First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (September 2019)
23 slides from First Hawaiian's investor presentation, Sep 6, 2019
Slide 1: Investor Presentation September 2019
0 Investor Presentation September 2019
Slide 2: Disclaimer: Forward-Looking Statements
DISCLAIMER Forward - Looking Statements This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward - looking statements are not historical facts and are based on current expectations, estimates and projections abo
Slide 3: Q2 2019 Highlights
Q2 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 $150 mm 2019 Stock Repurchase Program 1 2 3 4 5 6
Slide 5: Best-in-Class Franchise
NALs / Loans FHB Top Quartile 47.6% 51.5% FHB Top Quartile 18.5% 16.1% BEST - IN - CLASS FRANCHISE 4 Branch Presence Financial Overview – 2Q 2019 YTD ($ billions) Source: Public filings and SNL Financial as of 26 - Aug - 2019 Note: Financial data as of 30 - Jun - 2019. Market data as of 30 - Aug - 2
Slide 6: Hawaii Is an Attractive Market with Strong Economic Fundamentals
$16.8 $17.8 $17.7 $18.1 $18.5 $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 % 2.6 % 2.4 %
Slide 7: The Clear Leader in Hawaii
THE CLEAR LEADER IN HAWAII 6 The banking market in Hawaii is dominated by local banks with the top 6 banks accounting for ~97% of deposits; First Hawaiian is the clear leader among its Hawaii banking peers Sources: SNL Financial, FDIC, SEC and company filings. Company filings used for peers where av
Slide 8: Strategic Balance Sheet Management and Rational Deposit Market Benefit NIM
$ 131 $ 133 $ 135 $ 140 $ 141 $ 141 $ 144 $ 145 $ 146 3.22 % 3.23 % 3.29 % 3.47 % 3.58 % 3.61 % 3.77 % 3.85 % 3.88 % 0.21 % 0.28 % 0.31 % 0.35 % 0.40 % 0.47 % 0.48 % 0.56 % 0.57 % 3.02 % 2.96 % 2.99 % 3.13 % 3.18 % 3.11 % 3.23 % 3.23 % 3.25 % – % 0.50 % 1.00 % 1.50 % 2.00 % 2.50 % 3.00 % 3.50 % 4.00
Slide 9: Strong Performance Through the Cycle
Source: Public filings and SNL Financial as of 26 - Aug - 2019 Note: Financial data as of 30 - Jun - 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% 1.50% 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 2Q19 CONSISTENT TRACK RECORD OF STRONG PROFITABILITY 9 Source: Public filings and SNL Financial, as of 26 - Aug - 2019 Not
Slide 11: Strong Dividend Payout Ratio, Increased 2019 Stock Repurchase Program to $150MM
4.0% 2.7% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets STRONG DIVIDEND PAYOUT RATIO , INCREASED 2019 STOCK REPURCHASE PROGRAM TO $150MM (1) 10 Source: Public filings and SNL Financial as of 26 - Aug - 2019 Note: Financial data as of 30 - Jun - 2019. $10 – $50bn banks constituted a
Slide 12: Appendix
fA First Hawaiian, Inc. Appendix
Slide 13: Full Suite of Products and Services
FULL SUITE OF PRODUCTS AND SERVICES 12 • Largest commercial lender in Hawaii • 58 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 34% Money Market 18% Savings 26% 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 $16.8 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 2Q19 SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a leading market share position
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 $13.3 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 2Q19 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
0.21% 0.73% 0.20% 0.13% 1.18% 0.12% 0.00% 0.50% 1.00% 1.50% '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 2Q19 PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 15 Year Ended Decembe
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% 55.3% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 2011 2012 2013 2014 2015 2016 2017 2018 2Q19 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
Source: SNL Financial and the Federal Reserve website, as of 28 - Aug - 2019 (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 quarter lag. (2) Includes First H
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 and six months ended June 30, 2019 and 2018 and three months ended March 31, 2019. (dollars in thousands, except per share amounts) Income Statement Data: Net income $ 72,433 $ 69,924 $ 69,053 $ 142,357 $ 137,011 Average total stockh
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 20 (1) One - time items included nonrecurring offering costs, public company transition related costs and the loss on our funding swap as a result of a decrease in the conversion rate of our Visa Class B restricted shares sold in 2016. (2) Represents the adjustments
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) 2018 2017 2016 2015 2014 2013 2012 2011 Net Income $ 264.4 $ 183.7 $230.2 $213.8 $216.7 $214.5 $211.1 $199.7 Basic E
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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