Central Pacific Financial
Annual Report 2007

Plain-text annual report

CENTRAL PACIFIC FINANCIAL CORP. Holding Company of Central Pacific Bank www.centralpacificbank.com Printed in Hawaii on 100% post-consumer recycled paper. CHAIRMAN AND PRESIDENT/CHIEF EXECUTIVE OFFICER’S MESSAGE “A trusted partner, a true neighbor – we’re a People-SuccessSM bank driven to serve our customers and communities.” Central Pacific Bank has provided banking services to consumers and businesses in Hawaii since 1954. We have grown along with our 50th state, proudly playing a part in its evolution from a plantation economy into a world-renowned visitor industry and now on the way to becoming a vital and more diversified player in the global marketplace. In this fast-paced and more vibrant environment, we realize that the dependability and convenience of community-based banking will enable Central Pacific Bank’s people and branches to better serve our customers’ most important needs. With the launch of our new mission statement, we are placing a greater emphasis on People Success. Defining ourselves as “a trusted partner and a true neighbor” ensures each one of us has an accurate compass for moving Central Pacific Bank in the right direction. Keeping connected and aligned with our four stakeholders – our customers, shareholders, employees and community – will enable us to accomplish the spirit of our mission. Working together, we are prepared to deliver the next level of product and service excellence to all those within our banking ‘Ohana (family). Our commitment to loyalty is as strong today as it was on the first day we opened our doors. You can be certain all of us at Central Pacific Bank will stand steadfastly beside you – our customer, partner or neighbor in the community – guiding and helping you as you care for your family, grow your business and strengthen our way of life in these beautiful islands we all call our home. Ronald K. Migita, Chairman of the Board, and Clint Arnoldus, President and Chief Executive Officer, Central Pacific Bank and its parent company, Central Pacific Financial Corp. Consumers and businesses in Hawaii continue to depend on Central Pacific Bank for their banking needs, and their numbers are growing every day. Our standing as the fourth largest bank in the state was reaffirmed at the close of 2007 with total deposits increasing by 4.1 percent, loans and leases growing by 7.7 percent, and total assets rising 3.5 percent to $5.7 billion when compared with our closing figures for 2006. Our growth in 2007 underscores Central Pacific’s steady performance in the Hawaii market – the result of our strong relationships with our loyal customers. Increases in our Retail and Business Banking divisions, Commercial Lending and Commercial Real Estate divisions, Wealth Management group and Central Pacific HomeLoans provided us with a string of highlights in a challenging year for the industry. The current operating environment for financial institutions like ours is the most challenging since the savings & loan crisis in the late 1980s. Credit costs are rising as a result of the collapse of the subprime residential mortgage market and net interest margins are under pressure as the Federal Reserve aggressively lowers market interest rates to avoid a recession. When Central Pacific merged with City Bank in 2004, we gained operations in California that provided us with geographic diversification in our sources of income. Over the past several years, we grew our Mainland operations and expanded to several strategic West Coast locations that complimented our products and services in Hawaii. Although our bank is not directly involved in subprime lending in California, our indirect exposure as a lender in the residential construction market has led to higher credit costs in provisions for loan and lease losses of $21.2 million and $28.2 million in the third and fourth quarters of 2007, respectively. We have positioned additional senior-level personnel with real estate experience in our California operations and have also retained outside real estate experts. Together, we believe that we will be able to manage the credit challenges in our California residential construction loan portfolio. Central Pacific Financial Corp. 1 CHAIRMAN AND PRESIDENT/CHIEF EXECUTIVE OFFICER’S MESSAGE Ronald K. Migita, Chairman of the Board, and Clint Arnoldus, President and Chief Executive Officer, Central Pacific Bank and its parent company, Central Pacific Financial Corp. Consumers and businesses in Hawaii continue to depend on Central Pacific Bank for their banking needs, and their numbers are growing every day. Our standing as the fourth largest bank in the state was reaffirmed at the close of 2007 with total deposits increasing by 4.1 percent, loans and leases growing by 7.7 percent, and total assets rising 3.5 percent to $5.7 billion when compared with our closing figures for 2006. Our growth in 2007 underscores Central Pacific’s steady performance in the Hawaii market – the result of our strong relationships with our loyal customers. Increases in our Retail and Business Banking divisions, Commercial Lending and Commercial Real Estate divisions, Wealth Management group and Central Pacific HomeLoans provided us with a string of highlights in a challenging year for the industry. The current operating environment for financial institutions like ours is the most challenging since the savings & loan crisis in the late 1980s. Credit costs are rising as a result of the collapse of the subprime residential mortgage market and net interest margins are under pressure as the Federal Reserve aggressively lowers market interest rates to avoid a recession. When Central Pacific merged with City Bank in 2004, we gained operations in California that provided us with geographic diversification in our sources of income. Over the past several years, we grew our Mainland operations and expanded to several strategic West Coast locations that complimented our products and services in Hawaii. Although our bank is not directly involved in subprime lending in California, our indirect exposure as a lender in the residential construction market has led to higher credit costs in provisions for loan and lease losses of $21.2 million and $28.2 million in the third and fourth quarters of 2007, respectively. We have positioned additional senior-level personnel with real estate experience in our California operations and have also retained outside real estate experts. Together, we believe that we will be able to manage the credit challenges in our California residential construction loan portfolio. Central Pacific Financial Corp. 1 In the last half of 2007, our California residential construction holdings had an adverse impact on Central Pacific’s share price and market capitalization. With this decline, Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets required the performance of a goodwill impairment test. As a result of this test, the bank recorded a non-cash impairment charge of $48 million in the fourth quarter of 2007. The charge had no impact on cash flows, tangible equity or regulatory capital. The fundamentals and capital of Central Pacific remain unaffected and strong. Our Board of