boh-20200127
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 8-K
 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of ReportJanuary 27, 2020
(Date of earliest event reported)
 
BANK OF HAWAII CORP
(Exact name of registrant as specified in its charter)
 
Delaware1-688799-0148992
(State of Incorporation)(Commission File Number)(IRS Employer Identification No.)
 
130 Merchant StreetHonoluluHawaii96813
(Address of principal executive offices)(City)(State)(Zip Code)
(888) 643-3888
(Registrant's telephone number, including area code)

 N/A
(Former name or former address, if changed since last report)

 Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading SymbolName of each exchange on which registered
Common Stock$.01 Par ValueBOHNew York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company   

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o



Item 2.02.                                       Results of Operations and Financial Condition.
 
On January 27, 2020, Bank of Hawaii Corporation announced its results of operations for the quarter ended December 31, 2019.  The public announcement was made by means of a press release, the text of which is furnished as Exhibit 99.1 hereto and incorporated herein by reference.

Item 9.01.                                       Financial Statements and Exhibits.
 
(d) Exhibits
 
Exhibit No.
 99.1 January 27, 2020 Press Release: Bank of Hawaii Corporation Fourth Quarter 2019 Financial Results.  Any internet addresses provided in this release are for informational purposes only and are not intended to be hyperlinks.  Furnished herewith.




Signatures
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
Date: January 27, 2020Bank of Hawaii Corporation
  
  
 By:/s/ Mark A. Rossi
       Mark A. Rossi
       Vice Chairman and Corporate Secretary


Document

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Bank of Hawaii Corporation 2019 Financial Results

2019 Record Earnings of $5.56 Per Diluted Share
2019 Net Income $225.9 Million
Diluted Earnings Per Share $1.45 for the Fourth Quarter of 2019
Net Income $58.1 Million for the Fourth Quarter of 2019
Board of Directors Declares Dividend of $0.67 Per Share
Board of Directors Increases Share Repurchase Authorization by $100 Million


FOR IMMEDIATE RELEASE

HONOLULU, HI (January 27, 2020) -- Bank of Hawaii Corporation (NYSE: BOH) today reported diluted earnings per share of $5.56 for the full year of 2019, an increase of 6.3 percent from diluted earnings per share of $5.23 in 2018. Net income for the year was $225.9 million, up $6.3 million or 2.9 percent from net income of $219.6 million in the previous year. The return on average assets for the full year of 2019 was 1.29 percent unchanged from 1.29 percent in 2018. The return on average equity for the full year of 2019 was 17.65 percent compared with 17.63 percent in 2018. The efficiency ratio for the full year of 2019 improved to 55.68 percent compared with 56.71 percent in 2018.

“Bank of Hawaii finished 2019 with strong financial performance and made significant progress on our strategic initiatives," said Peter Ho, Chairman, President, and CEO. “Our loan balances grew 5.2 percent in 2019 and our deposit balances grew 5.0 percent compared with 2018. Our asset quality, capital and liquidity all remain strong. During the fourth quarter we continued to reduce our leveraged lease exposure with the early buyout of a lease which reduced our loan balances by $42.7 million.”

Diluted earnings per share were $1.45 for the fourth quarter of 2019, an increase from $1.29 in the third quarter of 2019 and $1.30 in the fourth quarter of 2018. Net income for the fourth quarter of 2019 was $58.1 million, up from $52.1 million in the previous quarter and $53.9 million in the same quarter last year. The return on average assets for the fourth quarter of 2019 was 1.29 percent compared with 1.17 percent in the third quarter of 2019 and 1.26 percent in the fourth quarter last year. The return on average equity for the fourth quarter of 2019 was 17.84 percent compared with 16.02 percent in the third quarter of 2019 and 17.05 percent in the fourth quarter last year. The efficiency ratio for the fourth quarter of 2019 was 54.26 percent compared with 58.55 percent in the previous quarter and 57.75 percent in the same quarter last year.

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Bank of Hawaii Corporation 2019 Financial Results        Page 2

Financial Highlights

Net interest income, on a taxable-equivalent basis, was $499.9 million for the full year of 2019, an increase of $8.4 million from net interest income of $491.5 million in 2018. Net interest income, on a taxable-equivalent basis, for the fourth quarter of 2019 was $124.2 million, a decrease of $1.0 million compared with net interest income of $125.2 million in the third quarter of 2019 and the fourth quarter last year. Analyses of changes in net interest income are included in Tables 8a, 8b and 8c.

