Bank of Hawai‘i Corporation Fourth Quarter 2022 Financial Results

  • 2022 Diluted Earnings Per Common Share $5.48
  • 2022 Net Income $225.8 Million
  • Diluted Earnings Per Common Share $1.50 for the Fourth Quarter of 2022
  • Net Income $61.3 Million for the Fourth Quarter of 2022
  • Board of Directors Declares Dividend of $0.70 Per Common Share

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BOH 4Q 2022 Earnings Release Supplement

HONOLULU--()--Bank of Hawai‘i Corporation (NYSE: BOH) today reported diluted earnings per common share of $5.48 for the full year of 2022, compared with diluted earnings per common share of $6.25 for the full year of 2021. Net income for the year was $225.8 million, down 10.9% from the previous year. Return on average assets for the full year of 2022 was 0.98%, compared to 1.14% in 2021. Return on average common equity for the full year of 2022 was 17.83% compared to 17.92% in 2021.

Diluted earnings per common share for the fourth quarter of 2022 was $1.50, compared with diluted earnings per common share of $1.28 in the previous quarter and $1.55 in the same quarter last year. Net income for the fourth quarter of 2022 was $61.3 million, up 16.1% from the third quarter of 2022 and down 4.0% from the fourth quarter of 2021. The increase from the third quarter of 2022 was primarily due to a one-time charge in the third quarter related to our agreement to sell assets that terminated certain leveraged leases.

“Bank of Hawai‘i ended 2022 with strong financial performance,” said Peter Ho, Chairman, President, and CEO. “As we look forward into 2023, we are well positioned for a challenging environment, thanks to our leading market position, superior credit quality, disciplined expense management, and strong liquidity and capital.”

Financial Highlights

  • The return on average assets for the fourth quarter of 2022 was 1.05% compared with 0.91% in the previous quarter and 1.12% in the same quarter of 2021.
  • The return on average common equity for the fourth quarter of 2022 was 21.28% compared with 16.98% in the previous quarter and 17.40% in the same quarter of 2021.
  • Net interest income for the fourth quarter of 2022 was $140.7 million, a decrease of 0.6% from the third quarter of 2022 and an increase of 11.4% from the fourth quarter of 2021. Net interest margin was 2.60% in the fourth quarter of 2022, unchanged from the previous quarter and an increase of 26 basis points from the same quarter of 2021.
    • The increase in net interest income and margin in the fourth quarter of 2022 compared to the prior year was due to the higher rate environment and strong loan growth over the year.
  • There was a $0.2 million provision for credit losses for the fourth quarter of 2022 compared with no provision in the previous quarter and a net benefit of $9.7 million in the same quarter of 2021.
  • Noninterest income was $41.2 million in the fourth quarter of 2022, an increase of 34.3% from the previous quarter and a decrease of 3.3% from the same quarter of 2021.
    • Noninterest income in the third quarter of 2022 included a one-time pre-tax charge of $6.9 million related to our agreement to sell assets that terminated leveraged leases related to 31 locomotives. In addition, noninterest income in the third quarter also included a negative adjustment of $0.9 million related to a change in the Visa Class B conversion ratio.
  • Noninterest expense was $102.7 million in the fourth quarter of 2022, a decrease of 2.9% from the previous quarter and an increase of 1.0% from the same quarter of 2021.
    • Noninterest expense in the third quarter of 2022 included $1.8 million in separation expenses.
  • The effective tax rate for the fourth quarter of 2022 was 22.4% compared with 20.7% in the previous quarter and 17.1% during the same quarter of 2021.
    • The lower effective tax rate in the prior quarter was primarily due to tax benefits related to the aforementioned agreement to sell assets that terminated certain leveraged leases.
    • The lower effective tax rate in the fourth quarter of 2021 included a $3.6 million benefit due to larger than expected tax credits from 2020 and a reduction in the valuation allowance related to low-income housing partnerships.

Asset Quality

The Company’s overall asset quality remained strong during the fourth quarter of 2022.

  • Total non-performing assets were $12.6 million at December 31, 2022, down $1.2 million from September 30, 2022 and down $6.3 million from December 31, 2021. Non-performing assets as a percentage of total loans and leases and foreclosed real estate were 0.09% at the end of the quarter, a decrease of 1 basis point from the end of the prior quarter and a decrease of 6 basis points from the same quarter of 2021.
  • Net loan and lease charge-offs during the fourth quarter of 2022 were $1.9 million or 0.05% annualized of total average loans and leases outstanding.
    • Net loan and lease charge-offs for the fourth quarter of 2022 were comprised of charge-offs of $3.2 million partially offset by recoveries of $1.4 million.
    • Compared to the prior quarter, net loan and lease charge-offs increased by $0.7 million or 2 basis points annualized on total average loans and leases outstanding.
    • Compared to the same quarter of 2021, net loan and lease charge-offs increased by $1.2 million or 3 basis points annualized on total average loans and leases outstanding.
  • The allowance for credit losses on loans and leases was $144.4 million at December 31, 2022, a decrease of $2.0 million from September 30, 2022 and a decrease of $13.4 million from December 31, 2021. The ratio of the allowance for credit losses to total loans and leases outstanding was 1.06% at the end of the quarter, down 4 basis points from the end of the prior quarter and down 23 basis points from the end of the same quarter of 2021.

Balance Sheet

  • Total assets were $23.6 billion at December 31, 2022, an increase of 2.0% from September 30, 2022 and an increase of 3.6% from December 31, 2021.
  • The investment securities portfolio was $8.3 billion at December 31, 2022, an increase of 4.7% from September 30, 2022 and a decrease of 7.9% from December 31, 2021.
    • The investment portfolio remains largely comprised of securities issued by U.S. government agencies and U.S. government-sponsored enterprises.
  • Total loans and leases were $13.6 billion at December 31, 2022, an increase of 2.4% from September 30, 2022 and an increase of 11.3% from December 31, 2021.
    • Total loans and leases excluding PPP loans were $13.6 billion at December 31, 2022, an increase of 2.5% from September 30, 2022 and an increase of 12.3% from December 31, 2021.
  • Total deposits were $20.6 billion at December 31, 2022, a decrease of 1.3% from September 30, 2022 and an increase of 1.3% from December 31, 2021.

Capital and Dividends

  • The Tier 1 Capital Ratio was 12.15% at December 31, 2022 compared with 12.72% at September 30, 2022 and 13.56% at December 31, 2021.
  • The Tier 1 Leverage Ratio was 7.37% at December 31, 2022 compared with 7.28% at September 30, 2022 and 7.32% at December 31, 2021.
  • The Company repurchased 192.3 thousand shares of common stock at a total cost of $15.0 million under its share repurchase program in the fourth quarter of 2022 at an average cost of $77.77 per share repurchased.
    • The Company’s Board of Directors increased the authorization under the share repurchase program by an additional $100.0 million. Total remaining buyback authority under the share repurchase program was $135.9 million at January 20, 2023.
  • The Company’s Board of Directors declared a quarterly cash dividend of $0.70 per share on the Company’s outstanding common shares. The dividend will be payable on March 14, 2023 to shareholders of record at the close of business on February 28, 2023.
  • On January 4, 2023, the Board of Directors declared the quarterly dividend payment of $10.94 per share, equivalent to $0.2735 per depositary share, on its preferred stock. The depositary shares representing the Series A Preferred Stock are traded on the NYSE under the symbol “BOH.PRA.” The dividend will be payable on February 1, 2023 to shareholders of record of the preferred stock at the close of business on January 17, 2023.

