Skip to main navigation Financial Release Bank of Hawaii Corporation Third Quarter 2021 Financial Results October 25, 2021 BOH 3Q2021 Earnings Diluted Earnings Per Common Share $1.52 Net Income $62.1 Million Board of Directors Declares Dividend of $0.70 Per Share HONOLULU--(BUSINESS WIRE)--Oct. 25, 2021-- Bank of Hawaii Corporation (NYSE: BOH) today reported diluted earnings per common share of $1.52 for the third quarter of 2021, compared with diluted earnings per common share of $1.68 in the previous quarter and $0.95 in the same quarter last year. Net income for the third quarter of 2021 was $62.1 million, down 8.1% from the second quarter of 2021 and up 64.0% from the third quarter of 2020. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211025005224/en/ “Bank of Hawaii’s operating results were solid in the third quarter of 2021," said Peter Ho, Chairman, President, and CEO. “Core consumer and commercial loan and deposit growth was strong in the quarter. Credit quality in the quarter remained good.” Financial Highlights The return on average assets for the third quarter of 2021 was 1.07% compared with 1.23% in the previous quarter and 0.76% in the same quarter last year. The return on average common equity for the third quarter of 2021 was 17.08% compared with 19.61% in the previous quarter and 11.01% in the same quarter last year. Net interest income for the third quarter of 2021 was $126.8 million, an increase of 2.7% from the second quarter of 2021 and an increase of 2.1% from the third quarter of 2020. Net interest margin was 2.32% in the third quarter of 2021, a decrease of 5 basis points from the previous quarter and 35 basis points from the same quarter last year. The decrease in the net interest margin from prior year is largely due to higher levels of liquidity from continued strong deposit growth and lower interest rates, partially offset by higher fees from Paycheck Protection Program (“PPP”) loans, deployment of excess liquidity and core loan growth. The provision for credit losses for the third quarter of 2021 was a net benefit of $10.4 million compared with a net benefit of $16.1 million in the previous quarter and net expense of $28.6 million in the same quarter last year. Noninterest income was $41.4 million in the third quarter of 2021, a decrease of 6.9% from the second quarter of 2021 and a decrease of 0.9% from the third quarter of 2020. One-time items in the second quarter of 2021 included a gain of $3.7 million related to the sale of investment securities. Noninterest expense was $96.5 million in the third quarter of 2021, flat to the second quarter of 2021 and an increase of 7.3% from the third quarter of 2020. One-time significant items in the third quarter of 2021 included a gain of $6.3 million related to the sale of property partially offset by $3.8 million of fees related to the early termination of repurchase agreements and $1.2 million in severance. One-time significant items in the second quarter of 2021 included fees related to the early termination of FHLB advances and repurchase agreements of $3.2 million offset by a gain on the sale of property of $3.1 million. One-time significant items in the third quarter of 2020 included a gain of $1.9 million related to the sale of a branch building partially offset by $1.8 million in severance. The efficiency ratio during the third quarter of 2021 was 57.38% compared with 57.47% in the previous quarter and 54.22% during the same quarter last year. The increase in the efficiency ratio from prior year is driven by an increase in noninterest expense. The effective tax rate for the third quarter of 2021 was 24.40% compared with 22.84% in the previous quarter and 20.09% during the same quarter last year. The increase from same quarter prior year is primarily due to higher pretax book income compared to relatively stable tax adjustments and the delayed impact of the TCJA on the deductibility of deferred executive compensation. Asset Quality The Company’s overall asset quality continued to remain stable during the third quarter of 2021. Total non-performing assets were $20.6 million at September 30, 2021, up $1.6 million from June 30, 2021 and $2.0 million from September 30, 2020. Non-performing assets as percentage of total loans and leases and foreclosed real estate were 0.17% at the end of the quarter of 2021, up 1 basis point from the end of the prior quarter and the end of the same quarter last year. Net loan and lease charge-offs during the third quarter of 2021 were $1.2 million or 0.04% annualized of total average loans and leases outstanding. Net loan and lease charge-offs for the third quarter of 2021 were comprised of charge-offs of $3.4 million partially offset by recoveries of $2.3 million. Compared to the prior quarter, net loan and lease charge-offs were flat. Compared to the third quarter of 2020, net loan and lease charge-offs increased by $2.7 million or 9 basis points annualized on total average loans and leases outstanding. The allowance for credit losses on loans and leases was $167.9 million at September 30, 2021, a decrease of $12.5 million from June 30, 2021 and $35.6 million from September 30, 2020. The ratio of the allowance for credit losses to total loans and leases outstanding was 1.39% at the end of the quarter, down 11 basis points from the end of the prior quarter and 34 basis points from the end of the same quarter last year. Balance Sheet Total assets increased to a new record of $23.0 billion at September 30, 2021, an increase of 1.3% from June 30, 2021 and 14.2% from September 30, 2020. The investment securities portfolio was $9.3 billion at September 30, 2021, up 9.2% from June 30, 2021 and 44.8% from September 30, 2020 due to growth in deposits that continued to outpace loan growth. The investment portfolio remains largely comprised of securities issued by U.S. government agencies and U.S. government-sponsored enterprises. Total loans and leases were $12.1 billion at September 30, 2021, an increase of 0.3% from June 30, 2021 and 2.4% from September 30, 2020. Total loans excluding PPP loans were $11.8 billion at September 30, 2021, an increase of 2.4% from June 30, 2021 and an increase of 4.8% from September 30, 2020. Total deposits were $20.5 billion at September 30, 2021, an increase