The net interest margin for the full year of 2019 was 3.03 percent, a decrease of 2 basis points from the net interest margin of 3.05 percent in 2018. The net interest margin was 2.95 percent in the fourth quarter of 2019, a decrease of 6 basis points from the previous quarter and 15 basis points from the same quarter last year.

The provision for credit losses for the full year of 2019 was $16.0 million compared with a provision for credit losses of $13.4 million in 2018. Results for the fourth quarter of 2019 included a provision for credit losses of $4.8 million compared with $4.3 million in the previous quarter and $2.0 million in the same quarter last year.

Noninterest income for the full year of 2019 was $183.3 million, an increase of $14.4 million or 8.5 percent compared with noninterest income of $168.9 million in 2018. The increase from the previous year was primarily due to growth in mortgage banking income, higher gains on sales of leased assets, increased customer derivative activity, and higher service charges on deposits that were partially offset by a decline in credit card fees resulting from the sale of the credit card portfolio in the fourth quarter of 2018. Noninterest income was $47.7 million in the fourth quarter of 2019 compared with noninterest income of $46.5 million in the third quarter of 2019 and $42.1 million in the fourth quarter of 2018. Noninterest income in the fourth quarter of 2019 included a gain of $3.8 million related to the early buyout of a leveraged lease that was partially offset by a reduction in mortgage banking income and customer derivative activity. Noninterest income during the third quarter of 2019 included a negative adjustment of $0.5 million related to a change in the Visa Class B conversion. There were no significant items in noninterest income during the fourth quarter of 2018.

Noninterest expense for the full year of 2019 was $379.2 million, an increase of $7.6 million or 2.0 percent compared with noninterest expense of $371.6 million in 2018. The increase from the previous year was primarily due to increased depreciation and equipment costs related to the Company’s strategic initiatives, higher salaries and benefits, and increased legal costs that were partially offset by a reduction in credit card expenses due to the sale of the portfolio. Noninterest expense was $93.1 million in the fourth quarter of 2019 compared with noninterest expense of $100.3 million in the third quarter of 2019 and $95.9 million in the fourth quarter of 2018. There were no significant items in noninterest expense during the fourth quarter of 2019. Noninterest expense during the third quarter of 2019 included a $6.0 million increase in the legal reserve. Noninterest expense in the fourth quarter of 2018 included $3.0 million in one-time significant items related to a medical expense, an operational loss, and legal expenses. An analysis of noninterest expenses related to salaries and benefits is included in Table 9.

The effective tax rate for the full year of 2019 was 20.96 percent compared with the effective tax rate of 18.73 percent for 2018. The effective tax rate for the fourth quarter of 2019 was 21.15 percent compared with 22.08 percent in the previous quarter and 20.92 percent during the same quarter last year.

The Company’s business segments are defined as Retail Banking, Commercial Banking, Investment Services and Private Banking, and Treasury & Other. Results are determined based on the Company’s internal financial management reporting process and organizational structure. Selected financial information for the business segments is included in Tables 13a and 13b.




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Bank of Hawaii Corporation 2019 Financial Results        Page 3

Asset Quality

The Company’s strong overall asset quality continued to remain stable during the fourth quarter of 2019. Total non-performing assets were $20.1 million at December 31, 2019, down from $21.6 million at September 30, 2019 and up from $12.9 million at December 31, 2018. Non-performing assets as a percentage of total loans and leases and foreclosed real estate were 0.18 percent at December 31, 2019 compared with 0.20 percent at September 30, 2019 and 0.12 percent at December 31, 2018.

Accruing loans and leases past due 90 days or more were $8.4 million at December 31, 2019 compared with $6.1 million at September 30, 2019 and $6.6 million at December 31, 2018. Restructured loans and leases not included in non-accrual loans or accruing loans past due 90 days or more were $63.1 million at December 31, 2019 compared with $46.2 million at September 30, 2019 and $48.7 million at December 31, 2018. More information on non-performing assets and accruing loans and leases past due 90 days or more is presented in Table 11.