Conference Call Information

The Company will review its fourth quarter financial results today at 8:00 a.m. Hawaii Time (1:00 p.m. Eastern Time). The live call, including a slide presentation, will be accessible on the investor relations link of Bank of Hawai‘i Corporation's website, www.boh.com.

Forward-Looking Statements

This news release, and other statements made by the Company in connection with it may contain "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties that could cause results to be materially different from expectations. Forecasts of our financial results and condition, expectations for our operations and business prospects, and our assumptions used in those forecasts and expectations are examples of certain of these forward-looking statements. Do not unduly rely on forward-looking statements. Actual results might differ significantly from our forecasts and expectations because of a variety of factors. More information about these factors is contained in Bank of Hawai‘i Corporation's Annual Report on Form 10-K for the year ended December 31, 2021 and its Form 10-Q for the fiscal quarters ended March 31, 2022, June 30, 2022 and September 30, 2022, which were filed with the U.S. Securities and Exchange Commission. These forward-looking statements are not guarantees of future performance and speak only as of the date made, and, except as required by law, the Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events, new information or future circumstances.

Bank of Hawai‘i Corporation is an independent regional financial services company serving businesses, consumers, and governments in Hawaii and the West Pacific. The Company's principal subsidiary, Bank of Hawai'i, was founded in 1897. For more information about Bank of Hawai‘i Corporation, see the Company’s web site, www.boh.com. Bank of Hawai‘i Corporation is a trade name of Bank of Hawaii Corporation.

Bank of Hawai‘i Corporation and Subsidiaries
Financial Highlights Table 1
Three Months Ended Year Ended
December 31, September 30, December 31, December 31,
(dollars in thousands, except per share amounts)

2022

 

2022

 

2021

 

2022

 

2021

For the Period:
Operating Results
Net Interest Income

$

140,738

 

$

141,655

 

$

126,388

 

$

540,558

 

$

497,290

 

Provision for Credit Losses

 

200

 

 

-

 

 

(9,700

)

 

(7,800

)

 

(50,500

)

Total Noninterest Income

 

41,172

 

 

30,660

 

 

42,574

 

 

157,541

 

 

171,353

 

Total Noninterest Expense

 

102,703

 

 

105,749

 

 

101,678

 

 

415,265

 

 

393,589

 

Pre-Provision Net Revenue

 

79,207

 

 

66,566

 

 

67,284

 

 

282,834

 

 

275,054

 

Net Income

 

61,307

 

 

52,801

 

 

63,837

 

 

225,804

 

 

253,372

 

Net Income Available to Common Shareholders

 

59,338

 

 

50,832

 

 

61,868

 

 

217,928

 

 

250,397

 

Basic Earnings Per Common Share

 

1.51

 

 

1.28

 

 

1.56

 

 

5.50

 

 

6.29

 

Diluted Earnings Per Common Share

 

1.50

 

 

1.28

 

 

1.55

 

 

5.48

 

 

6.25

 

Dividends Declared Per Common Share

 

0.70

 

 

0.70

 

 

0.70

 

 

2.80

 

 

2.74

 

 
Performance Ratios
Return on Average Assets

 

1.05

%

 

0.91

%

 

1.12

%

 

0.98

%

 

1.14

%

Return on Average Shareholders' Equity

 

18.91

 

 

15.31

 

 

15.92

 

 

16.10

 

 

16.94

 

Return on Average Common Equity

 

21.28

 

 

16.98

 

 

17.40

 

 

17.83

 

 

17.92

 

Efficiency Ratio 1

 

56.46

 

 

61.37

 

 

60.18

 

 

59.49

 

 

58.86

 

Net Interest Margin 2

 

2.60

 

 

2.60

 

 

2.34

 

 

2.50

 

 

2.36

 

Dividend Payout Ratio 3

 

46.36

 

 

54.69

 

 

44.87

 

 

50.91

 

 

43.56

 

Average Shareholders' Equity to Average Assets

 

5.56

 

 

5.91

 

 

7.02

 

 

6.10

 

 

6.73

 

 
Average Balances
Average Loans and Leases

$

13,452,791

 

$

13,126,717

 

$

12,086,705

 

$

12,896,510

 

$

12,023,669

 

Average Assets

 

23,147,398

 

 

23,135,820

 

 

22,666,280

 

 

23,006,671

 

 

22,227,156

 

Average Deposits

 

20,341,327

 

 

20,863,681

 

 

20,222,470

 

 

20,550,739

 

 

19,771,147

 

Average Shareholders' Equity

 

1,286,291

 

 

1,367,946

 

 

1,590,600

 

 

1,402,533

 

 

1,495,586

 

 
Per Share of Common Stock
Book Value

$

28.54

 

$

27.55

 

$

35.57

 

$

28.54

 

$

35.57

 

Tangible Book Value

 

27.75

 

 

26.76

 

 

34.78

 

 

27.75

 

 

34.78

 

Market Value
Closing

 

77.56

 

 

76.12

 

 

83.76

 

 

77.56

 

 

83.76

 

High

 

82.87

 

 

85.45

 

 

88.96

 

 

92.38

 

 

99.10

 

Low

 

70.15

 

 

70.89

 

 

78.73

 

 

70.15

 

 

75.65

 

 
December 31, September 30, December 31,

2022

2022

2021

As of Period End:
Balance Sheet Totals
Loans and Leases

$

13,646,420

 

$

13,321,606

 

$

12,259,076

 

Total Assets

 

23,606,877

 

 

23,134,040

 

 

22,784,941

 

Total Deposits

 

20,615,696

 

 

20,888,773

 

 

20,360,108

 

Other Debt

 

410,294

 

 

10,319

 

 

10,391

 

Total Shareholders' Equity

 

1,316,995

 

 

1,282,384

 

 

1,611,611

 

 
Asset Quality
Non-Performing Assets

$

12,647

 

$

13,868

 

$

18,966

 

Allowance for Credit Losses - Loans and Leases

 

144,439

 

 

146,436

 

 

157,821

 

Allowance to Loans and Leases Outstanding 4

 

1.06

%

 

1.10

%

 

1.29

%

 
Capital Ratios 5
Common Equity Tier 1 Capital Ratio

 

10.92

%

 

11.42

%

 

12.12

%

Tier 1 Capital Ratio

 

12.15

 

 

12.72

 

 

13.56

 

Total Capital Ratio

 

13.17

 

 

13.82

 

 

14.81

 

Tier 1 Leverage Ratio

 

7.37

 

 

7.28

 

 

7.32

 

Total Shareholders' Equity to Total Assets

 

5.58

 

 

5.54

 

 

7.07

 

Tangible Common Equity to Tangible Assets 6

 

4.69

 

 

4.64

 

 

6.15

 

Tangible Common Equity to Risk-Weighted Assets 6

 

7.76

 

 

7.97

 

 

11.44

 

 
Non-Financial Data
Full-Time Equivalent Employees

 

2,076

 

 

2,115

 

 

2,056

 

Branches

 

51

 

 

51

 

 

54

 

ATMs

 

320

 

 

316

 

 

307

 

1

Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income).

2

Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets.

3

Dividend payout ratio is defined as dividends declared per common share divided by basic earnings per common share.

4

The numerator comprises the Allowance for Credit Losses - Loans and Leases.

5

Regulatory capital ratios as of December 31, 2022 are preliminary.

