Company: BOH
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0000046195-25-000037
Chunk: 88

Company: BANK OF HAWAII CORP
Filing Date: 2025-10-28
Form: 10-Q
Item: Part I, Item 1
Chunk 88
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 the composition of our investment securities portfolio, adjust hedge positions, and change the proportion of investments made into the AFS and held-to-maturity (“HTM”) investment categories.

Mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac represent the largest concentration in our portfolio. As of September 30, 2025, the issuers of these securities carry credit ratings equivalent to those of the U.S. Government, reflecting the explicit and/or implicit guarantees provided.

Net unrealized losses in our AFS and HTM investment securities were $0.8 billion as of September 30, 2025 and $1.1 billion as of December 31, 2024. In addition, we transferred AFS investment securities to the HTM category in 2022. At the time of transfer, these securities had a fair value of $1.3 billion. The unrealized losses at the time of transfer are being amortized over the estimated remaining life of the securities as an adjustment of yield and recognized as a reduction of interest income. The unamortized balance of these losses was $160.5 million and $177.9 million as of September 30, 2025 and December 31, 2024, respectively. See Note 2 Investment Securities and Note 7 Accumulated Other Comprehensive Income to the unaudited Consolidated Financial Statements for more information. In October 2025, we initiated the process of repositioning a portion of our AFS securities. As a result, we expect to realize a loss on the sale of certain securities during the quarter ending December 31, 2025 that is expected to range from $16 million to $17 million.

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Loans and Leases

Table 6 presents the composition of our loan and lease portfolio by major categories.

Loan and Lease Portfolio BalancesTable 6(dollars in thousands)September 30, 2025December 31, 2024Dollar ChangePercent ChangeCommercialCommercial Mortgage$4,040,711 $4,020,622 $20,089 0.5 %Commercial and Industrial1,581,232 1,705,133 (123,901)(7.3)Construction380,944 308,898 72,046 23.3 Lease Financing92,213 90,756 1,457 1.6 Total Commercial6,095,100 6,125,409 (