Directors has maintained our quarterly dividend at current levels and authorized the repurchase of up to 3.3 million shares of the company’s common stock. Our belief in the Hawaii market remains solid. Central Pacific remains aggressive in developing innovative new products to deepen our relationship with existing customers and introduce new customers to our bank. In 2006, we became the first bank in Hawaii to unveil new technology that enables our business customers to make deposits via electronic transfer. Our Remote Deposit Central is a real time saver for Hawaii’s busy entrepreneurs and business managers. In 2007, we introduced Choice CheckingSM that provides both consumers and sole proprietors with an account which pays money market interest and the added value of a debit card and online banking privileges – all with no fee if certain activities are met. Of course, our flagship Exceptional Plan for consumers and businesses continues to set the standard for all that Central Pacific Bank offers. The Exceptional Plan enables our customers to combine their Central Pacific consumer or business accounts and receive the benefits of higher interest and greater liquidity. By continuing to listen to our customers and find answers to their needs, we are able to bring them better value and added convenience in a way that we believe is unmatched by other local banks. Additionally, we made 2007 a pivotal year by embracing the literal meaning of the words “community bank.” We are committed to bringing back good, old-fashioned, face-to-face banking with your own neighborhood banker as your primary point of contact for all your personal and business banking needs. In essence, your neighborhood Central Pacific Bank will become your “one-stop shop” for banking. Community banking will differentiate us in the marketplace. It’s a way of doing business that will ensure we are deeply woven into the tapestry of the community. In addition to their banking duties, our staff at each branch will have the responsibility of knowing what’s going on in their respective communities. So when it comes to community service, they will determine whether Central Pacific donates to the neighborhood Boy or Girl Scout troop or funds the local high school’s next band trip. Each branch will report to one of six community banking regional managers, who will ensure each community within our state is represented. Making this change in the way we do business will not happen overnight. More than one-third of Central Pacific’s employees will be involved in community banking. We began to lay out the structure for community banking in September, and we expect to see good results from this new “grassroots” model by the end of 2008. By that time, we expect to have customers all the way from Lihue on Kauai to Hilo on the Big Island and all those between Hawaii Kai and Kapolei and over to Kailua on Oahu seeing us as their bank because of the trusted relationship with their community banker at Central Pacific. Inspiring and guiding our employees during this change is our new mission statement: “A trusted partner, a true neighbor – we’re a People-SuccessSM bank driven to serve our customers and communities. ”This is part of a natural evolution within the bank, incorporating the goal behind our previous mission statement, “To be recognized as the best community bank serving Hawaii,” and more clearly defining what we mean by “best.” Central Pacific Financial Corp. 2 Our employees are the reason Central Pacific Bank was once again named one of the Best Places to Work in 2007 by Hawaii Business magazine. It was our second consecutive year for this honor, which is derived from extensive surveys of company employees by an independent firm. Our employees’ enthusiasm is reciprocated by our recognition of their individual efforts. Our quarterly awards for Exceptional performance often go to individuals who have exceeded expectations by contributing as much as 100 percent to more than 1,000 percent of their division’s annual goals. Central Pacific then hosts the “best of the best” at our annual Pinnacle Awards banquet. We are dedicated to creating positive experiences for each and every customer whenever and wherever they bank with us – from the thriving business in Honolulu or the local family in Kahului on Maui to our international customers from Asia or other parts of the world. As a bank, our customer service works hand in hand with our innovative products, which combine to bring our customers among the best the marketplace has to offer. We are competitive, not just on a local scale but on a global scale as well. Whether our customers walk into one of our branches or do their banking online, they will find products and services developed with them in mind. And there is more to come as our newly formed Alternative & Future Delivery Channels Division develops synergies between the capabilities of our bank and emerging new technologies. In 2007 and moving into 2008, Central Pacific Bank welcomed new branches in Pearl City Highlands on Oahu and Lahaina on Maui, bringing our total number of branches to 39. We renovated our Kalihi branch in December, and we will open new and improved Kapahulu and Kaneohe branches. New branches are also on the drawing board. With these expansions, relocations and upgrades, Central Pacific is not only adding more convenience for customers but also placing the capabilities and financial strength of Hawaii’s fourth largest bank at the thresholds of many more homes and businesses. Our goals for the future are clear. We will manage the challenges in our California portfolio. We will increasingly incorporate technology in our products and services to bring enhancements to a growing customer base. We will maintain our flexibility to quickly respond to changes in the marketplace. And we will keep an eye on the future to ensure Central Pacific remains in a position to capitalize on emerging trends. One area where we can make a huge difference is in the development of alternative energy resources. Since the success of our relationship with Kaheawa Wind Power on Maui, people now see us as the “Alternative Energy Bank.” As a commitment to protect our fragile environment, this year’s annual report has been printed on 100% post-consumer recycled paper. The future lies promisingly before us, and it always presents us with an unlimited number of paths to take. Central Pacific is fortunate to have a group of extraordinary business and community-oriented leaders guiding us. We extend our warmest appreciation to these distinguished members of our Board of Directors. Humbled by your loyalty and inspired by your confidence, we recommit ourselves to the future. Central Pacific Bank and our employees will continue to place your needs and best interests above all else. Whether you are a customer or shareholder, you can be certain that our business philosophy of “keeping your needs first” combined with our commitment “to be a People-Success bank” will continue to bring opportunity, growth, soundness and dependability to your relationship with Central Pacific Bank. In serving you and our valued communities, we will work to earn your recognition as a “trusted partner and true neighbor.” RONALD