First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (February 2021)
28 slides from First Hawaiian's investor presentation, Feb 8, 2021
Slide 1: Investor Presentation February / March 2021
0 Investor Presentation February / March 2021
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 reflec
Slide 3: Q4 2020 Highlights
Q4 2020 HIGHLIGHTS 1 (1) Comparisons to Q3 2020 (2) ROATA and ROATCE are non GAAP financial measures. A reconciliation of average tangible assets and average tangible stockhold ers ’ equity to the comparable GAAP measurements is provided in the appendix of this slide presentation. (3) Declared on Ja
Slide 4: Asset Quality Well-Positioned Coming Into 2021
ASSET QUALITY WELL - POSITIONED COMING INTO 2021 3 • 30 - 89 past due comprised of accruing and non - accruing loans Note: TLL - Total Loans and Leases • 90 past due comprised of accruing loans
Slide 5: Allowance for Credit Loss Provision Increased Due to Continued Uncertainty
ALLOWANCE FOR CREDIT LOSS PROVISION INCREASED DUE TO CONTINUED UNCERTAINTY Q4 provisions reflect a weak but unchanged economic view with relatively few changes in the risk composition of the portfolio. We continue to hold a qualitative overlay for loans based on default expectations not imbedded in
Slide 6: Commercial Risk Rating Composition by Loan Type
COMMERCIAL RISK RATING COMPOSITION BY LOAN TYPE 5 As of 12/31/2020 ($ mm) Risk Rating C&I CRE Const. Lease Total Pass 2,685,883 89% 3,100,309 91% 667,354 91% 234,933 95% 6,688,479 90% Special Mention 164,897 6% 226,905 7% 15,104 2% 4,099 2% 411,005 6% Substandard 75,273 2% 64,964 2% 3,891 1% 6,379 3
Slide 7: Deferrals and Modifications Reperformance Rates Remain Strong
DEFERRALS AND MODIFICATIONS REPERFORMANCE RATES REMAIN STRONG As of 12/31/20 ($ mm) COVID Deferrals & Mods 1 Returned to Pay ($ mm) Original Deferrals ($ mm) Subsequent Deferrals & Mods ($ mm) Delinquent ($ mm) Commercial and Industrial 888 881 3 4 2 Commercial Real Estate 1,151 1,076 6 66 3 Constru
Slide 8: Investment Highlights
INVESTMENT HIGHLIGHTS 7 Strong, Consistent Financial Performance Leading Position In Attractive Market Experienced Leadership Team High Quality Balance Sheet Proven Through The Cycle Performance Well - Capitalized With Attractive Dividend 1 2 3 4 5 6
Slide 9: Strong Performer in Attractive Market
NALs / Loans 49.8% 50.8% FHB Top Quartile 11.1% 13.7% FHB Top Quartile STRONG PERFORMER IN ATTRACTIVE MARKET 8 Branch Presence Financial Overview – 4Q 2020 YTD ($ billions) Source: Public filings and S&P Global Market Intelligence as of 03 - Feb - 2021 Note: Financial data as of 31 - Dec - 2020. Mar
Slide 10: Fundamental Strengths of Hawaii's Economy Remain Intact
DESPITE NEAR - TERM CHALLENGES, THE FUNDAMENTAL STRENGTHS OF HAWAII’S ECONOMY REMAIN INTACT 9 • Attractive destination for domestic and international travelers • Attractive alternative for travelers concerned about international travel • Well - developed visitor industry infrastructure • High qualit
Slide 11: Strong Performance Through the Cycle
Source: Public filings and S&P Global Market Intelligence as of 03 - Feb - 2021 Note: Financial data as of 31 - Dec - 2020. $10 – $50bn banks constituted as of 31 - Dec - 2019; excludes merger targets. (1) FHB ratios shown as core. Core excludes certain gains, expenses and one - time items. See annu
Slide 12: Proven, Consistent, and Conservative Credit Risk Management
0.21% 0.73% 0.23% 0.11% 1.18% 0.14% 0.00% 0.50% 1.00% 1.50% '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 11 Year Ended Dece
Slide 13: Consistent Track Record of Strong Profitability
1.39% 1.30% 1.31% 1.22% 1.10% 1.18% 1.22% 1.49% 1.51% 0.91% 0.87% 1.03% 1.05% 1.09% 1.05% 1.10% 1.07% 1.40% 1.37% 1.03% 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 CONSISTENT TRACK RECORD OF STRONG PROFITABILITY 12 Source: Public filings and S&P Global
Slide 14: Well Capitalized with an Attractive Dividend, $75MM Stock Repurchase Program
