New book by Larry Connors Click here Improve your trading - See how
--Board of Directors Declares Dividend of $0.45 Per Share
Bank of Hawaii Corporation (NYSE:BOH) today reported diluted earnings per share of $0.76 for the third quarter of 2009, up from $0.65 in the previous quarter, and down from $0.99 in the same quarter last year. Net income for the third quarter of 2009 was $36.5 million compared to net income of $31.0 million in the second quarter of 2009, and $47.4 million in the third quarter of 2008. Results for the third quarter of 2008 included a net credit of $8.9 million related to the Company's resolution of Sale In/Lease Out ("SILO") leases with the Internal Revenue Service. The return on average assets for the third quarter of 2009 was 1.21 percent, compared to 1.06 percent during the previous quarter, and 1.82 percent during the same quarter last year. The return on average equity for the third quarter of 2009 was 16.44 percent compared to 14.49 percent for the second quarter of 2009, and 24.17 percent for the third quarter of 2008.
"Bank of Hawaii Corporation had good results for the third quarter of 2009 despite continuing economic weakness," said Allan R. Landon, Chairman, and CEO. "We were able to increase our liquidity, capital, and reserves, improve profitability, and our Board affirmed our dividend. Asset quality indicators were mixed this quarter as we continue to address weakened credits. Bank of Hawaii has a strong balance sheet and remains safe, balanced, and well prepared for the future."
For the nine months, ended September 30, 2009, net income was $103.5 million compared to net income of $152.9 million for the same period last year. Diluted earnings per share were $2.16 for the nine-month period in 2009, down from $3.17 for the same period in 2008. The year-to-date return on average assets was 1.19 percent compared to 1.95 percent for the same period in 2008. The year-to-date return on average equity was 16.24 percent, down from 26.26 percent for the nine months ended September 30, 2008 partially due to the growth in capital.
Results for the nine months ended September 30, 2009 included gains of $13.7 million from the disposition of leased equipment and the sale of the Company's retail insurance brokerage business. These gains were offset by increases in the allowance for loan and lease losses, expenses for legal contingencies, an industry-wide FDIC special assessment, impairment of a leveraged lease residual value, and early debt retirement. Results for the same period in 2008 included $31.0 million from the mandatory redemption of Visa shares, a reversal of Visa legal costs, and a lessee's early buy-out of an aircraft lease. Partially offsetting these gains were expenses for employee incentives, legal contingencies, a call premium on Capital Securities, increases in the allowance for loan and lease losses, and contributions to the Bank of Hawaii Charitable Foundation. Details of these items are included in Table 2.
Financial Highlights
Net interest income, on a taxable equivalent basis, for the third quarter of 2009 was $109.2 million, up $6.0 million from net interest income of $103.2 million in the second quarter of 2009, and up $5.4 million from net interest income of $103.8 million in the third quarter of 2008. Net interest income in the third quarter of 2009 included a charge of $1.0 million related to impairment of the residual value of an aircraft leveraged lease investment. The increase in net interest income compared with the second quarter of 2009 was largely due to a higher level of earning assets and a higher net interest margin. Net interest income in the third quarter of 2008 included a $4.0 million reduction of income related to settlement of the SILO leases. For the nine months ended September 30, 2009, net interest income, on a taxable-equivalent basis, was $309.7 million compared to $313.6 million for the same period in 2008. Analyses of the changes in net interest income are included in Tables 7a, 7b and 7c.
The net interest margin was 3.85 percent for the third quarter of 2009, a 12 basis point increase from 3.73 percent in the second quarter of 2009, and a 48 basis point decrease from 4.33 percent in the third quarter of 2008. For the nine months ended September 30, 2009, the net interest margin was 3.78 percent compared to 4.30 percent for the same nine months in 2008. The decrease in the net interest margin was largely the result of lower interest rates and the Company's strategy to increase liquidity and reduce risk.
Results for the third quarter of 2009 included a provision for credit losses of $27.5 million compared with $28.7 million in the second quarter of 2009 and $20.4 million in the third quarter of 2008. The provision for credit losses exceeded net charge-offs by $5.2 million in the third quarter of 2009. The provision for credit losses exceeded net charge-offs by $3.0 million in the second quarter of 2009 and exceeded net charge-offs by $13.0 million in the third quarter of 2008.
Noninterest income was $56.8 million for the third quarter of 2009, a decrease of $3.0 million compared to $59.8 million in the second quarter of 2009, and essentially flat with noninterest income of $57.0 million in the third quarter of 2008. Noninterest income in the second quarter of 2009 included a gain of $2.8 million related to the disposition of leased equipment and $0.9 million due to the previously mentioned sale of the retail insurance brokerage business.
Noninterest expense was $84.0 million in the third quarter of 2009, down $5.6 million from $89.6 million in the previous quarter, and down $2.8 million from $86.8 million in the same quarter last year. Noninterest expense in the second quarter of 2009 included $5.7 million related to an industry-wide FDIC special assessment. Noninterest expense in the third quarter of 2008 included a $2.0 million broad based employee incentive accrual. An analysis of salary and benefit expenses is included in Table 8.
