First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Q1 2023 Earnings Presentation
20 slides from First Hawaiian's earnings presentation, Apr 28, 2023
Slide 1: 1st Quarter 2023 Earnings Call
1st Quarter 2023 Earnings Call April 28, 2023 0
Slide 2: Forward-Looking Statements
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 reflect our current views with respect to, among other things, future events and our financial performance. Th
Slide 3: Q1 2023 Financial Highlights
Q1 2023 FINANCIAL HIGHLIGHTS1 Q1 2023 Q4 2022 • Net income $66.8 mm Net Income ($mm) $66.8 $79.6 • Grew total loans and leases $129.3 mm Diluted EPS $0.52 $0.62 • Total deposits declined $407.5 mm, 82 bp cost Net Interest Margin 3.11% 3.15% of deposits Efficiency Ratio 54.5% 51.5% • Net interest mar
Slide 4: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS $ in thousands 3/31/23 12/31/22 Assets Cash and Cash $ 865.6 $ 526.6 Comments Equivalents1 Investment Securities 3,054.3 3,151.1 - AFS • Balance sheet liquidity remains ample Investment Securities 4,261.4 4,320.6 o Increased Cash and Cash Equivalents to - HTM $865.6 mm Loans
Slide 5: Loans and Leases Grew $129 MM, or 0.9%, in Q1
LOANS AND LEASES GREW $129 MM, OR 0.9%, IN Q1 Total Loans and Leases Q1 ‘23 vs Q4 ‘22 Net Changes ($ millions) Construction 69 (+8.2%) ($ billions) 14.1 14.2 0.3 0.3 Home Equity 40 (+3.8%) 12.9 1.1 1.1 Leasing 0.2 C&I Home Equity 0.9 1.2 1.2 32 (+1.5%) Consumer 1.2 Leases 29 (+9.7%) 2.2 2.3 C&I 1.9
Slide 6: Outflow of Retail and Commercial Deposits Slowed in Q1 Versus Prior Quarter
OUTFLOW OF RETAIL AND COMMERCIAL DEPOSITS SLOWED IN Q1 VERSUS PRIOR QUARTER Total Deposits Deposit Composition ($ billions) ($ billions) 22.3 21.7 21.3 1.8 Time 1.7 2.5 2.6 Money 4.0 9.9 Market 4.0 3.8 9.6 6.8 Savings 6.4 6.2 Retail Commercial Public Q1 Highlights • $408 mm, or 1.9%, decline in tota
Slide 7: Deposit Coverage and Borrowing Capacity
DEPOSIT COVERAGE AND BORROWING CAPACITY QUARTER-END AND INTRA-QUARTER BALANCES FDIC DEPOSIT INSURANCE COVERAGE $ Billions 21.69 FDIC INSURED 21.29 21.28 DEPOSITS + 1.90 1.78 1.79 FDIC INSURED FULLY COLLATERALIZED DEPOSITS PUBLIC DEPOSITS 19.79 19.51 19.49 50% 58% 12/31/2022 3/7/2023 3/31/2023 Retail
Slide 8: $4.5 MM Decrease in Net Int Income, 4 bp Decrease in NIM
$4.5 MM DECREASE IN NET INT INCOME, 4 BP DECREASE IN NIM 210.0 5.00% 205.0 4.90% 200.0 4.80% 195.0 Net Interest Income and Net Interest Margin 4.70% Q4 ‘22 – Q1 ‘23 NIM Walk 190.0 4.60% 185.0 4.50% 180.0 171.8 4.40% 175.0 ($ millions) 167.2 4.30% 170.0 4.20% 165.0 4.10% 160.0 4.00% 155.0 3.90% 150.0
Slide 9: Noninterest Income and Expense
NONINTEREST INCOME AND EXPENSE Noninterest Income Noninterest Expense 125.0 ($ millions) ($ millions) 120.0 118.6 48.2 49.0 115.0 113.9 41.4 110.0 105.0 104.0 100.0 59.0% 54.5% 95.0 51.5% 90.0 85.0 80.0 75.0 Q1 22 Q4 22 Q1 23 Q1 22 Q4 22 Q1 23 Nonint Expense Efficiency Ratio • Q2 BOLI income include
