HONOLULU, Oct. 25, 2024 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), ("First Hawaiian” or the "Company”) today reported financial results for its quarter ended September 30, 2024.
"I'm happy to report that we had a very good third quarter,” said Bob Harrison, Chairman, President, and CEO. "Net interest income and noninterest income increased over the prior quarter, expenses were well controlled and credit quality remained excellent. I'm also pleased to report that during the third quarter, Moody's reviewed and reaffirmed all of First Hawaiian Bank's long-term credit and deposit ratings.”
On October 23, 2024, the Company's Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on November 29, 2024, to stockholders of record at the close of business on November 18, 2024.
Third Quarter 2024 Highlights:
- Net income of $61.5 million, or $0.48 per diluted share
- Total loans and leases decreased $118.5 million versus the prior quarter
- Total deposits decreased $91.1 million versus the prior quarter
- Net interest margin increased 3 basis points to 2.95%
- Recorded a $7.4 million provision for credit losses
- Board of Directors declared a quarterly dividend of $0.26 per share
Total assets were $23.8 billion as of September 30, 2024, a decrease of $211.5 million, or 0.9%, from $24.0 billion as of June 30, 2024.
Gross loans and leases were $14.2 billion as of September 30, 2024, a decrease of $118.5 million, or 0.8%, from $14.4 billion as of June 30, 2024.
Total deposits were $20.2 billion as of September 30, 2024, a decrease of $91.1 million, or 0.4%, from $20.3 billion as of June 30, 2024.
Net Interest Income
Net interest income for the third quarter of 2024 was $156.7 million, an increase of $3.9 million, or 2.5%, compared to $152.9 million for the prior quarter.
The net interest margin was 2.95% in the third quarter of 2024, an increase of 3 basis points compared to 2.92% in the prior quarter.
Provision Expense
During the quarter ended September 30, 2024, we recorded a $7.4 million provision for credit losses. In the quarter ended June 30, 2024, we recorded a $1.8 million provision for credit losses.
Noninterest Income
Noninterest income was $53.3 million in the third quarter of 2024, an increase of $1.5 million compared to noninterest income of $51.8 million in the prior quarter.
Noninterest Expense
Noninterest expense was $126.1 million in the third quarter of 2024, an increase of $4.1 million compared to noninterest expense of $122.1 million in the prior quarter.
The efficiency ratio was 59.8% and 59.2% for the quarters ended September 30, 2024 and June 30, 2024, respectively.
Taxes
The effective tax rate was 19.6% and 23.3% for the quarters ended September 30, 2024 and June 30, 2024, respectively.
Asset Quality
The allowance for credit losses was $163.7 million, or 1.15% of total loans and leases, as of September 30, 2024, compared to $160.5 million, or 1.12% of total loans and leases, as of June 30, 2024. The reserve for unfunded commitments was $33.7 million as of September 30, 2024 compared to $33.4 million as of June 30, 2024. Net charge-offs were $3.9 million, or 0.11% of average loans and leases on an annualized basis, for the quarter ended September 30, 2024, compared to net charge-offs of $2.5 million, or 0.07% of average loans and leases on an annualized basis, for the quarter ended June 30, 2024. Total non-performing assets were $17.8 million, or 0.13% of total loans and leases and other real estate owned, as of September 30, 2024, compared to $18.0 million, or 0.13% of total loans and leases and other real estate owned, as of June 30, 2024.
Capital
Total stockholders' equity increased $97.7 million in the third quarter, and stood at $2.6 billion on September 30, 2024 and June 30, 2024.
The tier 1 leverage, common equity tier 1 and total capital ratios were 9.14%, 13.03% and 14.25%, respectively, on September 30, 2024, compared with 9.03%, 12.73% and 13.92%, respectively, on June 30, 2024.
The Company did not repurchase any shares in the third quarter.
First Hawaiian, Inc.
First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii's oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company's website, www.fhb.com.
Conference Call Information
First Hawaiian will host a conference call to discuss the Company's results today at 1:00 p.m. Eastern Time, 7:00 a.m. Hawaii Time.
To access the call by phone, participants will need to click on the following registration link: https://register.vevent.com/register/BIec8273f35cc340bcb13d27eae17d127b, register for the conference call, and then you will receive the dial-in number and a personalized PIN code. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.
A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as "may”, "might”, "should”, "could”, "predict”, "potential”, "believe”, "expect”, "continue”, "will”, "anticipate”, "seek”, "estimate”, "intend”, "plan”, "projection”, "would”, "annualized” and "outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission ("SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2023 and our Quarterly Report on Form 10-Q for the quarters ended March 31, 2024 and June 30, 2024.
Use of Non-GAAP Financial Measures
Return on average tangible assets, return on average tangible stockholders' equity, tangible book value per share and tangible stockholders' equity to tangible assets are non-GAAP financial measures. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy.