The efficiency ratio for the third quarter of 2009 was 50.69 percent, compared with an efficiency ratio of 55.07 percent in the previous quarter and 54.05 percent in the same quarter last year. The efficiency ratio for the nine-month period ended September 30, 2009 was 52.74 percent compared with 51.12 percent for the same period last year.
The effective tax rate for the third quarter of 2009 was 32.71 percent, compared to 30.18 percent in the previous quarter, and 11.24 percent during the third quarter last year. Taxes in the third quarter of 2009 included a $0.4 million credit related to the previously mentioned leveraged lease residual value impairment, and taxes in the second quarter of 2009 were reduced by a $1.6 million tax benefit resulting from accounting for the termination of a leveraged lease. The lower effective tax rate in the third quarter of 2008 was due to a credit of $12.9 million related to the previously mentioned SILO lease settlement.
The Company's business segments are defined as Retail Banking, Commercial Banking, Investment Services, and Treasury & Other. Results are determined based on the Company's internal financial management reporting process and organizational structure. Selected financial information for the business segments is included in Tables 12a and 12b.
Asset Quality
Credit quality during the third quarter of 2009 continued to reflect the weak national and local economies. Non-accrual loans and leases were $48.3 million at the end of September 30, 2009, up from $38.6 million at June 30, 2009, and up from $5.6 million at September 30, 2008. As a percentage of total loans and leases, non-accrual loans and leases were 0.81 percent at September 30, 2009. The increase in non-accrual loans was largely in two commercial construction loans.
Accruing loans and leases past due 90 days or more increased $2.7 million during the third quarter of 2009 due to the addition of a $3.0 million commercial construction loan on the island of Hawaii, which offset a small decline in delinquent consumer loans. More information on non-performing assets and accruing loans and leases past due 90 days or more is presented in Table 10.
Net charge-offs during the third quarter of 2009 were $22.3 million, down from $25.7 million in the second quarter of 2009, and up from $7.4 million in the third quarter last year. Net charge-offs for the third quarter of 2009 included $5.8 million in partial charge-offs related to three non-accrual commercial construction loans and $4.0 million in partial charge-offs related to the sale of three syndicated credits.
The allowance for loan and lease losses was $142.7 million at September 30, 2009, up from $137.4 million at June 30, 2009 and $115.5 million at September 30, 2008. The ratio of the allowance for loan and lease losses to total loans and leases increased to 2.41 percent at September 30, 2009. The reserve for unfunded commitments at September 30, 2009 was unchanged at $5.4 million. Details of charge-offs, recoveries and the components of the total reserve for credit losses are summarized in Table 11.
Other Financial Highlights
Total assets were $12.21 billion at September 30, 2009, up slightly from total assets of $12.19 billion at June 30, 2009, and up $1.87 billion from total assets of $10.34 billion at September 30, 2008. Average total assets were $11.99 billion during the third quarter of 2009, up $235 million from average assets of $11.75 billion during the previous quarter, and up $1.65 billion from average assets of $10.34 billion during the third quarter last year. The growth in assets was primarily in investment securities available for sale and is the result of strong deposit generation.
The Company continued to decrease loans during the quarter due to reduced loan demand along with planned credit exits and payoffs to reduce overall portfolio risk. Also in the third quarter of 2009, the Company sold its position in three syndicated loans totaling $19.5 million. Loan and lease portfolio balances, including elements of higher risk, are summarized in Table 9.
Total deposits were $9.25 billion at September 30, 2009, up $230 million from $9.02 billion at June 30, 2009, and up $1.59 billion from $7.66 billion at September 30, 2008. The increase in deposits was widespread among deposit categories except time deposits. Average total deposits were $9.13 billion in the third quarter of 2009, down $91 million from average deposits of $9.22 billion during the previous quarter, and up $1.36 billion from $7.77 billion during the third quarter last year. The Company slowed deposit growth during the third quarter due to the limited lending opportunities. Deposit balances are summarized in Tables 6a, 6b, and 9.
Consistent with the Company's strategy to build capital levels, no shares were repurchased during the third quarter of 2009. Remaining buyback authority under the share repurchase program was $85.4 million at September 30, 2009. Total shareholders' equity increased to $902.8 million at September 30, 2009, compared to $845.9 million at June 30, 2009, and $780.0 million at September 30, 2008.
The ratio of tangible common equity to risk weighted assets was 14.56 percent at September 30, 2009, up from 13.02 percent at June 30, 2009, and up from 11.04 percent at September 30, 2008. At September 30, 2009, the Tier 1 leverage ratio was 6.67 percent compared to 6.66 percent at June 30, 2009, and 7.27 percent at September 30, 2008. The decrease in the Tier 1 leverage ratio compared with the same quarter last year was due to the significant growth in investment securities, primarily Treasury and Ginnie Mae securities.
