Exhibit 99.1
Bank of Hawaii Corporation 2004 Financial Results
• 2004 Diluted Earnings Per Share $3.08, Up 39% From 2003
• 2004 Net Income $173.3 Million, Up 28% From 2003
• Board of Directors Increases Share Repurchase Authorization $100 Million
• Board of Directors Declares Dividend of $0.33 Per Share
FOR IMMEDIATE RELEASE
HONOLULU, HI (January 24, 2005) — Bank of Hawaii Corporation (NYSE: BOH) today reported diluted earnings per share for 2004 of $3.08, up $0.87 or 39.4 percent from diluted earnings per share of $2.21 in 2003. Net income for the year was $173.3 million, up $38.1 million or 28.2 percent from $135.2 million in the previous year. The return on average assets in 2004 was 1.78 percent, up from 1.44 percent in 2003. The return on average equity for the year was 22.78 percent, up from 15.02 percent in 2003.
“I am very pleased with Bank of Hawaii Corporation’s financial performance in 2004. We exceeded the financial objectives of the first year of our three-year plan,” said Allan R. Landon, Chairman and CEO. “Additionally, we grew our businesses, improved our processes, and maintained excellent asset quality. The Hawaii economy remains solid and we are optimistic about 2005.”
Diluted earnings per share for the fourth quarter of 2004 were $0.82, up $0.16 or 24.2 percent from $0.66 per diluted share for the same period last year. Net income in the fourth quarter of 2004 was $46.2 million, up $7.6 million or 19.6 percent from net income of $38.7 million in the fourth quarter last year. Results for the fourth quarter of 2004 included a return to income of $6.5 million before tax ($4.1 million after tax or $0.07 per diluted share), resulting from a release of the allowance for loan and lease losses due to further improvement in the Company’s credit quality and continued strong economic conditions. The return on average assets for the fourth quarter of 2004 was 1.89 percent, up from 1.66 percent in the fourth quarter of 2003. The return on average equity was 23.63 percent for the quarter, up from 18.59 percent in the same quarter last year.
- more -
Financial Highlights
Net interest income, on a taxable equivalent basis, for the fourth quarter of 2004 was $100.0 million, up $1.2 million from $98.8 million in the third quarter of 2004 and up $6.6 million from $93.4 million in the fourth quarter last year. The increase in net interest income from the previous quarter was largely due to an increase in average earning assets. An analysis of the change in net interest income for the full year of 2004 is included in Table 6.
The net interest margin was 4.40 percent for the fourth quarter of 2004, a 1 basis point increase from 4.39 percent in the previous quarter and a 5 basis point increase from 4.35 percent in the fourth quarter of 2003. The net interest margin for the full year of 2004 was 4.32 percent, a 9 basis point increase from 4.23 percent in 2003.
The Company returned to income $6.5 million of the allowance for loan and lease losses during the fourth quarter of 2004. This was attributable to further improvement in the credit quality of the loan portfolio, lower than anticipated net charge-offs during 2004, management’s ongoing assessment of the portfolio, and continued strength in the economic environment. In addition, the Company revised its allocation of the components of the allowance for loan and lease losses as a result of current accounting interpretations.
Non-interest income was $48.4 million for the fourth quarter, a decrease of $4.7 million or 8.9 percent compared to non-interest income of $53.1 million in the third quarter of 2004. Non-interest income in the third quarter of 2004 included a gain of $5.2 million on the sale of assets at the end of a leveraged lease transaction. Excluding this gain, non-interest income increased $0.5 million as growth in trust and asset management fees and service charges on deposits offset losses on the sale of investment securities and a decline in insurance income. Non-interest income was down $1.1 million or 2.2 percent from non-interest income of $49.4 million in the fourth quarter of 2003 largely due to a decline in gains on sales of mortgage loans.
