Bank Of Hawaii Corporation · NYSE:BOH
Bank Of Hawaii — Q4 2024 Earnings Presentation
43 slides from Bank Of Hawaii's earnings presentation, Jan 27, 2025
Slide 1: Fourth quarter 2024 financial report
Bank of Hawai‘i Corporation fourth quarter 2024 financial report January 27, 2025
Slide 2: Disclosure: forward-looking statements
disclosure forward-looking statements this presentation, and other statements made by the Company in connection with it, may contain forward-looking statements concerning, among other things, forecasts of our financial results and condition, expectations for our operations and business prospects, an
Slide 3: Fourth quarter 2024 highlights
fourth quarter 2024 highlights • $0.85 diluted earnings per common share • $39.2 million net income • net interest margin expanded for the third consecutive quarter to earnings highlights 2.19% and December net interest margin expanded to 2.26% • average cost of total deposits decreased to 1.77% fro
Slide 4: Leader in a unique deposit market
leader in a unique deposit market the leader in a unique deposit market with five local competitors holding 96% of the bank deposit market other 4.4% BOH ∆ in market share TBNK 34.1% 2.9% ∆ 1-yr ∆ 5-yr CPF 11.7% 1.9% FHB ASB 32.5% 14.4% 0.6% 0.6% 2024 0.3% 0.2% other other (0.1)%(0.1)% 4.1% BOH 4.5%
Slide 5: Stable deposit balances
stable deposit balances $ in billions average balances $20.3 $20.4 $20.5 $20.7 $20.5 $20.4 $20.5 $20.8 $20.0 $13.5 $14.0 $14.7 $15.0 $14.0 $15.0 $15.0 $15.2 $15.5 $6.9 $6.4 $6.0 $5.8 $5.7 $5.6 $5.4 $5.3 $5.3 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 noninterest-bearing deposits interest-bearing d
Slide 6: Change in NIBD and low yield interest-bearing deposits
∆ NIBD and low yield interest- bearing deposits $ in billions ∆ 3-month rolling average balance of NIBD and low yield interest-bearing deposits $0.80 $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $- $(0.10) $(0.20) $(0.30) $(0.40) note: low yield interest-bearing deposits include accounts yielding inter
Slide 7: Cost of funds: interest-bearing deposits
cost of funds interest-bearing deposits 3.05% 2.99% 2.91% 2.73% 2.52% 2.44% 2.46% 2.39% 2.37% 2.30% 2.11% 1.95% 1.59% 1.54% 1.09% 0.97% 0.69% 0.48% 0.30% 0.20% 0.13% 0.11% 0.07% 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 BOH KRX median source: S&P Capital IQ; KBW Regional Banking In
Slide 8: Cost of funds: total deposits
cost of funds total deposits 2.34% 2.26% 2.19% 2.10% 1.85% 1.87% 1.81% 1.74% 1.77% 1.67% 1.52% 1.40% 1.09% 1.08% 0.75% 0.66% 0.46% 0.31% 0.20% 0.12% 0.08% 0.07% 0.05% 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 BOH KRX median source: S&P Capital IQ; KBW Regional Banking Index (KRX) 8
Slide 9: Unemployment: experience and forecast
unemployment experience & forecast 20.2% 4.2% 2.9% 2.8% 2.8% 2.8% 2.8% 2.2% 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 Oct-24 1Q25 2Q25 3Q25 4Q25 Nov-24 Hawai‘i unemployment Hawai‘i unemployment forecast national unemployment source for Hawai‘i une