K. MIGITA Chairman of the Board CLINT ARNOLDUS President and CEO Note: On March 10, 2008, Clint Arnoldus announced his retirement from Central Pacific Financial Corp., effective December 31, 2008. The Board has commenced a search for a new President and CEO that will include both internal and external candidates. Central Pacific Financial Corp. 3 Central Pacific Bank is bringing back the “good ol’ days,” the ones people like the Teramoto family nostalgically look back upon. By re-introducing community-based banking to the Islands, we intend to make simplified transactions, personal service and neighborhood convenience the standards your family can depend on in today’s fast-paced world. With new branches in Pearl City, Oahu and Lahaina, Maui, we now have 39 branches to serve your community. And neighborhood banking is just the beginning! Each branch has a community banker responsible for helping you with all your financial needs. Think of your banker as your family doctor, a primary service provider who knows you best and keeps your finances growing strong. If you have specialized needs, your banker can refer you to others, such as our Wealth Management team who can address your private banking, trust and investment needs. If you’re purchasing or refinancing a home, your banker will introduce you to professionals at Central Pacific HomeLoans. In short, your banker and the resources of Central Pacific are here for you. Keeping closely attuned to customer needs through our banking relationships has made Central Pacific an innovator of products that consistently lead the industry. In 2007, we introduced Choice Checking, a first in Hawaii banking. Our newest checking account pays higher money market interest rates and also offers a debit card, direct deposit, bill payment and online banking – all at no fee if certain conditions are met. Banking has never been more rewarding and convenient! Central Pacific Financial Corp. 4 Our Choice Checking furthers Central Pacific’s goal of offering customers “the best.” Of course, this is nothing new for our bank, which continues to earn high praise for our flagship Exceptional Plan. This account enables you to combine all your Central Pacific accounts for higher yielding interest while still maintaining the liquidity of your funds. Its value really lives up to its name! For those who can’t choose between our Choice Checking and Exceptional Plan, there’s an Exceptional Choice just for you! To complement our superior service and products, Central Pacific proudly offers the continuous enhancements that evolutionary technology brings to 24/7 banking. Our new Alternative & Future Delivery Channels Division is strategically building upon our electronic service delivery platform while preserving the security, accuracy and integrity of your transactions. For your convenience and safety, Central Pacific is keeping its standards high as we work toward providing advanced self-service functions such as online account openings, inter-bank funds transfers and mobile banking. To support the ethnic diversity of our Islands and banking interests from abroad, our three websites – English, Japanese and Korean – are customized for each user-audience. Much like the Farmers’ Market at Kapiolani Community College, Central Pacific will offer the Teramotos and all of Hawaii’s families a place to come to for a variety of fresh and innovative products and services offered at a good value. We will continue to work hard to be a bank that people in the community can embrace as their own. Central Pacific Financial Corp. 5 Relationships begin with shared goals and values and become especially rewarding when they produce meaningful accomplishments. For example, when WCIT Architecture became a Central Pacific customer, we immediately identified with their collaborative spirit, energetic staff, unwavering dedication to excellence and genuine commitment to our community. In delivering our best, Central Pacific enables WCIT to concentrate on their own area of expertise – bringing the community distinctive designs that beautifully combine form, function and a sense of place. Central Pacific is focused on providing financial tools to help you build your own business success story. Our Business Exceptional Plan and our recently launched Choice CheckingSM for Sole Proprietors provide businesses with higher interest on their funds and a host of free services that deliver increased flexibility, enhanced convenience and greater value. Five other checking products offer a range of other features as well. We continue to introduce customers to Remote Deposit Central, a technology enabling businesses that rely heavily on paper check transactions to scan and convert checks into electronic transmissions. The program supplied is capable of recognizing duplicate items, balancing batch transactions and providing a record that can be imported to your business software. Central Pacific takes pride in being the first bank in Hawaii to offer this product, saving you back-office time so you can devote more attention to your customers. In 2008, Central Pacific will be improving and expanding Remote Deposit Central to enhance its features and bring this service to more small businesses. Another Central Pacific first is our Women’s Business Central, designed to empower women business owners and professionals by providing resources and networking opportunities. Women’s Business Central also puts you in contact with a team of experienced bankers who understand how you think and can provide the support you need, such as cash management assistance, commercial loans, real estate financing, wealth management or private banking. Our support of the small business community made Central Pacific the Hawaii Small Business Administration Lender of the Year in Category II for the fourth straight year. The SBA also named Central Pacific Vice President Susan Utsugi the 2008 Women In Business Champion for Oahu. A regional manager for Community Banking and the driving force behind Women’s Business Central, Susan coordinates informational and networking events and provides valuable insight and support to entrepreneurs as they transform their business concepts into thriving enterprises. As a partner in your endeavors, we will place our best assets – whether they are financial resources, products, services or the expertise of our people – behind you to help you get started and build your business. With Central Pacific Bank supporting you, a small beginning today could turn your business into the next WCIT Architecture, a fast growing, respected and successful global competitor. Central Pacific Financial Corp. 7 Celebrating its 100th anniversary in 2008, Suisan Company, Ltd. is another Hawaii business that, like Central Pacific, rose from humble beginnings and today prominently stands as one of the state’s top 150 companies. Through diversification, Hilo-based Suisan turned its local fresh fish distribution company into a purveyor of frozen food, dry groceries, meat, poultry and dairy products, fresh produce and desserts. Local grocers, restaurants and gourmet food centers worldwide look to Suisan for quality goods and service provided in the true spirit of aloha. Central Pacific