Hawaii's Pacific Century Financial Corp. has an Asian strategy, but it is different from that of most U.S. banks.

The parent of Bank of Hawaii, Pacific Century said it is still open to acquisitions or alliances in the islands and nations south and west of Hawaii, despite the effects of the Asia crisis on its commercial activity in the region.

"We remain confident in the long-term potential of our Asia- Pacific franchise," said Karl Pan, executive vice president of Pacific Century's international and Pacific islands division. "We will always consider appropriate opportunities for acquisitions or expansion."

In May, Pacific Century purchased Banque Paribas Pacifique, the French bank's unit in New Caledonia. It has also acquired 70% of the assets in Banque Paribas Polynesie, which raised the number of Pacific Century's international offices to 78 in 17 countries.

Mr. Pan said the Asia crisis has not stalled plans to expand into new territories. He said the bank continues to look at the possibility of establishing a presence in China.

Acquisitions of foreign branches have been a key part of the bank's South Pacific strategy. It has acquired Credit Lyonnais' units in French Polynesia and New Caledonia. Mr. Pan said that as French banks sought to leave the Pacific, Bank of Hawaii saw an entrance to an island market to which it could bring experience and a product mix that was developed in Hawaii.

"We enter a market with the view of expanding its range of financial services," Mr. Pan said. "Services such as automated teller machines and personalized checking are often missing from islands, which can have populations as low as 35,000."

The bank's many links to Asia have brought Pacific Century its share of crisis-related losses. Loans to failed Thai finance companies and Indonesian firms caused Pacific Century to take $26 million in chargeoffs by midyear.

Given the environment in Asia and Hawaii, analysts say the question is whether Pacific Century, like rival First Hawaiian Inc., will turn more to the mainland U.S. for future growth. First Hawaiian appears to have curtailed expansion in Asian markets, focusing instead on bringing its resources to California, where it bought Banque Nationale de Paris' San Francisco-based banking franchise.

"If that works well for them, Pacific Century may be under pressure to do the same," said Thomas Smith, an analyst at Standard & Poor's.

But mainland deals probably would prove too costly for the bank, given U.S. prices and the bank's balance sheet, hit by a $19.4 million restructuring charge. For the short term, Pacific Century's franchise in Hawaii could bring in the most returns, said David Winton, an analyst at Keefe, Bruyette & Woods. "There are signs of growth in Hawaii."

An uptick in Hawaii's economy would be good news for the bank. Asian trade flows, a major part of the bank's Asian wholesale banking franchise, have declined noticeably, Mr. Pan said. But product flows in the world's fastest-growing trade region still play a big role in Pacific Century's business.

"While the growth rate is no longer increasing in double digits, it is growing in single digits," he said.

And the trade-based Pacific network will help the bank when Asia rebounds. "Over the long term, the Pacific rim will have above-average growth," said Mr. Winton. "And they're sitting in the middle of that trade."

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