First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (August 2021)
27 slides from First Hawaiian's investor presentation, Aug 9, 2021
Slide 1: Investor Presentation August/September 2021
0 Investor Presentation August/September 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: State of Hawaii Update
STATE OF HAWAII UPDATE 2 DAILY AVERAGE VISITOR ARRIVALS 1 STATE OF HAWAII VACCINATION PROGRESS 1 STATE OF HAWAII COVID 19 TRENDS HAWAII ECONOMIC INDICATORS Sources: US Department of Labor – Bureau of Labor Statistics, Honolulu Board of Realtors Source: https://hawaiicovid19.com/travel/data/ (1) Augu
Slide 4: Q2 2021 Highlights
Q2 2021 HIGHLIGHTS 1 (1) Comparisons to Q1 2021 (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) Declared on J
Slide 5: Investment Highlights
INVESTMENT HIGHLIGHTS 4 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 6: Strong Performer in Attractive Market
NALs / Loans 54.8% 57.3% FHB Peer Median 17.1% 16.5% FHB Peer Median STRONG PERFORMER IN ATTRACTIVE MARKET 5 Branch Presence Financial Overview – 2Q 2021 YTD ($ billions) Source: Public filings and S&P Global Market Intelligence as of 3 - Aug - 2021 Note: Financial data as of 30 - Jun - 2021. Market
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: $9.1 $20.8 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
$9.1 $20.8 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 2Q21 Source: Public filings and S&P Global Market Intelligence as of 3 - Aug - 2021 Note: Financial data as of 30 - Jun - 2021. $10 – $50bn banks constituted as of 31 - Dec - 2020; excludes merger targets. (1) FHB ratios shown as cor
Slide 9: Consistent Track Record of Strong Profitability
$ 356 $ 342 $ 341 $ 332 $ 325 $ 359 $ 385 $ 411 $ 406 $ 370 $ 159 $ – $ 50 $ 100 $ 150 $ 200 $ 250 $ 300 $ 350 $ 400 $ 450 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2Q21 1.39% 1.51% 0.91% 1.30% 0.92% 1.37% 1.03% 1.42% 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2011 2012 2013 2014 2015 2016 20
Slide 10: Proven, Consistent, and Conservative Credit Risk Management
0.21% 0.73% 0.09% 0.10% 1.10% 0.08% 0.00% 0.50% 1.00% 1.50% '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 2Q21 PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 9 Year Ended
Slide 11: Well-Capitalized with an Attractive Dividend
3.8% 2.8% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets WELL - CAPITALIZED WITH AN ATTRACTIVE DIVIDEND, $75MM STOCK REPURCHASE PROGRAM IN 2021 10 Source: Public filings and S&P Global Market Intelligence as of 3 - Aug - 2021 Note: Financial data as of 30 - Jun - 2021. $10 – $50bn b
Slide 12: Appendix
Appendix @ First Hawaiian; inc.
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: The Leader in Hawaii
THE LEADER IN HAWAII 13 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 15: Managing NIM Through a Challenging Interest Rate Environment
$ 144 $ 145 $ 146 $ 143 $ 140 $ 139 $ 128 $ 134 $ 135 $ 129 $ 131 3.77 % 3.85 % 3.88 % 3.79 % 3.66 % 3.57 % 2.84 % 2.86 % 2.83 % 2.66 % 2.55 % 0.48 % 0.56 % 0.57 % 0.54 % 0.44 % 0.38 % 0.19 % 0.13 % 0.11 % 0.08 % 0.07 % 3.23 % 3.23 % 3.25 % 3.19 % 3.15 % 3.12 % 2.58 % 2.70 % 2.71 % 2.55 % 2.46 % 4Q1
Slide 16: 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 $20.8 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 2Q21 Demand 41% Money Market 19% Savings 26% Time 8% SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a leading mar
Slide 17: 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 $13.1 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 2Q21 STEADY ORGANIC GROWTH AND BALANCED LOAN PORTFOLIO Steady through the cycle organic loan growth and balanced loan portfolio 16 Well - positioned to
Slide 18: 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% 54.8% 61.9% 62.0% 63.4% 62.0% 61.1% 59.2% 58.0% 56.1% 55.7% 56.3% 57.3% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2Q21 First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets 2.04% 1.87% 1
Slide 19: Asset Quality
ASSET QUALITY CONTINUED IMPROVEMENT IN AQ SINCE Q1 2020 BANK RECORDED A $35 MILLION RELEASE IN PROVISION 18 • 30 - 89 past due comprised of accruing and non - accruing loans Note: TLL - Total Loans and Leases • 90 past due comprised of accruing loans • Includes OREO
Slide 20: Allowance for Credit Loss
ALLOWANCE FOR CREDIT LOSS $35 million in provision release in Q2 as the economic outlook and credit quality improved. Q2 ACL decreased by 16% or $31.2 million to $169.1 million. The reserve for unfunded commitments decreased by $4.9 million to $29.2 million. Q2 ACL / Total Loans and Leases is 1.29%
Slide 21: Hawaii Banks Have a Significant Deposit Advantage
HAWAII BANKS HAVE A SIGNIFICANT DEPOSIT ADVANTAGE 20 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 22: 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 23: (dollars in thousands, except per share amounts) Income Statement Data: Net income $ 86,741
(dollars in thousands, except per share amounts) Income Statement Data: Net income $ 86,741 $ 57,693 $ 20,049 $ 144,434 $ 58,914 Core net income $ 87,704 $ 57,693 $ 20,204 $ 145,397 $ 59,007 Average total stockholders' equity $ 2,691,966 $ 2,727,701 $ 2,697,775 $ 2,709,735 $ 2,679,293 Less: average
Slide 24: GAAP to Non-GAAP Reconciliation
GAAP TO NON - GAAP RECONCILIATION 23 1) One - time items include severance costs. 2) Represents the adjustments to net income, tax effected at the Company’s effective tax rate for the respective period (dollars in thousands, except per share amounts) Net interest income $ 131,481 $ 129,158 $ 127,822
Slide 25: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 24 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 26: GAAP to Non-GAAP Reconciliation - Annual
GAAP TO NON - GAAP RECONCILIATION - ANNUAL 25 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 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) Costs associated with the sale of stock for the years ended December 31, 2020 and 2019 related to ch