helped Suisan and our many business customers build, expand and improve their operations. Long- standing relationships with all our customers add to our understanding of your diverse needs, which has enabled us to align our products, services and personnel to address the challenges you face. The business bankers in our community banks are qualified to help you with operational loans, such as our new Business ExpressLine of Credit, which speeds our approval of your revolving line of credit, providing access to additional funds whenever you need it. Another new loan product is our Association (AOAO) Loan, designed to help Homeowner, Condominium and Interval Owner Associations with funding for maintenance and building upgrades as well as equipment and lease-to-fee purchases. Central Pacific also helps businesses through our Commercial Equipment Leasing program. We continue to introduce more businesses to this financing alternative, and in 2007 our leasing portfolio experienced a 3.6 percent increase. Central Pacific Financial Corp. 8 Leasing provides the advantages of conserving operating capital and lowering monthly payments while allowing financing for 100 percent of equipment costs and flexible lease options. To complement our business loans, we have banking services that make back office duties easier and more efficient so you can spend more time where it really counts – with your customers. Our introduction of Remote Deposit Central even enables you to deposit business checks without leaving your office! With our other Cash Management tools and the option of our invaluable Merchant Services, Central Pacific will always be right here beside you, growing your business to last 100 years and beyond. We want to contribute to our state’s future as well. Inspired by Governor Linda Lingle’s commitment to Hawaii’s energy independence and our successful relationship with Kaheawa Wind Power on Maui, we anticipate increasing the $9 million we have committed to renewable energy since 2002. Currently, we are assessing a number of future projects. In the years to come, whether we are creating new energy resources or standing beside your business that has been handed down for generations, what will remain most important to us at Central Pacific is putting our passion for success to work for you. Central Pacific Financial Corp. 9 Opportunities that allow Central Pacific to make positive contributions to our communities are a privilege and pleasure. Our role in creating affordable housing for Hawaii’s kupuna (elderly) calls upon the market knowledge of our experienced and respected team of professionals. Not only are they proficient in bringing projects to market, but they also add their personal diligence, respect and heart to each endeavor. Central Pacific is proud to be part of a premier development team for affordable housing on Oahu. Working with the Hawaii Housing Finance & Development Corporation, we have completed a total of nine projects over the past 11 years, bringing 545 critically needed rental units to market. Project manager Gary Furuta turns to Central Pacific for his all-important financing. In April, Ainahau Vista opened to provide 106 homes for kupuna in Waikiki. Another affordable project is slated for Waianae, Oahu. Our projects around the state enabled our Hawaii Commercial Real Estate team to provide $525 million in funding during the year, making us a top commercial real estate lender. Developers and investors demand an experienced and responsive bank like Central Pacific. This was evident when The Festival Companies closed on two retail shopping centers on Maui in a short timeframe. Central Pacific provided more than $24 million in acquisition financing and met the deadline. Central Pacific is often asked to participate with Mainland lenders on projects that help Hawaii’s economy. Most noteworthy is our involvement with the highly anticipated Trump International Hotel & Tower at Waikiki Beach Walk. Central Pacific is honored to be the only local bank in this prestigious project, part of the largest redevelopment effort in Waikiki’s history. In California, our Commercial Real Estate team will be focused on working with existing business relationships to manage the challenges presented by the downturn in the residential construction market due to the subprime mortgage lending crisis. We have committed additional senior-level personnel with real estate experience to the existing team and retained outside real estate experts to assist us in this regard. As the future unfolds, our dedicated banking professionals and talented partners will be there to meet the challenges and needs facing our communities. In Waikiki and around the state, we will continue to assist in rejuvenating our visitor industry and remain open to new opportunities that will contribute to the quality of life in our islands. As an important part of this pledge, we will work to keep housing affordable for our kupuna, enabling them to enjoy the simple pleasure of spending quality time with their families. Central Pacific Financial Corp. 11 Cyril and Bobby-Jo Huddy almost gave up their dream. After 18 months of rejections and mortgage offers with unrealistically high monthly payments, the Huddys found Central Pacific HomeLoans. They were presented with several manageable options and found a team of professionals who took them through every step of the home- buying process. They chose a low, fixed-rate, 30-year mortgage and were able to purchase a Mililani townhome, thanks to their new friends at Central Pacific HomeLoans! Integrity is an absolute must at Central Pacific and at Central Pacific HomeLoans, which helped thousands of Hawaii families with their mortgages and the refinancing of their homes in 2007. In our second year since acquiring this mortgage lending affiliate for our bank, not only were we able to maintain our spot as the second largest home loan lender in the state, but we also gained additional market share that helped us outdistance our nearest competitor. Central Pacific HomeLoans is not affected by subprime mortgage lending. As a prudent and responsible lender, we try to qualify as many applicants as possible by matching them with the best available products on the market. However, if they fall outside the normal parameters, we work with them to educate them on what they need to do financially so that they will be better prepared to meet eligibility requirements in the future. We have taken our reputation and industry experience out into the community, strengthening our relationships with developers and realtors, which has allowed us to assist buyers of units within new condominium projects such as Moana Pacific, 909 Kapiolani, Capitol Place, Keola Lai, and others. These actions enabled Central Pacific HomeLoans to fund more than $1 billion in mortgages during 2007. In addition, we serviced more than $1.195 billion for other lenders, including Fannie Mae and Freddie Mac. In 2007, Central Pacific HomeLoans was also given the responsibility of handling the bank’s home equity lines of credit for its customers. Consolidating all the residential real-estate-based lending will provide customers with faster turnaround on their applications and greater