of 1.6% from June 30, 2021 and an increase of 15.5% from September 30, 2020. The Company early terminated $100.0 million of repurchase agreements in the third quarter of 2021. Capital and Dividends The Tier 1 Capital Ratio was 13.47% at September 30, 2021 compared with 13.87% at June 30, 2021 and 12.09% at September 30, 2020. The increase from the same quarter in the prior year was driven by the issuance of preferred stock in the second quarter of 2021. The Tier 1 Leverage Ratio was 7.10% at September 30, 2021 compared with 7.31% at June 30, 2021 and 6.81% at September 30, 2020. The increase from the same quarter in the prior year was driven by the issuance of $180 million of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A in the second quarter of 2021. The Company repurchased 241.3 thousand shares of common stock at a total cost of $20.0 million under its share repurchase program in the third quarter of 2021 at an average cost of $82.89 per share repurchased. Total remaining buyback authority under the share repurchase program was $93.1 million at September 30, 2021. The Company’s Board of Directors declared a quarterly cash dividend of $0.70 per share on the Company’s outstanding common shares. The dividend will be payable on December 14, 2021 to shareholders of record at the close of business on November 30, 2021. On October 5, 2021, the Board of Directors declared the quarterly dividend payment of $10.94 per share, equivalent to $0.2735 per depositary share, on its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A. The depositary shares representing the Series A Preferred Stock are traded on the NYSE under the symbol “BOH.PRA.” The dividend will be payable on November 1, 2021 to shareholders of record of the preferred stock at the close of business on October 18, 2021. Conference Call Information The Company will review its third quarter financial results today at 8:00 a.m. Hawaii Time (2:00 p.m. Eastern Time). The live call, including a slide presentation, will be accessible on the investor relations link of Bank of Hawaii Corporation's website, www.boh.com. The webcast link is https://edge.media-server.com/mmc/p/3r3nw6ad The toll-free number for the teleconference is 1 (844) 543-5235 in the United States and Canada and 1 (703) 318-2209 for other international callers. Use the pass code “Bank of Hawaii” to access the call. A replay of the conference call will be available for one week beginning approximately 11:00 a.m. Hawaii Time on Monday, October 25, 2021. The replay number is 1 (855) 859-2056 in the United States and Canada and 1 (404) 537-3406 from other international locations. Enter the conference ID 6897518 when prompted. In addition, the replay will be available on the Company's website, www.boh.com. Forward-Looking Statements This news release, and other statements made by the Company in connection with it may contain "forward-looking statements" (as defined in the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties that could cause results to be materially different from expectations. Forecasts of our financial results and condition, expectations for our operations and business prospects, and our assumptions used in those forecasts and expectations are examples of certain of these forward-looking statements. Do not unduly rely on forward-looking statements. Actual results might differ significantly from our forecasts and expectations because of a variety of factors. More information about these factors is contained in Bank of Hawaii Corporation's Annual Report on Form 10-K for the year ended December 31, 2020 and its Form 10-Q for the fiscal quarters ended March 31, 2021 and June 30, 2021, which were filed with the U.S. Securities and Exchange Commission. These forward-looking statements are not guarantees of future performance and speak only as of the date made, and, except as required by law, the Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events, new information or future circumstances. Bank of Hawaii Corporation is an independent regional financial services company serving businesses, consumers, and governments in Hawaii and the West Pacific. The Company's principal subsidiary, Bank of Hawaii, was founded in 1897. For more information about Bank of Hawaii Corporation, see the Company’s web site, www.boh.com. Bank of Hawaii Corporation and Subsidiaries Financial Highlights Table 1 Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, (dollars in thousands, except per share amounts) 2021 2021 2020 2021 2020 For the Period: Operating Results Net Interest Income $ 126,819 $ 123,514 $ 124,166 $ 370,902 $ 376,823 Provision for Credit Losses 1 (10,400 ) (16,100 ) 28,600 (40,800 ) 102,600 Total Noninterest Income 41,378 44,431 41,734 128,779 139,151 Total Noninterest Expense 96,519 96,527 89,949 291,911 275,153 Net Income 62,053 67,533 37,840 189,535 111,490 Basic Earnings Per Common Share 1.53 1.69 0.95 4.73 2.81 Diluted Earnings Per Common Share 1.52 1.68 0.95 4.70 2.80 Dividends Declared Per Common Share 0.70 0.67 0.67 2.04 2.01 Performance Ratios Return on Average Assets 1.07 % 1.23 % 0.76 % 1.15 % 0.78 % Return on Average Shareholders' Equity 15.41 19.17 11.01 17.31 11.08 Return on Average Common Equity 8 17.08 19.61 11.01 18.10 11.08 Efficiency Ratio 2 57.38 57.47 54.22 58.42 53.33 Net Interest Margin 3 2.32 2.37 2.67 2.37 2.82 Dividend Payout Ratio 4 45.75 39.64 70.53 42.95 71.53 Average Shareholders' Equity to Average Assets 6.95 6.40 6.93 6.63 7.06 Average Balances Average Loans and Leases $ 11,958,321 $ 12,096,308 $ 11,739,785 $ 12,002,426 $ 11,510,222 Average Assets 22,993,036 22,073,569 19,741,139 22,079,174 19,053,626 Average Deposits 20,473,777 19,698,285 17,270,206 19,619,053 16,591,640 Average Shareholders' Equity 1,598,076 1,412,924 1,367,756 1,463,566 1,344,402 Per Share of Common Stock Book Value $ 35.30 $ 34.80 $ 33.99 $ 35.30 $ 33.99 Tangible Book Value 8 34.38 33.91 33.21 34.38 33.21 Market Value Closing 82.17 84.22 50.52 82.17 50.52 High 87.12 95.95 61.94 99.10 95.53 Low 75.68 81.23 48.77 75.65 46.70 September 30, June 30, December 31, September 30, 2021 2021 2020 2020 As of Period End: Balance Sheet Totals Loans and Leases $ 12,072,750 $ 12,041,378 $ 11,940,020 $ 11,793,608 Total Assets 22,965,383 22,672,183 20,603,651 20,109,489 Total