4.3% 2.9% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets WELL CAPITALIZED WITH AN ATTRACTIVE DIVIDEND, ANNOUNCED $75MM STOCK REPURCHASE PROGRAM 13 Source: Public filings and S&P Global Market Intelligence as of 03 - Feb - 2021 Note: Financial data as of 31 - Dec - 2020. $10 – $50bn
Slide 15: Appendix
a First Hawaiian, Inc. Appendix
Slide 16: Full Suite of Products and Services
FULL SUITE OF PRODUCTS AND SERVICES 15 • Largest commercial lender in Hawaii • 56 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 17: Managing NIM Through a Challenging Interest Rate Environment
$ 141 $ 144 $ 145 $ 146 $ 143 $ 140 $ 139 $ 128 $ 134 $ 135 3.61 % 3.77 % 3.85 % 3.88 % 3.79 % 3.66 % 3.57 % 2.84 % 2.86 % 2.83 % 0.47 % 0.48 % 0.56 % 0.57 % 0.54 % 0.44 % 0.38 % 0.19 % 0.13 % 0.11 % 3.11 % 3.23 % 3.23 % 3.25 % 3.19 % 3.15 % 3.12 % 2.58 % 2.70 % 2.71 % 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19
Slide 18: Solid, Low-Cost Core Deposit Base
$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 $19.2 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 Demand 39% Money Market 17% Savings 25% Time 10% SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a leading market share
Slide 19: 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 $13.3 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 STEADY ORGANIC GROWTH AND BALANCED LOAN PORTFOLIO Steady through the cycle organic loan growth and balanced loan portfolio 18 Well positioned to serve clients
Slide 20: Demonstrated History of Disciplined Expense Management
46.7% 46.8% 46.4% 47.9% 50.2% 47.9% 47.0% 46.6% 47.6% 49.8% 61.7% 63.0% 63.9% 62.8% 61.3% 60.0% 58.5% 56.4% 55.7% 56.4% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets 2.04% 1.87% 1.78% 1.74% 1.74%
Slide 21: The Leader in Hawaii
THE LEADER IN HAWAII 20 The banking market in Hawaii is dominated by local banks, with the top 4 banks accounting for ~93% of deposits Sources: S&P Global Market Intelligence, FDIC, SEC and company filings. Company filings used for peers where available, othe rwi se regulatory data used. Note: Finan
Slide 22: Hawaii Banks Have a Significant Deposit Advantage
HAWAII BANKS HAVE A SIGNIFICANT DEPOSIT ADVANTAGE 21 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 23: GAAP to Non-GAAP Reconciliations
GAAP TO NON - GAAP RECONCILIATIONS We present net interest income, noninterest income, noninterest expense, efficiency ratio, net income, pre - tax, pre - provision ea rnings, basic and diluted earnings per share and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non
Slide 24: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 23 For the Three Months Ended For the Year Ended December 31, September 30, December 31, December 31, (dollars in thousands, except per share amounts) 2020 2020 2019 2020 2019 Income Statement Data: Net income $ 61,739 $ 65,101 $ 67,836 $ 185,754 $ 284,392 Core net
Slide 25: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 24 1) Costs associated with the sale of stock for the three and twelve months ended December 31, 2020 and 2019 related to changes i n t he valuation of the funding swap entered into with the buyer of our Visa Class B restricted sales in 2016. 2) One - time items for
Slide 26: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 25 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) 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Net Income $185.8 $ 284.4 $ 264.4 $ 183.7 $230.2 $213.8 $216.7 $21
Slide 27: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 26 Note: Totals may not sum due to rounding. (1) Adjustments that are not material to our financial results have not been presented for certain periods. (2) Noninterest income and expenses prior to 2017 have been revised from the amounts previously reported
Slide 28: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 27 Note: Totals may not sum due to rounding. (1) Adjustments that are not material to our financial results have not been presented for certain periods. (2) Costs associated with the sale of stock for the years ended December 31, 2020 and 2019 related to ch
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