efficiency in processing transactions. In these islands where family ties are so highly cherished, a place where everyone can come together, grow closer and call home is important to our sense of community. At the nucleus of our communities, Central Pacific HomeLoans will continue to strive to make home ownership possible for all our customers. Central Pacific Financial Corp. 13 As the owner/operator of Kahala Barber, Marion Oki holds the distinction of having the longest relationship with Kahala Mall. She was even a tenant with the mall’s predecessor, Waialae Shopping Center, and recently celebrated her 50th year in business at Kahala Mall. Central Pacific’s Wealth Management group is particularly pleased to provide expertise that enables Marion to leave many of her financial details to us, letting her concentrate on her life, whether she’s busy at her shop or flying off to her favorite getaway, Las Vegas. At Central Pacific, we pride ourselves on getting to know you, your business and your financial goals. By taking the time to establish an ongoing relationship with you, we are able to truly understand and find solutions that best match your needs for the present as well as the future. Our Private Banking professionals are dedicated to serving the special needs of customers with more complex banking transactions. We work closely with you to get to know your goals and how we should proceed to help you attain them. Much like our community bankers, we ensure the entire capabilities of Central Pacific’s products and services are at your disposal. In 2007, our team added to its successful track record by hitting its deposit target and growing its total assets to $279 million. Our Investment Services Division offers a full range of products to help you maintain a diversified portfolio and a wealth of knowledge to provide you with expert guidance. With the advanced planning capabilities of LPL Financial Services, America’s leading independent brokerage firm, Central Pacific is able to provide you with sound investment advice that is in line with your needs and risk tolerance. Our Trust Division provides investment management, asset protection assistance and succession planning to help you grow and preserve a financial legacy for your heirs. In 2007, this division expanded its accounts by 12 percent and its assets by 11 percent, bringing its assets under administration to $2.5 billion. We are continuing our relationship with Affinity Investment Advisors for large cap investments, and this year added two money managers for high-quality small cap investments and fixed income management, nationally ranked Pacific Global and Pacific Advisors, respectively. Whether you are trying to grow your own portfolio or the retirement funds of a work group, we can give you results with great peace of mind. Central Pacific’s Wealth Management experts and our industry-leading partners are here to help you manage and build your personal assets. It is a rare privilege for us to get to know each customer’s family and to help them create a legacy for future generations. Like Marion, Central Pacific’s Wealth Management team believes in long- standing relationships. Central Pacific Financial Corp. 15 Making Hawaii a better place is a responsibility that everyone at Central Pacific Bank approaches with great passion. During 2007, it was our privilege to participate in a number of events and charitable projects that provided benefits to more than 300 worthy causes throughout the state. Central Pacific Bank supported the March of Dimes WalkAmerica for a third straight year. More than 70 employee teams participated in WalkAmerica events on Oahu, the Big Island, Kauai and Maui. Central Pacific was one of the largest walk teams again statewide with 420 employees, family and friends, who joined forces to raise $85,000 to fight birth defects. Our team on Oahu also earned the distinction of being the island’s largest with 350 walkers! Central Pacific Bank is proud to be an annual sponsor of the American Cancer Society’s Relay For Life, a signature team event that promotes survivorship and increases cancer awareness in the community. This year, employees from our Hilo and Maui branches worked together to collect donations to fund cancer research. Our business customers enabled us to once again hold three successful charity golf tournaments. Our 30th Annual Central Pacific Bank Charity Golf Tournament held at Pearl Country Club raised over $50,000 for capital improvements at Shriner’s Hospitals for Children – Honolulu, which has been providing orthopedic surgical and rehabilitative care at no cost to patients or families, helping more than 24,000 children throughout the Pacific Basin since 1923. On the Neighbor Islands, nearly 200 golfers participated in the 19th Annual Central Pacific Bank Pundy Yokouchi Memorial Golf Tournament, renamed to honor our senior advisor from Maui who passed away in 2006. The tournament raised $40,000 for the Maui Arts & Cultural Center, which hosts the Valley Isle’s major events. On the Garden Isle, our 23rd Annual Central Pacific/The Arc of Kauai Golf Tournament has been the sole fundraising event for the non-profit for more than 10 years. This year, the tournament raised $38,000 that was used to assist over 191 children and adults with developmental disabilities. In 2007, we continued our fight against hunger. Employees and customers of our Hilo Branch collected 250 pounds of non-perishable food as well as monetary donations for the Big Island Food Drive Day. On Oahu, Central Pacific stepped up with a donation of $25,000 after Lanakila Meals on Wheels disclosed a $350,000 shortfall in funding. The largest meal delivery service in Hawaii and the only provider serving thousands of Oahu seniors, Meals on Wheels delivers nutritious meals to the doorsteps of homebound seniors at no cost. For some, it is the only meal they’ll enjoy all day. Central Pacific Financial Corp. 16 We know that ordinary citizens perform extraordinary acts of heroism all across our state. We acknowledge their accomplishments by sponsoring the American Red Cross Annual True Blue Hero Recognition Breakfast. This year, more than 50 heroes were guests of honor at the event, which was held during KSSK’s Perry and Price on-air, live radio broadcast from John Dominis Restaurant. This was also our 14th year for the C.A.T.C.H. (Citizens Against Troublemakers and Criminals in Hawaii) Fund. Inspired by the success of radio station KSSK’s Posse program, which uses listeners’ tips to resolve crimes in the community, Central Pacific Bank donates $1,000 into the C.A.T.C.H. Fund each time a perpetrator is brought to justice. At the end of the year, the funds are used to support good deeds in the community. To further the higher education of student athletes attending the University of Hawaii, we continued our $100 Loyalty Awards for each football touchdown, basketball 3-pointer and volleyball ace scored by UH teams. Outstanding efforts by the athletes this year enabled us to present a $25,000 “Loyalty” Check to the university for the Central Pacific Bank Endowed Scholarship Fund. With such rich diversity in our people and cultures across Hawaii, Central Pacific is given opportunities to help