Deposits 20,493,678 20,169,709 18,211,621 17,738,883 Other Debt 10,414 10,437 60,481 60,502 Total Shareholders' Equity 1,597,109 1,583,531 1,374,507 1,361,739 Asset Quality Non-Performing Assets $ 20,620 $ 18,974 $ 18,481 $ 18,626 Allowance for Credit Losses - Loans and Leases 167,920 180,385 216,252 203,496 Allowance to Loans and Leases Outstanding 5 1.39 % 1.50 % 1.81 % 1.73 % Capital Ratios 6 Common Equity Tier 1 Capital Ratio 12.02 % 12.36 % 12.06 % 12.09 % Tier 1 Capital Ratio 13.47 13.87 12.06 12.09 Total Capital Ratio 14.72 15.13 13.31 13.35 Tier 1 Leverage Ratio 7.10 7.31 6.71 6.81 Total Shareholders' Equity to Total Assets 6.95 6.98 6.67 6.77 Tangible Common Equity to Tangible Assets 7, 8 6.04 6.06 6.53 6.63 Tangible Common Equity to Risk-Weighted Assets 7,8 11.46 11.81 11.89 12.02 Non-Financial Data Full-Time Equivalent Employees 2,049 2,085 2,022 2,038 Branches 54 54 65 67 ATMs 303 312 357 358 1 Provision for Credit Losses for 2021 includes Provision for Unfunded Commitments and Accrued Interest Receivable, 2020 represents only Provisions for Loans and Leases. 2 Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income). 3 Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets. 4 Dividend payout ratio is defined as dividends declared per common share divided by basic earnings per common share. 5 The numerator comprises the Allowance for Credit Losses - Loans and Leases. 6 Regulatory capital ratios as of September 30, 2021 are preliminary. 7 Tangible common equity to tangible assets and tangible common equity to risk-weighted assets are Non-GAAP financial measures. Tangible common equity is defined by the Company as common shareholders' equity minus goodwill and intangible assets. Intangible assets are included as a component of other assets in the Consolidated Statements of Condition. See Table 2 “Reconciliation of Non-GAAP Financial Measures." 8 Return on Average Common Equity was revised from 19.60% for the three months ended June 30, 2021, Tangible Common Equity to Tangible Asset was revised from 6.08% for the three months ended June 30, 2021, Tangible Common Equity to Risk-Weighted Assets was revised from 11.85% for the three months ended June 30, 2021, and Tangible Book Value was revised from $34.02 for the three months ended June 30, 2021. Bank of Hawaii Corporation and Subsidiaries Reconciliation of Non-GAAP Financial Measures Table 2 September 30, June 30, December 31, September 30, (dollars in thousands) 2021 2021 2020 2020 Total Shareholders' Equity $ 1,597,109 $ 1,583,531 $ 1,374,507 $ 1,361,739 Less: Preferred Stock 180,000 180,000 - - Goodwill 31,517 31,517 31,517 31,517 Tangible Common Equity $ 1,385,592 $ 1,372,014 $ 1,342,990 $ 1,330,222 Total Assets $ 22,965,383 $ 22,672,183 $ 20,603,651 $ 20,109,489 Less: Goodwill 31,517 31,517 31,517 31,517 Tangible Assets $ 22,933,866 $ 22,640,666 $ 20,572,134 $ 20,077,972 Risk-Weighted Assets, determined in accordance with prescribed regulatory requirements $ 12,093,010 $ 11,614,522 $ 11,295,077 $ 11,068,888 Total Shareholders' Equity to Total Assets 6.95 % 6.98 % 6.67 % 6.77 % Tangible Common Equity to Tangible Assets (Non-GAAP) 6.04 % 6.06 % 6.53 % 6.63 % Tier 1 Capital Ratio 13.47 % 13.87 % 12.06 % 12.09 % Tangible Common Equity to Risk-Weighted Assets (Non-GAAP) 11.46 % 11.81 % 11.89 % 12.02 % Note: Risk-Weighted Assets and Regulatory capital ratios as of September 30, 2021 are preliminary. Bank of Hawaii Corporation and Subsidiaries Consolidated Statements of Income Table 3 Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, (dollars in thousands, except per share amounts) 2021 2021 2020 2021 2020 Interest Income Interest and Fees on Loans and Leases $ 100,570 $ 100,894 $ 103,189 $ 300,763 $ 319,027 Income on Investment Securities Available-for-Sale 16,396 16,467 14,558 48,700 45,845 Held-to-Maturity 16,754 13,576 15,967 43,630 51,942 Deposits 2 - 3 9 13 Funds Sold 382 260 149 779 787 Other 159 182 151 526 494 Total Interest Income 134,263 131,379 134,017 394,407 418,108 Interest Expense Deposits 3,837 4,152 5,891 12,318 28,105 Securities Sold Under Agreements to Repurchase 3,423 3,470 3,622 10,426 11,667 Funds Purchased - - - 1 90 Short-Term Borrowings - - 1 - 62 Other Debt 184 243 337 760 1,361 Total Interest Expense 7,444 7,865 9,851 23,505 41,285 Net Interest Income 126,819 123,514 124,166 370,902 376,823 Provision for Credit Losses (10,400 ) (16,100 ) 28,600 (40,800 ) 102,600 Net Interest Income After Provision for Credit Losses 137,219 139,614 95,566 411,702 274,223 Noninterest Income Trust and Asset Management 11,415 11,682 10,752 34,375 32,217 Mortgage Banking 3,136 3,058 4,047 12,056 11,020 Service Charges on Deposit Accounts 6,510 6,065 6,027 18,703 18,575 Fees, Exchange, and Other Service Charges 13,604 13,807 12,296 41,018 34,913 Investment Securities Gains (Losses), Net (1,259 ) 2,423 (1,121 ) (39 ) 11,125 Annuity and Insurance 735 911 881 2,348 2,692 Bank-Owned Life Insurance 1,897 2,063 1,806 5,877 5,035 Other 5,340 4,422 7,046 14,441 23,574 Total Noninterest Income 41,378 44,431 41,734 128,779 139,151 Noninterest Expense Salaries and Benefits 56,447 56,161 51,951 168,859 157,129 Net Occupancy 3,079 5,047 7,281 17,216 24,997 Net Equipment 8,924 8,796 9,223 26,598 25,874 Data Processing 4,722 4,557 4,691 15,601 13,895 Professional Fees 2,948 3,114 2,743 9,468 9,012 FDIC Insurance 1,594 1,669 1,282 4,917 4,296 Other 18,805 17,183 12,778 49,252 39,950 Total Noninterest Expense 96,519 96,527 89,949 291,911 275,153 Income Before Provision for Income Taxes 82,078 87,518 47,351 248,570 138,221 Provision for Income Taxes 20,025 19,985 9,511 59,035 26,731 Net Income $ 62,053 $ 67,533 $ 37,840 $ 189,535 $ 111,490 Preferred Stock Dividends 1,006 - - 1,006 - Net Income Available to Common Shareholders $ 61,047 $ 67,533 $ 37,840 $ 188,529 $ 111,490 Basic Earnings Per Common Share $ 1.53 $ 1.69 $ 0.95 $ 4.73 $ 2.81 Diluted Earnings Per Common Share $ 1.52 $ 1.68 $ 0.95 $ 4.70 $ 2.80 Dividends Declared Per Common Share $ 0.70 $ 0.67 $ 0.67 $ 2.04 $ 2.01 Basic Weighted Average Common Shares 39,881,437 39,902,583 39,745,120 39,870,450 39,710,252 Diluted Weighted Average Common Shares 40,080,919 40,122,905 39,869,135 40,088,899 39,872,406 Bank of Hawaii Corporation and Subsidiaries Consolidated Statements of Comprehensive