The Company's Board of Directors declared a quarterly cash dividend of $0.45 per share on the Company's outstanding shares. The dividend will be payable on December 14, 2009 to shareholders of record at the close of business on November 30, 2009.
On October 9, 2009, the Company signed an agreement to sell certain assets of the Company's wholesale insurance business, Triad Insurance Agency, Inc. ("Triad"), to a third party. The agreement precludes the Company from competing directly or indirectly with Triad for a period of five years after the closing date of the sale. In connection with this sale, several employees of Triad were hired by the third party. The sale of Triad closed on October 22, 2009 and resulted in a pre-tax gain of approximately $1.5 million. Net income of Triad for the year ended December 31, 2008 was approximately $4.5 million.
Hawaii Economy
Hawaii's economy during the third quarter of 2009 continued to reflect weakness primarily the result of slow national economic conditions and lower visitor activity in the state. Visitor arrivals appear to be stabilizing. However, visitor spending continues to decline as a result of discounting. State general fund revenues have declined 14.4 percent during the first eight months of 2009 primarily due to a decline in general excise and use taxes. Total jobs have contracted 3.1 percent from the beginning of the year. The statewide unemployment rate improved slightly to 7.2 percent on a seasonally adjusted basis at the end of September compared with 7.3 percent at the end of June. Residential real estate prices in Hawaii continue to hold their value better than many U. S. mainland markets and months of inventory declined to 5.3 months at the end of September. More information on Hawaii economic trends is presented in Table 14.
Conference Call Information
The Company will review its third quarter 2009 financial results today at 8:00 a.m. Hawaii Time (2:00 p.m. Eastern Time). The conference call will be accessible via teleconference and the Investor Relations link of Bank of Hawaii Corporation's web site, www.boh.com. The conference call number for participants in the United States is 800-510-0146. International participants should call 617-614-3449. No pass code is required. A replay of the conference call will be available for one week beginning Monday, October 26, 2009 by calling 888-286-8010 in the United States or 617-801-6888 internationally and entering the pass code number 79433710 when prompted. A replay will also be available on the Company's web site, 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", such as forecasts of our financial results and condition, expectations for our operations and business prospects, and our assumptions used in those forecasts and expectations. 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, 2008, which was filed with the U.S. Securities and Exchange Commission. We have not committed to update forward-looking statements to reflect later events or circumstances.
Bank of Hawaii Corporation is a regional financial services company serving businesses, consumers, and governments in Hawaii, American Samoa, and the West Pacific. The Company's principal subsidiary, Bank of Hawaii, was founded in 1897 and is the largest independent financial institution in Hawaii. 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) 2009 2009 2008 2009 2008
For the Period:
Operating Results
Net Interest Income $ 108,887 $ 102,851 $ 103,575 $ 308,800 $ 312,923
Provision for Credit Losses 27,500 28,690 20,358 81,077 41,957
Total Noninterest Income 56,800 59,832 56,986 186,997 203,650
Total Noninterest Expense 83,987 89,584 86,790 261,504 264,084
Net Income 36,471 31,006 47,409 103,517 152,906
Basic Earnings Per Share 0.76 0.65 1.00 2.17 3.20
Diluted Earnings Per Share 0.76 0.65 0.99 2.16 3.17
Dividends Declared Per Share 0.45 0.45 0.44 1.35 1.32
Performance Ratios
Return on Average Assets 1.21 % 1.06 % 1.82 % 1.19 % 1.95 %
Return on Average Shareholders' Equity 16.44 14.49 24.17 16.24 26.26
Efficiency Ratio (1) 50.69 55.07 54.05 52.74 51.12
Operating Leverage (2) 11.77 (8.04 ) (12.02 ) (7.21 ) 8.65
Net Interest Margin (3) 3.85 3.73 4.33 3.78 4.30
Dividend Payout Ratio (4) 59.21 69.23 44.00 62.21 41.25
Average Shareholders' Equity to Average Assets 7.34 7.30 7.55 7.34 7.41
Average Balances
Average Loans and Leases $ 6,034,956 $ 6,258,403 $ 6,512,453 $ 6,245,117 $ 6,543,871
Average Assets 11,988,995 11,753,580 10,339,490 11,616,237 10,495,367
Average Deposits 9,131,064 9,222,130 7,772,535 9,036,247 7,893,972
