Update: BoH delays closure
Following another personal plea by Gov. Lolo Matalasi Moliga during a meeting in Honolulu, the Bank of Hawai’i has delayed indefinitely the official closure of its local operations, which was set for March 14, 2014.
The Honolulu based financial institution had delayed for a year, beginning in March this year, the full closure of its operations in the territory, following requests by the governor, Congressman Faleomavaega Eni and other local officials.
The delay was meant to allow American Samoa to establish another U.S. bank locally, and that is underway, as the locally based Community Bank of American Samoa is currently undergoing federal regulatory approval.
With the closure less than 100-days away, Lolo requested a meeting with BoH president and chief executive officer Peter Ho; the meeting was held yesterday at the bank’s headquarters in Hawai’i.
In a media statement following the meeting, Lolo said he was “very humbled, overwhelmed and speechless” by Ho and BoH’s “continued commitment and great sensitivity to the needs of the people of American Samoa" reflected in his approval of Lolo's plea for help to extend the bank’s departure timeline beyond March of next year.
Lolo said the response from Ho “transcended my expectations— for he has assured me that Bank of Hawai’i will leave the American Samoa market only when it is determined that its departure will not cause economic disruption for the territory.”
Responding to Samoa News questions as to a specific date for the bank shutdown in the territory, the governor’s executive assistant Iulogologo Joseph Pereira said there is “no time line” for the bank’s departure “but it will be determined jointly between the Governor and Peter Ho when it is assured that BoH's departure will not cause any economic and financial upheaval for American Samoa.”
In his statement, Lolo said Ho’s decision to delay the bank’s departure “reflects not only his leadership character but that of Bank of Hawai’i putting people first instead of profits, thereby promoting the true spirit of ‘aloha’.”
Lolo extended to Ho and the bank the profound gratitude of American Samoa for their delayed departure, adding that this was not an easy decision because BoH’s operation in the territory is functioning in “closure mode”.
“Nevertheless, I would have been deemed negligent and an irresponsible leader if I didn’t make the attempt to seek help,” he said. “You could not imagine my state of jubilation over the outcome that I had thought would be impossible.”
He said BoH’s decision could not have come in the more opportune time— giving the Community Bank time to complete its setup requirements.
“Business disruptions will be minimized since the banking linkage with the United States will continue, thus bolstering instead of retarding economic recovery efforts vigorously being re-energized by the government’s aggressive economic development agenda,” Lolo said.
He also said this additional time empowers the local government to complete its initiatives targeting the stabilization of banking services in the territory.
In a BoH statement, Ho said yesterday that based on discussions with Lolo and BoH’s monitoring of the progress, it is evident that additional time would be beneficial for the local community.
“As we have indicated previously, our commitment is to provide a smooth transition for our customers and the American Samoa Government, and we will not leave until we are comfortable that the depository needs of the territory can be appropriately accommodated. We want to be supportive,” he said in a statement released by BoH’s corporate office.
STATEMENT FROM CHAMBER OF COMMERCE
Chamber of Commerce chairman David Robinson says the business group congratulates the governor on his success in persuading BoH to leave their doors open for business beyond the previously announced March 14 closure date.
“The continuation of their banking activities will allow existing customers to maintain their accounts and relieve the other retail bank from the prospect of having to cope with more new accounts when they have been struggling to handle the demand caused by the BoH announcement some months ago,” Robinson said responding to Samoa News inquiries.
He said the BoH decision should give the Community Bank some additional time to make its arrangements with the relevant bank license authorities to have all requirements to operate met as soon as possible in the New Year.
“Hopefully in 2014 we shall see the present two retail banks, the Development Bank and the Community Bank all working together to provide more assistance to our small and medium size businesses, and existing business with plans to invest and expand,” he said. “This should provide much needed impetus to move the development in our economy forward in 2014.”