Income Table 4 Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, (dollars in thousands) 2021 2021 2020 2021 2020 Net Income $ 62,053 $ 67,533 $ 37,840 $ 189,535 $ 111,490 Other Comprehensive Income (Loss), Net of Tax: Net Unrealized Gains (Losses) on Investment Securities (7,541 ) (123 ) (4,900 ) (57,714 ) 44,389 Defined Benefit Plans 441 442 374 1,324 1,122 Other Comprehensive Income (Loss) (7,100 ) 319 (4,526 ) (56,390 ) 45,511 Comprehensive Income $ 54,953 $ 67,852 $ 33,314 $ 133,145 $ 157,001 Bank of Hawaii Corporation and Subsidiaries Consolidated Statements of Condition Table 5 September 30, June 30, December 31, September 30, (dollars in thousands) 2021 2021 2020 2020 Assets Interest-Bearing Deposits in Other Banks $ 2,188 $ 2,584 $ 1,646 $ 4,233 Funds Sold 422,063 909,730 333,022 736,524 Investment Securities Available-for-Sale 4,353,520 4,522,941 3,791,689 3,190,313 Held-to-Maturity (Fair Value of $4,895,763; $3,965,117; $3,348,693; and $3,288,668) 4,899,880 3,947,613 3,262,727 3,198,830 Loans Held for Sale 21,965 47,490 82,565 - Loans and Leases 12,072,750 12,041,378 11,940,020 11,793,608 Allowance for Credit Losses (167,920 ) (180,385 ) (216,252 ) (203,496 ) Net Loans and Leases 11,904,830 11,860,993 11,723,768 11,590,112 Total Earning Assets 21,604,446 21,291,351 19,195,417 18,720,012 Cash and Due from Banks 231,711 269,153 279,420 260,167 Premises and Equipment, Net 199,144 198,508 199,695 199,021 Operating Lease Right-of-Use Assets 97,007 97,264 99,542 96,200 Accrued Interest Receivable 46,751 47,046 49,303 57,370 Foreclosed Real Estate 2,332 2,332 2,332 2,332 Mortgage Servicing Rights 22,099 21,473 19,652 21,887 Goodwill 31,517 31,517 31,517 31,517 Bank-Owned Life Insurance 293,230 292,805 291,480 291,231 Other Assets 437,146 420,734 435,293 429,752 Total Assets $ 22,965,383 $ 22,672,183 $ 20,603,651 $ 20,109,489 Liabilities Deposits Noninterest-Bearing Demand $ 7,111,693 $ 6,570,232 $ 5,749,612 $ 5,428,567 Interest-Bearing Demand 4,768,725 4,498,825 4,040,733 3,824,448 Savings 7,540,345 7,704,575 6,759,213 6,763,891 Time 1,072,915 1,396,077 1,662,063 1,721,977 Total Deposits 20,493,678 20,169,709 18,211,621 17,738,883 Securities Sold Under Agreements to Repurchase 450,490 550,490 600,590 602,106 Other Debt 10,414 10,437 60,481 60,502 Operating Lease Liabilities 104,452 105,380 107,412 103,869 Retirement Benefits Payable 49,802 50,260 51,197 43,505 Accrued Interest Payable 3,415 3,879 5,117 6,613 Taxes Payable and Deferred Taxes 9,815 11,844 2,463 12,124 Other Liabilities 246,208 186,653 190,263 180,148 Total Liabilities 21,368,274 21,088,652 19,229,144 18,747,750 Shareholders' Equity Preferred Stock ($.01 par value; authorized 180,000 shares; issued and outstanding: September 30, 2021 and June 30, 2021 - 180,000 shares) 180,000 180,000 - - Common Stock ($.01 par value; authorized 500,000,000 shares; issued / outstanding: September 30, 2021 - 58,559,089 / 40,305,801; June 30, 2021 - 58,557,754 / 40,465,482; December 31, 2020 - 58,285,624 / 40,119,312; and September 30, 2020 - 58,248,690 / 40,060,675) 580 580 580 580 Capital Surplus 598,341 594,261 591,360 588,632 Accumulated Other Comprehensive Income (Loss) (48,568 ) (41,468 ) 7,822 14,399 Retained Earnings 1,916,861 1,884,431 1,811,979 1,797,763 Treasury Stock, at Cost (Shares: September 30, 2021 - 18,253,288; June 30, 2021 - 18,092,272; December 31, 2020 - 18,166,312; and September 30, 2020 - 18,188,015) (1,050,105 ) (1,034,273 ) (1,037,234 ) (1,039,635 ) Total Shareholders' Equity 1,597,109 1,583,531 1,374,507 1,361,739 Total Liabilities and Shareholders' Equity $ 22,965,383 $ 22,672,183 $ 20,603,651 $ 20,109,489 Bank of Hawaii Corporation and Subsidiaries Consolidated Statements of Shareholders' Equity Table 6 Accum. Other Compre- Preferred Common hensive Shares Preferred Shares Common Capital Income Retained Treasury (dollars in thousands) Outstanding Stock Outstanding Stock Surplus (Loss) Earnings Stock Total Balance as of December 31, 2020 - $ - 40,119,312 $ 580 $ 591,360 $ 7,822 $ 1,811,979 $ (1,037,234 ) $ 1,374,507 Net Income - - - - - - 189,535 - 189,535 Other Comprehensive Loss - - - - - (56,390 ) - - (56,390 ) Share-Based Compensation - - - - 9,658 - - - 9,658 Preferred Stock Issued, Net 180,000 180,000 - - (4,513 ) - - - 175,487 Common Stock Issued under Purchase and Equity Compensation Plans - - 466,265 - 1,836 - (1,218 ) 10,541 11,159 Common Stock Repurchased - - (279,776 ) - - - - (23,412 ) (23,412 ) Cash Dividends Declared Common Stock ($2.04 per share) - - - - - - (82,429 ) - (82,429 ) Cash Dividends Declared Preferred Stock - - - - - - (1,006 ) - (1,006 ) Balance as of September 30, 2021 180,000 $ 180,000 40,305,801 $ 580 $ 598,341 $ (48,568 ) $ 1,916,861 $ (1,050,105 ) $ 1,597,109 Balance as of December 31, 2019 - $ - 40,039,695 $ 579 $ 582,566 $ (31,112 ) $ 1,761,415 $ (1,026,616 ) $ 1,286,832 Net Income - - - - - - 111,490 - 111,490 Other Comprehensive Income - - - - - 45,511 - - 45,511 Cumulative Change in Accounting Principle - - - - - - 3,632 - 3,632 Share-Based Compensation - - - - 5,347 - - - 5,347 Common Stock Issued under Purchase and Equity Compensation Plans - - 222,682 1 719 - 1,762 4,878 7,360 Common Stock Repurchased - - (201,702 ) - - - - (17,897 ) (17,897 ) Cash Dividends Declared Common Stock ($2.01 per share) - - - - - - (80,536 ) - (80,536 ) Balance as of September 30, 2020 - $ - 40,060,675 $ 580 $ 588,632 $ 14,399 $ 1,797,763 $ (1,039,635 ) $ 1,361,739 Bank of Hawaii Corporation and Subsidiaries Average Balances and Interest Rates - Taxable-Equivalent Basis Table 7a Three Months Ended Three Months Ended Three Months Ended September 30, 2021 June 30, 2021 September 30, 2020 Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ (dollars in millions) Balance Expense Rate Balance Expense Rate Balance Expense Rate Earning Assets Interest-Bearing Deposits in Other Banks $ 3.2 $ - 0.23 % $ 2.2 $ - 0.04 % $ 2.6 $ - 0.45 % Funds Sold 999.5 0.4 0.15 946.2 0.3 0.11 584.2 0.1 0.10 Investment Securities Available-for-Sale Taxable 4,454.9 16.3 1.46 4,290.8 16.3 1.53 2,918.6 14.3 1.96 Non-Taxable 10.1 0.1 4.34 12.3 0.1 4.27 25.8 0.3 4.22 Held-to-Maturity Taxable 4,294.6 16.5 1.53 3,496.2 13.4 1.53 3,257.7 15.7 1.93 Non-Taxable 64.8 0.4 2.37 41.5 0.3 2.53 54.1 0.4 2.66 Total Investment Securities 8,824.4 