6

Tangible common equity to tangible assets and tangible common equity to risk-weighted assets are Non-GAAP financial measures.
Tangible common equity is defined by the Company as common shareholders' equity minus goodwill. See Table 2 "Reconciliation of Non-GAAP Financial Measures".
Bank of Hawai‘i Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures Table 2

December 31,

 

September 30,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2021

 
Total Shareholders' Equity

$

1,316,995

 

$

1,282,384

 

$

1,611,611

 

Less: Preferred Stock

 

180,000

 

 

180,000

 

 

180,000

 

Goodwill

 

31,517

 

 

31,517

 

 

31,517

 

Tangible Common Equity

$

1,105,478

 

$

1,070,867

 

$

1,400,094

 

 
Total Assets

 

23,606,877

 

 

23,134,040

 

 

22,784,941

 

Less: Goodwill

 

31,517

 

 

31,517

 

 

31,517

 

Tangible Assets

$

23,575,360

 

$

23,102,523

 

$

22,753,424

 

 
Risk-Weighted Assets, determined in accordance
with prescribed regulatory requirements 1

$

14,238,798

 

$

13,428,188

 

$

12,236,805

 

 
Total Shareholders' Equity to Total Assets

 

5.58

%

 

5.54

%

 

7.07

%

Tangible Common Equity to Tangible Assets (Non-GAAP)

 

4.69

%

 

4.64

%

 

6.15

%

 
Tier 1 Capital Ratio 1

 

12.15

%

 

12.72

%

 

13.56

%

Tangible Common Equity to Risk-Weighted Assets (Non-GAAP) 1

 

7.76

%

 

7.97

%

 

11.44

%

1

Regulatory capital ratios as of December 31, 2022 are preliminary.
Bank of Hawai‘i Corporation and Subsidiaries
Consolidated Statements of Income Table 3
Three Months Ended Year Ended

December 31,

 

September 30,

 

December 31,

 

December 31,

(dollars in thousands, except per share amounts)

2022

 

2022

 

2021

 

2022

 

2021

Interest Income
Interest and Fees on Loans and Leases

$

128,683

 

$

115,013

 

$

97,853

 

$

439,798

 

$

398,616

 

Income on Investment Securities
Available-for-Sale

 

18,476

 

 

16,995

 

 

15,850

 

 

70,555

 

 

64,550

 

Held-to-Maturity

 

23,708

 

 

20,243

 

 

18,325

 

 

81,490

 

 

61,955

 

Deposits

 

13

 

 

10

 

 

1

 

 

32

 

 

10

 

Funds Sold

 

1,093

 

 

2,335

 

 

104

 

 

4,274

 

 

883

 

Other

 

340

 

 

322

 

 

176

 

 

1,217

 

 

702

 

Total Interest Income

 

172,313

 

 

154,918

 

 

132,309

 

 

597,366

 

 

526,716

 

Interest Expense
Deposits

 

23,494

 

 

10,296

 

 

2,898

 

 

39,678

 

 

15,216

 

Securities Sold Under Agreements to Repurchase

 

4,289

 

 

2,745

 

 

2,834

 

 

12,600

 

 

13,260

 

Funds Purchased

 

318

 

 

40

 

 

6

 

 

417

 

 

7

 

Short-Term Borrowings

 

1,978

 

 

-

 

 

-

 

 

2,070

 

 

-

 

Other Debt

 

1,496

 

 

182

 

 

183

 

 

2,043

 

 

943

 

Total Interest Expense

 

31,575

 

 

13,263

 

 

5,921

 

 

56,808

 

 

29,426

 

Net Interest Income

 

140,738

 

 

141,655

 

 

126,388

 

 

540,558

 

 

497,290

 

Provision for Credit Losses

 

200

 

 

-

 

 

(9,700

)

 

(7,800

)

 

(50,500

)

Net Interest Income After Provision for Credit Losses

 

140,538

 

 

141,655

 

 

136,088

 

 

548,358

 

 

547,790

 

Noninterest Income
Trust and Asset Management

 

10,652

 

 

10,418

 

 

11,693

 

 

43,803

 

 

46,068

 

Mortgage Banking

 

991

 

 

1,002

 

 

2,908

 

 

5,980

 

 

14,964

 

Service Charges on Deposit Accounts

 

7,513

 

 

7,526

 

 

6,861

 

 

29,620

 

 

25,564

 

Fees, Exchange, and Other Service Charges

 

13,906

 

 

13,863

 

 

14,439

 

 

54,914

 

 

55,457

 

Investment Securities Losses, Net

 

(1,124

)

 

(2,147

)

 

(1,258

)

 

(6,111

)

 

(1,297

)

Annuity and Insurance

 

1,087

 

 

1,034

 

 

876

 

 

3,782

 

 

3,224

 

Bank-Owned Life Insurance

 

2,475

 

 

2,486

 

 

1,907

 

 

9,968

 

 

7,784

 

Other

 

5,672

 

 

(3,522

)

 

5,148

 

 

15,585

 

 

19,589

 

Total Noninterest Income

 

41,172

 

 

30,660

 

 

42,574

 

 

157,541

 

 

171,353

 

Noninterest Expense
Salaries and Benefits

 

57,639

 

 

59,938

 

 

59,434

 

 

235,270

 

 

228,293

 

Net Occupancy

 

9,499

 

 

10,186

 

 

9,028

 

 

39,441

 

 

26,244

 

Net Equipment

 

9,942

 

 

9,736

 

 

9,105

 

 

38,374

 

 

35,703

 

Data Processing

 

4,579

 

 

4,616

 

 

4,696

 

 

18,362

 

 

20,297

 

Professional Fees

 

3,958

 

 

3,799

 

 

3,427

 

 

14,557

 

 

12,895

 

FDIC Insurance

 

1,774

 

 

1,680

 

 

1,619

 

 

6,546

 

 

6,536

 

Other

 

15,312

 

 

15,794

 

 

14,369

 

 

62,715

 

 

63,621

 

Total Noninterest Expense

 

102,703

 

 

105,749

 

 

101,678

 

 

415,265

 

 

393,589

 

Income Before Provision for Income Taxes

 

79,007

 

 

66,566

 

 

76,984

 

 

290,634

 

 

325,554

 

Provision for Income Taxes

 

17,700

 

 

13,765

 

 

13,147

 

 

64,830

 

 

72,182

 

Net Income

$

61,307

 

$

52,801

 

$

63,837

 

$

225,804

 

$

253,372

 

Preferred Stock Dividends

 

1,969

 

 

1,969

 

 

1,969

 

 

7,877

 

 

2,975

 

Net Income Available to Common Shareholders

$

59,338

 

$

50,832

 

$

61,868

 

$

217,927

 

$

250,397

 

Basic Earnings Per Common Share

$

1.51

 

$

1.28

 

$

1.56

 

$

5.50

 

$

6.29

 

Diluted Earnings Per Common Share

$

1.50

 

$

1.28

 

$

1.55

 

$

5.48

 

$

6.25

 

Dividends Declared Per Common Share

$

0.70

 

$

0.70

 

$

0.70

 

$

2.80

 

$

2.74

 

Basic Weighted Average Common Shares

 

39,395,338

 

 

39,567,047

 

 

39,741,063

 

 

39,601,089

 

 

39,837,798

 

Diluted Weighted Average Common Shares

 

39,618,896

 

 

39,758,209

 

 

39,955,525

 

 

39,788,002

 

 

40,053,664

 

Bank of Hawai‘i Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income (Loss) Table 4
Three Months Ended Year Ended
December 31, September 30, December 31, December 31,
(dollars in thousands)