Slide 10: Visitor arrivals
visitor arrivals monthly by market, indexed to January 2017 200 180 160 140 120 100 80 60 40 20 - total domestic Japan other source: Hawaii Department of Business, Economic Development, and Tourism (DBEDT) 10
Slide 11: Revenue per available room
revenue per available room revenue per available room (RevPAR) $340 $310 $280 $250 $220 $190 $160 $130 $100 $70 $40 $10 source: Hawaii Department of Business, Economic Development, and Tourism (DBEDT) 11
Slide 12: Stable real estate prices
stable real estate prices Oahu market indicators single family homes condominiums Dec 24 Dec 23 Δ Dec 23 2024 2023 Δ 2023 Dec 24 Dec 23 Δ Dec 23 2024 2023 Δ 2023 5.8% 4.8% 5.9% 1.3% median sales $1,055 $997 $1,100 $1,050 $540 $510 $515 $509 price (000s) 25.3% 9.1% 18.8% closed 228 182 2,793 2,560 32
Slide 13: Credit performance
AN Bank of Hawai'i Corporation | credit performance
Slide 14: Lending philosophy
lending philosophy we lend in our core markets to long-standing relationships Hawai'i 93% U.S. West mainland Pacific 3% 4% note: as of December 31, 2024 14
Slide 15: Consumer portfolio
consumer portfolio 56% of total loans wtd % total % total avg home equity asset type consumer loans WALTV FICO $2.2 residential mortgage 58% 33% 49% 805 home equity 27% 15% 46% 790 $8.0B residential consumer real estate secured 85% 48% 48% 800 mortgage $4.6 automobile 10% 5% n/a 733 automobile $0.8
Slide 16: Commercial portfolio
commercial portfolio 44% of total loans CRE $4.0 % total % total asset type comml loans WALTV residential commercial real estate 66% 29% 55% mortgage $6.1B construction 5% 2% 57% commercial real estate secured 71% 31% 55% commercial & industrial 28% 12% n/a construction leasing 1% 1% n/a $0.3 C&I ho
Slide 17: Stable real estate market
stable real estate market Oahu market vacancies and inventory vacancy inventory (sq ft) 3Q24 3Q23 10 yr avg 10 yr CAGR industrial 1.10% 0.64% 1.75% 0.28% office 13.13% 13.52% 12.46% - 1.08% retail 5.82% 5.79% 5.91% 0.74% multi-family 3.96% 3.83% 4.80% 0.73% note: 10-year average vacancy and 10-yr CA
Slide 18: Commercial real estate (CRE)
commercial real estate (CRE) 29% of total loans 1,100 $1,025.2 900 $724.6 $704.8 700 $676.3 $524.1 $millions 500 7% $371.5 5% 5% 5% 300 4% 3% 100 multi-family industrial retail lodging office other -100 wtd avg LTV 57% 55% 54% 53% 57% 54% % owner n/a 42% 3% n/a 20% 26% avg exposure $3.3 $2.5 $4.4 $1
Slide 19: CRE scheduled maturities
CRE scheduled maturities modest near-term maturities 1,800 40.4% 1,600 1,400 1,200 1,000 $millions 800 14.2% 600 13.1% 12.9% 400 7.6% 7.4% 4.6% 200 0 2025 2026 2027 2028 2029 2030 2031+ 19
Slide 20: CRE loan balances by LTV
CRE loan balances by LTV LTV > 80% - $81MM, 2.0% of CRE 62.5% 2,500 2,000 1,500 $millions 1,000 23.2% 12.2% 500 1.8% 0.2% 0.01% 0 ≤ 60% > 60% to 70% > 70% to 80% > 80% to 85% > 85% to 90% > 90% 20
Slide 21: Credit quality
