Faleomavaega questions reasons for departure of BoH
Congressman Faleomavaega Eni has questioned the sudden announcement by Bank of Hawai’i to shut down operations early next year and suggests that the new administration of governor-elect Lolo Matalasi Moliga set up a task force to seek out another U.S. bank for the territory.
BoH plans to shut down its two local branches on Mar. 15 next year, a move described by Lolo as “devastating to American Samoa” and he wants to find a way to intervene so the bank will not leave.
“One would think that having presence and providing a very important service to the territory's consumers and especially our business community for several decades—and the Bank of Hawaii suddenly announces its departure— should raise some serious questions as to "why". And I am not willing to accept an explanation that it had something to do with some administrative adjustments on the operations between Guam and its main headquarters in Hawaii,” said Faleomavaega about the bank’s closure, responding to media inquiries for comments.
He said one thing is for certain: the recent decision by the federal court in the lawsuit between ASG and the Honolulu-based Marisco Ltd., has put BoH “in a very difficult position, and probably at a cost of tens of thousands of dollars in court costs and attorneys fees, and now the bank finds itself as a victim in a very heated legal battle between Marisco and ASG.”
Marisco had sued ASG for failure to pay more than $800,000 in outstanding invoices and the case was settled thru a federal mediator. However, BoH was dragged into the case when the federal court issued a Writ of Execution — per request by Marisco — to garnish some $811,000 in the ASG general account held by BoH.
ASG has since appealed the garnishment order as well as the order to deposit the money into the federal court registry. At the same time two ASG lawsuits against the bank are pending in the High Court. (The latest update on this entire matter was in Monday’s edition this week).
BoH vice president and district manager for American Samoa, Hobbs Lowson didn’t immediately respond to a Samoa News inquiry, asking if the closure decision has anything to do with the Marisco/ASG/BoH cases.
While it’s “probably too late to ask Bank of Hawaii to stay... I suggest to find out if Samoa has a commercial bank like that of ANZ Bank and perhaps it may want to establish presence in the territory,” said Faleomavaega. “It is essential we have at least two banks to operate in American Samoa.”
He says the new Lolo administration may want to set up a special Task Force to seek out other potential lending institutions in the U.S. “There’s a good number of them out there, but ASG needs to put together a package and selling points why another bank would be good for our people and our business community,” he added.
Samoa News asked Lolo last Friday if his incoming administration will seek to attract another U.S. bank to enter the local market. Lolo said he cannot comment on this issue at this time “until we get to the bottom of the real situation and problems encountered by the bank.”
Lolo said, “I hope there is something to be done to convince BoH to remain here for a very long time, but again, we must find out from the bank some of the issues they faced.”
Samoa News has since learned that Lolo met with BoH officials over the weekend but no additional information came out of the meeting, which later resulted in the appointment of two officials with the Lolo/Lemanu transition team to liaison with the bank as it closes its local operations after more than 40 years in the territory.
Meanwhile, local BoH customers have started receiving their notification letters about the closure, and cited information previously announced by the bank. The letter also states that the bank is “encouraging all customers to make necessary banking arrangements well before Mar. 15, 2013.”
“If you wish to continue banking with us through our Hawaii operations, we will assist with transferring the services of any checking, savings or IRA accounts to our main branch in Honolulu,” the letter states.
It also says that those who wish to comment to federal regulators about the closure of local branches, should mail their comments to the Federal Reserve Bank of San Francisco, 101 Market Street, San Francisco, CA 94105.