Net charge-offs for the full year of 2019 were $12.7 million or 0.12 percent of total average loans and leases compared with net charge-offs of $14.1 million or 0.14 percent of total average loans and leases in 2018. Net charge-offs during the fourth quarter of 2019 were $3.7 million or 0.13 percent annualized of total average loans and leases outstanding and were comprised of charge-offs of $6.2 million partially offset by recoveries of $2.6 million. Net charge-offs during the third quarter of 2019 were $3.0 million or 0.11 percent annualized of total average loans and leases outstanding and were comprised of charge-offs of $5.8 million and recoveries of $2.8 million. Net charge-offs during the fourth quarter of 2018 were $4.0 million or 0.15 percent annualized of total average loans and leases outstanding and were comprised of charge-offs of $6.9 million and recoveries of $2.9 million.

The allowance for loan and lease losses was $110.0 million at December 31, 2019, an increase from $108.9 million at September 30, 2019 and $106.7 million at December 31, 2018. The ratio of the allowance for loan and lease losses to total loans and leases outstanding was 1.00 percent at December 31, 2019, unchanged from September 30, 2019 and down 2 basis points from December 31, 2018. The total reserve for unfunded commitments of $6.8 million at December 31, 2019 was unchanged from the prior quarter and the same quarter last year. Details of loan and lease charge-offs, recoveries, and the components of the total reserve for credit losses are summarized in Table 12.



Total assets were $18.10 billion at December 31, 2019, an increase of 2.4 percent from total assets of $17.67 billion at September 30, 2019 and an increase of 5.6 percent from total assets of $17.14 billion at December 31, 2018. Average total assets were $17.54 billion during the full year of 2019, an increase of 3.3 percent from average total assets of $16.97 billion during 2018.

The investment securities portfolio was $5.66 billion at December 31, 2019, an increase of 2.2 percent from total securities of $5.54 billion at September 30, 2019 and an increase of 3.1 percent from total securities of $5.49 billion at December 31, 2018. The investment securities portfolio remains largely comprised of securities issued by U.S. government agencies and included $2.62 billion in securities available for sale and $3.04 billion in securities held to maturity at December 31, 2019.

Total loans and leases were $10.99 billion at December 31, 2019, an increase of 1.0 percent from total loans and leases of $10.88 billion at September 30, 2019 and 5.2 percent from total loans and leases of $10.45 billion at December 31, 2018. Adjusted for the previously mentioned early buyout of a leveraged lease, total loans increased 1.4 percent from the previous quarter and 5.6 percent from the same quarter last year.



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Bank of Hawaii Corporation 2019 Financial Results        Page 4

The commercial portfolio grew to $4.21 billion at the end of the fourth quarter of 2019, an increase of 1.4 percent from commercial loans of $4.16 billion at the end of the third quarter of 2019 and 5.9 percent from commercial loans of $3.98 billion at the end of the fourth quarter last year. Adjusted for the previously mentioned early buyout of a leveraged lease, commercial loans increased 2.4 percent from the previous quarter and 7.0 percent from the same quarter last year. Consumer loans grew to $6.78 billion at December 31, 2019, an increase of 0.8 percent from consumer loans of $6.72 billion at the end of the third quarter of 2019 and 4.8 percent from consumer loans of $6.47 billion at the end of the fourth quarter last year. Average total loans and leases during the full year of 2019 were $10.69 billion, an increase of 6.4 percent from average loans and leases of $10.04 billion during 2018. Loan and lease portfolio balances are summarized in Table 10.

Total deposits were $15.78 billion at December 31, 2019, an increase of 2.9 percent from total deposits of $15.34 billion at September 30, 2019 and an increase of 5.0 percent from total deposits of $15.03 billion at December 31, 2018. Consumer deposits increased to $8.12 billion at December 31, 2019, an increase of 2.9 percent from consumer deposits of $7.89 billion at the end of the third quarter of 2019 and an increase of 5.1 percent from $7.73 billion at the end of the fourth quarter last year. Commercial deposits increased to $6.32 billion at the end of the fourth quarter of 2019, an increase of 2.8 percent from $6.15 billion at the end of the third quarter of 2019 and an increase of 3.7 percent from $6.10 billion at the end of the fourth quarter last year. Other deposits, including public funds, were $1.34 billion at December 31, 2019, an increase of 3.7 percent from total other deposits of $1.29 billion at September 30, 2019 and an increase of 11.6 percent from $1.20 billion at December 31, 2018. Average total deposits during the full year of 2019 were $15.23 billion, an increase of 3.2 percent compared with average total deposits of $14.76 billion during 2018. Deposit balances are summarized in Tables 7a, 7b, and 10.