perpetuate the many cherished and colorful traditions that make living in the islands so special. We proudly sponsor and participate in the Filipino, Korean and Okinawan festivals, which draw large crowds who enjoy the all-day entertainment, food, cultural displays and family activities. Our Central Pacific family takes great pleasure in closing the year with our participation in the Lokahi Giving Project, which brings the bank, its employees and customers together to ensure those less fortunate will enjoy a brighter holiday season. With our Central Pacific teams adopting families and our branches serving as drop-off points for gift and monetary donations, we were able to raise over $150,000 in 2007. Serving the community beside people who are our long-time customers, friends and neighbors continues to inspire and humble us. In 2008, our community banks will be taking the lead in determining what their own neighborhoods need most. By combining the resources of our bank, our people and our communities, Central Pacific hopes to create many more positive outcomes throughout Hawaii as we dedicate ourselves to being your trusted partner and true neighbor. Central Pacific Financial Corp. 17 Corporate Directory A S O F D E C E M B E R 3 1 , 2 0 0 7 Board of Directors Front row: Christine H. H. Camp, President & CEO, Avalon Group, LLC, Ronald K. Migita, Chairman of the Board, Central Pacific Financial Corp., Clint Arnoldus, President & Chief Executive Officer, Central Pacific Financial Corp., Colbert M. Matsumoto, Chairman of the Board & Chief Executive Officer, Island Insurance Company, Limited Back row: Clayton K. Honbo, M.D., Retired, Earl E. Fry, Executive Vice President, Chief Financial Officer & Secretary, Informatica Corporation, Dennis I. Hirota, Ph.D., President, Sam O. Hirota, Inc., Dwight L. Yoshimura, Senior Vice President & Senior General Manager, GGP Limited Partnership, Paul J. Kosasa, President & Chief Executive Officer, MNS Ltd. dba ABC Stores, Richard J. Blangiardi, President & General Manager, HITV Operating Company, Inc., dba KGMB9, B. Jeannie Hedberg, C.P.A., Member, Hedberg, Batara & Vaughan-Sarandi, LLC, Maurice H. Yamasato, President, Yamasato, Fujiwara, Higa & Associates, Inc. Missing: Duane K. Kurisu, Chairman of the Board & Chief Executive Officer, aio, LLC, Crystal K. Rose, J.D., Partner, Bays Deaver Lung Rose & Holma, Mike K. Sayama, Ph.D., Vice President, Customer Relations, Hawaii Medical Service Association Executive Management Blenn A. Fujimoto, Vice Chairman, Hawaii Market, Clint Arnoldus, President & Chief Executive Officer, Dean K. Hirata, Vice Chairman & Chief Financial Officer Central Pacific Financial Corp. 18 Island of Kauai Lindbergh Akita Dennis M. Esaki Richard Maeda Carolyn A. Nii, C.P.A. Frank Nonaka Allan A. Smith Roy Tanaka Dennis R. Yamada, Esq. Island of Maui Hilario A. Aquilizan, M.D. Hitoshi Hirayama Lawrence N. C. Ing, Esq. Howard Miyamoto, D.D.S. Maria A. Unemori, C.P.A. Advisors Senior Joichi Saito, Chairman Emeritus Yoshiharu Satoh, Chairman Emeritus Paul Devens Alice F. Guild Daniel K. Inouye, U.S. Senator Eaton Magoon, Jr. Minoru Ueda Lester B.K. Yee, M.D. Neighbor Islands Island of Hawaii (Hilo) Tsuneo Akiyama Roland Higashi Thomas Hirano James T. Lambeth, M.D. Rex Matsuno Ernest A. Sakamoto Island of Hawaii (Kailua-Kona) James W. Higgins Wally K. Ichishita William Kimi, Jr. Jean A. Murphy, GRI, CIPS Financial Highlights C E N T R A L PA C I F I C F I N A N C I A L C O R P. A N D S U B S I D I A R I E S (Dollars in thousands, except per share data) 2007 2006 Change For the Year Net Income Basic Earnings Per Share Diluted Earnings Per Share Cash Dividends Declared Per Share At December 31 Assets Deposits Loans and Leases Shareholders’ Equity Book Value Per Share Market Value Per Share Average Number of Shares Outstanding Financial Ratios Return on Average Assets Return on Average Equity Return on Average Tangible Equity Efficiency Ratio* (92.7)% (92.7)% (92.6)% 11.4% 3.5% 4.1% 7.7% (8.6)% (2.5)% (52.4)% (1.0)% $ $ $ $ 5,806 0.19 0.19 0.98 5,680,386 4,002,719 4,141,705 674,403 23.45 18.46 30,197 79,180 2.60 2.57 0.88 5,487,192 3,844,483 3,846,004 738,139 24.04 38.76 30,511 0.10% 0.77% 1.35% 47.80% 1.50% 11.16% 21.01% 49.67% * Efficiency ratio is derived by dividing other operating expense excluding amortization and impairment of intangible assets and goodwill by net operating revenue (net interest income on a taxable equivalent basis plus other operating income before securities transactions). Refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 for the Consolidated Financial Statements, including Report of Independent Registered Public Accounting Firm thereon. Central Pacific Financial Corp. 19 Consolidated Financial Highlights C E N T R A L PA C I F I C F I N A N C I A L C O R P. A N D S U B S I D I A R I E S – Y E A R S E N D E D D E C E M B E R 3 1 , 2 0 0 7 , 2 0 0 6 , 2 0 0 5 , 2 0 0 4 & 2 0 0 3 Selected Financial Data (Dollars in thousands, except per share data) 2007 2006 2005 2004 2003 $ Statement of Income Data Total interest income Total interest expense Net interest income Provision for loan and lease losses Net interest income after provision for loan and lease losses Other operating income Goodwill impairment Other operating expense (excluding goodwill impairment) Income before income taxes Income taxes Net income 349,877 137,979 211,898 53,001 158,897 45,804 48,000 128,556 28,145 22,339 5,806 Balance Sheet Data (Year-end) Interest-bearing deposits in other banks Investment securities (1) Loans and leases Allowance for loan and lease losses Goodwill Core deposit premium Total assets Core deposits (2) Total deposits Long-term debt Total shareholders’ equity Per Share Data Basic earnings per share Diluted earnings per share Cash dividends declared Book value Weighted average shares outstanding (in thousands) Financial Ratios Return on average assets Return on average shareholders’ equity Net income to average tangible shareholders’ equity Efficiency ratio (3) Net interest margin (4) Net charge-offs to average loans Nonperforming assets to year-end loans and other real estate (5) Allowance for loan and lease losses to year-end loans Allowance for loan and lease losses to nonaccrual loans Dividend payout ratio $` $ 241 881,254 4,141,705 92,049 244,702 28,750 5,680,386 2,833,317 4,002,719 916,019 674,403 0.19 0.19 0.98 23.45 30,197 0.10% 0.77% 1.35% 47.80% 4.33% 0.33% 1.48% 2.22% 149.57% 515.79% $ $ $ 320,381 109,532 210,849 1,350 209,499 43,156 — 132,163 120,492 41,312 79,180 5,933 898,358 3,846,004 52,280 298,996 31,898 5,487,192 2,860,926 3,844,483 740,189 738,139 2.60 2.57 0.88 24.04 30,511 1.50% 11.16% 21.01% 49.67% 4.55% 0.05% 0.23% 1.36% 583.61% 33.85% $ $ $ 263,250 66,577 196,673 3,917 192,756 41,002 — 124,772 108,986 36,527 72,459 9,813 925,285 3,552,749 52,936 303,358 35,795 5,239,139 2,814,435 3,642,244 749,258 676,234 2.42 2.38 0.73 22.22 29,956 1.48% 11.16% 22.88% 49.59% 4.63% 0.05% 0.35% 1.49% 421.77% 30.17% $ $ $ 150,389 30,217 120,172 2,083 118,089 22,018 — 86,131 53,976 16,582 37,394 52,978 850,821 3,099,830 50,703 284,712 49,188 4,651,902 2,716,973 3,327,026 587,380 567,862 1.90 1.87 0.64 20.17 19,636 1.25% 12.37% 18.45% 57.77% 4.51% 0.06% 0.35% 1.64% 492.79% 