Non-interest expense was $82.1 million in the fourth quarter of 2004, down $2.1 million or 2.5 percent from $84.2 million in the previous quarter and down $1.3 million or 1.6 percent from $83.4 million in the same quarter last year. The decrease for both periods was due to a reduction in salaries and benefits related to incentive compensation and separation expenses. In addition, the fourth quarter of 2003 included higher stock-based compensation expense that was offset by a curtailment gain on post-retirement benefits. An analysis of salary and benefit expenses is included in Table 7.
The efficiency ratio for the fourth quarter of 2004 was 55.37 percent, an improvement from 55.45 percent in the previous quarter and from 58.41 percent in the same quarter last year. The efficiency ratio for the full year of 2004 was 56.14 percent compared to 63.38 percent for 2003. Excluding systems replacement costs, the efficiency ratio for 2003 was 59.51 percent.
The Company’s business segments are defined as Retail Banking, Commercial Banking, Investment Services Group, and Treasury and Other Corporate. Results are determined based on the Company’s internal financial management reporting process and organizational structure. Previously reported results have been reclassified to conform to current methodologies. Business segment performance details are summarized in Tables 11a and 11b.
2
Asset Quality
Bank of Hawaii Corporation’s strong credit quality continued to improve during the fourth quarter of 2004. Non-performing assets were $13.9 million at the end of the quarter, a decrease of $2.1 million, or 13.3 percent, compared to non-performing assets of $16.0 million at the end of the previous quarter. Non-performing assets declined $17.9 million, or 56.3 percent, compared to $31.7 million at the end of 2003. At December 31, 2004 the ratio of non-performing assets to total loans and foreclosed real estate was 0.23 percent compared with 0.27 percent at September 30, 2004 and 0.55 percent at December 31, 2003.
Non-accrual loans were $13.7 million at December 31, 2004, a reduction of $2.1 million, or 13.3 percent, from $15.8 million at September 30, 2004 and down $13.7 million, or 50.0 percent, from $27.3 million at December 31, 2003. Non-accrual loans as a percentage of total loans were 0.23 percent at December 31, 2004, down from 0.27 percent at the end of the previous quarter and down from 0.48 percent at the end of 2003.
Net charge-offs during the fourth quarter of 2004 were $4.6 million, or 0.31 percent (annualized) of total average loans, compared to $0.3 million, or 0.02 percent (annualized) of total average loans in the third quarter of 2004. Net charge-offs in the fourth quarter of 2004 were comprised of $6.7 million in charge-offs partially offset by recoveries of $2.1 million. Net charge-offs during the fourth quarter of 2003 were $3.6 million, or 0.26 percent (annualized) of total average loans. Net charge-offs for the full year of 2004 were $5.5 million, or 0.09 percent of total average loans, a decrease of $8.3 million, or 60.2 percent, from net charge-offs of $13.8 million, or 0.25 percent of total average loans in 2003.
The allowance for loan and lease losses was $106.8 million at December 31, 2004 down from $124.7 million at September 30, 2004 and down from $129.1 million at December 31, 2003. The decrease in the allowance from the previous quarter was partially due to the previously mentioned $6.5 million return to income from the allowance for loan and lease losses. The decrease from the previous year also reflects a $3.5 million return to income from the allowance for loan and lease losses during the second quarter of 2004. In addition, during the fourth quarter of 2004 $6.8 million was reclassified from the allowance for loan and lease losses to other liabilities representing the estimate for probable credit losses inherent in unfunded commitments to extend credit. The process used to determine the reserve for unfunded commitments remains consistent with the process for determining the allowance for loan and lease losses. The allowance for unfunded commitments at December 31, 2004 was up from $6.7 million at September 30, 2004 and down from $6.9 million at December 31, 2003.
The ratio of the allowance for loan and lease losses to total loans was 1.78 percent at December 31, 2004, down from 2.14 percent at September 30, 2004 and down from 2.24 percent at December 31, 2003. If the allowance for unfunded commitments had been reclassified at either September 30, 2004 or at December 31, 2003, the ratio of the allowance for loan and lease losses to total loans would have been 2.03 percent and 2.12 percent, respectively.