Table 14 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.
| Investor Relations Contact: Kevin Haseyama, CFA (808) 525-6268 | Media Contact: Lindsay Chambers (808) 525-6254 |
| Financial Highlights | Table 1 | |||||||||||||||
| For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| September 30, | June 30, | September 30, | September 30, | |||||||||||||
| (dollars in thousands, except per share data) | 2024 | 2024 | 2023 | 2024 | 2023 | |||||||||||
| Operating Results: | ||||||||||||||||
| Net interest income | $ | 156,707 | $ | 152,851 | $ | 157,148 | $ | 463,985 | $ | 484,334 | ||||||
| Provision for credit losses | 7,400 | 1,800 | 7,500 | 15,500 | 21,300 | |||||||||||
| Noninterest income | 53,288 | 51,768 | 46,097 | 156,427 | 142,468 | |||||||||||
| Noninterest expense | 126,147 | 122,086 | 119,383 | 377,046 | 358,831 | |||||||||||
| Net income | 61,492 | 61,921 | 58,221 | 177,633 | 187,481 | |||||||||||
| Basic earnings per share | 0.48 | 0.48 | 0.46 | 1.39 | 1.47 | |||||||||||
| Diluted earnings per share | 0.48 | 0.48 | 0.46 | 1.38 | 1.47 | |||||||||||
| Dividends declared per share | 0.26 | 0.26 | 0.26 | 0.78 | 0.78 | |||||||||||
| Dividend payout ratio | 54.17 | % | 54.17 | % | 56.52 | % | 56.52 | % | 53.06 | % | ||||||
| Performance Ratios(1): | ||||||||||||||||
| Net interest margin | 2.95 | % | 2.92 | % | 2.86 | % | 2.93 | % | 2.96 | % | ||||||
| Efficiency ratio | 59.77 | % | 59.22 | % | 58.31 | % | 60.38 | % | 56.86 | % | ||||||
| Return on average total assets | 1.02 | % | 1.04 | % | 0.93 | % | 0.99 | % | 1.01 | % | ||||||
| Return on average tangible assets (non-GAAP)(2) | 1.06 | % | 1.08 | % | 0.97 | % | 1.03 | % | 1.06 | % | ||||||
| Return on average total stockholders' equity | 9.45 | % | 9.91 | % | 9.76 | % | 9.37 | % | 10.72 | % | ||||||
| Return on average tangible stockholders' equity (non-GAAP)(2) | 15.35 | % | 16.42 | % | 16.84 | % | 15.43 | % | 18.68 | % | ||||||
| Average Balances: | ||||||||||||||||
| Average loans and leases | $ | 14,304,806 | $ | 14,358,049 | $ | 14,349,402 | $ | 14,325,065 | $ | 14,238,309 | ||||||
| Average earning assets | 21,328,882 | 21,247,707 | 22,060,480 | 21,352,739 | 22,040,704 | |||||||||||
| Average assets | 24,046,696 | 23,958,913 | 24,727,893 | 24,064,208 | 24,699,826 | |||||||||||
| Average deposits | 20,367,805 | 20,308,028 | 21,212,102 | 20,415,746 | 21,245,055 | |||||||||||
| Average stockholders' equity | 2,588,806 | 2,512,471 | 2,367,422 | 2,532,911 | 2,337,292 | |||||||||||
| Market Value Per Share: | ||||||||||||||||
| Closing | 23.15 | 20.76 | 18.05 | 23.15 | 18.05 | |||||||||||
| High | 26.18 | 22.68 | 22.59 | 26.18 | 28.28 | |||||||||||
| Low | 20.28 | 19.48 | 17.41 | 19.48 | 15.08 | |||||||||||
| As of | As of | As of | As of | ||||||||||
| September 30, | June 30, | December 31, | September 30, | ||||||||||
| (dollars in thousands, except per share data) | 2024 | 2024 | 2023 | 2023 | |||||||||
| Balance Sheet Data: | |||||||||||||
| Loans and leases | $ | 14,241,370 | $ | 14,359,899 | $ | 14,353,497 | $ | 14,332,335 | |||||
| Total assets | 23,780,285 | 23,991,791 | 24,926,474 | 24,912,524 | |||||||||
| Total deposits | 20,227,702 | 20,318,832 | 21,332,657 | 21,511,489 | |||||||||
| Short-term borrowings | 250,000 | 500,000 | 500,000 | 500,000 | |||||||||
| Total stockholders' equity | 2,648,034 | 2,550,312 | 2,486,066 | 2,351,009 | |||||||||
| Per Share of Common Stock: | |||||||||||||
| Book value | $ | 20.71 | $ | 19.94 | $ | 19.48 | $ | 18.42 | |||||
| Tangible book value (non-GAAP)(2) | 12.92 | 12.16 | 11.68 | 10.62 | |||||||||
| Asset Quality Ratios: | |||||||||||||
| Non-accrual loans and leases / total loans and leases | 0.13 | % | 0.13 | % | 0.13 | % | 0.10 | % | |||||
| Allowance for credit losses for loans and leases / total loans and leases | 1.15 | % | 1.12 | % | 1.09 | % | 1.08 | % | |||||
| Capital Ratios: | |||||||||||||
| Common Equity Tier 1 Capital Ratio | 13.03 | % | 12.73 | % | 12.39 | % | 12.21 | % | |||||
| Tier 1 Capital Ratio | 13.03 | % | 12.73 | % | 12.39 | % | 12.21 | % | |||||
| Total Capital Ratio | 14.25 | % | 13.92 | % | 13.57 | % | 13.38 | % | |||||
| Tier 1 Leverage Ratio |
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