First Hawaiian, Inc. · NASDAQ:FHB
First Hawaiian — Investor Presentation (February 2022)
28 slides from First Hawaiian's investor presentation, Feb 15, 2022
Slide 1: Investor Presentation First Quarter 2022
0 Investor Presentation First Quarter 2022
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
HIGHLIGHTS • New covid cases and hospitalizations have peaked and are rapidly declining • As of Feb 10, approximately 56.7% of those eligible have received a booster or third dose • State unemployment rate continues to decline: Dec 2021 unemployment rate was 5.7% • Residential real estate market rem
Slide 4: Q4 2021 Financial Highlights
Q4 2021 FINANCIAL HIGHLIGHTS 1 (1) Comparisons to Q3 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) Dec
Slide 5: Proactively Managing the Balance Sheet
PROACTIVELY MANAGING THE BALANCE SHEET 4 $ thousands 12/31/21 9/30/21 Assets Int - bearing Deposits in Other Banks $ 1,011.8 $ 2,130.6 Investment Securities 8,428.0 7,953.7 Loans and Leases 12,962.0 12,834.3 Total Assets 24,992.4 25,548.3 Liabilities Deposits 21,816.1 22,120.0 Long - Term Borrowings
Slide 6: Investment Highlights
INVESTMENT HIGHLIGHTS 5 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 7: Strong Performer in Attractive Market
NALs / Loans 54.3% 57.1% FHB Peer Median 16.3% 16.0% FHB Peer Median STRONG PERFORMER IN ATTRACTIVE MARKET 6 Branch Presence Financial Overview – 4Q 2021 YTD ($ billions) Source: Public filings and S&P Global Market Intelligence as of 4 - Feb - 2022 Note: Financial data as of 31 - Dec - 2021. Market
Slide 8: Fundamental Strengths of Hawaii's Economy Remain Intact
DESPITE NEAR - TERM CHALLENGES, THE FUNDAMENTAL STRENGTHS OF HAWAII’S ECONOMY REMAIN INTACT 7 • Attractive destination for domestic and international travelers • Attractive alternative for travelers concerned about international travel • Well - developed visitor industry infrastructure • High qualit
Slide 9: $9.1 $21.8 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18
$9.1 $21.8 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 Source: Public filings and S&P Global Market Intelligence as of 4 - Feb - 2022 Note: Financial data as of 31 - Dec - 2021. $10 – $50bn banks constituted as of 31 - Dec - 2021; excludes merger targets. (1) FHB ratios shown as core
Slide 10: Consistent Track Record of Strong Profitability
$ 356 $ 342 $ 341 $ 332 $ 325 $ 359 $ 385 $ 411 $ 406 $ 370 $ 328 $ – $ 50 $ 100 $ 150 $ 200 $ 250 $ 300 $ 350 $ 400 $ 450 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1.39% 1.51% 0.91% 1.19% 0.92% 1.37% 1.03% 1.39% 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2011 2012 2013 2014 2015 2016 20
Slide 11: Proven, Consistent, and Conservative Credit Risk Management
0.21% 0.73% 0.10% 0.10% 1.05% 0.06% 0.00% 0.50% 1.00% 1.50% '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 PROVEN, CONSISTENT, AND CONSERVATIVE CREDIT RISK MANAGEMENT Strong through the cycle credit performance driven by conservative approach to credit risk management 10 Year Ended
Slide 12: Well-Capitalized with an Attractive Dividend
3.6% 2.6% First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets WELL - CAPITALIZED WITH AN ATTRACTIVE DIVIDEND $75MM STOCK REPURCHASE PROGRAM IN 2022 11 Source: Public filings and S&P Global Market Intelligence as of 4 - Feb - 2022 Note: Financial data as of 31 - Dec - 2021. $10 – $50bn ba
Slide 13: Appendix
Appendix Bk First Hawaiian, Inc.
Slide 14: Full Suite of Products and Services
FULL SUITE OF PRODUCTS AND SERVICES 13 • Largest commercial lender in Hawaii • 58 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 15: A Leader in Hawaii
A LEADER IN HAWAII 14 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: Financi
Slide 16: Balance Sheet Well Positioned to Benefit from Rising Rates
BALANCE SHEET WELL POSITIONED TO BENEFIT FROM RISING RATES 15 NIM expected to bottom in Q1 if Fed begins tightening in March Well Positioned for Rising Rates 3.1 % 6.0 % 6.1 % 11.8 % Ramp Immediate Change NII Sensitivity +100bps NII Sensitivity +50bps • 29% of loan portfolio indexed to 1 or 3 month
Slide 17: 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 $21.8 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 Demand 43% Money Market 19% Savings 26% Time 7% SOLID, LOW - COST CORE DEPOSIT BASE Strong brand, deep ties to the community and a leading mark
Slide 18: 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 $13.0 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 STEADY ORGANIC GROWTH AND BALANCED LOAN PORTFOLIO Steady through the cycle organic loan growth and balanced loan portfolio Expect mid - to - high si
Slide 19: 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% 54.3% 60.3% 60.3% 62.2% 61.9% 61.1% 59.2% 58.3% 55.8% 55.7% 55.6% 57.1% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 First Hawaiian, Inc. Public U.S. Banks with $10-$50bn of Assets 2.04% 1.87% 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 • 90 past due comprised of accruing loans • Includes OREO
Slide 21: Allowance for Credit Loss Reserve Levels Continue to Provide for Uncertainty
ALLOWANCE FOR CREDIT LOSS RESERVE LEVELS CONTINUE TO PROVIDE FOR UNCERTAINTY 20 Rollforward of the On - Balance Sheet Allowance for Credit Losses The economic outlook remained unchanged from Q3 due to the surge in Omicron cases. The ACL decrease is primarily the result of commercial upgrades. Q4 Ass
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: (dollars in thousands, except per share amounts) Income Statement Data: Net income $ 57,022
(dollars in thousands, except per share amounts) Income Statement Data: Net income $ 57,022 $ 64,279 $ 61,739 $ 265,735 $ 185,754 Core net income $ 68,013 $ 65,819 $ 65,288 $ 279,229 $ 189,378 Average total stockholders' equity $ 2,675,513 $ 2,738,540 $ 2,732,271 $ 2,708,370 $ 2,698,853 Less: averag
Slide 25: (dollars in thousands, except per share amounts) Net interest income $ 137,327 $ 132,593
(dollars in thousands, except per share amounts) Net interest income $ 137,327 $ 132,593 $ 135,227 $ 530,559 $ 535,734 Core net interest income (non-GAAP) $ 137,327 $ 132,593 $ 135,227 $ 530,559 $ 535,734 Noninterest income $ 41,573 $ 50,104 $ 53,598 $ 184,916 $ 197,380 Losses (gains) on sale of sec
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) 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 Net Income $265.7 $185.8 $ 284.4 $ 264.4 $ 183.7 $230.2 $213.
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, 2021, 2020 and 2019 related
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