33.3 1.51 7,840.8 30.1 1.54 6,256.2 30.7 1.96 Loans Held for Sale 24.6 0.2 2.80 25.7 0.2 2.86 15.9 0.1 3.24 Loans and Leases 1 Commercial and Industrial 1,644.8 17.0 4.09 1,934.5 16.8 3.49 1,917.0 14.1 2.93 Commercial Mortgage 2,952.7 21.9 2.94 2,883.5 21.3 2.96 2,722.3 21.7 3.18 Construction 289.9 2.5 3.38 285.6 2.6 3.66 234.0 2.1 3.60 Commercial Lease Financing 109.3 0.4 1.58 105.7 0.4 1.54 110.7 0.5 1.82 Residential Mortgage 4,253.2 34.8 3.27 4,234.3 35.6 3.35 3,988.7 36.7 3.68 Home Equity 1,621.4 12.2 2.97 1,573.4 12.1 3.09 1,625.2 14.1 3.45 Automobile 718.7 6.2 3.41 710.4 6.1 3.45 708.3 6.4 3.59 Other 2 368.3 5.7 6.16 368.9 6.0 6.53 433.6 7.6 6.96 Total Loans and Leases 11,958.3 100.7 3.35 12,096.3 100.9 3.34 11,739.8 103.2 3.50 Other 31.5 0.2 2.02 32.3 0.2 2.26 33.3 0.2 1.81 Total Earning Assets 3 21,841.5 134.8 2.45 20,943.5 131.7 2.52 18,632.0 134.3 2.88 Cash and Due from Banks 252.2 256.1 234.3 Other Assets 899.3 874.0 874.8 Total Assets $ 22,993.0 $ 22,073.6 $ 19,741.1 Interest-Bearing Liabilities Interest-Bearing Deposits Demand $ 4,707.1 0.7 0.06 $ 4,452.4 0.7 0.07 $ 3,465.5 0.4 0.04 Savings 7,687.0 1.8 0.09 7,533.0 1.8 0.09 6,886.0 1.7 0.10 Time 1,267.0 1.4 0.44 1,418.4 1.7 0.47 1,568.3 3.8 0.97 Total Interest-Bearing Deposits 13,661.1 3.9 0.11 13,403.8 4.2 0.12 11,919.8 5.9 0.20 Securities Sold Under Agreements to Repurchase 547.8 3.4 2.45 570.3 3.5 2.41 602.9 3.6 2.35 Other Debt 10.4 0.2 7.04 30.2 0.2 3.22 60.5 0.3 2.22 Total Interest-Bearing Liabilities 14,219.3 7.5 0.21 14,004.3 7.9 0.22 12,583.2 9.8 0.31 Net Interest Income $ 127.3 $ 123.8 $ 124.5 Interest Rate Spread 2.24 % 2.30 % 2.57 % Net Interest Margin 2.32 % 2.37 % 2.67 % Noninterest-Bearing Demand Deposits 6,812.7 6,294.5 5,350.4 Other Liabilities 362.9 361.9 439.7 Shareholders' Equity 1,598.1 1,412.9 1,367.8 Total Liabilities and Shareholders' Equity $ 22,993.0 $ 22,073.6 $ 19,741.1 1 Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis. 2 Comprised of other consumer revolving credit, installment, and consumer lease financing. 3 Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21%, of $315,000, $269,000, and $295,000 for the three months ended September 30, 2021, June 30, 2021, and September 30, 2020, respectively. Bank of Hawaii Corporation and Subsidiaries Average Balances and Interest Rates - Taxable-Equivalent Basis Table 7b Nine Months Ended Nine Months Ended September 30, 2021 September 30, 2020 Average Income/ Yield/ Average Income/ Yield/ (dollars in millions) Balance Expense Rate Balance Expense Rate Earning Assets Interest-Bearing Deposits in Other Banks $ 2.9 $ - 0.44 % $ 2.2 $ - 0.76 % Funds Sold 833.7 0.8 0.12 428.3 0.8 0.24 Investment Securities Available-for-Sale Taxable 4,252.9 48.4 1.52 2,745.7 45.1 2.19 Non-Taxable 11.5 0.4 4.29 30.1 1.0 4.37 Held-to-Maturity Taxable 3,728.9 42.9 1.53 3,084.4 51.0 2.21 Non-Taxable 48.2 0.9 2.46 54.4 1.1 2.66 Total Investment Securities 8,041.5 92.6 1.54 5,914.6 98.2 2.21 Loans Held for Sale 25.5 0.5 2.81 20.8 0.5 3.35 Loans and Leases 1 Commercial and Industrial 1,826.9 48.1 3.52 1,763.9 45.2 3.43 Commercial Mortgage 2,894.5 64.5 2.98 2,631.9 69.2 3.51 Construction 280.0 7.3 3.51 234.3 7.1 4.04 Commercial Lease Financing 107.1 1.2 1.52 111.0 1.6 1.88 Residential Mortgage 4,211.8 106.2 3.36 3,941.3 109.5 3.70 Home Equity 1,596.4 36.9 3.09 1,656.8 43.6 3.51 Automobile 712.5 18.4 3.46 710.2 19.0 3.57 Other 2 373.2 18.1 6.48 460.8 23.9 6.93 Total Loans and Leases 12,002.4 300.7 3.35 11,510.2 319.1 3.70 Other 32.4 0.5 2.17 33.9 0.5 1.95 Total Earning Assets 3 20,938.4 395.1 2.52 17,910.0 419.1 3.12 Cash and Due from Banks 259.6 271.7 Other Assets 881.2 871.9 Total Assets $ 22,079.2 $ 19,053.6 Interest-Bearing Liabilities Interest-Bearing Deposits Demand $ 4,450.6 2.0 0.06 $ 3,268.1 1.9 0.08 Savings 7,414.6 5.0 0.09 6,693.9 11.0 0.22 Time 1,437.1 5.3 0.49 1,712.2 15.2 1.19 Total Interest-Bearing Deposits 13,302.3 12.3 0.12 11,674.2 28.1 0.32 Short-Term Borrowings 0.8 - 0.09 38.3 0.2 0.52 Securities Sold Under Agreements to Repurchase 572.7 10.4 2.40 603.4 11.6 2.54 Other Debt 33.5 0.8 3.03 62.6 1.4 2.90 Total Interest-Bearing Liabilities 13,909.3 23.5 0.22 12,378.5 41.3 0.44 Net Interest Income $ 371.6 $ 377.8 Interest Rate Spread 2.30 % 2.68 % Net Interest Margin 2.37 % 2.82 % Noninterest-Bearing Demand Deposits 6,316.8 4,917.4 Other Liabilities 389.5 413.3 Shareholders' Equity 1,463.6 1,344.4 Total Liabilities and Shareholders' Equity $ 22,079.2 $ 19,053.6 1 Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis. 2 Comprised of other consumer revolving credit, installment, and consumer lease financing. 3 Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21%, of $836,000 and $1,010,000 for the nine months ended September 30, 2021 and September 30, 2020, respectively. Bank of Hawaii Corporation and Subsidiaries Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8a Three Months Ended September 30, 2021 Compared to June 30, 2021 (dollars in millions) Volume 1 Rate 1 Total Change in Interest Income: Funds Sold $ - $ 0.1 $ 0.1 Investment Securities Available-for-Sale Taxable 0.6 (0.6 ) - Held-to-Maturity Taxable 3.1 - 3.1 Non-Taxable 0.1 - 0.1 Total Investment Securities 3.8 (0.6 ) 3.2 Loans and Leases Commercial and Industrial (4.0 ) 4.2 0.2 Commercial Mortgage 0.7 (0.1 ) 0.6 Construction 0.1 (0.2 ) (0.1 ) Commercial Lease Financing 0.1 (0.1 ) - Residential Mortgage 0.2 (1.0 ) (0.8 ) Home Equity 0.5 (0.4 ) 0.1 Automobile 0.1 - 0.1 Other 2 - (0.3 ) (0.3 ) Total Loans and Leases (2.3 ) 2.1 (0.2 ) Total Change in Interest Income 1.5 1.6 3.1 Change in Interest Expense: Interest-Bearing Deposits Demand 0.1 (0.1 ) - Time (0.2 ) (0.1 ) (0.3 ) Total Interest-Bearing Deposits (0.1 ) (0.2 ) (0.3 ) Securities Sold Under Agreements to Repurchase (0.1 ) - (0.1 ) Other Debt (0.2 ) 0.2 - Total Change in Interest Expense (0.4 ) - (0.4 ) Change in Net Interest Income $ 1.9 $ 1.6 $ 3.5 1 The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns. 2 Comprised of other consumer revolving credit, installment, and consumer lease financing. Bank of Hawaii Corporation and Subsidiaries Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8b Three Months Ended September 30, 2021 Compared to September 30, 2020 (dollars in millions) Volume 1 Rate 1 Total Change in Interest Income: Funds Sold $ 