2022

2022

2021

2022

2021

Net Income

$

61,307

$

52,801

 

$

63,837

 

$

225,804

 

$

253,372

 

Other Comprehensive Income (Loss), Net of Tax:
Net Unrealized Gains (Losses) on Investment Securities

 

5,677

 

(79,600

)

 

(26,244

)

 

(376,694

)

 

(83,958

)

Defined Benefit Plans

 

7,359

 

354

 

 

8,430

 

 

8,418

 

 

9,754

 

Other Comprehensive Income (Loss)

 

13,036

 

(79,246

)

 

(17,814

)

 

(368,276

)

 

(74,204

)

Comprehensive Income (Loss)

$

74,343

$

(26,445

)

$

46,023

 

$

(142,472

)

$

179,168

 

Bank of Hawai‘i Corporation and Subsidiaries
Consolidated Statements of Condition Table 5

December 31,

September 30,

December 31,

(dollars in thousands)

2022

2022

2021

Assets
Interest-Bearing Deposits in Other Banks

$

3,724

 

$

5,429

 

$

2,571

 

Funds Sold

 

81,364

 

 

402,714

 

 

361,536

 

Investment Securities
Available-for-Sale

 

2,844,823

 

 

2,424,608

 

 

4,276,056

 

Held-to-Maturity (Fair Value of $4,615,393; $4,668,074; and $4,646,619)

 

5,414,139

 

 

5,461,160

 

 

4,694,780

 

Loans Held for Sale

 

1,035

 

 

418

 

 

26,746

 

Loans and Leases

 

13,646,420

 

 

13,321,606

 

 

12,259,076

 

Allowance for Credit Losses

 

(144,439

)

 

(146,436

)

 

(157,821

)

Net Loans and Leases

 

13,501,981

 

 

13,175,170

 

 

12,101,255

 

Total Earning Assets

 

21,847,066

 

 

21,469,499

 

 

21,462,944

 

Cash and Due from Banks

 

316,679

 

 

247,506

 

 

196,327

 

Premises and Equipment, Net

 

206,777

 

 

208,251

 

 

199,393

 

Operating Lease Right-of-Use Assets

 

92,307

 

 

94,613

 

 

95,621

 

Accrued Interest Receivable

 

61,002

 

 

50,143

 

 

45,242

 

Foreclosed Real Estate

 

1,040

 

 

1,040

 

 

2,332

 

Mortgage Servicing Rights

 

22,619

 

 

23,104

 

 

22,251

 

Goodwill

 

31,517

 

 

31,517

 

 

31,517

 

Bank-Owned Life Insurance

 

453,882

 

 

451,407

 

 

344,587

 

Other Assets

 

573,988

 

 

556,960

 

 

384,727

 

Total Assets

$

23,606,877

 

$

23,134,040

 

$

22,784,941

 

 
Liabilities
Deposits
Noninterest-Bearing Demand

$

6,714,982

 

$

7,300,157

 

$

7,275,287

 

Interest-Bearing Demand

 

4,232,567

 

 

4,399,625

 

 

4,628,567

 

Savings

 

7,962,410

 

 

7,954,006

 

 

7,456,165

 

Time

 

1,705,737

 

 

1,234,985

 

 

1,000,089

 

Total Deposits

 

20,615,696

 

 

20,888,773

 

 

20,360,108

 

Securities Sold Under Agreements to Repurchase

 

725,490

 

 

425,490

 

 

450,490

 

Other Debt

 

410,294

 

 

10,319

 

 

10,391

 

Operating Lease Liabilities

 

100,526

 

 

102,705

 

 

103,210

 

Retirement Benefits Payable

 

26,991

 

 

37,053

 

 

38,494

 

Accrued Interest Payable

 

9,698

 

 

3,405

 

 

2,499

 

Taxes Payable

 

7,104

 

 

13,527

 

 

11,901

 

Other Liabilities

 

394,083

 

 

370,384

 

 

196,237

 

Total Liabilities

 

22,289,882

 

 

21,851,656

 

 

21,173,330

 

Shareholders' Equity
Preferred Stock ($.01 par value; authorized 180,000 shares;
issued / outstanding: December 31, 2022; September 30, 2022; and December 31, 2021 - 180,000)

 

180,000

 

 

180,000

 

 

180,000

 

Common Stock ($.01 par value; authorized 500,000,000 shares;
issued / outstanding: December 31, 2022 - 58,733,625 / 39,835,750;
September 30, 2022 - 58,728,796 / 40,011,473; and December 31, 2021 - 58,554,669 / 40,253,193)

 

582

 

 

582

 

 

581

 

Capital Surplus

 

620,578

 

 

615,985

 

 

602,508

 

Accumulated Other Comprehensive Loss

 

(434,658

)

 

(447,694

)

 

(66,382

)

Retained Earnings

 

2,055,912

 

 

2,024,641

 

 

1,950,375

 

Treasury Stock, at Cost (Shares: December 31, 2022 - 18,897,875; September 30, 2022 - 18,717,323;
and December 31, 2021 - 18,301,476)

 

(1,105,419

)

 

(1,091,130

)

 

(1,055,471

)

Total Shareholders' Equity

 

1,316,995

 

 

1,282,384

 

 

1,611,611

 

Total Liabilities and Shareholders' Equity

$

23,606,877

 

$

23,134,040

 

$

22,784,941

 

Bank of Hawai‘i Corporation and Subsidiaries
Consolidated Statements of Shareholders' Equity Table 6
Accumulated
Other
Preferred Common Comprehensive
Shares Preferred Shares Common Capital Income Retained Treasury
(dollars in thousands) Outstanding Stock Outstanding Stock Surplus (Loss) Earnings Stock Total
Balance as of December 31, 2020

-

$

-

40,119,312

 

$

580

$

591,360

 

$

7,822

 

$

1,811,979

 

$

(1,037,234

)

$

1,374,507

 

Net Income

-

 

-

-

 

 

-

 

-

 

 

-

 

 

253,372

 

 

-

 

 

253,372

 

Other Comprehensive Loss

-

 

-

-

 

 

-

 

-

 

 

(74,204

)

 

-

 

 

-

 

 

(74,204

)

Share-Based Compensation

-

 

-

-

 

 

-

 

13,267

 

 

-

 

 

-

 

 

-

 

 

13,267

 

Preferred Stock Issued, Net

180,000

 

180,000

-

 

 

-

 

(4,513

)

 

-

 

 

-

 

 

-

 

 

175,487

 

Common Stock Issued under Purchase and Equity
Compensation Plans and Related Tax Benefits

-

 

-

507,121

 

 

1

 

2,394

 

 

-

 

 

(1,368

)

 

13,021

 

 

14,048

 

Common Stock Repurchased

-

 

-

(373,240

)

 

-

 

-

 

 

-

 

 

-

 

 

(31,258

)

 

(31,258

)

Cash Dividends Declared Common Stock ($2.74 per share)

-

 

-

-

 

 

-

 

-

 

 

-

 

 

(110,633

)

 

-

 

 

(110,633

)

Cash Dividends Declared Preferred Stock

-

 

-

-

 

 

-

 

-

 

 

-

 

 

(2,975

)

 

-

 

 

(2,975

)

Balance as of December 31, 2021

180,000

$

180,000

40,253,193

 

$

581

$

602,508

 

$

(66,382

)

$

1,950,375

 

$

(1,055,471

)

$

1,611,611

 

 
Net Income

-

 

-

-

 

