Pacific Century Financial Corp., which owns Bank of Hawaii, says big plans for Southern California were behind the decision for its bank there to continue outsourcing.

Sticking with M&I Data Services Inc. will help Encino-based Pacific Century Bank grow, said Mary P. Carryer, vice chairwoman of Bank of Hawaii and its $15 billion-asset parent.

Given the saturation of the Hawaiian market, Southern California is "a priority area for us," Ms. Carryer said. Staying with M&I Data Services, a unit of Marshall & Ilsley Corp. of Milwaukee, "gives us an opportunity to grow that business quickly and easily."

The California bank has only $1.3 billion of assets. The parent company aims to make it about as large as Bank of Hawaii, which has $8 billion.

Most of Pacific Century Bank's customers are businesses. The bank will probably work with M&I Data to bring them more cash management capabilities, Ms. Carryer said.

The decision to stick with M&I was made during a year-2000 systems evaluation.

In general, Honolulu-based Pacific Century Financial is "looking at more ways to outsource technology," Ms. Carryer said. It already outsources credit card processing to Total System Services Inc. and a portion of its trust processing to Sungard Data Systems Inc.

"Part of the difficulty is finding the right technical resources in Hawaii," Ms. Carryer said.

The banking industry overall is moving away from outsourcing. Most of the top 50 companies, which include Pacific Century, operate their own systems, according to an annual survey by Computer Based Solutions Inc. of Dallas. So do most of medium-size and small bank companies.

Bank of Hawaii operates a number of systems in its vast Pacific Rim operations.

The flagship Bank of Hawaii in Honolulu runs in-house applications including Hogan Systems' demand deposit account software and Shaw Systems Inc.'s loan software.

Branches in the Western Pacific-where English is spoken and U.S. dollars are used-connect to the Hogan and Shaw systems.

In the Southern Pacific-where French is spoken and foreign currencies are used-branches run on a client/server system from Phoenix International. For those islands also covered by French banking law, the bank runs Applibanque from the French company Opley.

In Asia and related New York branches, where trade finance and correspondent banking is the specialty, the bank runs Midas-Kapiti's international banking system.

"We're far more complex than your average $15 billion-asset bank," Ms. Carryer said. "We've got banks in islands you've never heard of. It's part of what attracted me" to Pacific Century.

Ms. Carryer joined the company about 18 months ago after four years with Westpac Banking Corp. of Australia and 18 years at Wells Fargo & Co. of San Francisco. Besides technology, she oversees Pacific Century's California operations and leasing company, auditing, and human resources. u

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