First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (May 2023)
27 slides from First Hawaiian's investor presentation, May 15, 2023
Slide 1: Investor Presentation May - June, 2023
0 Investor Presentation May - June , 2023
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
Slide 3: Q1 2023 Financial Highlights
Q1 2023 FINANCIAL HIGHLIGHTS 1 (1) Comparisons to Q4 2022 (2) ROATA and ROATCE are non - GAAP financial measures. A reconciliation of average tangible assets and average tangible stockholders ’ equity to the comparable GAAP measurements is provided in the appendix of this slide presentation. (3) Dec
Slide 4: Q1 2023 Balance Sheet Highlights
Q1 2023 BALANCE SHEET HIGHLIGHTS 3 $ in thousands 3/31/23 12/31/22 Assets Cash and Cash Equivalents 1 $ 865.6 $ 526.6 Investment Securities - AFS 3,054.3 3,151.1 Investment Securities - HTM 4,261.4 4,320.6 Loans and Leases 14,221.3 14,092.0 Total Assets 24,884.2 24,577.2 Liabilities Deposits $ 21,28
Slide 5: Investment Highlights
INVESTMENT HIGHLIGHTS 4 Strong, Consistent Financial Performance Leading Position In Attractive Markets Experienced Leadership Team High Quality Balance Sheet Proven Through The Cycle Performance Well - Capitalized With Attractive Dividend 1 2 3 4 5 6
Slide 6: Strong Performer in Attractive Market
NALs / Loans 54.5% 54.6% FHB Peer Median 20.8% 15.9% FHB Peer Median STRONG PERFORMER IN ATTRACTIVE MARKET 5 Branch Presence Financial Overview – 1Q 2023 ($ billions) Source: Public filings and S&P Global Market Intelligence as of 9 - May - 2023 Note: Financial data as of 31 - Mar - 2023. Market dat
Slide 7: Fundamental Strengths of Hawaii's Economy Remain Intact
DESPITE NEAR - TERM CHALLENGES, THE FUNDAMENTAL STRENGTHS OF HAWAII’S ECONOMY REMAIN INTACT 6 • Attractive destination for domestic and international travelers • Attractive alternative for travelers concerned about international travel • Well - developed visitor industry infrastructure • High qualit
Slide 8: Strong Performance Through the Cycle
$9.1 $21.3 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 22 1Q23 Source: Public filings and S&P Global Market Intelligence as of 9 - May - 2023 Note: Financial data as of 31 - Mar - 2023. $10 – $50bn banks constituted as of 31 - Dec - 2022; excludes merger targets. (1) ROATCE (Return o
Slide 9: Consistent Track Record of Strong Profitability
$359 $365 $357 $355 $353 $380 $387 $380 $395 $365 $310 $353 $98 $ – $ 50 $ 100 $ 150 $ 200 $ 250 $ 300 $ 350 $ 400 $ 450 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q23 1.40% 1.47% 0.89% 1.15% 0.91% 1.38% 1.03% 1.18% 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% CONSISTENT TRACK RECORD
Slide 10: Proven, Consistent, and Conservative Credit Risk Management
0.21% 0.73% 0.09% 0.10% 0.95% 0.06% 0.00% 0.50% 1.00% 1.50% PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 9 Year Ended December 31 0.16% 0.63% 0.13% 0.39% 3.10% 0.39% 0.00% 0.50% 1.00%
Slide 11: Well-Capitalized with an Attractive Dividend
WELL - CAPITALIZED WITH AN ATTRACTIVE DIVIDEND 10 Source: Public filings and S&P Global Market Intelligence as of 9 - May - 2023 Note: Financial data as of 31 - Mar - 2023. $10 – $50bn banks constituted as of 31 - Dec - 2022, excludes merger targets. Percentages ma y not total due to rounding. (1) D
Slide 12: Appendix
APPENDIX fA First Hawaiian, Inc: ee ee
Slide 13: Full Suite of Products and Services
FULL SUITE OF PRODUCTS AND SERVICES 12 • 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 14: A Leader in Hawaii
A LEADER IN HAWAII 13 The banking market in Hawaii is dominated by local banks, with the top 4 banks accounting for ~93% of deposits (2) 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: Fin
Slide 15: Well Positioned for Volatile Interest Rates