 

-

 

-

 

 

-

 

 

225,804

 

 

-

 

 

225,804

 

Other Comprehensive Loss

-

 

-

-

 

 

-

 

-

 

 

(368,276

)

 

-

 

 

-

 

 

(368,276

)

Share-Based Compensation

-

 

-

-

 

 

-

 

16,066

 

 

-

 

 

-

 

 

-

 

 

16,066

 

Common Stock Issued under Purchase and Equity
Compensation Plans and Related Tax Benefits

-

 

-

272,007

 

 

1

 

2,004

 

 

-

 

 

167

 

 

5,115

 

 

7,287

 

Common Stock Repurchased

-

 

-

(689,450

)

 

-

 

-

 

 

-

 

 

-

 

 

(55,063

)

 

(55,063

)

Cash Dividends Declared Common Stock ($2.80 per share)

-

 

-

-

 

 

-

 

-

 

 

-

 

 

(112,557

)

 

-

 

 

(112,557

)

Cash Dividends Declared Preferred Stock

-

 

-

-

 

 

-

 

-

 

 

-

 

 

(7,877

)

 

-

 

 

(7,877

)

Balance as of December 31, 2022

180,000

$

180,000

39,835,750

 

$

582

$

620,578

 

$

(434,658

)

$

2,055,912

 

$

(1,105,419

)

$

1,316,995

 

Bank of Hawai‘i Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable-Equivalent Basis 1 Table 7a
Three Months Ended Three Months Ended Three Months Ended
December 31, 2022 September 30, 2022 December 31, 2021
Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
(dollars in millions) Balance Expense 2 Rate Balance Expense 2 Rate Balance Expense 2 Rate
Earning Assets
Interest-Bearing Deposits in Other Banks

$

2.2

$

-

2.32

%

$

2.9

$

-

1.32

%

$

2.2

$

-

0.05

%

Funds Sold

 

118.1

 

1.2

3.62

 

 

411.8

 

2.3

2.22

 

 

273.2

 

0.1

0.15

 

Investment Securities
Available-for-Sale
Taxable

 

2,593.5

 

18.4

2.83

 

 

3,481.9

 

17.0

1.95

 

 

4,308.6

 

15.8

1.47

 

Non-Taxable

 

7.5

 

0.1

4.14

 

 

2.5

 

-

1.56

 

 

5.8

 

0.1

3.67

 

Held-to-Maturity
Taxable

 

5,401.9

 

23.5

1.74

 

 

4,645.7

 

20.1

1.73

 

 

4,757.4

 

18.1

1.52

 

Non-Taxable

 

35.4

 

0.2

2.10

 

 

35.6

 

0.2

2.10

 

 

58.0

 

0.3

2.31

 

Total Investment Securities

 

8,038.3

 

42.2

2.10

 

 

8,165.7

 

37.3

1.82

 

 

9,129.8

 

34.3

1.50

 

Loans Held for Sale

 

3.3

 

-

5.65

 

 

4.3

 

0.1

4.46

 

 

20.8

 

0.1

2.85

 

Loans and Leases 3
Commercial and Industrial

 

1,379.9

 

14.8

4.25

 

 

1,353.8

 

12.5

3.66

 

 

1,297.0

 

8.9

2.72

 

Paycheck Protection Program

 

21.3

 

0.1

2.30

 

 

28.0

 

0.2

3.02

 

 

181.0

 

5.7

12.55

 

Commercial Mortgage

 

3,627.4

 

40.6

4.44

 

 

3,530.9

 

33.3

3.74

 

 

3,075.1

 

22.2

2.86

 

Construction

 

246.9

 

3.3

5.29

 

 

233.0

 

2.8

4.81

 

 

246.8

 

2.2

3.50

 

Commercial Lease Financing

 

72.0

 

0.3

1.49

 

 

89.1

 

0.4

1.58

 

 

107.4

 

0.3

1.12

 

Residential Mortgage

 

4,617.9

 

38.9

3.37

 

 

4,526.6

 

37.4

3.30

 

 

4,293.6

 

33.9

3.16

 

Home Equity

 

2,207.7

 

17.9

3.23

 

 

2,144.8

 

16.4

3.04

 

 

1,757.8

 

12.8

2.88

 

Automobile

 

851.1

 

7.0

3.29

 

 

795.5

 

6.4

3.19

 

 

730.2

 

6.1

3.34

 

Other 4

 

428.6

 

6.1

5.64

 

 

425.0

 

5.9

5.48

 

 

397.8

 

5.8

5.79

 

Total Loans and Leases

 

13,452.8

 

129.0

3.81

 

 

13,126.7

 

115.3

3.49

 

 

12,086.7

 

97.9

3.22

 

Other

 

50.1

 

0.4

2.72

 

 

36.9

 

0.3

3.49

 

 

34.4

 

0.2

2.05

 

Total Earning Assets

 

21,664.8

 

172.8

3.17

 

 

21,748.3

 

155.3

2.84

 

 

21,547.1

 

132.6

2.45

 

Cash and Due from Banks

 

244.3

 

233.5

 

231.3

Other Assets

 

1,238.3

 

1,154.0

 

887.9

Total Assets

$

23,147.4

$

23,135.8

$

22,666.3

 
Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand

$

4,131.4

 

3.5

0.33

 

$

4,286.0

 

1.4

0.13

 

$

4,685.7

 

0.7

0.06

 

Savings

 

7,869.9

 

13.4

0.68

 

 

7,962.0

 

6.6

0.33

 

 

7,443.2

 

1.2

0.06

 

Time

 

1,467.7

 

6.6

1.78

 

 

1,146.9

 

2.3

0.79

 

 

1,019.2

 

1.0

0.40

 

Total Interest-Bearing Deposits

 

13,469.0

 

23.5

0.69

 

 

13,394.9

 

10.3

0.30

 

 

13,148.1

 

2.9

0.09

 

Short-Term Borrowings

 

234.9

 

2.3

3.82

 

 

4.9

 

0.1

3.17

 

 

18.5

 

-

0.13

 

Securities Sold Under Agreements to Repurchase

 

594.5

 

4.3

2.82

 

 

425.5

 

2.7

2.52

 

 

450.5

 

2.8

2.46

 

Other Debt

 

137.5

 

1.5

4.32

 

 

10.3

 

0.2

7.05

 

 

10.4

 

0.2

7.05

 

Total Interest-Bearing Liabilities

 

14,435.9

 

31.6

0.87

 

 

13,835.6

 

13.3

0.38

 

 

13,627.5

 

5.9

0.17

 

Net Interest Income

$

141.2

$

142.0

$

126.7

Interest Rate Spread

2.30

%

2.46

%

2.28

%

Net Interest Margin

2.60

%

2.60

%

2.34

%

Noninterest-Bearing Demand Deposits

 

6,872.3

 

7,468.8

 

7,074.4

Other Liabilities

 

552.9

 

463.5

 

373.8

Shareholders' Equity

 

1,286.3

 

1,367.9

 

1,590.6

Total Liabilities and Shareholders' Equity

$

23,147.4

$

23,135.8

$

22,666.3

1

Due to rounding, the amounts presented in this table may not tie to other amounts presented elsewhere in this report.

2

Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21%, of $433,000, $343,000, and $280,000 for the three months ended December 31, 2022, September 30, 2022, and December 31, 2021, respectively.

