117,976 $ 879,184
Earning assets 1,384,539 1,306,249 1,381,827 1,113,184
Total assets 1,498,012 1,417,113 1,480,595 1,169,199
Deposits 1,016,865 918,612 983,290 829,358
Equity 115,809 110,460 113,783 101,401