Average Shareholders' Equity 880,003 858,139 780,334 852,347 777,650
Market Price Per Share of Common Stock
Closing $ 41.54 $ 35.83 $ 53.45 $ 41.54 $ 53.45
High 42.92 41.42 70.00 45.24 70.00
Low 33.65 31.35 37.46 25.33 37.46
September 30, June 30, December 31, September 30,
2009 2009 2008 2008
As of Period End:
Balance Sheet Totals
Loans and Leases $ 5,931,358 $ 6,149,911 $ 6,530,233 $ 6,539,458
Total Assets 12,208,025 12,194,695 10,763,475 10,335,047
Total Deposits 9,250,100 9,019,661 8,292,098 7,658,484
Long-Term Debt 91,424 91,432 203,285 204,616
Total Shareholders' Equity 902,799 845,885 790,704 780,020
Asset Quality
Allowance for Loan and Lease Losses $ 142,658 $ 137,416 $ 123,498 $ 115,498
Non-Performing Assets (5) 48,536 39,054 14,949 5,927
Financial Ratios
Allowance to Loans and Leases Outstanding 2.41 % 2.23 % 1.89 % 1.77 %
Tier 1 Capital Ratio 13.43 12.56 11.24 11.14
Total Capital Ratio 14.70 13.82 12.49 12.40
Leverage Ratio 6.67 6.66 7.30 7.27
Tangible Common Equity to Total Assets (6) 7.11 6.65 7.01 7.20
Tangible Common Equity to Risk-Weighted Assets (6) 14.56 13.02 11.28 11.04
Non-Financial Data
Full-Time Equivalent Employees 2,474 2,533 2,581 2,573
Branches and Offices 85 85 85 84
ATMs 485 486 462 467
(1) Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income). (2) Operating leverage is defined as the percentage change in income before the provision for credit losses and the provision for income taxes. Measures are presented on a linked quarter basis. (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 share divided by basic earnings per share. (5) Excluded from non-performing assets are non-accrual loans held for sale of $7.7 million and $5.2 million as of September 30, 2009 and June 30, 2009, respectively. (6) Tangible common equity, a non-GAAP financial measure, is defined by the Company as shareholders' equity minus goodwill and intangible assets. Intangible assets are included as a component of other assets in the Consolidated Statements of Condition.
Bank of Hawaii Corporation and Subsidiaries
Net Significant Income (Expense) Items Table 2
Three Months Ended Nine Months Ended
September 30, June 30, September 30, September 30,
(dollars in thousands) 2009 2009 2008 2009 2008
Leveraged Lease Residual Value Impairment $ (968 ) $ - $ - $ (968 ) $ -
SILO Leveraged Lease - - (3,981 ) - (3,981 )
Gain on Disposal of Leased Equipment - 2,782 - 12,818 11,588
Gain on Sale of Insurance Subsidiary - 852 - 852 -
Gain on Mandatory Redemption of Visa Shares - - - - 13,737
Increase in Allowance for Loan and Lease Losses (5,242 ) (3,000 ) (13,000 ) (19,160 ) (24,500 )
FDIC Special Assessment - (5,744 ) - (5,744 ) -
Market Premium on Repurchased Long-Term Privately Placed Debt - - - (875 ) -
Cash Grants for the Purchase of Company Stock - - - - (4,640 )
Employee Incentive Awards - - (2,000 ) - (6,386 )
Legal Contingencies - - - (1,500 ) (3,016 )
Bank of Hawaii Charitable Foundation and Other Contributions - - - - (2,250 )
Call Premium on Capital Securities - - - - (991 )
Separation Expense - - - - (615 )
Reversal of Visa Legal Costs - - - - 5,649
Significant Income (Expense) Items Before the Benefit for Income (6,210 ) (5,110 ) (18,981 ) (14,577 ) (15,405 )
Taxes
Income Tax Impact Related to Lease Transactions (373 ) (286 ) (12,920 ) 3,213 (14,331 )
Income Tax Impact (1,835 ) (2,762 ) (5,250 ) (9,249 ) (8,095 )
Net Significant Income (Expense) Items $ (4,002 ) $ (2,062 ) $ (811 ) $ (8,541 ) $ 7,021
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) 2009 2009 2008 (1) 2009 2008 (1)
Interest Income
Interest and Fees on Loans and Leases $ 79,530 $ 83,342 $ 92,744 $ 249,464 $ 295,116
Income on Investment Securities
Trading - - 1,174 594 3,543
Available-for-Sale 46,419 38,155 35,152 116,875 104,724
Held-to-Maturity 2,179 2,369 2,870 7,115 9,142
Deposits 3 5 33 18 432
Funds Sold 320 526 141 1,423 1,553
Other 277 276 490 829 1,405
Total Interest Income 128,728 124,673 132,604 376,318 415,915
Interest Expense
Deposits 12,235 14,481 17,736 43,741 65,439
Securities Sold Under Agreements to Repurchase 6,394 6,477 7,675 19,523 25,780
Funds Purchased 5 5 507 15 1,410
Short-Term Borrowings - - 13 - 59
Long-Term Debt 1,207 859 3,098 4,239 10,304
Total Interest Expense 19,841 21,822 29,029 67,518 102,992
Net Interest Income 108,887 102,851 103,575 308,800 312,923
Provision for Credit Losses 27,500 28,690 20,358 81,077 41,957
Net Interest Income After Provision for Credit Losses 81,387 74,161 83,217 227,723 270,966
Noninterest Income
Trust and Asset Management 10,915 11,881 14,193 34,428 44,739