Concentrations of credit exposure to selected components of the portfolio are summarized in Table 8.
3
Other Financial Highlights
Total assets were $9.77 billion at December 31, 2004, up from $9.59 billion at September 30, 2004 and up from $9.46 billion at December 31, 2003. Total loans and leases were $5.99 billion at December 31, 2004, up from $5.82 billion at September 30, 2004 and up from $5.76 billion at December 31, 2003. Commercial lending increased during the quarter. Total commercial loans were $2.04 billion at December 31, 2004, up $87 million compared to $1.96 billion at September 30, 2004 and up $51 million from $1.99 billion at December 31, 2003. Consumer lending continued its solid pace in the fourth quarter. Total consumer loans were $3.86 billion at December 31, 2004, up $79 million compared to $3.78 billion at the end of the previous quarter and up $163 million compared to $3.69 billion at the end of 2003.
Total deposits at December 31, 2004 were $7.56 billion, up $151 million from total deposits of $7.41 billion at September 30, 2004 and up $232 million from total deposits of $7.33 billion at December 31, 2003. Non-interest bearing demand deposits were $1.98 billion at December 31, 2004, up $79 million compared to $1.90 billion at September 30, 2004 and up $44 million from $1.93 billion at December 31, 2003.
During the fourth quarter of 2004, Bank of Hawaii Corporation repurchased 1.0 million shares of common stock at a total cost of $50.3 million under its share repurchase program. The average cost was $49.01 per share repurchased during the quarter. From the beginning of the share repurchase program in July 2001 through December 31, 2004, the Company repurchased a total of 34.9 million shares and returned a total of $1,087.5 million to the shareholders at an average cost of $31.13 per share.
The Company’s Board of Directors has increased the authorization under the share repurchase program by an additional $100 million of common stock. This new authorization, combined with the previously announced authorizations of $1,150 million, brings the total repurchase authority to $1,250 million. From January 1, 2005 through January 21, 2005, the Company repurchased an additional 0.4 million shares of common stock at an average cost of $48.98 per share. Remaining buyback authority under the share repurchase program was $141.7 million at January 21, 2005.
The Company’s capital and liquidity remain strong. At December 31, 2004 the Tier 1 leverage ratio was 8.29 percent compared to 7.69 percent at September 30, 2004 and 8.43 percent at December 31, 2003.
The Company’s Board of Directors has declared a quarterly cash dividend of $0.33 per share on the Company’s outstanding shares. The dividend will be payable on March 14, 2005 to shareholders of record at the close of business on February 28, 2005.
Outlook
Hawaii enters 2005 with continued payroll growth, low unemployment, nominal personal income growth approaching 6.0 percent, reasonable inflation, and tourism at record levels. The dollar’s continuing weakness and solid economic growth in Asia should contribute to further increases in international tourism. Construction and real estate investment are expected to remain strong drivers of growth in the Hawaii economy.
4
Bank of Hawaii Corporation currently estimates that its net income for 2005 should be approximately $174 million to $177 million. Based on current economic conditions, the Company expects further credit quality improvement and, as a result, the allowance for loan and lease losses may be further reduced. Net income estimates for 2005 include a $10 million provision for loan and lease losses. An analysis of credit quality is performed quarterly to determine the adequacy of the allowance for loan and lease losses. The results of this analysis determine the timing and amount of the provision for loan and lease losses. Earnings per share and return on equity projections continue to be dependent upon, among other things, the terms and timing of share repurchases.
Conference Call Information
The Company will review its fourth quarter 2004 financial results today at 8:00 a.m. Hawaii Time (1:00 p.m. Eastern Time). The presentation will be accessible via teleconference and via the Investor Relations link of Bank of Hawaii Corporation’s web site, www.boh.com. The conference call number is 800-573-4752 in the United States or 617-224-4324 for international callers. No confirmation code is required to access the call. A replay will be available for one week beginning Monday, January 24, 2005 by calling 888-286-8010 in the United States or 617-801-6888 for international callers and entering the number 60030955 when prompted. A replay of the presentation will also be available via the Investor Relations link of the Company’s web site.