3

Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

4

Comprised of other consumer revolving credit, installment, and consumer lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable-Equivalent Basis 1 Table 7b
Year Ended Year Ended
December 31, 2022 December 31, 2021
Average Income/ Yield/ Average Income/ Yield/
(dollars in millions) Balance Expense 2 Rate Balance Expense 2 Rate
Earning Assets
Interest-Bearing Deposits in Other Banks

$

3.0

$

-

1.05

%

$

2.7

$

-

0.36

%

Funds Sold

 

260.5

 

4.3

1.64

 

 

692.4

 

0.9

0.13

 

Investment Securities
Available-for-Sale
Taxable

 

3,644.2

 

70.5

1.93

 

 

4,266.9

 

64.2

1.50

 

Non-Taxable

 

4.0

 

0.1

2.92

 

 

10.1

 

0.4

4.21

 

Held-to-Maturity
Taxable

 

4,750.0

 

80.9

1.70

 

 

3,988.1

 

61.0

1.53

 

Non-Taxable

 

35.6

 

0.7

2.10

 

 

50.7

 

1.2

2.41

 

Total Investment Securities

 

8,433.8

 

152.2

1.80

 

 

8,315.8

 

126.8

1.53

 

Loans Held for Sale

 

6.9

 

0.3

3.70

 

 

24.3

 

0.7

2.82

 

Loans and Leases 3
Commercial and Industrial

 

1,349.3

 

46.2

3.42

 

 

1,285.1

 

37.1

2.88

 

Paycheck Protection Program

 

44.0

 

2.7

6.07

 

 

453.9

 

25.7

5.67

 

Commercial Mortgage

 

3,420.1

 

121.9

3.56

 

 

2,940.0

 

86.7

2.95

 

Construction

 

232.6

 

10.6

4.56

 

 

271.6

 

9.5

3.50

 

Commercial Lease Financing

 

88.5

 

1.3

1.49

 

 

107.2

 

1.5

1.42

 

Residential Mortgage

 

4,484.2

 

147.4

3.29

 

 

4,232.4

 

140.1

3.31

 

Home Equity

 

2,072.2

 

62.1

3.00

 

 

1,637.1

 

49.6

3.03

 

Automobile

 

786.1

 

25.4

3.23

 

 

717.0

 

24.6

3.43

 

Other 4

 

419.5

 

23.0

5.49

 

 

379.4

 

23.9

6.30

 

Total Loans and Leases

 

12,896.5

 

440.6

3.42

 

 

12,023.7

 

398.7

3.32

 

Other

 

40.5

 

1.2

3.01

 

 

32.9

 

0.7

2.13

 

Total Earning Assets

 

21,641.2

 

598.6

2.77

 

 

21,091.8

 

527.8

2.50

 

Cash and Due from Banks

 

237.4

 

252.5

Other Assets

 

1,128.1

 

882.9

Total Assets

$

23,006.7

$

22,227.2

 
Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand

$

4,377.1

 

6.1

0.14

 

$

4,509.8

 

2.7

0.06

 

Savings

 

7,767.7

 

22.9

0.30

 

 

7,421.9

 

6.2

0.08

 

Time

 

1,135.5

 

10.7

0.94

 

 

1,331.8

 

6.3

0.47

 

Total Interest-Bearing Deposits

 

13,280.3

 

39.7

0.30

 

 

13,263.5

 

15.2

0.11

 

Short-Term Borrowings

 

77.1

 

2.5

3.23

 

 

5.2

 

-

0.13

 

Securities Sold Under Agreements to Repurchase

 

479.8

 

12.6

2.63

 

 

541.9

 

13.3

2.45

 

Other Debt

 

42.4

 

2.0

4.82

 

 

27.7

 

0.9

3.41

 

Total Interest-Bearing Liabilities

 

13,879.6

 

56.8

0.41

 

 

13,838.3

 

29.4

0.21

 

Net Interest Income

$

541.8

$

498.4

Interest Rate Spread

2.36

%

2.29

%

Net Interest Margin

2.50

%

2.36

%

Noninterest-Bearing Demand Deposits

 

7,270.4

 

6,507.6

Other Liabilities

 

454.2

 

385.7

Shareholders' Equity

 

1,402.5

 

1,495.6

Total Liabilities and Shareholders' Equity

$

23,006.7

$

22,227.2

1

Due to rounding, the amounts presented in this table may not tie to other amounts presented elsewhere in this report.

2

Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21%, of $1,251,000 and $1,116,000 for the year ended December 31, 2022 and December 31, 2021, respectively.

3

Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

4

Comprised of other consumer revolving credit, installment, and consumer lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8a
Three Months Ended December 31, 2022
Compared to September 30, 2022
(dollars in millions) Volume 1 Rate 1 Total
Change in Interest Income:
Funds Sold

$

(2.1

)

$

1.0

 

$

(1.1

)

Investment Securities
Available-for-Sale
Taxable

 

(5.1

)

 

6.5

 

 

1.4

 

Non-Taxable

 

0.1

 

 

-

 

 

0.1

 

Held-to-Maturity
Taxable

 

3.2

 

 

0.2

 

 

3.4

 

Total Investment Securities

 

(1.8

)

 

6.7

 

 

4.9

 

Loans Held for Sale

 

(0.1

)

 

-

 

 

(0.1

)

Loans and Leases
Commercial and Industrial

 

0.3

 

 

2.0

 

 

2.3

 

Paycheck Protection Program

 

(0.1

)

 

-

 

 

(0.1

)

Commercial Mortgage

 

0.9

 

 

6.4

 

 

7.3

 

Construction

 

0.2

 

 

0.3

 

 

0.5

 

Commercial Lease Financing

 

(0.1

)

 

-

 

 

(0.1

)

Residential Mortgage

 

0.8

 

 

0.7

 

 

1.5

 

Home Equity

 

0.5

 

 

1.0

 

 

1.5

 

Automobile

 

0.4

 

 

0.2

 

 

0.6

 

Other 2

 

-

 

 

0.2

 

 

0.2

 

Total Loans and Leases

 

2.9

 

 

10.8

 

 

13.7

 

Other

 

0.4

 

 

(0.3

)

 

0.1

 

Total Change in Interest Income

 

(0.7

)

 

18.2

 

 

17.5

 

 
Change in Interest Expense:
Interest-Bearing Deposits
Demand

 

-

 

 

2.1

 

 

2.1

 

Savings

 

(0.1

)

 

6.9

 

 

6.8

 

Time

 

0.8

 

 

3.5

 

 

4.3

 

Total Interest-Bearing Deposits

 

0.7

 

 

12.5

 

 

13.2

 

Short-Term Borrowings

 

2.2

 

 

-

 

 

2.2

 

Securities Sold Under Agreements to Repurchase

 

1.2

 

 

0.4

 

 

1.6

 

Other Debt

 

1.4

 

 

(0.1

)

 

1.3

 

Total Change in Interest Expense

 

5.5

 

 

12.8

 

 

18.3

 

 
Change in Net Interest Income

$

(6.2

)

$

5.4

 

$

(0.8

)

1

The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.