WELL POSITIONED FOR VOLATILE INTEREST RATES 14 4 bp NIM decrease in Q1 Well - Matched Balance Sheet • Approximately $5.7 bn, or 41% of the loan portfolio, reprices within 90 days • Well - structured investment portfolio with limited extension risk • Stable, low - cost deposit base • Hawaii has exper
Slide 16: Solid, Low-Cost Core Deposit Base
$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 $21.8 $21.7 $21.3 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 1Q23 Demand 39% Money Market 18% Savings 27% Time 8% SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a
Slide 17: Deposit Coverage and Borrowing Capacity
DEPOSIT COVERAGE AND BORROWING CAPACITY 16 AVERAGE DEPOSIT BALANCES LIQUIDITY CAPACITY AVERAGE RETAIL ACCOUNT BALANCE $22,020 AVERAGE COMMERCIAL ACCOUNT BALANCE $147,912 QUARTER - END AND INTRA - QUARTER BALANCES 19.79 19.51 19.49 1.90 1.78 1.79 21.69 21.29 21.28 12/31/2022 3/7/2023 3/31/2023 Retail
Slide 18: Steady Organic Growth and Balanced Loan Portfolio
$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 $13.0 $14.1 $14.2 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 1Q23 STEADY ORGANIC GROWTH AND BALANCED LOAN PORTFOLIO Steady through the cycle organic loan growth and balanced loan portfolio Expect low to
Slide 19: Demonstrated History of Disciplined Expense Management
46.5% 45.3% 45.4% 46.1% 48.1% 47.0% 47.3% 49.0% 48.4% 50.1% 56.5% 55.2% 54.5% 61.4% 60.0% 63.0% 62.6% 61.4% 59.2% 58.5% 56.1% 55.8% 56.0% 56.8% 54.6% 54.6% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets 2.04% 1.88% 1.78% 1.74% 1.74% 1.74% 1.74% 1.
Slide 20: Asset Quality: Continued Strong Credit Performance
ASSET QUALITY CONTINUED STRONG CREDIT PERFORMANCE 19 • 30 - 89 past due comprised of accruing and non - accruing loans Note: TLL - Total Loans and Leases • NCO Rate - Based on YTD NCO • 90 past due comprised of accruing loans • Includes OREO
Slide 21: Commercial Real Estate
COMMERCIAL REAL ESTATE 20 As of 3/31/23 (In $ Millions) • Office exposure in CRE represents about 6% of total loans and leases • Despite enduring a prolonged period of high vacancy, hotel loans performed well over the COVID period reflecting the quality of sponsorship and underlying collateral. • Re
Slide 22: Commercial & Industrial
COMMERCIAL & INDUSTRIAL 21 As of 3/31/23 (In $ Millions) • Industries deemed to exhibit higher volatility represent a modest amount of total C&I exposure and dealer related credits represent about 26% of total C&I inclusive of $459 million in flooring balances. Property Type Balances % of Balances %
Slide 23: Construction
CONSTRUCTION 22 As of 3/31/23 (In $ Millions) • The construction book is largely centered in rental and for - sale housing Property Type Balances % of Balances Weighted Average LTV % Criticized 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
Slide 24: Hawaii Banks Have a Significant Deposit Advantage
HAWAII BANKS HAVE A SIGNIFICANT DEPOSIT ADVANTAGE 23 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 25: GAAP to Non-GAAP Reconciliations
GAAP TO NON - GAAP RECONCILIATIONS We present pre - tax, pre - provision earnings on an adjusted basis as a non - GAAP financial measure. We believe that the presentation of this non - GAAP financial measure helps identify underlying trends in our business from period to period that could otherwise
Slide 26: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 25 ( 1) Annualized for the three months ended March 31, 2023, December 31, 2022 and March 31, 2022. (dollars in thousands, except per share amounts) Income Statement Data: Net income $ 66,818 $ 79,588 $ 57,719 Average total stockholders' equity $ 2,299,422 $ 2,213,0
Slide 27: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 26 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) 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Net Income $265.7 $265.7 $185.8 $ 284.4 $ 264.4 $ 183.7