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.
Forward-Looking Statements
This news release, including the statements under the caption “Outlook,” contains forward-looking statements concerning, among other things, the economic and business environment in our service area and elsewhere, credit quality, the expected level of loan and lease loss provisioning, and anticipated net income and other financial and business matters in future periods. Our forward-looking statements are based on numerous assumptions, any of which could prove to be inaccurate and actual results may differ materially from those projected for a variety of reasons, including, but not limited to: 1) unanticipated changes in business and economic conditions, the competitive environment, fiscal and monetary policies, or legislation in Hawaii and the other markets we serve; 2) changes in our credit quality or risk profile which may increase or decrease the required level of allowance for loan and lease losses; 3) changes in market interest rates that may affect our credit markets and ability to maintain our net interest margin; 4) changes to the amount and timing of our proposed equity repurchases and repayment of maturing debt; 5) inability to achieve expected benefits of our business process changes due to adverse changes in implementation processes or costs, operational savings, or timing; 6) real or threatened acts of war or terrorist activity affecting business conditions; and 7) adverse weather and other natural conditions impacting our and our customers’ operations. We do not undertake any obligation to update forward-looking statements to reflect later events or circumstances.
# # # #
1
Bank of Hawaii Corporation and Subsidiaries
Highlights (Unaudited) |
| Table 1 |
(dollars in thousands except per share amounts) |
|
|
|
| Three Months Ended |
| Year Ended |
| ||||||||
Earnings Highlights and Performance Ratios |
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net Income |
| $ | 46,241 |
| $ | 38,673 |
| $ | 173,339 |
| $ | 135,195 |
|
Basic Earnings Per Share |
| 0.86 |
| 0.70 |
| 3.26 |
| 2.32 |
| ||||
Diluted Earnings Per Share |
| 0.82 |
| 0.66 |
| 3.08 |
| 2.21 |
| ||||
Cash Dividends |
| 18,200 |
| 16,770 |
| 66,326 |
| 50,589 |
| ||||
Net Income to Average Total Assets (ROA) |
| 1.89 | % | 1.66 | % | 1.78 | % | 1.44 | % | ||||
Net Income to Average Shareholders’ Equity (ROE) |
| 23.63 | % | 18.59 | % | 22.78 | % | 15.02 | % | ||||
Net Interest Margin |
| 4.40 | % | 4.35 | % | 4.32 | % | 4.23 | % | ||||
Efficiency Ratio 1 |
| 55.37 | % | 58.41 | % | 56.14 | % | 63.38 | % | ||||
Efficiency Ratio excluding System Replacement Costs |
| 55.37 | % | 58.41 | % | 56.14 | % | 59.51 | % | ||||
|
|
| December 31, |
| ||||
Statement of Condition Highlights and Performance Ratios |
|
| 2004 |
| 2003 |
| ||
|
|
|
|
|
|
| ||
Total Assets |
|
| $ | 9,766,191 |
| $ | 9,461,647 |
|
Net Loans |
|
| 5,880,134 |
| 5,628,095 |
| ||
Total Deposits |
|
| 7,564,667 |
| 7,332,779 |
| ||
Total Shareholders’ Equity |
|
| 814,834 |
| 793,132 |
| ||
|
|
|
|
|
|
| ||
Book Value Per Common Share |
|
| $ | 14.83 |
| $ | 14.44 |
|
Allowance / Loans and Leases Outstanding |
|
| 1.78 | % | 2.24 | % | ||
Average Equity / Average Assets |
|
| 7.81 | % | 9.60 | % | ||
Employees (FTE) |
|
| 2,623 |
| 2,702 |
| ||
Branches and offices |
|
| 87 |
| 89 |
| ||
|
|
|
|
|
|
| ||
Market Price Per Share of Common Stock for the Quarter Ended: |
|
|
|
|
|
| ||
| Closing |
| $ | 50.74 |
| $ | 42.20 |
|
| High |
| $ | 51.10 |
| $ | 42.99 |
|
| Low |
| $ | 46.80 |
| $ | 33.69 |
|
1 The efficiency ratio is defined as non-interest expense divided by total revenue (net interest income and non-interest income).
Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited) |
| Table 2 |
|
| Three Months Ended |
| Year Ended |
| ||||||||
(dollars in thousands except per share amounts) |
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| ||||
Interest Income |
|
|
|
|
|
|
|
|
| ||||
Interest and Fees on Loans and Leases |
| $ | 84,100 |
| $ | 80,351 |
| $ | 327,953 |
| $ | 334,793 |
|
Income on Investment Securities - Available for Sale |
| 26,394 |
| 19,032 |
| 93,528 |
| 77,793 |
| ||||
Income on Investment Securities - Held to Maturity |
| 6,147 |
| 7,183 |
| 26,204 |
| 18,956 |
| ||||
Deposits |
| 107 |
| 1,169 |
| 3,480 |
| 4,816 |
| ||||
Funds Sold |
| 356 |
| 85 |
| 1,058 |
| 1,919 |
| ||||
Other |
| 267 |
| 1,007 |
| 2,791 |
| 4,244 |
| ||||
Total Interest Income |
| 117,371 |
| 108,827 |
| 455,014 |
| 442,521 |
| ||||
Interest Expense |
|
|
|
|
|
|
|
|
| ||||
Deposits |
| 9,993 |
| 9,433 |
| 36,743 |
| 47,473 |
| ||||
Securities Sold Under Agreements to Repurchase |
| 3,120 |
| 1,359 |
| 9,353 |
| 7,939 |
| ||||
Funds Purchased |
| 395 |
| 249 |
| 1,815 |
| 944 |
| ||||
Short-Term Borrowings |
| 39 |
| 17 |
| 82 |
| 92 |
| ||||
Long-Term Debt |
| 3,893 |
| 4,417 |
| 16,431 |
| 20,131 |
| ||||
Total Interest Expense |
| 17,440 |
| 15,475 |
| 64,424 |
| 76,579 |
| ||||
Net Interest Income |
| 99,931 |
| 93,352 |
| 390,590 |
| 365,942 |
| ||||
Provision for Loan and Lease Losses |
| (6,500 | ) | — |
| (10,000 | ) | — |
| ||||
Net Interest Income After Provision for Loan and Lease Losses |
| 106,431 |
| 93,352 |
| 400,590 |
| 365,942 |
| ||||
Non-Interest Income |
|
|
|
|
|
|
|
|
| ||||
Trust and Asset Management |
| 13,934 |
| 12,759 |
| 53,465 |
| 50,996 |
| ||||
Mortgage Banking |
| 1,516 |
| 3,324 |
| 8,012 |
| 15,556 |
| ||||
Service Charges on Deposit Accounts |
| 10,155 |
| 9,442 |
| 39,117 |
| 35,938 |
| ||||
Fees, Exchange, and Other Service Charges |
| 13,684 |
| 13,725 |
| 54,907 |
| 56,221 |
| ||||
Investment Securities Gains (Losses) |
| (757 | ) | (20 | ) | (794 | ) | 1,789 |
| ||||
Insurance |
| 4,234 |
| 4,762 |
| 19,241 |
| 19,145 |
| ||||
Other |
| 5,584 |
| 5,445 |
| 31,146 |
| 19,075 |
| ||||
Total Non-Interest Income |
| 48,350 |
| 49,437 |
| 205,094 |
| 198,720 |
| ||||
Non-Interest Expense |
|
|
|
|
|
|
|
|
| ||||
Salaries and Benefits |
| 45,043 |
| 46,409 |
| 184,299 |
| 186,280 |
| ||||
Net Occupancy Expense |
| 9,606 |
| 9,933 |
| 38,347 |
| 38,980 |
| ||||
Net Equipment Expense |
| 6,316 |
| 7,395 |
| 23,926 |
| 33,652 |
| ||||
Information Technology Systems Replacement Project |
| — |
| — |
| — |
| 21,871 |
| ||||
Other |
| 21,138 |
| 19,667 |
| 87,868 |
| 77,092 |
| ||||
Total Non-Interest Expense |
| 82,103 |
| 83,404 |
| 334,440 |
| 357,875 |