Mortgage Banking 4,656 5,443 621 18,777 7,656
Service Charges on Deposit Accounts 14,014 12,910 13,045 40,310 37,539
Fees, Exchange, and Other Service Charges 14,801 15,410 15,604 45,187 47,098
Investment Securities Gains (Losses), Net (5 ) 12 159 63 446
Insurance 7,304 4,744 5,902 17,689 18,622
Other 5,115 9,432 7,462 30,543 47,550
Total Noninterest Income 56,800 59,832 56,986 186,997 203,650
Noninterest Expense
Salaries and Benefits 46,387 44,180 46,764 137,595 148,221
Net Occupancy 10,350 10,008 11,795 30,686 33,581
Net Equipment 4,502 4,502 4,775 13,320 13,570
Professional Fees 2,642 4,005 3,270 9,196 8,471
FDIC Insurance 3,290 8,987 321 14,091 817
Other 16,816 17,902 19,865 56,616 59,424
Total Noninterest Expense 83,987 89,584 86,790 261,504 264,084
Income Before Provision for Income Taxes 54,200 44,409 53,413 153,216 210,532
Provision for Income Taxes 17,729 13,403 6,004 49,699 57,626
Net Income $ 36,471 $ 31,006 $ 47,409 $ 103,517 $ 152,906
Basic Earnings Per Share $ 0.76 $ 0.65 $ 1.00 $ 2.17 $ 3.20
Diluted Earnings Per Share $ 0.76 $ 0.65 $ 0.99 $ 2.16 $ 3.17
Dividends Declared Per Share $ 0.45 $ 0.45 $ 0.44 $ 1.35 $ 1.32
Basic Weighted Average Shares 47,745,375 47,682,604 47,518,078 47,665,146 47,738,245
Diluted Weighted Average Shares 48,045,873 47,948,531 48,057,965 47,930,271 48,295,901
(1 )Certain prior period information has been reclassified to conform to current presentation.
Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Condition Table 4
September 30, June 30, December 31, September 30,
(dollars in thousands) 2009 2009 2008 2008 (1)
Assets
Interest-Bearing Deposits $ 5,863 $ 4,537 $ 5,094 $ 13,845
Funds Sold 401,200 656,000 405,789 -
Investment Securities
Trading - - 91,500 90,993
Available-for-Sale 4,827,588 4,292,911 2,519,239 2,572,111
Held-to-Maturity (Fair Value of $201,118; $214,484; $242,175; and 194,444 209,807 239,635 249,083
$245,720)
Loans Held for Sale 19,346 40,994 21,540 14,903
Loans and Leases 5,931,358 6,149,911 6,530,233 6,539,458
Allowance for Loan and Lease Losses (142,658 ) (137,416 ) (123,498 ) (115,498 )
Net Loans and Leases 5,788,700 6,012,495 6,406,735 6,423,960
Total Earning Assets 11,237,141 11,216,744 9,689,532 9,364,895
Cash and Noninterest-Bearing Deposits 291,480 294,022 385,599 285,762
Premises and Equipment 110,173 112,681 116,120 118,333
Customers' Acceptances 950 2,084 1,308 1,250
Accrued Interest Receivable 43,047 43,042 39,905 41,061
Foreclosed Real Estate 201 438 428 293
Mortgage Servicing Rights 25,437 24,731 21,057 27,707
Goodwill 34,959 34,959 34,959 34,959
Other Assets 464,637 465,994 474,567 460,787
Total Assets $ 12,208,025 $ 12,194,695 $ 10,763,475 $ 10,335,047
Liabilities
Deposits
Noninterest-Bearing Demand $ 2,055,872 $ 2,109,270 $ 1,754,724 $ 1,592,251
Interest-Bearing Demand 1,588,705 1,589,300 1,854,611 1,708,183
Savings 4,365,257 4,054,039 3,104,863 2,780,798
Time 1,240,266 1,267,052 1,577,900 1,577,252
Total Deposits 9,250,100 9,019,661 8,292,098 7,658,484
Funds Purchased 8,670 8,670 15,734 189,700
Short-Term Borrowings 7,200 10,000 4,900 10,621
Securities Sold Under Agreements to Repurchase 1,524,755 1,799,794 1,028,835 1,109,431
Long-Term Debt (includes $119,275 and $120,598 carried at fair 91,424 91,432 203,285 204,616
value as of December 31, 2008 and September 30, 2008, respectively)
Banker's Acceptances 950 2,084 1,308 1,250
Retirement Benefits Payable 43,918 54,286 54,776 22,438
Accrued Interest Payable 9,740 7,765 13,837 12,702
Taxes Payable and Deferred Taxes 254,375 226,936 229,699 240,795
Other Liabilities 114,094 128,182 128,299 104,990
Total Liabilities 11,305,226 11,348,810 9,972,771 9,555,027
Shareholders' Equity
Common Stock ($.01 par value; authorized 500,000,000 shares; 569 569 568 568
issued / outstanding: September 30, 2009 - 57,028,554 /
47,937,543; June 30, 2009 - 57,028,940 / 47,881,083; December 31,
2008 - 57,019,887 / 47,753,371; and September 30, 2008 -
57,022,797 / 47,707,629)
Capital Surplus 492,346 491,784 492,515 491,419
Accumulated Other Comprehensive Income (Loss) 37,307 (1,870 ) (28,888 ) (18,643 )
Retained Earnings 825,709 811,121 787,924 770,373
Treasury Stock, at Cost (Shares: September 30, 2009 - 9,091,011; (453,132 ) (455,719 ) (461,415 ) (463,697 )
June 30, 2009 - 9,147,857; December 31, 2008 - 9,266,516; and
September 30, 2008 - 9,315,168)
Total Shareholders' Equity 902,799 845,885 790,704 780,020
Total Liabilities and Shareholders' Equity $ 12,208,025 $ 12,194,695 $ 10,763,475 $ 10,335,047
(1) Certain prior period information has been
reclassified to conform to current presentation.
Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Shareholders' Equity Table 5
Accum.
Other
Compre-
hensive Compre-
Common Capital (Loss) Retained Treasury hensive
(dollars in thousands) Total Stock Surplus Income Earnings Stock Income
Balance as of December 31, 2008 $ 790,704 $ 568 $ 492,515 $ (28,888 ) $ 787,924 $ (461,415 )
Comprehensive Income:
Net Income 103,517 - - - 103,517 - $ 103,517
Other Comprehensive Income, Net of Tax:
Change in Unrealized Gains and Losses on Investment Securities 65,121 - - 65,121 - - 65,121
Available-for-Sale
Amortization of Net Loss Related to Pension and Postretirement 1,074 - - 1,074 - - 1,074
Benefit Plans
Total Comprehensive Income $ 169,712
Share-Based Compensation 1,700 - 1,700 - - -
Common Stock Issued under Purchase and Equity Compensation Plans 6,202 1 (1,869 ) - (1,101 ) 9,171
and Related Tax Benefits (209,847 shares)
Common Stock Repurchased (25,675 shares) (888 ) - - - - (888 )
Cash Dividends Paid (64,631 ) - - - (64,631 ) -
Balance as of September 30, 2009 $ 902,799 $ 569 $ 492,346 $ 37,307 $ 825,709 $ (453,132 )
Balance as of December 31, 2007 $ 750,255 $ 567 $ 484,790 $ (5,091 ) $ 688,638 $ (418,649 )
Cumulative-Effect Adjustment of a Change in Accounting Principle,
Net of Tax:
Adoption of Accounting Principles Related to the Fair Value Option (2,736 ) - - - (2,736 ) -
Comprehensive Income:
Net Income 152,906 - - - 152,906 - $ 152,906
Other Comprehensive Income, Net of Tax:
Change in Unrealized Gains and Losses on Investment Securities (13,699 ) - - (13,699 ) - - (13,699 )
Available-for-Sale
Amortization of Net Loss Related to Pension and Postretirement 147 - - 147 - - 147
Benefit Plans
Total Comprehensive Income $ 139,354
Share-Based Compensation 4,480 - 4,480 - - -
Common Stock Issued under Purchase and Equity Compensation Plans 13,728 1 2,149 - (5,075 ) 16,653
and Related Tax Benefits (378,382 shares)
Common Stock Repurchased (1,260,398 shares) (61,701 ) - - - - (61,701 )
Cash Dividends Paid (63,360 ) - - - (63,360 ) -
Balance as of September 30, 2008 $ 780,020 $ 568 $ 491,419 $ (18,643 ) $ 770,373 $ (463,697 )
Bank of Hawaii Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable Equivalent Basis Table 6a
Three Months Ended Three Months Ended Three Months Ended
September 30, 2009 June 30, 2009 September 30, 2008 (1)
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 $ 5.1 $ - 0.28 % $ 5.2 $ - 0.36 % $ 6.4 $ - 2.06 %
Funds Sold 489.7 0.3 0.26 833.2 0.5 0.25 28.4 0.1 1.96
Investment Securities
Trading - - - - - - 92.6 1.2 5.07
Available-for-Sale 4,491.2 46.7 4.16 3,662.1 38.5 4.21 2,601.2 35.4 5.44
Held-to-Maturity 202.0 2.2 4.31 219.9 2.4 4.31 255.4 2.9 4.50
Loans Held for Sale 25.2 0.2 2.95 24.1 0.2 4.21 6.6 0.1 6.34
Loans and Leases (2)
Commercial and Industrial 884.4 9.0 4.06 984.1 9.9 4.02 1,049.7 13.8 5.23
Commercial Mortgage 787.0 10.2 5.14 763.8 9.9 5.22 695.3 10.5 6.04
Construction 140.9 1.4 3.81 144.5 1.5 4.03 161.4 2.3 5.67
Commercial Lease Financing 464.0 3.0 2.56 450.2 3.5 3.13 472.9 0.2 0.15
Residential Mortgage 2,273.8 33.0 5.81 2,359.0 34.6 5.88 2,480.7 37.6 6.05
Home Equity 963.3 12.3 5.08 999.3 12.6 5.07 994.6 14.4 5.77
Automobile 304.5 6.1 7.88 325.5 6.5 7.96 403.6 8.2 8.09
Other (3) 217.1 4.3 7.95 232.0 4.6 7.89 254.3 5.6 8.80
Total Loans and Leases 6,035.0 79.3 5.24 6,258.4 83.1 5.32 6,512.5 92.6 5.67
Other 79.7 0.3 1.39 79.7 0.3 1.39 79.6 0.5 2.46
Total Earning Assets (4) 11,327.9 129.0 4.54 11,082.6 125.0 4.52 9,582.7 132.8 5.53
Cash and Noninterest-Bearing Deposits 203.5 203.9 274.3
Other Assets 457.6 467.1 482.5
Total Assets $ 11,989.0 $ 11,753.6 $ 10,339.5
Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand $ 1,625.6 0.2 0.06 $ 1,907.7 0.3 0.07 $ 1,793.0 1.5 0.32
Savings 4,190.2 6.6 0.63 4,036.9 7.8 0.77 2,790.3 6.3 0.90
Time 1,264.7 5.4 1.69 1,330.6 6.4 1.92 1,594.8 9.9 2.48
Total Interest-Bearing Deposits 7,080.5 12.2 0.69 7,275.2 14.5 0.80 6,178.1 17.7 1.14
Short-Term Borrowings 18.1 - 0.12 16.4 - 0.12 116.7 0.5 1.74
Securities Sold Under Agreements to Repurchase 1,464.3 6.4 1.71 1,168.2 6.5 2.20 1,077.4 7.7 2.80
Long-Term Debt 91.4 1.2 5.26 71.1 0.8 4.84 205.1 3.1 6.04
Total Interest-Bearing Liabilities 8,654.3 19.8 0.91 8,530.9 21.8 1.02 7,577.3 29.0 1.52
Net Interest Income $ 109.2 $ 103.2 $ 103.8
Interest Rate Spread 3.63 % 3.50 % 4.01 %
Net Interest Margin 3.85 % 3.73 % 4.33 %
Noninterest-Bearing Demand Deposits 2,050.5 1,946.9 1,594.4
Other Liabilities 404.2 417.7 387.5
Shareholders' Equity 880.0 858.1 780.3
Total Liabilities and Shareholders' Equity $ 11,989.0 $ 11,753.6 $ 10,339.5
(1) Certain prior period information has been
reclassified to conform to current presentation.
(2) 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.
(3) Comprised of other consumer revolving credit,
installment, and consumer lease financing.
(4) Interest income includes taxable equivalent basis
adjustments, based upon a federal statutory tax rate of 35%, of
$329,000, $331,000, and $234,000 for the three months ended
September 30, 2009, June 30, 2009, and September 30, 2008,
respectively.
Bank of Hawaii Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable Equivalent Basis Table 6b
Nine Months Ended Nine Months Ended
September 30, 2009 September 30, 2008 (1)
Average Income/ Yield/ Average Income/ Yield/
(dollars in millions) Balance Expense Rate Balance Expense Rate
Earning Assets
Interest-Bearing Deposits $ 5.0 $ - 0.49 % $ 22.2 $ 0.4 2.56 %
Funds Sold 743.7 1.4 0.25 82.6 1.6 2.47
Investment Securities
Trading 16.1 0.6 4.92 95.3 3.5 4.96
Available-for-Sale 3,600.8 117.8 4.36 2,627.5 105.5 5.35
Held-to-Maturity 218.9 7.1 4.33 270.1 9.1 4.51
Loans Held for Sale 23.7 0.7 3.82 8.8 0.4 5.79
Loans and Leases (2)
Commercial and Industrial 966.1 29.4 4.06 1,058.5 44.6 5.64
Commercial Mortgage 760.7 29.7 5.23 669.2 31.1 6.21
Construction 146.5 4.4 4.02 179.4 8.2 6.09
Commercial Lease Financing 459.0 10.1 2.95 473.8 8.3 2.33
Residential Mortgage 2,356.1 104.0 5.89 2,490.5 113.7 6.09
Home Equity 996.9 38.0 5.09 990.6 45.1 6.07
Automobile 328.6 19.5 7.93 421.7 25.7 8.14
Other (3) 231.3 13.7 7.90 260.2 18.0 9.22
Total Loans and Leases 6,245.2 248.8 5.32 6,543.9 294.7 6.01
Other 79.7 0.8 1.39 79.6 1.4 2.35
Total Earning Assets (4) 10,933.1 377.2 4.60 9,730.0 416.6 5.71
Cash and Noninterest-Bearing Deposits 216.8 280.4
Other Assets 466.3 485.0
Total Assets $ 11,616.2 $ 10,495.4
Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand $ 1,806.4 0.9 0.06 $ 1,635.6 4.9 0.40
Savings 3,922.4 22.6 0.77 2,802.2 22.1 1.06
Time 1,364.5 20.3 1.98 1,662.6 38.4 3.09
Total Interest-Bearing Deposits 7,093.3 43.8 0.82 6,100.4 65.4 1.43
Short-Term Borrowings 17.7 - 0.11 86.0 1.5 2.25
Securities Sold Under Agreements to Repurchase 1,191.2 19.5 2.16 1,100.5 25.8 3.10
Long-Term Debt 103.4 4.2 5.47 223.0 10.3 6.16
Total Interest-Bearing Liabilities 8,405.6 67.5 1.07 7,509.9 103.0 1.83
Net Interest Income $ 309.7 $ 313.6
Interest Rate Spread 3.53 % 3.88 %
Net Interest Margin 3.78 % 4.30 %
Noninterest-Bearing Demand Deposits 1,943.0 1,793.5
Other Liabilities 415.3 414.3
Shareholders' Equity 852.3 777.7
Total Liabilities and Shareholders' Equity $ 11,616.2 $ 10,495.4
(1) Certain prior period information has been
reclassified to conform to current presentation.