33.68% $ $ $ 110,231 20,178 90,053 700 89,353 15,834 — 55,578 49,609 15,669 33,940 5,145 540,785 1,443,154 24,774 — — 2,170,268 1,419,100 1,753,284 184,184 194,599 2.12 2.07 0.64 12.11 16,027 1.64% 18.33% 18.33% 51.94% 4.79% 0.01% 0.25% 1.72% 688.74% 30.19% (1) Held-to-maturity securities at amortized cost, available-for-sale securities at fair value. (2) Noninterest-bearing demand, interest-bearing demand and savings deposits, and time deposits under $100,000. (3) Efficiency ratio is derived by dividing other operating expense excluding amortization and impairment of intangible assets and goodwill by net operating revenue (net interest income on a taxable equivalent basis plus other operating income before securities transactions). (4) Computed on a taxable equivalent basis using an assumed income tax rate of 35%. (5) Nonperforming assets include nonaccrual loans, nonaccrual loans held for sale and other real estate. Refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 for the Consolidated Financial Statements, including Report of Independent Registered Public Accounting Firm thereon. Central Pacific Financial Corp. 20 Consolidated Balance Sheets C E N T R A L PA C I F I C F I N A N C I A L C O R P. A N D S U B S I D I A R I E S – D E C E M B E R 3 1 , 2 0 0 7 & 2 0 0 6 (Dollars in thousands) Assets Cash and due from banks Interest-bearing deposits in other banks Federal funds sold Investment securities: Held to maturity, at amortized cost (fair value of $46,077 at December 31, 2007 and $64,249 at December 31, 2006) Available for sale, at fair value Total investment securities Loans held for sale Loans and leases Less allowance for loan and lease losses Net loans and leases Premises and equipment Accrued interest receivable Investment in unconsolidated subsidiaries Goodwill Core deposit premium Mortgage servicing rights Bank-owned life insurance Federal Home Loan Bank stock Other assets Total assets Liabilities and Shareholders’ Equity Deposits: Noninterest-bearing demand Interest-bearing demand Savings and money market Time Total deposits ) Short-term borrowings Long-term debt Minority interest Other liabilities Total liabilities Shareholders' equity: Preferred stock, no par value, authorized 1,000,000 shares, none issued Common stock, no par value, authorized 100,000,000 shares, issued and outstanding 28,756,647 shares at December 31, 2007 and 30,709,389 shares at December 31, 2006 Surplus Retained earnings Accumulated other comprehensive loss Total shareholders' equity Total liabilities and shareholders' equity Refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 for the Consolidated Financial Statements, including Report of Independent Registered Public Accounting Firm thereon. Central Pacific Financial Corp. 21 2007) 2006 $ $ 79,088) 241) 2,800) 129,715) 5,933) —) 46,124) 835,130) 881,254) 37,572) 4,141,705) (92,049)) 4,049,656) 82,841) 26,041) 17,404) 244,702) 28,750) 11,222) 131,454) 48,797) 38,564) 5,680,386) 665,034) 461,175) 1,178,855) 1,697,655) 4,002,719) 16,000) 916,019) 13,104) 58,141) $ $ 65,204) 833,154) 898,358) 26,669) 3,846,004) (52,280) 3,793,724) 77,341) 26,269) 12,957) 298,996) 31,898) 11,640) 102,394) 48,797) 22,501) 5,487,192) 661,027) 438,943) 1,205,271) 1,539,242) 3,844,483) 79,308) 740,189) 13,130) 71,943) $ $ 5,005,983) 4,749,053) —) —) 403,304) 54,669) 222,644) (6,214) 674,403) 430,904) 51,756) 270,624) (15,145) 738,139) $ 5,680,386) $ 5,487,192) Consolidated Statements of Income C E N T R A L PA C I F I C F I N A N C I A L C O R P. A N D S U B S I D I A R I E S – Y E A R S E N D E D D E C E M B E R 3 1 , 2 0 0 7 , 2 0 0 6 & 2 0 0 5 (Dollars in thousands, except per share data) 2007) 2006) 2005) Interest Income Interest and fees on loans and leases Interest and dividends on investment securities: Taxable interest Tax-exempt interest Dividends Interest on deposits in other banks Interest on Federal funds sold and securities purchased under agreements to resell Dividends on Federal Home Loan Bank stock Total interest income Interest Expense Interest on deposits: Demand Savings and money market Time Interest on short-term borrowings Interest on long-term debt Total interest expense Net interest income Provision for loan and lease losses Net interest income after provision for loan and lease losses Other Operating Income Service charges on deposit accounts Other service charges and fees Income from bank-owned life insurance Gains on sales of loans Income from fiduciary activities Loan placement fees Fees on foreign exchange Equity in earnings of unconsolidated subsidiaries Investment securities gains (losses) Other Total other operating income Other Operating Expense Salaries and employee benefits Goodwill impairment Net occupancy Legal and professional services Equipment Communication expense Computer software expense Amortization of core deposit premium Advertising expense Amortization of mortgage servicing rights Other Total other operating expense Income before income taxes Income taxes Net income Per Share Data Basic earnings per share Diluted earnings per share Cash dividends declared $ 308,720) $ 279,246) $ 222,841) 34,721) 5,420) 247) 170) ) 306) 293) 34,775) 5,080) 538) 550) ) 143) 49) 34,058) 5,281) 278) 349) ) 171) 272) 349,877) 320,381) 263,250) ) $ $ 556) 23,950) 69,467) 1,616) 42,390) 137,979) 211,898) 53,001) 158,897) 14,167) 13,178) 5,821) 5,389) 3,566) 1,079) 721) 703) (1,715)) 2,895) 45,804) 62,562) 48,000) 10,408) 9,137) 5,228) 4,266) 3,360) 3,148) 2,582) 1,844) 26,021) 176,556) 28,145) 22,339) 5,806) 0.19) 0.19) 0.98) $ $ 566) 17,684) 53,419) 2,197) 35,666) 109,532) 210,849) 1,350) 209,499) 14,408) 12,188) 3,989) 4,863) 2,915) 1,767) 765) 576) (1,510) 3,195) 43,156) 73,211) —) 9,218) 8,575) 4,864) 4,642) 2,818) 3,897) 2,569) 2,223) 20,146) 132,163) 120,492) 41,312) 79,180) )2.60) 2.57) 0.88) $ $ 730) 7,859) 29,797) 1,858) 26,333) 66,577) 196,673) 3,917) 192,756) 11,782) 11,234) 2,205) 4,913) 2,431) 1,780) 787) 767) 1,550) 3,553) 41,002) 64,963) —) 9,666) 8,014) 4,873) 4,174) 2,798) 6,266) 2,347) 1,844) 19,827) 124,772) 108,986) 36,527) 72,459) 2.42) 2.38) 0.73) Refer to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007 for the Consolidated Financial Statements, including Report of Independent Registered Public Accounting Firm thereon. Central Pacific Financial Corp. 22 Shareholder Information Corporate Information Common Stock Information Corporate Headquarters 220 South King Street • Honolulu, Hawaii Listing of Common Stock NYSE: CPF Mailing Address P.O. Box 3590 • Honolulu, Hawaii • 96811-3590 Central Pacific Financial Corp.’s common stock trades on the New York Stock Exchange under the ticker symbol “CPF”. Shareholders of Record and Dividend Declaration & Stock Price Information As of December 31, 2007, there were 28,756,647 shares of common stock outstanding held by 3,594 shareholders of record, excluding individuals and institutions for whom shares were held in the names of nominees and brokerage firms. Set forth below are the high and low sales prices and the cash dividends declared on common stock for each quarter. 