| ||||
Income Before Income Taxes |
| 72,678 |
| 59,385 |
| 271,244 |
| 206,787 |
| ||||
Provision for Income Taxes |
| 26,437 |
| 20,712 |
| 97,905 |
| 71,592 |
| ||||
Net Income |
| $ | 46,241 |
| $ | 38,673 |
| $ | 173,339 |
| $ | 135,195 |
|
Basic Earnings Per Share |
| $ | 0.86 |
| $ | 0.70 |
| $ | 3.26 |
| $ | 2.32 |
|
Diluted Earnings Per Share |
| $ | 0.82 |
| $ | 0.66 |
| $ | 3.08 |
| $ | 2.21 |
|
Dividends Declared Per Share |
| $ | 0.33 |
| $ | 0.30 |
| $ | 1.23 |
| $ | 0.87 |
|
Basic Weighted Average Shares |
| 53,766,057 |
| 55,374,874 |
| 53,232,815 |
| 58,338,566 |
| ||||
Diluted Weighted Average Shares |
| 56,055,531 |
| 58,570,941 |
| 56,241,044 |
| 61,085,567 |
| ||||
Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Condition (Unaudited) |
| Table 3 |
(dollars in thousands) |
| December 31, |
| December 31, |
| ||
|
|
|
|
|
| ||
Assets |
|
|
|
|
| ||
Interest-Bearing Deposits |
| $ | 4,592 |
| $ | 154,735 |
|
Investment Securities - Available for Sale |
| 2,483,719 |
| 1,991,116 |
| ||
Investment Securities - Held to Maturity |
| 589,908 |
| 727,233 |
| ||
Funds Sold |
| 21,000 |
| — |
| ||
Loans Held for Sale |
| 17,642 |
| 9,211 |
| ||
Loans and Leases |
| 5,986,930 |
| 5,757,175 |
| ||
Allowance for Loan and Lease Losses |
| (106,796 | ) | (129,080 | ) | ||
Net Loans |
| 5,880,134 |
| 5,628,095 |
| ||
Total Earning Assets |
| 8,996,995 |
| 8,510,390 |
| ||
Cash and Non-Interest-Bearing Deposits |
| 225,359 |
| 363,495 |
| ||
Premises and Equipment |
| 146,095 |
| 160,005 |
| ||
Customers’ Acceptance Liability |
| 1,406 |
| 1,707 |
| ||
Accrued Interest Receivable |
| 36,044 |
| 32,672 |
| ||
Foreclosed Real Estate |
| 191 |
| 4,377 |
| ||
Mortgage Servicing Rights |
| 18,769 |
| 22,178 |
| ||
Goodwill |
| 36,216 |
| 36,216 |
| ||
Other Assets |
| 305,116 |
| 330,607 |
| ||
Total Assets |
| $ | 9,766,191 |
| $ | 9,461,647 |
|
Liabilities |
|
|
|
|
| ||
Deposits |
|
|
|
|
| ||
Non-Interest-Bearing Demand |
| $ | 1,977,703 |
| $ | 1,933,928 |
|
Interest-Bearing Demand |
| 1,536,323 |
| 1,356,330 |
| ||
Savings |
| 2,960,351 |
| 2,833,379 |
| ||
Time |
| 1,090,290 |
| 1,209,142 |
| ||
Total Deposits |
| 7,564,667 |
| 7,332,779 |
| ||
Securities Sold Under Agreements to Repurchase |
| 568,981 |
| 472,757 |
| ||
Funds Purchased |
| 149,635 |
| 109,090 |
| ||
Short-Term Borrowings |
| 15,000 |
| 12,690 |
| ||
Banker’s Acceptances Outstanding |
| 1,406 |
| 1,707 |
| ||
Retirement Benefits Payable |
| 65,708 |
| 61,841 |
| ||
Accrued Interest Payable |
| 7,021 |
| 7,483 |
| ||
Taxes Payable and Deferred Taxes |
| 229,928 |
| 207,101 |
| ||
Other Liabilities |
| 96,373 |
| 138,999 |
| ||
Long-Term Debt |
| 252,638 |
| 324,068 |
| ||
Total Liabilities |
| 8,951,357 |