During the fourth quarter of 2019, the Company repurchased 336.2 thousand shares of common stock at a total cost of $30.0 million under its share repurchase program. The average cost was $89.11 per share repurchased. From the beginning of the share repurchase program initiated during July 2001 through December 31, 2019, the Company has repurchased 56.9 million shares and returned nearly $2.3 billion to shareholders at an average cost of $40.38 per share. From January 2 through January 24, 2020 the Company repurchased an additional 71.5 thousand shares of common stock at an average cost of $93.50 per share repurchased. The Company’s Board of Directors increased the authorization under the share repurchase program by an additional $100.0 million. Remaining buyback authority under the share repurchase program was $120.4 million at January 24, 2020.

Total shareholders’ equity was $1.29 billion at December 31, 2019, down slightly from September 30, 2019, and up from $1.27 billion at December 31, 2018. The Tier 1 Capital Ratio was 12.18 percent at December 31, 2019 compared with 12.33 percent at September 30, 2019 and 13.07 percent at December 31, 2018. The Tier 1 Leverage Ratio at December 31, 2019 was 7.25 percent compared with 7.32 percent at September 30, 2019 and 7.60 percent at December 31, 2018.

The Company’s Board of Directors declared a quarterly cash dividend of $0.67 per share on the Company’s outstanding shares. The dividend will be payable on March 13, 2020 to shareholders of record at the close of business on February 28, 2020.

Hawaii Economy

General economic conditions in Hawaii remained stable during 2019 due to low interest rates, a relatively healthy construction sector and growing visitor arrivals. For the first eleven months of 2019 total visitor arrivals increased 5.4 percent and visitor spending increased 0.5 percent compared to the same period in 2018. Total visitor days rose 2.7 percent compared to the first eleven months of 2018.




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Bank of Hawaii Corporation 2019 Financial Results        Page 5

The statewide seasonally-adjusted unemployment rate in Hawaii continued to remain low at 2.6 percent in December 2019 compared with 3.5 percent nationally.

Real estate prices on Oahu remained steady during 2019 with a modest decline in total annual sales and stable median prices. For the full year of 2019, the median sales price of a single-family home on Oahu decreased 0.1 percent and the median price of a condominium on Oahu increased 1.2 percent compared with the same period in 2018. The volume of single-family home sales on Oahu increased 3.9 percent and the volume of condominium sales on Oahu decreased 4.8 percent in 2019 compared with 2018. As of December 31, 2019, months of inventory of single-family homes and condominiums on Oahu were 2.5 months and 3.4 months, respectively. More information on current Hawaii economic trends is presented in Table 15.

Conference Call Information

The Company will review its 2019 financial results today at 8:00 a.m. Hawaii Time (1:00 p.m. Eastern Time). The call will be accessible via teleconference and via the investor relations link of Bank of Hawaii Corporation's website, www.boh.com. The toll-free number is 1 (844) 543-5235 in the United States and Canada and 1 (703) 318-2209 for other international callers. Use the pass code “Bank of Hawaii” to access the call. A replay will be available for one week beginning approximately 11:00 a.m. Hawaii Time on Monday, January 27, 2020. The replay number is 1 (855) 859-2056 in the United States and Canada and 1 (404) 537-3406 from other international locations. Enter the conference ID 1787817 when prompted. In addition, a replay will be available on the Company'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", such as forecasts of our financial results and condition, expectations for our operations and business prospects, and our assumptions used in those forecasts and expectations. 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 Hawaii Corporation's Annual Report on Form 10-K for the year ended December 31, 2018, which was filed with the U.S. Securities and Exchange Commission. We do not promise to update forward-looking statements to reflect later events or circumstances