2

Comprised of other consumer revolving credit, installment, and consumer lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8b
Three Months Ended December 31, 2022
Compared to December 31, 2021
(dollars in millions) Volume 1 Rate 1 Total
Change in Interest Income:
Funds Sold

$

(0.1

)

$

1.2

 

$

1.1

 

Investment Securities
Available-for-Sale
Taxable

 

(8.1

)

 

10.7

 

 

2.6

 

Held-to-Maturity
Taxable

 

2.6

 

 

2.8

 

 

5.4

 

Non-Taxable

 

(0.1

)

 

-

 

 

(0.1

)

Total Investment Securities

 

(5.6

)

 

13.5

 

 

7.9

 

Loans Held for Sale

 

(0.2

)

 

0.1

 

 

(0.1

)

Loans and Leases
Commercial and Industrial

 

0.6

 

 

5.3

 

 

5.9

 

Paycheck Protection Program

 

(2.9

)

 

(2.7

)

 

(5.6

)

Commercial Mortgage

 

4.5

 

 

13.9

 

 

18.4

 

Construction

 

-

 

 

1.1

 

 

1.1

 

Commercial Lease Financing

 

(0.1

)

 

0.1

 

 

-

 

Residential Mortgage

 

2.7

 

 

2.3

 

 

5.0

 

Home Equity

 

3.5

 

 

1.6

 

 

5.1

 

Automobile

 

1.0

 

 

(0.1

)

 

0.9

 

Other 2

 

0.4

 

 

(0.1

)

 

0.3

 

Total Loans and Leases

 

9.7

 

 

21.4

 

 

31.1

 

Other

 

0.1

 

 

0.1

 

 

0.2

 

Total Change in Interest Income

 

3.9

 

 

36.3

 

 

40.2

 

 
Change in Interest Expense:
Interest-Bearing Deposits
Demand

 

(0.1

)

 

2.9

 

 

2.8

 

Savings

 

0.1

 

 

12.1

 

 

12.2

 

Time

 

0.6

 

 

5.0

 

 

5.6

 

Total Interest-Bearing Deposits

 

0.6

 

 

20.0

 

 

20.6

 

Short-Term Borrowings

 

0.7

 

 

1.6

 

 

2.3

 

Securities Sold Under Agreements to Repurchase

 

1.0

 

 

0.5

 

 

1.5

 

Other Debt

 

1.4

 

 

(0.1

)

 

1.3

 

Total Change in Interest Expense

 

3.7

 

 

22.0

 

 

25.7

 

 
Change in Net Interest Income

$

0.2

 

$

14.3

 

$

14.5

 

1

The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.

2

Comprised of other consumer revolving credit, installment, and consumer lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8c
Year Ended December 31, 2022
Compared to December 31, 2021
(dollars in millions) Volume 1 Rate 1 Total
Change in Interest Income:
Funds Sold

$

(0.9

)

$

4.3

 

$

3.4

 

Investment Securities
Available-for-Sale
Taxable

 

(10.3

)

 

16.6

 

 

6.3

 

Non-Taxable

 

(0.2

)

 

(0.1

)

 

(0.3

)

Held-to-Maturity
Taxable

 

12.5

 

 

7.4

 

 

19.9

 

Non-Taxable

 

(0.3

)

 

(0.2

)

 

(0.5

)

Total Investment Securities

 

1.7

 

 

23.7

 

 

25.4

 

Loans Held for Sale

 

(0.6

)

 

0.2

 

 

(0.4

)

Loans and Leases
Commercial and Industrial

 

1.9

 

 

7.2

 

 

9.1

 

Paycheck Protection Program

 

(24.8

)

 

1.8

 

 

(23.0

)

Commercial Mortgage

 

15.5

 

 

19.7

 

 

35.2

 

Construction

 

(1.5

)

 

2.6

 

 

1.1

 

Commercial Lease Financing

 

(0.2

)

 

-

 

 

(0.2

)

Residential Mortgage

 

8.3

 

 

(1.0

)

 

7.3

 

Home Equity

 

13.1

 

 

(0.6

)

 

12.5

 

Automobile

 

2.3

 

 

(1.5

)

 

0.8

 

Other 2

 

2.3

 

 

(3.2

)

 

(0.9

)

Total Loans and Leases

 

16.9

 

 

25.0

 

 

41.9

 

Other

 

0.2

 

 

0.3

 

 

0.5

 

Total Change in Interest Income

 

17.3

 

 

53.5

 

 

70.8

 

 
Change in Interest Expense:
Interest-Bearing Deposits
Demand

 

(0.1

)

 

3.5

 

 

3.4

 

Savings

 

0.3

 

 

16.4

 

 

16.7

 

Time

 

(1.0

)

 

5.4

 

 

4.4

 

Total Interest-Bearing Deposits

 

(0.8

)

 

25.3

 

 

24.5

 

Short-Term Borrowings

 

0.9

 

 

1.6

 

 

2.5

 

Securities Sold Under Agreements to Repurchase

 

(1.6

)

 

0.9

 

 

(0.7

)

Other Debt

 

0.6

 

 

0.5

 

 

1.1

 

Total Change in Interest Expense

 

(0.9

)

 

28.3

 

 

27.4

 

 
Change in Net Interest Income

$

18.2

 

$

25.2

 

$

43.4

 

1

The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.

2

Comprised of other consumer revolving credit, installment, and consumer lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Salaries and Benefits Table 9
Three Months Ended Year Ended

December 31,

 

September 30,

 

December 31,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2021

 

2022

 

2021

Salaries

$

37,395

 

$

37,792

$

35,758

$

146,840

$

135,416

Incentive Compensation

 

5,356

 

 

5,885

 

6,699

 

23,425

 

22,462

Share-Based Compensation

 

3,901

 

 

3,558

 

3,396

 

15,220

 

12,489

Commission Expense

 

830

 

 

1,005

 

2,094

 

4,708

 

8,901

Retirement and Other Benefits

 

4,065

 

 

4,448

 

4,661

 

17,242

 

20,213

Payroll Taxes

 

2,591

 

 

2,826

 

2,585

 

13,395

 

12,404

Medical, Dental, and Life Insurance

 

3,528

 

 

2,605

 

3,981

 

11,958

 

12,831

Separation Expense

 

(27

)

 

1,819

 

260

 

2,482

 

3,577

Total Salaries and Benefits

$

57,639

 

$

59,938

$

59,434

$

235,270

$

228,293

Bank of Hawai‘i Corporation and Subsidiaries
Loan and Lease Portfolio Balances Table 10

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2022

 

2022

 

2021

Commercial
Commercial and Industrial

$

1,389,066

$

1,368,966

$

1,323,830

$

1,354,757

$

1,361,921

Paycheck Protection Program

 

19,579

 

22,955

 

31,964

 

57,809

 

126,779

Commercial Mortgage

 

3,725,542

 

3,591,943

 

3,464,126

 

3,257,689

 

3,152,130

Construction

 

260,825

 

236,498

 

246,177

 

248,363

 

220,254

Lease Financing

 

69,491

 

73,989

 

89,535

 

98,107

 

105,108

Total Commercial

 

5,464,503

 

5,294,351

 

5,155,632

 

5,016,725

 

4,966,192

Consumer
Residential Mortgage

 

4,653,072

 

4,585,723

 

4,486,571

 

4,405,718

 

4,309,602

Home Equity

 

2,225,950

 

2,185,484

 

2,101,612

 

1,958,285

 

1,836,588

Automobile

 

870,396

 

820,640

 

775,065

 

742,934

 

736,565

Other 1

 

432,499

 

435,408

 

432,693

 

420,830

 

410,129

Total Consumer

 

8,181,917

 

8,027,255

 

7,795,941

 

7,527,767

 

7,292,884

Total Loans and Leases

$

13,646,420

$

13,321,606

$

12,951,573

$

12,544,492

$

12,259,076

 
 
Deposits

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2022

 

2022

 

2021

Consumer

$

10,304,335

$

10,507,946

$

10,554,121

$

10,654,192

$

10,438,844

Commercial

 