| 8,668,515 |
| ||
Shareholders’ Equity |
|
|
|
|
| ||
Common Stock ($.01 par value); authorized 500,000,000 shares; issued / outstanding: December 2004 - 81,711,752 / 54,960,857, December 2003 - 81,647,729 / 54,928,480, |
| 813 |
| 807 |
| ||
Capital Surplus |
| 450,998 |
| 391,701 |
| ||
Accumulated Other Comprehensive Income (Loss) |
| (12,917 | ) | (5,711 | ) | ||
Retained Earnings |
| 1,282,425 |
| 1,199,077 |
| ||
Deferred Stock Grants |
| (8,433 | ) | (8,309 | ) | ||
Treasury Stock, at Cost (Shares: December 2004 – 26,750,895, December 2003 - 26,719,249) |
| (898,052 | ) | (784,433 | ) | ||
Total Shareholders’ Equity |
| 814,834 |
| 793,132 |
| ||
Total Liabilities and Shareholders’ Equity |
| $ | 9,766,191 |
| $ | 9,461,647 |
|
Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Shareholders’ Equity (Unaudited) |
| Table 4 |
(dollars in thousands) |
| Total |
| Common |
| Capital |
| Accum. |
| Retained |
| Deferred |
| Treasury |
| Compre- |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Balance at December 31, 2003 |
| $ | 793,132 |
| $ | 807 |
| $ | 391,701 |
| $ | (5,711 | ) | $ | 1,199,077 |
| $ | (8,309 | ) | $ | (784,433 | ) |
|
| |
Comprehensive Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net Income |
| 173,339 |
| — |
| — |
| — |
| 173,339 |
| — |
| — |
| $ | 173,339 |
| |||||||
Other Comprehensive Income, Net of Tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Change in Unrealized Gains and Losses on Investment Securities |
| (5,519 | ) | — |
| — |
| (5,519 | ) | — |
| — |
| — |
| (5,519 | ) | ||||||||
Change in Pension Liability Adjustments |
| (1,687 | ) | — |
| — |
| (1,687 | ) | — |
| — |
| — |
| (1,687 | ) | ||||||||
Total Comprehensive Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| $ | 166,133 |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Common Stock Issued under Stock Plans and Related Tax Benefits (5,280,205 shares) |
| 159,972 |
| 6 |
| 59,297 |
| — |
| (23,665 | ) | (124 | ) | 124,458 |
|
|
| ||||||||
Treasury Stock Purchased (5,243,458 shares) |
| (238,077 | ) | — |
| — |
| — |
| — |
| — |
| (238,077 | ) |
|
| ||||||||
Cash Dividends Paid |
| (66,326 | ) | — |
| — |
| — |
| (66,326 | ) | — |
| — |
|
|
| ||||||||
Balance at December 31, 2004 |
| $ | 814,834 |
| $ | 813 |
| $ | 450,998 |
| $ | (12,917 | ) | $ | 1,282,425 |
| $ | (8,433 | ) | $ | (898,052 | ) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Balance at December 31, 2002 |
| $ | 1,015,759 |
| $ | 806 |
| $ | 372,192 |
| $ | 11,659 |
| $ | 1,115,910 |
| $ | (1,424 | ) | $ | (483,384 | ) |
|
| |
Comprehensive Income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Net Income |
| 135,195 |
| — |
| — |
| — |
| 135,195 |
| — |
| — |
| $ | 135,195 |
