First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (February 2020)
23 slides from First Hawaiian's investor presentation, Feb 11, 2020
Slide 1: Investor Presentation February/March 2020
0 Investor Presentation February/March 2020
Slide 2: Disclaimer: Forward-Looking Statements
DISCLAIMER Forward - Looking Statements This presentation contains, and from time - to - time in connection with this presentation our management may make, forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements refl e
Slide 3: 4Q 2019 Highlights
4Q 2019 HIGHLIGHTS (1) Core measurements are non - GAAP financial measurements. Core excludes certain gains, expenses and one - time items. See non - GAAP reconciliations of core net income, core diluted EPS, and core efficiency ratio to the comparable GAAP measurements in the appendix of this slide
Slide 4: Investment Highlights
INVESTMENT HIGHLIGHTS 3 Best - in - class Financial Performance Leading Position In Attractive Market High Quality Balance Sheet Proven Through The Cycle Performance Well - Capitalized With Healthy Dividend $150 mm 2019 Stock Repurchase Program 1 2 3 4 5 6
Slide 5: Best-in-Class Franchise
NALs / Loans FHB Top Quartile 47.6% 51.5% FHB Top Quartile 18.1% 16.1% BEST - IN - CLASS FRANCHISE 4 Branch Presence Financial Overview – 4Q 2019 YTD ($ billions) Source: Public filings and SNL Financial as of 04 - Feb - 2020 Note: Financial data as of 31 - Dec - 2019. Market data as of 31 - Jan - 2
Slide 6: Hawaii Is an Attractive Market with Strong Economic Fundamentals
$16.8 $17.6 $17.8 $18.2 $18.6 $18.9 2017A 2018A 2019E 2020E 2021E 2022E Government 20% Real Estate 20% Residential RE 23% Other 15% Transportation & Warehousing 5% Entertainment 10% Professiona l 9 % Construction 6% Retail Trade 7 % Healthcare & Education 8% 6.0 % 4.9 % 4.4 % 3.6 % 3.0 % 2.4 % 2.4 %
Slide 7: The Leader in Hawaii
THE LEADER IN HAWAII 6 The banking market in Hawaii is dominated by local banks, with the top 4 banks accounting for ~92% of deposits Sources: SNL Financial, FDIC, SEC and company filings. Company filings used for peers where available, otherwise regulatory dat a used. Note: Balance sheet and income
Slide 8: Managing NIM Through a Challenging Interest Rate Environment
$ 133 $ 135 $ 140 $ 141 $ 141 $ 144 $ 145 $ 146 $ 143 $ 140 3.23 % 3.29 % 3.47 % 3.58 % 3.61 % 3.77 % 3.85 % 3.88 % 3.79 % 3.66 % 0.28 % 0.31 % 0.35 % 0.40 % 0.47 % 0.48 % 0.56 % 0.57 % 0.54 % 0.44 % 2.96 % 2.99 % 3.13 % 3.18 % 3.11 % 3.23 % 3.23 % 3.25 % 3.19 % 3.15 % – % 0.50 % 1.00 % 1.50 % 2.00
Slide 9: Strong Performance Through the Cycle
Source: Public filings and SNL Financial as of 04 - Feb - 2020 Note: Financial data as of 31 - Dec - 2019. $10 – $50bn banks constituted as of 31 - Dec - 2018; excludes merger targets. (1) FHB ratios shown as core. Core excludes certain gains, expenses and one - time items. See annual and quarterly
Slide 10: Consistent Track Record of Strong Profitability
1.39% 1.30% 1.31% 1.22% 1.10% 1.18% 1.22% 1.49% 1.51% 0.87% 1.02% 1.06% 1.07% 1.04% 1.07% 1.05% 1.37% 1.36% 0.75% 1.00% 1.25% 1.50% 1.75% 2011 2012 2013 2014 2015 2016 2017 2018 2019 CONSISTENT TRACK RECORD OF STRONG PROFITABILITY 9 Source: Public filings and SNL Financial, as of 04 - Feb - 2020 Not
Slide 11: Strong Dividend Payout Ratio, Ongoing Share Repurchase Program
3.6% 2.8% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets STRONG DIVIDEND PAYOUT RATIO , ONGOING SHARE REPURCHASE PROGRAM 10 Source: Public filings and SNL Financial as of 04 - Feb - 2020 Note: Financial data as of 31 - Dec - 2019. $10 – $50bn banks constituted as of 31 - Dec - 2018,