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

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Bank of Hawaii Corporation and Subsidiaries
Financial HighlightsTable 1
Three Months EndedYear Ended
December 31,September 30,December 31,December 31,
(dollars in thousands, except per share amounts)20192019201820192018
For the Period:
Operating Results
Net Interest Income$123,885  $124,896  $123,973  $497,715  $486,352  
Provision for Credit Losses4,750  4,250  2,000  16,000  13,425  
Total Noninterest Income47,702  46,507  42,108  183,338  168,923  
Total Noninterest Expense93,096  100,349  95,911  379,227  371,624  
Net Income58,143  52,052  53,911  225,913  219,602  
Basic Earnings Per Share1.46  1.30  1.30  5.59  5.26  
Diluted Earnings Per Share1.45  1.29  1.30  5.56  5.23  
Dividends Declared Per Share0.67  0.65  0.62  2.59  2.34  
Performance Ratios
Return on Average Assets 1.29  %1.17  %1.26  %1.29  %1.29  %
Return on Average Shareholders' Equity 17.84  16.02  17.05  17.65  17.63  
Efficiency Ratio 1
54.26  58.55  57.75  55.68  56.71  
Net Interest Margin 2
2.95  3.01  3.10  3.03  3.05  
Dividend Payout Ratio 3
45.89  50.00  47.69  46.33  44.49  
Average Shareholders' Equity to Average Assets7.26  7.32  7.39  7.30  7.34  
Average Balances
Average Loans and Leases$10,878,672  $10,770,720  $10,320,051  $10,688,424  $10,043,661  
Average Assets17,821,004  17,605,394  16,988,550  17,537,570  16,970,992  
Average Deposits15,441,097  15,330,691  14,779,511  15,228,066  14,757,724  
Average Shareholders' Equity1,292,930  1,289,417  1,254,704  1,280,082  1,245,672  
Per Share of Common Stock
Book Value$32.14  $32.00  $30.56  $32.14  $30.56  
Tangible Book Value31.35  31.22  29.80  31.35  29.80  
Market Value
   Closing95.16  85.93  67.32  95.16  67.32  
   High95.68  88.20  82.80  95.68  89.09  
   Low81.29  79.13  63.64  66.54  63.64  
December 31,September 30,December 31,
201920192018
As of Period End:
Balance Sheet Totals
Loans and Leases$10,990,892  $10,881,298  $10,448,774  
Total Assets18,095,496  17,672,140  17,143,974  
Total Deposits15,784,482  15,340,752  15,027,242  
Other Debt85,565  110,585  135,643  
Total Shareholders' Equity1,286,832  1,291,490  1,268,200  
Asset Quality
Non-Performing Assets$20,117  $21,645  $12,930  
Allowance for Loan and Lease Losses110,027  108,936  106,693  
Allowance to Loans and Leases Outstanding1.00  %1.00  %1.02  %
Capital Ratios
Common Equity Tier 1 Capital Ratio12.18  %12.33  %13.07  %
Tier 1 Capital Ratio12.18  12.33  13.07  
Total Capital Ratio13.28  13.44  14.21  
Tier 1 Leverage Ratio7.25  7.32  7.60  
Total Shareholders' Equity to Total Assets7.11  7.31  7.40  
Tangible Common Equity to Tangible Assets 4
6.95  7.14  7.23  
Tangible Common Equity to Risk-Weighted Assets 4
11.85  12.10  12.52  
Non-Financial Data
Full-Time Equivalent Employees 2,124  2,124  2,122  
Branches68  67  69  
ATMs387  379  382  
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 share divided by basic earnings per share.
4 Tangible common equity to tangible assets and tangible common equity to risk-weighted assets are Non-GAAP financial measures. See Table 2 “Reconciliation of Non-GAAP Financial Measures."





Bank of Hawaii Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial MeasuresTable 2
December 31,September 30,December 31,
(dollars in thousands)201920192018
Total Shareholders' Equity$1,286,832  $1,291,490  $1,268,200  
Less:Goodwill31,517  31,517  31,517  
Tangible Common Equity$1,255,315  $1,259,973  $1,236,683  
Total Assets$18,095,496  $17,672,140  $17,143,974  
Less:Goodwill31,517  31,517  31,517  
Tangible Assets$18,063,979  $17,640,623  $17,112,457  
Risk-Weighted Assets, determined in accordance
   with prescribed regulatory requirements$10,589,061  $10,416,560  $9,878,904  
Total Shareholders' Equity to Total Assets 7.11 %7.31 %7.40 %
Tangible Common Equity to Tangible Assets (Non-GAAP)6.95 %7.14 %7.23 %
Tier 1 Capital Ratio 12.18 %12.33 %13.07 %
Tangible Common Equity to Risk-Weighted Assets (Non-GAAP)11.85 %12.10 %12.52 %





Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Income Table 3
Three Months EndedYear Ended
December 31,September 30,December 31,December 31,
(dollars in thousands, except per share amounts)20192019201820192018
Interest Income
   Interest and Fees on Loans and Leases$109,223  $110,877  $107,404  $439,012  $410,597  
   Income on Investment Securities
      Available-for-Sale16,158  17,512  13,043  62,174  50,152  
      Held-to-Maturity18,750  18,796  21,482  81,616  84,310  
   Deposits  10  41  34  
   Funds Sold 723  656  727  3,553  3,723  
   Other239  233  352  1,001  1,357  
Total Interest Income145,101  148,083  143,018  587,397  550,173  
Interest Expense
   Deposits16,407  18,055  13,172  68,374  41,143  
   Securities Sold Under Agreements to Repurchase4,071  4,257  4,671  17,522  18,519  
   Funds Purchased25  146  440  840  609  
   Short-Term Borrowings—   88  38  145  
   Other Debt713  728  674  2,908  3,405  
Total Interest Expense21,216  23,187  19,045  89,682  63,821  
Net Interest Income123,885  124,896  123,973  497,715  486,352  
Provision for Credit Losses4,750  4,250  2,000  16,000  13,425  
Net Interest Income After Provision for Credit Losses119,135  120,646  121,973  481,715  472,927  
Noninterest Income
   Trust and Asset Management11,157  10,930  10,558  44,233  43,877  
   Mortgage Banking3,199  4,864  2,148  13,686  8,437  
   Service Charges on Deposit Accounts7,835  7,592  7,562  30,074  28,811  
   Fees, Exchange, and Other Service Charges14,533  14,900  14,576  57,893  57,482  
   Investment Securities Gains (Losses), Net(906) (1,469) (841) (3,986) (3,938) 
   Annuity and Insurance1,272  1,278  1,409  6,934  5,822  
   Bank-Owned Life Insurance1,879  1,647  1,941  7,015  7,199  
   Other8,733  6,765  4,755  27,489  21,233  
Total Noninterest Income47,702  46,507  42,108  183,338  168,923  
Noninterest Expense
   Salaries and Benefits51,664  54,345  54,856  216,106  213,208  
   Net Occupancy8,824  8,803  8,918  33,800  34,742  
   Net Equipment7,930  7,637  6,364  29,295  23,852  
   Data Processing4,828  4,676  5,151  18,757  17,846  
   Professional Fees3,257  2,184  2,467  10,071  9,992  
   FDIC Insurance1,376  1,257  1,336  5,192  7,732  
   Other 15,217  21,447  16,819  66,006  64,252  
Total Noninterest Expense93,096  100,349  95,911  379,227  371,624  
Income Before Provision for Income Taxes73,741  66,804  68,170  285,826  270,226  
Provision for Income Taxes15,598  14,752  14,259  59,913  50,624  
Net Income$58,143  $52,052  $53,911  $225,913  $219,602  
Basic Earnings Per Share$1.46  $1.30  $1.30  $5.59  $5.26  
Diluted Earnings Per Share$1.45  $1.29  $1.30  $5.56  $5.23  
Dividends Declared Per Share$0.67  $0.65  $0.62  $2.59  $2.34  
Basic Weighted Average Shares39,880,619  40,190,508  41,325,456  40,384,328  41,714,770  
Diluted Weighted Average Shares40,179,016  40,450,742  41,601,649  40,649,570  41,999,399  




Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Comprehensive IncomeTable 4
Three Months EndedYear Ended
December 31,September 30,December 31,December 31,
(dollars in thousands)20192019201820192018
Net Income$58,143  $52,052  $53,911  $225,913  $219,602  
Other Comprehensive Income (Loss), Net of Tax:
Net Unrealized Gains (Losses) on Investment Securities(5,856) 5,405  11,169  22,677  (6,525) 
Defined Benefit Plans(3,482) 245  (2,974) (2,746) (2,326) 
Other Comprehensive Income (Loss)(9,338) 5,650  8,195  19,931  (8,851) 
Comprehensive Income $48,805  $57,702  $62,106  $245,844  $210,751  





Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of ConditionTable 5
December 31,September 30,December 31,
(dollars in thousands)201920192018
Assets
Interest-Bearing Deposits in Other Banks$4,979  $2,946  $3,028  
Funds Sold254,574  108,446  198,860  
Investment Securities
   Available-for-Sale2,619,003  2,594,394  2,007,942  
   Held-to-Maturity (Fair Value of $3,062,882; $2,972,273; and $3,413,994)3,042,294  2,946,910  3,482,092  
Loans Held for Sale39,062  36,720  10,987  
Loans and Leases10,990,892  10,881,298  10,448,774  
   Allowance for Loan and Lease Losses(110,027) (108,936) (106,693) 
     Net Loans and Leases10,880,865  10,772,362  10,342,081  
Total Earning Assets16,840,777  16,461,778  16,044,990  
Cash and Due from Banks299,105  259,492  324,081  
Premises and Equipment, Net188,388  179,453  151,837  
Operating Lease Right-of-Use Assets100,838  101,005  —  
Accrued Interest Receivable46,476  47,897  51,230  
Foreclosed Real Estate2,737  2,939  1,356  
Mortgage Servicing Rights25,022  24,408  24,310  
Goodwill 31,517  31,517  31,517  
Bank-Owned Life Insurance287,962  286,936  283,771  
Other Assets272,674  276,715  230,882  
Total Assets$18,095,496  $17,672,140  $17,143,974  
Liabilities
Deposits
   Noninterest-Bearing Demand$4,489,525  $4,392,706  $4,739,596  
   Interest-Bearing Demand3,127,205  3,000,865  3,002,925  
   Savings6,365,321  6,141,098  5,539,199  
   Time1,802,431  1,806,083  1,745,522  
Total Deposits15,784,482  15,340,752  15,027,242  
Short-Term Borrowings—  —  199  
Securities Sold Under Agreements to Repurchase604,306  604,299  504,296  
Other Debt 85,565  110,585  135,643  
Operating Lease Liabilities108,210  108,264  —  
Retirement Benefits Payable44,504  39,682  40,494  
Accrued Interest Payable8,040  8,435  8,253  
Taxes Payable and Deferred Taxes16,085  21,089  19,736  
Other Liabilities157,472  147,544  139,911  
Total Liabilities16,808,664  16,380,650  15,875,774  
Shareholders' Equity
Common Stock ($.01 par value; authorized 500,000,000 shares;
   issued / outstanding: December 31, 2019 - 58,166,910 / 40,039,695;
   September 30, 2019 - 58,176,305 / 40,359,259;
   and December 31, 2018 - 58,063,689 / 41,499,898)579  579  577  
Capital Surplus582,566  580,200  571,704  
Accumulated Other Comprehensive Loss(31,112) (21,774) (51,043) 
Retained Earnings1,761,415  1,730,437  1,641,314  
Treasury Stock, at Cost (Shares: December 31, 2019 - 18,127,215;
    September 30, 2019 - 17,817,046; and December 31, 2018 - 16,563,791)(1,026,616) (997,952) (894,352) 
Total Shareholders' Equity1,286,832  1,291,490  1,268,200  
Total Liabilities and Shareholders' Equity$18,095,496  $17,672,140  $17,143,974  





Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Shareholders' Equity Table 6
Accum.
Other
Compre-
hensive
Common SharesCommonCapitalIncomeRetainedTreasury
(dollars in thousands)OutstandingStockSurplus(Loss)EarningsStockTotal
Balance as of December 31, 201742,401,443  $576  $561,161  $(34,715) $1,512,218  $(807,372) $1,231,868  
Net Income—  —  —  —  219,602  —  219,602  
Other Comprehensive Loss—  —  —  (8,851) —  —  (8,851) 
Reclassification of the Income Tax Effects of the
 Tax Cuts and Jobs Act from AOCI—  —  —  (7,477) 7,477  —  —  
Share-Based Compensation —  —  8,146  —  —  —  8,146  
Common Stock Issued under Purchase and Equity
      Compensation Plans and Related Tax Benefits 219,210   2,397  —  513  5,008  7,919  
Common Stock Repurchased(1,120,755) —  —  —  —  (91,988) (91,988) 
Cash Dividends Declared ($2.34 per share)—  —  —  —  (98,496) —  (98,496) 
Balance as of December 31, 201841,499,898  $577  $571,704  $(51,043) $1,641,314  $(894,352) $1,268,200  
Net Income—  —  —  —  225,913  —  225,913  
Other Comprehensive Income—  —  —  19,931  —  —  19,931  
Share-Based Compensation —  —  8,337  —  —  —  8,337  
Common Stock Issued under Purchase and Equity
      Compensation Plans and Related Tax Benefits 212,924   2,525  —  (334) 5,385  7,578  
Common Stock Repurchased(1,673,127) —  —  —  —  (137,649) (137,649) 
Cash Dividends Declared ($2.59 per share)—  —  —  —  (105,478) —  (105,478) 
Balance as of December 31, 201940,039,695  $579  $582,566  $(31,112) $1,761,415  $(1,026,616) $1,286,832  