credit quality net charge-offs non-performing assets 0.4 0% 0.3 5% 0.3 0% 0.2 5% $0 0.2 0% 0.14% 0.14% 0.11% 0.10% $0 0.09% 0.1 5% 0.08% 0.05% $0 0.1 0% $0 0.0 5% $0 0.0 0% $0 4Q23 3Q24 4Q24 2024 4Q23 3Q24 4Q24 $0 NCOs/average loans NPAs/period-end loans plus OREO $0 $0 1.4 0% delinquencies criticiz
Slide 22: Financial update
AN Bank of Hawai'i Corporation | financial update
Slide 23: NII and NIM trends
NII and NIM trends $ in millions increasing NII and NIM 2.60% 2.60% $142 $141 2.47% 2.47% $136 $133 2.34% 2.26% 2.22% 2.18% 2.19% 2.20% $125 2.15% 2.16% $124 2.13% 2.13% 2.11% 2.11% $121 $120 $118 $116 $115 $114 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Sep-24 Oct-24 Nov-24 Dec-24
Slide 24: Cashflow repricing
cashflow repricing $ in millions quarterly impact from cashflows repricing: +$2.8 million maturities/prepayments maturities/prepayments reinvestment opportunities $600 8.0% $518 7.0% 6.6% $500 6.0% 5.9% 6.0% $400 5.0% 4.7% 4.5% 4.2% $300 $270 4.0% 3.7% 3.0% 2.5% $200 2.2% 2.2% $153 2.1% 2.0% 1.8% $9
Slide 25: Deposit mix shift and repricing
deposit mix shift and repricing $ in millions quarterly NII impact from deposit mix shift and repricing in 4Q24: $(0.9) million QoQ change in average NIBD and low yield interest-bearing deposit balances 1Q23 vs 4Q22 2Q23 vs 1Q23 3Q23 vs 2Q23 4Q23 vs 3Q23 1Q24 vs 4Q23 2Q24 vs 1Q24 3Q24 vs 2Q24 4Q24 v
Slide 26: NII impact from cashflow repricing in 2024
NII impact from cashflow repricing in 2024 $ in millions +$15.8 million in cumulative NII from 4Q23 to 4Q24 from cashflow repricing $135 $15.8 $(9.7) $(0.9) $130 $13.0 $(8.8) $2.8 $(2.6) $3.6 $9.3 $(6.2) $(8.8) $125 $(2.9) $4.8 $(6.2) $13.0 $4.5 $(3.3) net interest income $(1.7) $(3.3) $9.3 $120 $(3
Slide 27: Decrease in cost of deposits
decrease in cost of deposits decrease in total deposit and interest-bearing deposit costs 5.43% 5.50% 5.50% 5.50% 5.43% 5.30% 5.00% 4.81% 4.65% 5.16% 4.82% 2.57% 2.49% 2.36% 2.25% 4.69% 2.52% 2.46% 2.39% 2.37% 2.30% 3.82% 1.87% 1.95% 1.81% 1.74% 1.77% 1.67% Sep-24 Oct-24 Nov-24 Dec-24 1.54% 1.40% 2.
Slide 28: Cost of deposits by product
cost of deposits by product lower costs across all deposit products 4.17% 4.11% 4.04% 3.89% 4.18% 4.20% 4.17% 3.97% 4.02% 3.79% 3.44% Sep-24 Oct-24 Nov-24 Dec-24 2.64% 2.55% 2.71% 2.40% 2.63% 2.29% 2.53% 2.40% 2.44% 2.42% 1.95% 1.78% 1.39% Sep-24 Oct-24 Nov-24 Dec-24 1.05% 0.94% 0.94% 0.82% 0.82% 0.
Slide 29: Time deposit maturity schedule
time deposit maturity schedule 47% of time deposits set to reprice in 3 months and 71% in 6 months 50% 4.09% 3.74% 3.77% 45% 3.63% % of total time deposits scheduled to mature 40% 35% 30% 25% 47% 20% 15% 24% 10% 13% 5% 11% 0% 1Q25 2Q25 3Q25 4Q25 balance as % of total time deposits wtd avg rate note:
Slide 30: Rate sensitive earning assets and interest-bearing deposits
rate sensitive earning assets and interest-bearing deposits $ in billions balance sheet well-positioned for a range of rate outcomes rate sensitive earning assets rate sensitive interest-bearing deposits $7.0B $10.0B $6.0 $6.0 $5.8 $5.0 $5.0 $4.0 $4.0 $3.3 $3.1 $3.0 $3.0 $2.0 $2.0 $2.0 $1.3 $1.1 $1.