0.2 $ 0.1 $ 0.3 Investment Securities Available-for-Sale Taxable 6.3 (4.3 ) 2.0 Non-Taxable (0.2 ) - (0.2 ) Held-to-Maturity Taxable 4.4 (3.6 ) 0.8 Non-Taxable 0.1 (0.1 ) - Total Investment Securities 10.6 (8.0 ) 2.6 Loans Held for Sale 0.1 - 0.1 Loans and Leases Commercial and Industrial (2.1 ) 5.0 2.9 Commercial Mortgage 1.8 (1.6 ) 0.2 Construction 0.5 (0.1 ) 0.4 Commercial Lease Financing - (0.1 ) (0.1 ) Residential Mortgage 2.3 (4.2 ) (1.9 ) Home Equity - (1.9 ) (1.9 ) Automobile 0.1 (0.3 ) (0.2 ) Other 2 (1.1 ) (0.8 ) (1.9 ) Total Loans and Leases 1.5 (4.0 ) (2.5 ) Total Change in Interest Income 12.4 (11.9 ) 0.5 Change in Interest Expense: Interest-Bearing Deposits Demand 0.2 0.1 0.3 Savings 0.2 (0.1 ) 0.1 Time (0.6 ) (1.8 ) (2.4 ) Total Interest-Bearing Deposits (0.2 ) (1.8 ) (2.0 ) Securities Sold Under Agreements to Repurchase (0.3 ) 0.1 (0.2 ) Other Debt (0.4 ) 0.3 (0.1 ) Total Change in Interest Expense (0.9 ) (1.4 ) (2.3 ) Change in Net Interest Income $ 13.3 $ (10.5 ) $ 2.8 1 The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns. 2 Comprised of other consumer revolving credit, installment, and consumer lease financing. Bank of Hawaii Corporation and Subsidiaries Analysis of Change in Net Interest Income - Taxable-Equivalent Basis Table 8c Nine Months Ended September 30, 2021 Compared to September 30, 2020 (dollars in millions) Volume 1 Rate 1 Total Change in Interest Income: Funds Sold $ 0.5 $ (0.5 ) $ - Investment Securities Available-for-Sale Taxable 19.9 (16.6 ) 3.3 Non-Taxable (0.6 ) - (0.6 ) Held-to-Maturity Taxable 9.4 (17.5 ) (8.1 ) Non-Taxable (0.1 ) (0.1 ) (0.2 ) Total Investment Securities 28.6 (34.2 ) (5.6 ) Loans Held for Sale 0.1 (0.1 ) - Loans and Leases Commercial and Industrial 6.4 (3.5 ) 2.9 Commercial Mortgage 6.5 (11.2 ) (4.7 ) Construction 1.2 (1.0 ) 0.2 Commercial Lease Financing (0.1 ) (0.3 ) (0.4 ) Residential Mortgage 7.2 (10.5 ) (3.3 ) Home Equity (1.5 ) (5.2 ) (6.7 ) Automobile - (0.6 ) (0.6 ) Other 2 (4.3 ) (1.5 ) (5.8 ) Total Loans and Leases 15.4 (33.8 ) (18.4 ) Total Change in Interest Income 44.6 (68.6 ) (24.0 ) Change in Interest Expense: Interest-Bearing Deposits Demand 0.6 (0.5 ) 0.1 Savings 1.1 (7.1 ) (6.0 ) Time (2.1 ) (7.8 ) (9.9 ) Total Interest-Bearing Deposits (0.4 ) (15.4 ) (15.8 ) Short-Term Borrowings (0.1 ) (0.1 ) (0.2 ) Securities Sold Under Agreements to Repurchase (0.6 ) (0.6 ) (1.2 ) Other Debt (0.7 ) 0.1 (0.6 ) Total Change in Interest Expense (1.8 ) (16.0 ) (17.8 ) Change in Net Interest Income $ 46.4 $ (52.6 ) $ (6.2 ) 1 The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns. 2 Comprised of other consumer revolving credit, installment, and consumer lease financing. Bank of Hawaii Corporation and Subsidiaries Salaries and Benefits Table 9 Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, (dollars in thousands) 2021 2021 2020 2021 2020 Salaries $ 34,676 $ 33,413 $ 34,046 $ 99,658 $ 100,271 Incentive Compensation 4,677 5,172 2,683 15,763 6,069 Share-Based Compensation 3,335 3,174 1,442 9,093 4,754 Commission Expense 1,772 2,599 1,800 6,807 4,821 Retirement and Other Benefits 4,746 5,289 4,164 15,552 13,316 Payroll Taxes 2,825 3,026 2,624 9,819 9,949 Medical, Dental, and Life Insurance 3,222 3,204 3,422 8,850 11,394 Separation Expense 1,194 284 1,770 3,317 6,555 Total Salaries and Benefits $ 56,447 $ 56,161 $ 51,951 $ 168,859 $ 157,129 Bank of Hawaii Corporation and Subsidiaries Loan and Lease Portfolio Balances Table 10 September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2021 2021 2021 2020 2020 Commercial Commercial and Industrial $ 1,325,446 $ 1,257,305 $ 1,288,496 $ 1,357,610 $ 1,376,843 PPP 1 268,480 513,513 725,485 517,683 531,639 Commercial Mortgage 2,994,520 2,944,435 2,859,246 2,854,829 2,745,611 Construction 296,052 277,393 281,164 259,798 250,943 Lease Financing 107,526 110,500 104,980 110,766 111,831 Total Commercial 4,992,024 5,103,146 5,259,371 5,100,686 5,016,867 Consumer Residential Mortgage 4,272,540 4,264,180 4,216,976 4,130,513 4,044,228 Home Equity 1,680,229 1,594,781 1,577,500 1,604,538 1,605,486 Automobile 727,234 714,729 710,407 708,800 709,937 Other 2 400,723 364,542 376,449 395,483 417,090 Total Consumer 7,080,726 6,938,232 6,881,332 6,839,334 6,776,741 Total Loans and Leases $ 12,072,750 $ 12,041,378 $ 12,140,703 $ 11,940,020 $ 11,793,608 Deposits September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2021 2021 2021 2020 2020 Consumer $ 10,150,199 $ 9,848,285 $ 9,746,713 $ 9,347,725 $ 8,903,808 Commercial 8,767,733 8,675,909 8,241,102 7,302,832 7,159,531 Public and Other 1,575,746 1,645,515 1,568,836 1,561,064 1,675,544 Total Deposits $ 20,493,678 $ 20,169,709 $ 19,556,651 $ 18,211,621 $ 17,738,883 1 The PPP amounts presented, which are reported net of deferred costs and fees, were previously included as a component of the Commercial and Industrial loan class. 2 Comprised of other revolving credit, installment, and lease financing. Bank of Hawaii Corporation and Subsidiaries Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More Table 11 September 30, June 30, March 31, December 31, September 30, (dollars in thousands) 2021 2021 2021 2020 2020 Non-Performing Assets Non-Accrual Loans and Leases Commercial Commercial and Industrial $ 209 $ 258 $ 293 $ 441 $ 475 Commercial Mortgage 8,309 8,413 8,503 8,527 8,615 Total Commercial 8,518 8,671 8,796 8,968 9,090 Consumer Residential Mortgage 4,348 2,437 1,804 3,223 3,543 Home Equity 5,422 5,534 4,951 3,958 3,661 Total Consumer 9,770 7,971 6,755 7,181 7,204 Total Non-Accrual Loans and Leases 18,288 16,642 15,551 16,149 16,294 Foreclosed Real Estate 2,332 2,332 2,332 2,332 2,332 Total Non-Performing Assets $ 20,620 $ 18,974 $ 17,883 $ 18,481 $ 18,626 Accruing Loans and Leases Past Due 90 Days or More Commercial Commercial and Industrial $ - $ - $ 9 $ - $ - Total Commercial - - 9 - - Consumer Residential Mortgage $ 4,776 $ 4,069 $ 4,069 $ 5,274 $ 6,607 Home Equity 2,946 4,498 4,906 3,187 2,571 Automobile 395 277 604 925 156 Other 1 593 434 828 1,160 258 Total Consumer 8,710 9,278 10,407 10,546 9,592 Total Accruing Loans and Leases Past Due 90 Days or More $ 8,710 $ 9,278 $ 10,416 $ 10,546 $ 9,592 Restructured Loans on Accrual Status and Not Past Due 90 Days or More $ 62,787 $ 74,926 $ 74,216 $ 68,065 $ 58,650 Total Loans and Leases $ 12,072,750 $ 12,041,378 $ 12,140,703 $ 11,940,020 $ 11,793,608 Ratio of Non-Accrual Loans and Leases to Total Loans and Leases 0.15 % 0.14 % 0.13 % 0.14 % 0.14 % Ratio of Non-Performing Assets to Total Loans and Leases and Foreclosed Real Estate 0.17 % 0.16 % 0.15 % 0.15 % 0.16 % Ratio of Commercial Non-Performing Assets to Total Commercial Loans and Leases and Commercial Foreclosed Real Estate 0.17 % 0.17 % 0.17 % 0.18 % 0.18 % Ratio of Consumer Non-Performing Assets to Total Consumer Loans and Leases and Consumer Foreclosed Real Estate 0.17 % 0.15 % 0.13 % 0.14 % 0.14 % Ratio of Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More to Total Loans and Leases and Foreclosed Real Estate 0.24 % 0.23 % 0.23 % 0.24 % 0.24 % Quarter to Quarter Changes in Non-Performing Assets Balance at Beginning of Quarter $ 18,974 $ 17,883 $ 18,481 $ 18,626 $ 22,701 Additions 3,171 2,229 2,992 434 938 Reductions Payments (889 ) (722 ) (2,481 ) (490 ) (3,729 ) Return to Accrual Status (606 ) (416 ) (1,014 ) - (1,035 ) Sales of Foreclosed Real Estate - - - - (175 ) Charge-offs/Write-downs (30 ) - (95 ) (89 ) (74 ) Total Reductions (1,525 ) (1,138 ) (3,590 ) (579 ) (5,013 ) Balance at End of Quarter $ 20,620 $ 18,974 $ 17,883 $ 18,481 $ 18,626 1 Comprised of other revolving credit, installment, and lease financing. Bank of Hawaii Corporation and Subsidiaries Reserve for Credit Losses Table 12 Three Months Ended Nine Months Ended September 30, June 30, September 30, September 30, (dollars in thousands) 2021 2021 2020 2021 2020 Balance at Beginning of Period $ 186,371 $ 203,779 $ 175,958 $ 221,303 116,849 CECL Adoption (Day 1) Impact - - - - (5,072 ) Loans and Leases Charged-Off Commercial Commercial and Industrial (196 ) (456 ) (171 ) (900 ) (1,520 ) Consumer Residential Mortgage (197 ) (115 ) - (316 ) (84 ) Home Equity (289 ) (107 ) (43 ) (412 ) (316 ) Automobile (576 ) (1,209 ) (489 ) (3,894 ) (6,103 ) Other 1 (2,187 ) (2,422 ) (1,644 ) (8,523 ) (9,784 ) Total Loans and Leases Charged-Off (3,445 ) (4,309 ) (2,347 ) (14,045 ) (17,807 ) Recoveries on Loans and Leases Previously Charged-Off Commercial Commercial and Industrial 118 144 231 374 2,044 Commercial Mortgage - - - - 40 Consumer Residential Mortgage 173 481 414 1,609 795 Home Equity 216 527 727 1,276 2,024 Automobile 943 1,172 1,313 3,034 2,865 Other 1 802 801 1,119 2,459 2,645 Total Recoveries on Loans and Leases Previously Charged-Off 2,252 3,125 3,804 8,752 10,413 Net Recovered (Charged-Off) - Loans and Leases (1,193 ) (1,184 ) 1,457 (5,293 ) (7,394 ) Net Charged-Off - Accrued Interest Receivable (70 ) (124 ) - (502 ) Provision for Credit Losses: Loans and Leases (11,272 ) (16,774 ) 28,600 (43,039 ) 102,600 Accrued Interest Receivable (703 ) (828 ) - (1,531 ) - Unfunded Commitments 1,575 1,502 (202 ) 3,770 (1,170 ) Balance at End of Period 2 $ 174,708 $ 186,371 $ 205,813 $ 174,708 $ 205,813 Components Allowance for Credit Losses - Loans and Leases $ 167,920 180,385 203,496 $ 167,920 203,496 Allowance for Credit Losses - Accrued Interest Receivable 667 1,440 - 667 - Reserve for Unfunded Commitments 6,121 4,546 2,317 6,121 2,317 Total Reserve for Credit Losses $ 174,708 $ 186,371 $ 205,813 $ 174,708 $ 205,813 Average Loans and Leases Outstanding $ 11,958,321 $ 12,096,308 $ 11,739,785 $ 12,002,426 $ 11,510,222 Ratio of Net Loans and Leases Charged-Off (Recovered) to Average Loans and Leases Outstanding (annualized) 0.04 % 0.04 % (0.05 %) 0.06 % 0.09 % Ratio of Allowance for Credit Losses to Loans and Leases Outstanding 3 1.39 % 1.50 % 1.73 % 1.39 % 1.73 % 1 Comprised of other revolving credit, installment, and lease financing. 2 Included in this analysis is activity related to the Company's reserve for unfunded commitments, which is separately recorded in other liabilities in the Consolidated Statements of Condition. 3 The numerator comprises the Allowance for Credit Losses - Loans and Leases. Bank of Hawaii Corporation and Subsidiaries Business Segments Selected Financial Information Table 13a Consumer Commercial Treasury Consolidated (dollars in thousands) Banking Banking and Other Total Three Months Ended September 30, 2021 Net Interest Income $ 72,062 $ 50,088 $ 4,669 $ 126,819 Provision for Credit Losses 1,235 (42 ) (11,593 ) (10,400 ) Net Interest Income After Provision for Credit Losses 70,827 50,130 16,262 137,219 Noninterest Income 32,046 7,906 1,426 41,378 Noninterest Expense (71,377 ) (15,924 ) (9,218 ) (96,519 ) Income Before Income Taxes 31,496 42,112 8,470 82,078 Provision for Income Taxes (8,001 ) (10,373 ) (1,651 ) (20,025 ) Net Income $ 23,495 $ 31,739 $ 6,819 $ 62,053 Total Assets as of September 30, 2021 $ 7,530,513 $ 5,087,831 $ 10,347,039 $ 22,965,383 Three Months Ended September 30, 2020 Net Interest Income $ 73,868 $ 47,797 $ 2,501 $ 124,166 Provision for Credit Losses (1,372 ) (85 ) 30,057 28,600 Net Interest Income (Loss) After Provision for Credit Losses 75,240 47,882 (27,556 ) 95,566 Noninterest Income 31,776 7,672 2,286 41,734 Noninterest Expense (69,408 ) (15,430 ) (5,111 ) (89,949 ) Income (Loss) Before Income Taxes 37,608 40,124 (30,381 ) 47,351 Provision for Income Taxes (9,627 ) (9,784 ) 9,900 (9,511 ) Net Income (Loss) $ 27,981 $ 30,340 $ (20,481 ) $ 37,840 Total Assets as of September 30, 2020 $ 7,383,822 $ 5,027,836 $ 7,697,831 $ 20,109,489 Bank of Hawaii Corporation and Subsidiaries Business Segments Selected Financial Information Table 13b Consumer Commercial Treasury Consolidated (dollars in thousands) Banking Banking and Other Total Nine Months Ended September 30, 2021 Net Interest Income $ 212,991 $ 146,269 $ 11,642 $ 370,902 Provision for Credit Losses 5,088 205 (46,093 ) (40,800 ) Net Interest Income After Provision for Credit Losses 207,903 146,064 57,735 411,702 Noninterest Income 98,344 22,339 8,096 128,779 Noninterest Expense (222,426 ) (47,343 ) (22,142 ) (291,911 ) Income Before Income Taxes 83,821 121,060 43,689 248,570 Provision for Income Taxes (20,840 ) (29,634 ) (8,561 ) (59,035 ) Net Income $ 62,981 $ 91,426 $ 35,128 $ 189,535 Total Assets as of September 30, 2021 $ 7,530,513 $ 5,087,831 $ 10,347,039 $ 22,965,383 Nine Months Ended September 30, 2020 Net Interest Income $ 221,003 $ 144,253 $ 11,567 $ 376,823 Provision for Credit Losses 8,215 (819 ) 95,204 102,600 Net Interest Income (Loss) After Provision for Credit