(2) 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.
(3) Comprised of other consumer revolving credit,
installment, and consumer lease financing.
(4) Interest income includes taxable equivalent basis
adjustments, based upon a federal statutory tax rate of 35%, of
$886,000 and $711,000 for the nine months ended September 30, 2009
and 2008, respectively.
Bank of Hawaii Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable Equivalent Table 7a
Basis
Three Months Ended September 30, 2009
Compared to June 30, 2009
(dollars in millions) Volume (1) Rate (1) Time (1) Total
Change in Interest Income:
Funds Sold $ (0.2 ) $ - $ - $ (0.2 )
Investment Securities
Available-for-Sale 8.4 (0.5 ) 0.3 8.2
Held-to-Maturity (0.2 ) - - (0.2 )
Loans and Leases
Commercial and Industrial (1.1 ) 0.1 0.1 (0.9 )
Commercial Mortgage 0.3 (0.1 ) 0.1 0.3
Construction - (0.1 ) - (0.1 )
Commercial Lease Financing 0.1 (0.6 ) - (0.5 )
Residential Mortgage (1.5 ) (0.5 ) 0.4 (1.6 )
Home Equity (0.3 ) - - (0.3 )
Automobile (0.4 ) (0.1 ) 0.1 (0.4 )
Other (2) (0.3 ) - - (0.3 )
Total Loans and Leases (3.2 ) (1.3 ) 0.7 (3.8 )
Total Change in Interest Income 4.8 (1.8 ) 1.0 4.0
Change in Interest Expense:
Interest-Bearing Deposits
Demand (0.1 ) - - (0.1 )
Savings 0.3 (1.5 ) - (1.2 )
Time (0.3 ) (0.8 ) 0.1 (1.0 )
Total Interest-Bearing Deposits (0.1 ) (2.3 ) 0.1 (2.3 )
Securities Sold Under Agreements to Repurchase 1.5 (1.7 ) 0.1 (0.1 )
Long-Term Debt 0.3 0.1 - 0.4
Total Change in Interest Expense 1.7 (3.9 ) 0.2 (2.0 )
Change in Net Interest Income $ 3.1 $ 2.1 $ 0.8 $ 6.0
(1) The changes for each category of interest income and
expense are allocated between the portion of changes attributable
to the variance in volume, rate, and time for that category.
(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 Table 7b
Basis
Three Months Ended September 30, 2009
Compared to September 30, 2008
(dollars in millions) Volume (1) Rate (1) Total
Change in Interest Income:
Funds Sold $ 0.4 $ (0.2 ) $ 0.2
Investment Securities
Trading (0.6 ) (0.6 ) (1.2 )
Available-for-Sale 21.1 (9.8 ) 11.3
Held-to-Maturity (0.6 ) (0.1 ) (0.7 )
Loans Held for Sale 0.2 (0.1 ) 0.1
Loans and Leases
Commercial and Industrial (2.0 ) (2.8 ) (4.8 )
Commercial Mortgage 1.3 (1.6 ) (0.3 )
Construction (0.2 ) (0.7 ) (0.9 )
Commercial Lease Financing - 2.8 2.8
Residential Mortgage (3.1 ) (1.5 ) (4.6 )
Home Equity (0.4 ) (1.7 ) (2.1 )
Automobile For full details on Bank of Hawaii Corp (BOH) click here. Bank of Hawaii Corp (BOH) has Short Term PowerRatings of 6. Details on Bank of Hawaii Corp (BOH) Short Term PowerRatings is available at This Link.
More News:
Market Updates |
Stock Alerts |
All Trading News |
Stock Index
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
10 Exchange Place, Suite 1800
Jersey City, NJ 07302
© Copyright 2009 The Connors Group, Inc.