8,569,670

 

8,841,781

 

8,824,609

 

8,818,477

 

8,641,932

Public and Other

 

1,741,691

 

1,539,046

 

1,646,951

 

1,243,618

 

1,279,332

Total Deposits

$

20,615,696

$

20,888,773

$

21,025,681

$

20,716,287

$

20,360,108

1

Comprised of other revolving credit, installment, and lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More Table 11

December 31,

 

September 30,

 

June 30,

 

March 31,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2022

 

2022

 

2021

Non-Performing Assets
Non-Accrual Loans and Leases
Commercial
Commercial and Industrial

$

37

 

$

49

 

$

85

 

$

99

 

$

243

 

Commercial Mortgage

 

3,309

 

 

3,396

 

 

3,462

 

 

8,065

 

 

8,205

 

Total Commercial

 

3,346

 

 

3,445

 

 

3,547

 

 

8,164

 

 

8,448

 

Consumer
Residential Mortgage

 

4,239

 

 

4,945

 

 

5,179

 

 

3,845

 

 

3,305

 

Home Equity

 

4,022

 

 

4,438

 

 

4,435

 

 

5,638

 

 

4,881

 

Total Consumer

 

8,261

 

 

9,383

 

 

9,614

 

 

9,483

 

 

8,186

 

Total Non-Accrual Loans and Leases

 

11,607

 

 

12,828

 

 

13,161

 

 

17,647

 

 

16,634

 

Foreclosed Real Estate

 

1,040

 

 

1,040

 

 

2,332

 

 

2,332

 

 

2,332

 

Total Non-Performing Assets

$

12,647

 

$

13,868

 

$

15,493

 

$

19,979

 

$

18,966

 

 
Accruing Loans and Leases Past Due 90 Days or More
Commercial
Commercial and Industrial

$

-

 

$

-

 

$

-

 

$

22

 

$

-

 

Total Commercial

 

-

 

 

-

 

 

-

 

 

22

 

 

-

 

Consumer
Residential Mortgage

 

2,429

 

 

3,279

 

 

2,638

 

 

4,113

 

 

3,159

 

Home Equity

 

1,673

 

 

1,061

 

 

2,029

 

 

2,722

 

 

3,456

 

Automobile

 

589

 

 

467

 

 

359

 

 

504

 

 

729

 

Other 1

 

683

 

 

513

 

 

508

 

 

649

 

 

426

 

Total Consumer

 

5,374

 

 

5,320

 

 

5,534

 

 

7,988

 

 

7,770

 

Total Accruing Loans and Leases Past Due 90 Days or More

$

5,374

 

$

5,320

 

$

5,534

 

$

8,010

 

$

7,770

 

Restructured Loans on Accrual Status
and Not Past Due 90 Days or More

$

43,658

 

$

44,641

 

$

46,024

 

$

54,136

 

$

60,519

 

Total Loans and Leases

$

13,646,420

 

$

13,321,606

 

$

12,951,573

 

$

12,544,492

 

$

12,259,076

 

 
Ratio of Non-Accrual Loans and Leases to Total Loans and Leases

 

0.09

%

 

0.10

%

 

0.10

%

 

0.14

%

 

0.14

%

 
Ratio of Non-Performing Assets to Total Loans and Leases
and Foreclosed Real Estate

 

0.09

%

 

0.10

%

 

0.12

%

 

0.16

%

 

0.15

%

 
Ratio of Non-Performing Assets to Total Assets

 

0.05

%

 

0.06

%

 

0.06

%

 

0.07

%

 

0.07

%

 
Ratio of Commercial Non-Performing Assets to Total Commercial Loans
and Leases and Commercial Foreclosed Real Estate

 

0.06

%

 

0.07

%

 

0.07

%

 

0.16

%

 

0.17

%

 
Ratio of Consumer Non-Performing Assets to Total Consumer Loans
and Leases and Consumer Foreclosed Real Estate

 

0.11

%

 

0.13

%

 

0.15

%

 

0.16

%

 

0.14

%

 
Ratio of Non-Performing Assets and Accruing Loans and Leases
Past Due 90 Days or More to Total Loans and Leases
and Foreclosed Real Estate

 

0.13

%

 

0.14

%

 

0.16

%

 

0.22

%

 

0.22

%

 
Quarter to Quarter Changes in Non-Performing Assets
Balance at Beginning of Quarter

$

13,868

 

$

15,493

 

$

19,979

 

$

18,966

 

$

20,620

 

Additions

 

704

 

 

489

 

 

2,293

 

 

2,243

 

 

357

 

Reductions
Payments

 

(1,605

)

 

(706

)

 

(5,511

)

 

(1,230

)

 

(972

)

Return to Accrual Status

 

(301

)

 

(116

)

 

(1,267

)

 

-

 

 

(1,038

)

Sales of Foreclosed Real Estate

 

-

 

 

(1,292

)

 

-

 

 

-

 

 

-

 

Charge-offs / Write-downs

 

(19

)

 

-

 

 

(1

)

 

-

 

 

(1

)

Total Reductions

 

(1,925

)

 

(2,114

)

 

(6,779

)

 

(1,230

)

 

(2,011

)

Balance at End of Quarter

$

12,647

 

$

13,868

 

$

15,493

 

$

19,979

 

$

18,966

 

1

Comprised of other revolving credit, installment, and lease financing.
Bank of Hawai‘i Corporation and Subsidiaries
Reserve for Credit Losses Table 12
Three Months Ended Year Ended

December 31,

 

September 30,

 

December 31,

 

December 31,

(dollars in thousands)

2022

 

2022

 

2021

 

2022

 

2021

Balance at Beginning of Period

$

152,927

 

$

154,098

 

$

174,708

 

$

164,297

 

$

221,303

 

 
Loans and Leases Charged-Off
Commercial
Commercial and Industrial

 

(196

)

 

(147

)

 

(217

)

 

(925

)

 

(1,117

)

Consumer
Residential Mortgage

 

-

 

 

-

 

 

-

 

 

(80

)

 

(316

)

Home Equity

 

(10

)

 

-

 

 

(5

)

 

(100

)

 

(417

)

Automobile

 

(1,171

)

 

(794

)

 

(1,045

)

 

(4,652

)

 

(4,939

)

Other 1

 

(1,846

)

 

(1,924

)

 

(2,007

)

 

(7,585

)

 

(10,530

)

Total Loans and Leases Charged-Off

 

(3,223

)

 

(2,865

)

 

(3,274

)

 

(13,342

)

 

(17,319

)

Recoveries on Loans and Leases Previously Charged-Off
Commercial
Commercial and Industrial

 

87

 

 

45

 

 

132

 

 

552

 

 

506

 

Consumer
Residential Mortgage

 

63

 

 

156

 

 

858

 

 

1,193

 

 

2,467

 

Home Equity

 

202

 

 

367

 

 

390

 

 

1,500

 

 

1,666

 

Automobile

 

412

 

 

441

 

 

476

 

 

2,276

 

 

3,510

 

Other 1

 

604

 

 

709

 

 

746

 

 

2,702

 

 

3,205

 

Total Recoveries on Loans and Leases Previously Charged-Off

 

1,368

 

 

1,718

 

 

2,602

 

 

8,223

 

 

11,354

 

Net Charged-Off - Loans and Leases

 

(1,855

)

 

(1,147

)

 

(672

)

 

(5,119

)

 

(5,965

)

Net Charged-Off - Accrued Interest Receivable

 

(25

)