Slide 10: Asset Quality
ASSET QUALITY CONTINUED STRONG CREDIT PERFORMANCE • NCO Rate - Based on YTD NCO • 90 past due comprised of accruing loans • Includes OREO Note: TLL - Total Loans and Leases • 30-89 past due comprised of accruing and non-accruing loans 9
Slide 11: Allowance for Credit Loss
ALLOWANCE FOR CREDIT LOSS RESERVE LEVELS CONTINUE TO PROVIDE FOR UNCERTAINTY • Q1 ACL / Total Loans and Leases increased to 1.03% of all loans with improvements in asset quality offsetting needs related to portfolio growth. • The reserve continues to incorporate downside risks due to inflation and g
Slide 12: Commercial Real Estate
COMMERCIAL REAL ESTATE (In $ Millions) • Diversified across property type • Weighted LTV of 59.8% • Criticized asset 0.6% down 50 bps from year end Weighted Property Type Balances % of Balances % Criticized Average LTV Office 829 20.2% 61.2% 0.6% Hotel 423 10.3% 53.9% 0.0% Retail 659 16.0% 60.4% 0.8
Slide 13: Questions
QUESTIONS rN First Hawaiian, Inc.
Slide 14: Appendix
> AP Pp EN D IX fA First Hawaiian, Inc. 13
Slide 15: Summary Income Statement
SUMMARY INCOME STATEMENT Quarter ended ($ in millions except per share data) 3/31/23 12/31/22 3/31/22 Net interest income $ 167.2 $ 171.8 $ 133.9 Provision for credit losses 8.8 3.0 (5.7) Noninterest income 49.0 48.2 41.4 Noninterest expense 118.6 113.9 104.0 Pre-tax income 88.9 103.1 77.0 Tax expen
Slide 16: Selected Balance Sheet Items
SELECTED BALANCE SHEET ITEMS As of ($ in millions except per share data) 3/31/23 12/31/22 3/31/22 Selected Assets Investment securities – AFS $ 3,054.3 $ 3,151.1 $ 8,062.4 Investment securities – HTM 4,261.4 4,320.6 - Loans and leases 14,221.3 14,092.0 12,891.7 Total assets 24,884.2 24,577.2 25,042.
Slide 17: Commercial & Industrial
COMMERCIAL & INDUSTRIAL (In Millions) Property Type Balances % of Balances % Criticized Auto Dealers 601 26.4% 0.0% Retail 34 1.5% 0.2% Hospitality/Hotel 79 3.5% 0.5% Food Service 50 2.2% 4.9% Transportation 51 2.3% 3.2% Other 1,452 64.0% 2.5% Total 2,268 100.00% 1.8% • Industries deemed to exhibit
Slide 18: Construction
CONSTRUCTION (In Millions) Weighted Property Type Balances % of Balances % Criticized Average LTV Office 52 5.7% 50.8% 0.0% Hotel 52 5.7% 50.1% 0.0% Retail 24 2.7% 63.9% 2.0% Multi-family 448 49.0% 54.2% 0.0% Industrial 76 8.3% 51.5% 0.0% Dealer Related 76 8.3% 83.9% 0.0% Other 186 20.4% 59.9% 0.1%
Slide 19: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS 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 compute our return on average tangible assets as the ratio of ne
Slide 20: GAAP to Non-GAAP Reconciliation
GAAP TO NON-GAAP RECONCILIATION For the Three Months Ended March 31, December 31, March 31, (dollars in thousands, except per share amounts) 2023 2022 2022 Income Statement Data: Net income $ 66,818 $ 79,588 $ 57,719 Average total stockholders' equity $ 2,299,422 $ 2,213,030 $ 2,547,865 Less: averag