2007 Fourth Quarter Third Quarter Second Quarter First Quarter 2006 Fourth Quarter Third Quarter Second Quarter First Quarter Stock Price High Low Cash Dividends Declared $ 40.50 30.63 33.60 36.50 40.50 $ 40.15 39.79 39.48 40.15 39.33 $ 18.24 18.24 27.69 32.83 34.60 $ 33.30 35.50 34.34 33.30 33.55 $ $ 0.98 0.25 0.25 0.24 0.24 0.88 0.23 0.23 0.21 0.21 Financial Information For additional financial information, analysts, investors and others can obtain a copy of Form 10-K by writing or e-mailing: Central Pacific Financial Corp. Investor Relations P.O. Box 3590 Honolulu, Hawaii 96811-3590 E-mail: investor@centralpacificbank.com A copy of the Company’s Annual Report and Form 10-K are also available on the Company’s web site. Contact Information Phone: Fax: Web site: www.centralpacificbank.com info@centralpacificbank.com E-mail: (808) 544-0500 (808) 531-2875 SWIFT: FEDWIRE:CENT PAC HONO 121301578 CEPBUS77 Annual Meeting 10:00 a.m. (Hawaii Standard Time) • Tuesday, May 27, 2008 Plaza Club 900 Fort Street Mall, Honolulu, HI 96813 All shareholders are invited to attend. Independent Registered Public Accounting Firm KPMG LLP Shareholder Inquiries Wells Fargo Bank, stock transfer agent for Central Pacific Financial Corp. common stock, maintains shareholder records and can assist with address changes, corrections in Social Security or tax identification numbers and reissuance of stock certificates. Contact information for Wells Fargo Bank: Address: Wells Fargo Bank Shareowner Services P.O. Box 64874 St Paul, MN 55164-0874 Phone: Toll Free: 800-468-9716 Monday - Friday, 7 a.m. to 7 p.m. (Central Standard Time) Direct Dial: 651-450-4064 Web site: www.wellsfargo.com Forward-Looking Statements (these statements apply to Central Pacific Financial Corp. and all of its respective subsidiaries and affiliates, to include, without limitation, Central Pacific Bank, all of which are collectively referred to herein as the “company”). This document may contain forward-looking statements concerning projections of revenues, income, expenses, earnings per share, capital expenditures, dividends, capital structure, or other financial items or matters, concerning future economic performance, concerning merger-related synergies or matters, concerning growth, concerning company operations, activities, initiatives, projects, products and services, or concerning any of the assumptions underlying or relating to any of the foregoing. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts, and generally include the words “believes”, “plans”, “intends”, “expects”, “estimates”, “hopes”, “envisions”, “targets”, “goals”, “projects”, “anticipates”, “strives” or words of similar meaning or expression. While we believe that our forward-looking statements and the assumptions underlying them are reasonably based, such statements and assumptions, are by their nature subject to risks and uncertainties, and thus could later prove to be inaccurate or incorrect. Accordingly, actual results could materially differ from projections for a variety of reasons, to include, but not limited to: the impact of local, national, and international economies and events (including national disasters) on the company’s business and operations and on tourism, the military, the real estate market and industry, and other major industries operating within the Hawaii market and other regional markets in which the company conducts its business; the impact of legislation and regulation affecting the banking and financial services industry; the impact of competitive products, services, pricing, and other competitive forces within the banking and financial services industry; movements in interest loan delinquency rates; and trading of Central Pacific Financial Corp. stock. For further information on factors which could cause actual results to materially differ from projections, please see Central Pacific Financial Corp.’s publicly available Securities and Exchange Commission filings, including its most recent Form 10-K. The company does not update any of its forward- looking statements. rates; Central Pacific Financial Corp. 23 Products and Services & Branch Locations Products and Services Central Pacific Bank is a full-service commercial bank with a multitude of services as generally listed below: Deposit Services Loans Electronic Banking Trust & Investments Other • Personal Checking • Business Checking • Money Market Accounts • Sweep Accounts • Savings Accounts • Certificates of Deposit • Individual Retirement Accounts • IOLTA/IRETA Accounts • Lockbox • Armored Car Deposit Pick-ups • Commercial Loans • Construction Loans • S.B.A. Loans • Leasing Services • Credit Lines • Mortgage Loans • Home Equity Loans • Letters of Credit • Credit Cards • Consumer Loans • Credit Life and Disability Insurance Branch Locations • Internet Banking / Bill Payment Services • Phone Banking • CheckCard • Merchant Bankcard Services • Private Banking • Savings Bonds • Traveler’s Checks • Notary Services • Wire Transfers • Financial Planning • Custodial • Asset Management • Annuities (Fixed & Variable Rates) • Securities • International Banking • Mutual Funds • Bonds • Brokerage Services Through a network of 39 branches statewide, including four supermarket branches and over 90 ATMs, the company brings convenience to its customers. There are 32 branches on the island of Oahu, four branches on the island of Maui, two branches on the island of Hawaii, and a branch on the island of Kauai. Island of Oahu Main Branch 220 South King Street Kaneohe Branch 45-1054 Kamehameha Highway Pearl Highlands Branch 1030 Makolu Street Kahului Branch 85 West Kaahumanu Avenue Island of Maui Beretania Branch 1338 South Beretania Street Kaneohe Windward Branch 45-1151 Kamehameha Highway Pearlridge Branch 98-150 Kaonohi Street Royal Kunia Instore Branch 94-615 Kupuohi Street (in Times Supermarket) Wahiawa Branch 935 California Avenue Waikiki Branch 105 Uluniu Avenue Waikiki Shopping Plaza Branch 2250 Kalakaua Avenue (on Seaside Avenue) Waimalu Branch 98-1247 Kaahumanu Street Waipahu Branch 94-210 Pupukahi Street Ward Branch 505 Ward Avenue Bethel Branch 1018 Bethel Street Kapahulu Branch 909 Kapahulu Avenue Hawaii Kai Branch 6600 Kalanianaole Highway Kapalama Branch 1535 Dillingham Boulevard Kahala Branch 4211 Waialae Avenue Kahala Instore Branch 1173 21st Avenue (in Times Supermarket) Kaheka Instore Branch 801 Kaheka Street (in Don Quijote) Kailua Branch 419 Kuulei Road Kailua Instore Branch 345 Hahani Street (in Don Quijote) Kaimuki Branch 3465 Waialae Avenue Kalihi Branch 2024 North King Street Kapiolani Branch 1600 Kapiolani Boulevard Kapolei Branch 680 Kamokila Boulevard Keeaumoku Branch 818 Keeaumoku Street Mapunapuna Branch 960 Mapunapuna Street McCully Branch 2002 South King Street MiIilani Branch 95-720 Lanikuhana Avenue Moiliili Branch 2615 South King Street Pearl City Instore Branch 850 Kamehameha Highway (in Don Quijote) Central Pacific Financial Corp. 24 Kihei Branch 207 Piikea Avenue Lahaina Branch 355 Keawe Street Wailuku Branch 2061 Wells Street Island of Hawaii Hilo Branch 525 Kilauea Avenue Kailua-Kona Branch 75-1010 Henry Street Island of Kauai Lihue Branch 4364 Rice Street Member FDIC CENTRAL PACIFIC FINANCIAL CORP. Holding Company of Central Pacific Bank www.centralpacificbank.com Printed in Hawaii on 100% post-consumer recycled paper.

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