Company: BOH
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0000046195-25-000037
Chunk: 161

Company: BANK OF HAWAII CORP
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 8
Chunk 161
---
 Total Credit Commitments$3,223,003 $3,234,095 

36

Unfunded Commitments to Extend CreditCommitments to extend credit are agreements to lend to a customer as long as there is no violation of the terms or conditions established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since commitments may expire without being drawn, the total commitment amount does not necessarily represent future cash requirements.Standby and Commercial Letters of CreditStandby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third-party. Standby letters of credit generally become payable upon the failure of the customer to perform according to the terms of the underlying contract with the third-party, while commercial letters of credit are issued specifically to facilitate commerce and typically result in the commitment being drawn on when the underlying transaction is consummated between the customer and a third party. The contractual amount of these letters of credit represents the maximum potential future payments guaranteed by the Company. The Company has recourse against the customer for any amount it is required to pay to a third-party under a standby letter of credit and generally holds cash or deposits as collateral on those standby letters of credit for which collateral is deemed necessary. Assets valued at $77.0 million secured certain specifically identified standby letters of credit as of September 30, 2025. As of September 30, 2025, the standby and commercial letters of credit had remaining terms ranging from 1 to 12 months.ContingenciesThe Company is subject to various pending and threatened legal proceedings arising out of the normal course of business or operations. On at least a quarterly basis, the Company assesses its liabilities and contingencies in connection with outstanding legal proceedings using the most recent information available. On a case-by-case basis, reserves are established for those legal claims for which it is probable that a loss will be incurred, and the amount of such loss can be reasonably estimated. Based on information currently available, management believes that the eventual outcome of these claims against the Company will not be materially in excess of such amounts reserved by the Company. However, in the event of unexpected future developments, it is possible that the ultimate resolution of these matters may result in a loss that materially exceeds the reserves established by the Company.

Note 12.  Fair Value of Assets and Liabilities

Fair Value HierarchyFair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the