Central Pacific Financial Corp. said Friday it is in its strongest financial position in at least 17 years after a $325 million private recapitalization and a $135 million investment from the U.S. Treasury.

The parent of Central Pacific Bank, the state’s fourth largest, addressed its condition amid concerns that arose after news that taxpayers could lose more than $60 million from the bailout package that the bank received from the U.S. Treasury in January 2009.

"The Treasury’s involvement was critical to the recapitalization and turnaround efforts of our company," Central Pacific spokesman Wayne Kirihara said.

The recapitalization closed last February.

Central Pacific’s stock jumped 79 cents, or 6.1 percent, to $13.70 Friday after the Treasury said the previous day it planned to sell roughly half of the Central Pacific stock it acquired in connection with the bailout. The Treasury said it would net $35.9 million for its sale of 2.85 million shares at a price of $12.75 to institutional investors. The transaction is expected to close on or before Wednesday. The Treasury still owns about 2.8 million shares of Central Pacific stock.

"The Treasury’s TARP (Troubled Asset Relief Program) investment was not a loan, but an equity investment in return for preferred shares, which it exchanged for common shares as part of the company’s recapitalization plan," Central Pacific said.

Treasury spokesman Matt Anderson said the agency’s approach is to strike a balance between exiting its investments in private companies as soon as possible and maximizing value for taxpayers. He offered no timetable for the Treasury selling its remaining shares.

Analyst Joe Gladue, who has a "neutral" rating and $15 price target on the stock, said in his latest report that he is encouraged by Central Pacific’s return to profitability, a $4.6 million profit in the first quarter that was the bank’s first positive quarter in two years.

"Central Pacific continues to make significant progress on resolving problem assets and the outlook for further improvements is good," he wrote in the April 28 report.

Last month, federal and state regulators lifted a consent order that had been placed upon the bank 17 months earlier that mandated Central Pacific improve its capital ratio and other segments of its operations. In its place, Central Pacific entered into an informal memorandum of understanding with its regulators, the Federal Deposit Insurance Corp. and the Hawaii Division of Financial Institutions.

As of March 31, Central Pacific was above the regulatory "well-capitalized" levels as well as above the heightened levels required in the recently terminated consent order. The three key capital ratio metrics measure a bank’s financial footing. Those are of concern to regulators because they give the bank a cushion to buffer future loan losses.