Losses 212,788 145,072 (83,637 ) 274,223 Noninterest Income 93,309 26,483 19,359 139,151 Noninterest Expense (210,744 ) (47,552 ) (16,857 ) (275,153 ) Income (Loss) Before Income Taxes 95,353 124,003 (81,135 ) 138,221 Provision for Income Taxes (24,235 ) (30,278 ) 27,782 (26,731 ) Net Income (Loss) $ 71,118 $ 93,725 $ (53,353 ) $ 111,490 Total Assets as of September 30, 2020 $ 7,383,822 $ 5,027,836 $ 7,697,831 $ 20,109,489 Bank of Hawaii Corporation and Subsidiaries Selected Quarterly Financial Data Table 14 Three Months Ended September 30, June 30, March 31, December 31, September 30, (dollars in thousands, except per share amounts) 2021 2021 2021 2020 2020 Quarterly Operating Results Interest Income Interest and Fees on Loans and Leases $ 100,570 $ 100,894 $ 99,299 $ 98,471 $ 103,189 Income on Investment Securities Available-for-Sale 16,396 16,467 15,837 15,449 14,558 Held-to-Maturity 16,754 13,576 13,300 14,113 15,967 Deposits 2 - 7 1 3 Funds Sold 382 260 137 115 149 Other 159 182 185 167 151 Total Interest Income 134,263 131,379 128,765 128,316 134,017 Interest Expense Deposits 3,837 4,152 4,329 4,861 5,891 Securities Sold Under Agreements to Repurchase 3,423 3,470 3,533 3,614 3,622 Funds Purchased - - 1 5 - Short-Term Borrowings - - - - 1 Other Debt 184 243 333 337 337 Total Interest Expense 7,444 7,865 8,196 8,817 9,851 Net Interest Income 126,819 123,514 120,569 119,499 124,166 Provision for Credit Losses (10,400) (16,100) (14,300) 15,200 28,600 Net Interest Income After Provision for Credit Losses 137,219 139,614 134,869 104,299 95,566 Noninterest Income Trust and Asset Management 11,415 11,682 11,278 11,239 10,752 Mortgage Banking 3,136 3,058 5,862 6,851 4,047 Service Charges on Deposit Accounts 6,510 6,065 6,128 6,335 6,027 Fees, Exchange, and Other Service Charges 13,604 13,807 13,607 12,143 12,296 Investment Securities Gains (Losses), Net (1,259) 2,423 (1,203) (1,193) (1,121) Annuity and Insurance 735 911 702 670 881 Bank-Owned Life Insurance 1,897 2,063 1,917 2,353 1,806 Other 5,340 4,422 4,679 6,860 7,046 Total Noninterest Income 41,378 44,431 42,970 45,258 41,734 Noninterest Expense Salaries and Benefits 56,447 56,161 56,251 50,200 51,951 Net Occupancy 3,079 5,047 9,090 14,536 7,281 Net Equipment 8,924 8,796 8,878 9,574 9,223 Data Processing 4,722 4,557 6,322 4,604 4,691 Professional Fees 2,948 3,114 3,406 3,174 2,743 FDIC Insurance 1,594 1,669 1,654 1,484 1,282 Other 18,805 17,183 13,264 15,082 12,778 Total Noninterest Expense 96,519 96,527 98,865 98,654 89,949 Income Before Provision for Income Taxes 82,078 87,518 78,974 50,903 47,351 Provision for Income Taxes 20,025 19,985 19,025 8,589 9,511 Net Income $ 62,053 $ 67,533 $ 59,949 $ 42,314 $ 37,840 Preferred Stock Dividends 1,006 - - - - Net Income Available to Common Shareholders $ 61,047 $ 67,533 $ 59,949 $ 42,314 $ 37,840 Basic Earnings Per Common Share $ 1.53 $ 1.69 $ 1.51 $ 1.06 $ 0.95 Diluted Earnings Per Common Share $ 1.52 $ 1.68 $ 1.50 $ 1.06 $ 0.95 Balance Sheet Totals Loans and Leases $ 12,072,750 $ 12,041,378 $ 12,140,703 $ 11,940,020 $ 11,793,608 Total Assets 22,965,383 22,672,183 21,947,271 20,603,651 20,109,489 Total Deposits 20,493,678 20,169,709 19,556,651 18,211,621 17,738,883 Total Shareholders' Equity 1,597,109 1,583,531 1,360,221 1,374,507 1,361,739 Performance Ratios Return on Average Assets 1.07 % 1.23 % 1.15 % 0.83 % 0.76 % Return on Average Shareholders' Equity 15.41 19.17 17.65 12.26 11.01 Return on Average Common Equity 17.08 19.61 17.65 12.26 11.01 Efficiency Ratio 1 57.38 57.47 60.45 59.88 54.22 Net Interest Margin 2 2.32 2.37 2.43 2.48 2.67 1 Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and noninterest income). 2 Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets. Bank of Hawaii Corporation and Subsidiaries Hawaii Economic Trends Table 15 Eight Months Ended Year Ended ($ in millions; jobs in thousands) August 31, 2021 December 31, 2020 December 31, 2019 Hawaii Economic Trends State General Fund Revenues 1 $ 5,325.4 21.2 % $ 6,415.1 (12.3) % $ 7,316.5 5.5 % General Excise and Use Tax Revenue 1 $ 2,367.9 11.6 % $ 3,038.8 (15.6) % $ 3,602.2 5.1 % Jobs 2 601.8 588.2 659.7 August 31, December 31, (spot rates) 2021 2020 2019 Unemployment, seasonally adjusted 3 Statewide 7.0 % 10.3 % 2.1 % Oahu 6.0 9.3 2.0 Island of Hawaii 6.6 10.1 2.5 Maui 8.5 14.3 2.0 Kauai 8.9 13.9 2.1 September 30, December 31, (percentage change, except months of inventory) 2021 2020 2019 2018 Housing Trends (Single Family Oahu) 4 Median Home Price 20.2 % 5.2 % (0.1) % 4.6 % Home Sales Volume (units) 24.2 % 2.3 % 3.9 % (7.7) % Months of Inventory 1.2 1.4 2.5 2.8 Monthly Visitor Arrivals, Percentage Change (in thousands) Not Seasonally Adjusted from Previous Year Tourism 5 August 31, 2021 722.4 3,133.1 July 31, 2021 879.6 3,798.4 June 30, 2021 791.1 4,534.7 May 31, 2021 629.7 6,807.4 April 30, 2021 484.1 10,506.3 March 31, 2021 439.8 1.1 February 28, 2021 235.3 (71.6) January 31, 2021 172.0 (80.1) December 31, 2020 235.8 (75.2) November 30, 2020 183.8 (77.3) October 31, 2020 76.6 (90.4) September 30, 2020 18.9 (97.4) August 31, 2020 22.3 (97.6) July 31, 2020 22.6 (97.7) June 30, 2020 17.1 (98.2) May 31, 2020 9.1 (98.9) April 30, 2020 4.6 (99.5) March 31, 2020 434.9 (53.7) February 29, 2020 828.1 5.8 January 31, 2020 862.6 5.1 December 31, 2019 952.4 5.8 November 30, 2019 809.1 3.9 October 31, 2019 796.2 4.3 September 30, 2019 738.2 3.1 August 31, 2019 926.4 9.6 July 31, 2019 995.2 5.9 June 30, 2019 951.6 6.1 May 31, 2019 841.4 4.6 April 30, 2019 856.3 6.6 March 31, 2019 939.1 3.9 February 28, 2019 782.7 0.5 January 31, 2019 820.6 3.0 1 Source: Hawaii Department of Business, Economic Development & Tourism 2 Source: U. S. Bureau of Labor Statistics 3 Source: UHERO 4 Source: Honolulu Board of REALTORS 5 Source: Hawaii Tourism Authority View source version on businesswire.com: https://www.businesswire.com/news/home/20211025005224/en/ Media Inquiries Melissa Torres-Laing Email: Melissa.Torres-Laing@boh.com Telephone: 808-694-8384 Mobile: 808-859-1703 Investor/Analyst Inquiries Janelle Higa Email: Janelle.Higa@boh.com Telephone: 808-694-8007 Source: Bank of Hawaii Corporation Print Page Email Alerts RSS Feeds Request Information Footer Nav Bottom Legal Privacy Policy About Bank of Hawaii BOH.com © Bank of Hawaii Corporation 2021