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Monday, February 2, 2009
The Obama-Auchi Connection: First Hawaiian Bank avoids subprime lending, makes record profit
By Andrew Walden @ 12:34 PM :: 7947 Views

by Andrew Walden

Banks worldwide are still reeling from the effects of non-performing loans on their books.  But First Hawaiian Bank didn't participate in the Democrat-mandated sub-prime mortgage lending spree of 2005-07 which created the current economic crisis.  So they have done very well while other banks flounder. 

Interestingly, First Hawaiian's ownership structure leads back to BNP Paribas, a large French bank. According to the website of Cipaf, an investment vehicle of Nadhmi Auchi’s General Mediterranean Holdings (GMH), Cipaf is “amongst the topmost investors in the enlarged BNP Paribas.”*  Nadhmi Auchi, a former Iraqi Baathist official of Saddam Hussein's government, more recently financed business ventures with now-convicted-felon and Chicago political 'fixer' Tony Rezko creating a condition of "longstanding indebtedness" of Rezko to Auchi's holding company.  Rezko funded the political campaigns of impeached Illinois Governor Rod Blagojevich and President Barack Obama.  Rezko also assisted Obama in the purchase of his Chicago mansion.

The Honolulu Advertiser reports: "A large part of the growth was due to a 20.8 percent increase in the bank's loan and lease volume. For the quarter, that sector totaled $7.9 billion, the bank said. Total assets increased by 1.8 percent to $12.8 billion. The bank's nonperforming assets as a percentage of total assets remained one of the nation's lowest at 0.1 percent." 

Even more interesting, look who First Hawaiian is owned by.... 

"Founded in 1858, First Hawaiian is a unit of BancWest Corp., which is a wholly owned subsidiary of BNP Paribas, France's largest bank by market value....."

To put the pieces together, here are a selection of articles on Barack Obama, Rod Blagojevich, Tony Rezko, and Nadhmi Auchi, once described as BNP Paribas' largest private shareholder:

Obama's Iraqi Oil-for-Food Connection

Iraqi Billionaire threatens reporters investigating Obama-Rezko affair

Lehman Bros: Obama’s Rezko-Auchi Conflict of Interest

Obama’s Fannie Mae/Freddie Mac connection

Mansion 'mistake' piles the pressure on Barack Obama

Barack Obama Reading List


* (Update 3-24-09) What is the status of Auchi’s companies’ interest in BNP Paribas? The website of Auchi’s Luxembourg-based "Compagnie Internationale de Participations Bancaires en Financières SA" (CIPAF) boasts, “Until the merger of BNP and Paribas, the Cipaf group was one of the largest independent shareholders of Compagnie Financière de Paribas. Since the merger, it ranks amongst the topmost investors in the enlarged BNP Paribas, now a leading European banking group.”

But Auchi’s lawyers of the London firm Carter-Ruck in a February 10, 2009 letter to this writer claim, “It is untrue that our client is the largest private shareholder in BNP Paribas. Our client had a minority shareholding in Paribas when it was bought by BNP. As a result of the shareholding he then became a minority shareholder in BNP Paribas….Since the merger our client sold his shareholding in the bank.”

The careful reader will note there is no flat statement that Auchi and his companies today own no shares of BNP Paribas. The 2004 Annual Report of CIPAF states: “During the year the directors decided to divest the company of its holdings in BNP Paribas profitably, but continued to deal in options.” Likewise the 2004 Annual Report of Auchi’s holding company GMH asserts, “After many years, the Group has divested itself of all its shareholding in BNP Paribas, but continues to deal in options.”

So why does CIPAF now publicly describe itself--and by extension GMH—as “amongst the topmost investors in the enlarged BNP Paribas….” The GMH website, updated January 2, 2007, describes the activities of CIPAF and Paribas regarding the acquisition and subsequent sale of two Luxembourg banks but mentions nothing about any divestiture of BNP Paribas stock. There is no mention of BNP Paribas in the 2005 and 2006 annual reports of GMH and CIPAF. The 2007 and 2008 Annual Reports are not yet available online for either company.

Has CIPAF/GMH trading in the options market for BNP Paribas stock led to CIPAF again owning BNP Paribas stock? The “Wayback” Internet archive indicates that the CIPAF website was archived with an update on February 8, 2005--about the time the 2004 Annual Report was issued. The site was next archived with an update November 29, 2007. So readers are left with a non-denial denial from Carter-Ruck, contradictory statements from the four year old Annual Reports and the more recent websites, and the absence of the 2007 and 2008 Annual Reports from GMH and CIPAF.


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