Slide 12: Appendix
Mr First Hawaiian, inc. Appendix
Slide 13: Full Suite of Products and Services
FULL SUITE OF PRODUCTS AND SERVICES 12 • Largest commercial lender in Hawaii • 57 commercial bankers (2) • Relationship - based lending • Primary focus on Hawaii, additional focus on California • C&I, leases, auto dealer flooring, CRE, and C&D • Strong relationships with proven local real estate dev
Slide 14: Solid, Low-Cost Core Deposit Base
Demand 36% Money Market 19% Savings 27% Time 12% $8.9 $9.1 $9.4 $10.2 $10.5 $12.2 $12.9 $13.6 $14.7 $16.1 $16.8 $17.6 $17.2 $16.4 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a leading market share position h
Slide 15: Steady Organic Growth and Balanced Loan Portfolio
$6.4 $6.5 $7.9 $8.0 $8.3 $8.3 $9.0 $9.5 $10.0 $10.7 $11.5 $12.3 $13.1 $13.2 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 STEADY ORGANIC GROWTH AND BALANCED LOAN PORTFOLIO Steady through the cycle organic loan growth and balanced loan portfolio with attractive forward growth opportunities
Slide 16: Proven, Consistent, and Conservative Credit Risk Management
PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 15 Year Ended December 31 0.16% 0.63% 0.14% 0.41% 3.18% 0.64% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% '06 '07 '08 '09 '10 '11 '12
Slide 17: Demonstrated History of Disciplined Expense Management
46.7% 46.8% 46.4% 47.9% 50.2% 47.9% 47.0% 46.6% 47.6% 61.7% 63.0% 63.9% 62.8% 61.4% 60.0% 58.3% 56.4% 56.2% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets 2.04% 1.87% 1.78% 1.74% 1.74% 1.71% 1.72% 1.77%
Slide 18: Hawaii Banks Have a Significant Deposit Advantage
HAWAII BANKS HAVE A SIGNIFICANT DEPOSIT ADVANTAGE 17 Source: SNL Financial and the Federal Reserve website (1) Deposit beta is defined as the change in deposit costs as a percentage of the change in Fed Funds over a particular period. D ep osit cost uses starting point (2Q04) to peak (3Q07); one qua
Slide 19: GAAP to Non-GAAP Reconciliations
GAAP TO NON - GAAP RECONCILIATIONS We present net interest income, noninterest income, noninterest expense, efficiency ratio, net income, basic and diluted earn ing s per share and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non - GAAP financial measure. These core
Slide 20: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 19 ( 1) Annualized for the three months ended December 31, 2019, September 30, 2019 and December 31, 2018. (dollars in thousands, except per share amounts) Income Statement Data: Net income $ 67,836 $ 74,199 $ 59,995 $ 284,392 $ 264,394 Core net income $ 71,250 $ 75
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 20 1) The Company reached an agreement in principle to resolve a putative class action lawsuit alleging that the Bank improperly ch arg ed certain overdraft fees. In connection with the settlement agreement, the Company recorded an expense of approximately $4.1 mill
Slide 22: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 21 Note: Totals may not sum due to rounding. As of and for the Twelve Months Ended December 31, (Dollars in millions, except per share data) 2019 2018 2017 2016 2015 2014 2013 2012 2011 Net Income $ 284.4 $ 264.4 $ 183.7 $230.2 $213.8 $216.7 $214.5 $211.1 $
Slide 23: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 22 Note: Totals may not sum due to rounding. (1) Noninterest income and expenses prior to 2017 have been revised from the amounts previously reported to reflect the reclassif ica tions described in the footnote to Table 1 of the fourth quarter 2017 earnings
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