Slide 31: Optimizing balance sheet
optimizing balance sheet earning asset composition 0.4% 1% 5% 100% 2% 3% 3% 3% 4% 2% 1% 9% 9% 13% 13% 14% 12% 26% 27% 80% 27% 28% 32% 29% 29% 29% 30% 60% 40% 73% 72% 67% 61% 55% 57% 55% 54% 53% 20% 0% 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 fixed
Slide 32: Noninterest income
noninterest income $ in millions increasing core noninterest income reported noninterest income core noninterest income $45.1 $45.1 $45.4 $42.3 $43.0 $42.3 normalizing item: +$2.4 Visa Class B conversion ratio adjustment 4Q23 3Q24 4Q24 4Q23 3Q24 4Q24 note: numbers may not add up due to rounding 32
Slide 33: Noninterest expense
noninterest expense $ in millions continued discipline in expense management reported noninterest expense core noninterest expense $116.0 $14.7 FDIC $107.1 $107.9 $107.1 $107.9 special $102.9 assessment normalizing items: -$14.7 FDIC special assessment +$1.7 other expense savings (not expected to re
Slide 34: Financial summary
financial summary $ in millions, except per share amounts 4Q 2024 3Q 2024 4Q 2023 ∆ 3Q 2024 ∆ 4Q 2023 2024 ∆ 2023 net interest income $ 120.2 $ 117.6 $ 115.8 $ 2.6 $ 4.4 $ 466.6 $ (30.4) noninterest income 43.0 45.1 42.3 (2.1) 0.8 172.5 (4.1) total revenue 163.2 162.7 158.1 0.5 5.2 639.1 (34.5) noni
Slide 35: Capital
capital strong capital 15.11% 15.00% 14.05% 13.95% 13.60% 13.6% 1 76.6% 12.56% 5.11% 5.00% 11.66% 11.59% 11.33% 3.60% 6.05% 5.95% 60.3% 4.56% 59.1% 5.16% 5.09% 4.83% 8.38% 8.31% 7.51% 3.38% 3.31% 2.51% 10.00% 10.00% 10.00% 8.00% 8.00% 8.00% 6.50% 6.50% 6.50% 5.00% 5.00% 5.00% 0.00% 0.00% 0.00% 4Q23
Slide 36: Takeaways
takeaways ✔ high quality and low cost deposit base in unique and competitively advantageous deposit market ✔ continuing trend of increase in NII and NIM ✔ exceptional credit quality ✔ strong liquidity and risk-based capital 36
Slide 37: Q&A
AN Bank of Hawai'i Corporation | Q&A
Slide 38: Appendix
AN Bank of Hawai'i Corporation | appendix
Slide 39: Insured/collateralized deposits
insured/collateralized deposits uninsured/ uncollateralized insured 42% 49% uninsured/ collateralized 9% note: as of December 31, 2024, numbers may not add up due to rounding 39
Slide 40: Readily available liquidity
readily available liquidity Bank of Hawai‘i carries substantial liquidity lines and equivalents for both day-to-day operational and liquidity backstop purposes $10.0B cash securities available $8.6B FHLB uninsured/ uncollateralized FRB deposits note: as of December 31, 2024, cash includes fed funds
Slide 41: CRE supply constraints
CRE supply constraints Oahu market inventory 10-yr CAGR: 0.3% 10-yr CAGR: -1.1% 10-yr CAGR: 0.7% 10-yr CAGR: 0.7% note: 10-yr CAGR for inventory are based on year-end 2013 through 2023 41 source: Colliers (industrial, office, retail) and CoStar (multi-family)
Slide 42: CRE office
CRE office 3% of total loans scheduled maturity 300 LTV distribution 250 200 $ millions LTV > 60% to 70% 150 36.0% 31.7% 32% 100 11.0% 11.5% 50 2.5% 4.9% 2.3% LTV > 70% to - $371MM 80% 11% 2025 2026 2027 2028 2029 2030 2031+ highlights LTV > 80% 6% LTV ≤ 60% • 57% wtd avg LTV 51% • $1.8MM average ex
Slide 43: CRE multi-family
CRE multi-family 7% of total loans scheduled maturity 700 64.1% LTV distribution 600 500 $ millions LTV > 60% to 70% 400 27% 300 200 15.7% 8.1% 100 4.4% 1.8% 2.6% 3.2% $1.0B LTV > 70% to - 80% 2025 2026 2027 2028 2029 2030 2031+ 19% highlights LTV ≤ 60% 54% • 57% wtd avg LTV • $3.3MM average exposur