HONOLULU - Pacific Century Financial Corp. said late Friday that it had appointed Michael E. O'Neill, former chief financial officer and vice chairman of BankAmerica Corp. and no stranger to tough banking situations, to the position of chairman and chief executive officer.
At the Hawaii-based holding company and its flagship, Bank of Hawaii, Mr. O'Neill, 54, replaces chairman and chief executive officer Lawrence M. Johnson. In August, Mr. Johnson, 60, announced his intention to retire once his position was filled after worsening credit problems at the company hit earnings and caused its share price to crater over 30%.
Mr. Johnson's announcement set off a national search by the board and executive recruiter Korn/Ferry International for a banking executive who would be both able to turn around the troubled institution and have familiarity with the Pacific Rim economies reached by the bank's sprawling network.
Mr. O'Neill, who moved to Honolulu last week and started his first official day Friday by talking to the management committee and the local press, said he'll be employing years of experience in capital management on his first months on the job.
"My experience is in looking at a business, slicing it into discrete parts, and figuring out where we're making money and where we are not," he said in an interview Saturday.
"The performance of the company is such that obviously, some change is needed," he said.
Before the end of the first quarter, he said he expects to have a strategic plan to present to the Pacific Century board.
Another top priority: Hiring a replacement for the current chief credit officer, who announced his intention to retire earlier this year.
And as a token of his faith in the bank's future, he said he plans to buy about $10 million in Pacific Century shares, which have been trading between $13 and $14 for the last week, during the course of the next few months.
This position won't be the first in which Mr. O'Neill is charged with straightening out a bank struggling with loan problems.
Most significant are the years spent at Continental Bank, the Chicago-based commercial bank whose bad energy loans prompted a $1.9 billion regulatory bailout in 1984 and paved the way, 10 years later, for its sale to San Francisco-based BankAmerica Corp.
Mr. O'Neill left Continental in 1984 after spending several years in overseas positions, including a Hong Kong-based post. After working as an independent consultant providing work-out advice to banks and corporations, he rejoined Continental in 1989 as a managing director in mergers and acquisitions and then subsequently headed the bank's restructuring program.
Later, as chief financial officer of Continental, he was one of the primary brokers of the bank's sale to BankAmerica. When the Continental sale was completed, he headed BankAmerica's private equity business and subsequently became chief financial officer at the bank.
After the bank announced its merger with NationsBank Corp. in 1998, Mr. O'Neill took on the role of transition chairman of the combined institution's six-member policy committee and was responsible for planning and implementing the two banks' integration.
He left BankAmerica in February 1999 to take the chief executive position at Barclays Bank PLC, the London-based bank that at the time was also in the midst of a strategic repositioning. But shortly after accepting that post, a viral infection that caused arrhythmia - irregular heart rate - caused him to step down.
He said he has been fully recovered since the beginning of this year and has acted as a consultant to a number of institutions on the East Coast and in Europe during this time.