Bank of Hawaii Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable-Equivalent BasisTable 7a
Three Months EndedThree Months EndedThree Months Ended
December 31, 2019September 30, 2019December 31, 2018
AverageIncome/Yield/AverageIncome/Yield/AverageIncome/Yield/
(dollars in millions)BalanceExpenseRateBalanceExpenseRateBalanceExpenseRate
Earning Assets
Interest-Bearing Deposits in Other Banks$3.4  $—  0.90  %$3.1  $—  1.19  %$3.3  $—  1.21  %
Funds Sold177.7  0.7  1.59  121.1  0.7  2.12  128.2  0.7  2.22  
Investment Securities
Available-for-Sale
   Taxable2,578.3  15.9  2.46  2,647.9  17.1  2.59  1,480.5  10.0  2.70  
   Non-Taxable33.4  0.4  4.35  42.6  0.5  4.45  556.4  3.8  2.77  
Held-to-Maturity
   Taxable2,994.7  18.4  2.46  2,873.7  18.5  2.57  3,360.5  20.0  2.38  
   Non-Taxable61.7  0.4  2.70  65.2  0.4  2.72  235.1  1.9  3.16  
Total Investment Securities5,668.1  35.1  2.47  5,629.4  36.5  2.59  5,632.5  35.7  2.53  
Loans Held for Sale31.0  0.3  3.67  24.3  0.2  3.94  12.1  0.2  4.63  
Loans and Leases 1
Commercial and Industrial 1,356.1  13.3  3.90  1,383.8  14.4  4.14  1,351.1  14.3  4.21  
Commercial Mortgage2,479.7  25.5  4.08  2,423.7  26.2  4.28  2,256.0  24.2  4.25  
Construction179.1  2.1  4.73  126.0  1.6  5.10  179.8  2.2  4.79  
Commercial Lease Financing135.4  0.8  2.38  161.8  1.0  2.57  173.2  1.0  2.42  
Residential Mortgage3,850.4  36.7  3.81  3,809.6  36.5  3.83  3,615.8  35.1  3.88  
Home Equity1,683.4  15.7  3.70  1,689.2  16.1  3.79  1,652.4  15.7  3.78  
Automobile715.2  6.5  3.59  707.0  6.4  3.59  641.8  6.0  3.73  
Other 2
479.4  8.5  7.02  469.6  8.5  7.16  450.0  8.8  7.72  
Total Loans and Leases10,878.7  109.1  3.99  10,770.7  110.7  4.09  10,320.1  107.3  4.14  
Other34.9  0.2  2.74  35.0  0.3  2.66  36.8  0.4  3.82  
Total Earning Assets 3
16,793.8  145.4  3.45  16,583.6  148.4  3.56  16,133.0  144.3  3.56  
Cash and Due from Banks222.2  231.5  234.3  
Other Assets805.0  790.3  621.3  
Total Assets$17,821.0  $17,605.4  $16,988.6  
Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand$2,990.3  1.0  0.14  $2,950.2  1.1  0.15  $2,888.3  1.5  0.20  
Savings6,245.0  8.0  0.51  6,122.0  8.8  0.57  5,494.5  4.5  0.32  
Time1,842.3  7.4  1.59  1,851.0  8.2  1.75  1,800.7  7.2  1.59  
Total Interest-Bearing Deposits11,077.6  16.4  0.59  10,923.2  18.1  0.66  10,183.5  13.2  0.51  
Short-Term Borrowings5.8  —  1.66  27.1  0.1  2.13  89.6  0.5  2.31  
Securities Sold Under Agreements to Repurchase604.3  4.1  2.64  513.8  4.3  3.24  504.3  4.7  3.62  
Other Debt106.2  0.7  2.67  110.6  0.7  2.62  145.2  0.7  1.85  
Total Interest-Bearing Liabilities11,793.9  21.2  0.71  11,574.7  23.2  0.79  10,922.6  19.1  0.69  
Net Interest Income$124.2  $125.2  $125.2  
Interest Rate Spread2.74  %2.77  %2.87  %
Net Interest Margin2.95  %3.01  %3.10  %
Noninterest-Bearing Demand Deposits 4,363.5  4,407.5  4,596.0  
Other Liabilities370.7