| |||||||
Other Comprehensive Income, Net of Tax: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Change in Unrealized Gains and Losses on Investment Securities |
| (16,434 | ) | — |
| — |
| (16,434 | ) | — |
| — |
| — |
| (16,434 | ) | ||||||||
Change in Pension Liability Adjustments |
| (936 | ) | — |
| — |
| (936 | ) | — |
| — |
| — |
| (936 | ) | ||||||||
Total Comprehensive Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| $ | 117,825 |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Common Stock Issued under Stock Plans and Related Tax Benefits (1,683,424 shares) |
| 40,115 |
| 1 |
| 19,509 |
| — |
| (1,439 | ) | (6,885 | ) | 28,929 |
|
|
| ||||||||
Treasury Stock Purchased (9,762,079 shares) |
| (329,978 | ) | — |
| — |
| — |
| — |
| — |
| (329,978 | ) |
|
| ||||||||
Cash Dividends Paid |
| (50,589 | ) | — |
| — |
| — |
| (50,589 | ) | — |
| — |
|
|
| ||||||||
Balance at December 31, 2003 |
| $ | 793,132 |
| $ | 807 |
| $ | 391,701 |
| $ | (5,711 | ) | $ | 1,199,077 |
| $ | (8,309 | ) | $ | (784,433 | ) |
|
| |
Bank of Hawaii Corporation and Subsidiaries
Consolidated Average Balances and Interest Rates - Taxable Equivalent Basis (Unaudited) |
| Table 5a |
|
| Three Months Ended |
| Three Months Ended |
| Three Months Ended |
| ||||||||||||||||||
(dollars in millions) |
| Average |
| Income/ |
| Yield/ |
| Average |
| Income/ |
| Yield/ |
| Average |
| Income/ |
| Yield/ |
| ||||||
Earning Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Interest-Bearing Deposits |
| $ | 21.0 |
| $ | 0.1 |
| 2.05 | % | $ | 82.6 |
| $ | 0.5 |
| 2.39 | % | $ | 218.6 |
| $ | 1.2 |
| 2.12 | % |
Funds Sold |
| 74.3 |
| 0.4 |
| 1.92 |
| 28.6 |
| 0.1 |
| 1.51 |
| 34.3 |
| 0.1 |
| 0.99 |
| ||||||
Investment Securities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Available for Sale |
| 2,444.9 |
| 26.4 |
| 4.32 |
| 2,325.5 |
| 24.6 |
| 4.23 |
| 1,900.2 |
| 19.0 |
| 4.01 |
| ||||||
Held to Maturity |
| 615.1 |
| 6.1 |
| 4.00 |
| 659.0 |
| 6.3 |
| 3.87 |
| 740.5 |
| 7.2 |
| 3.88 |
| ||||||
Loans Held for Sale |
| 15.9 |
| 0.2 |
| 5.72 |
| 11.3 |
| 0.2 |
| 5.74 |
| 13.9 |
| 0.2 |
| 6.21 |
| ||||||
Loans and Leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Commercial and Industrial |
| 773.6 |
| 11.2 |
| 5.78 |
| 796.2 |
| 10.6 |
| 5.34 |
| 858.2 |
| 10.6 |
| 4.90 |
| ||||||
Construction |
| 115.2 |
| 1.5 |
| 5.10 |
| 81.1 |
| 1.0 |
| 5.01 |
| 99.2 |
| 1.1 |
| 4.30 |
| ||||||
Commercial Mortgage |
| 624.4 |
| 8.6 |
| 5.47 |
| 658.9 |
| 8.8 |
| 5.29 |
| 627.4 |
| 8.9 |
| 5.62 |
| ||||||
Residential Mortgage |
| 2,304.9 |
| 32.3 |
| 5.61 |
| 2,282.6 |
| 32.1 |
| 5.62 |
| 2,336.3 |
| 34.5 |
| 5.90 |
| ||||||
Installment |
| 738.2 |
| 15.6 |
| 8.38 |
| 722.7 |
| 15.2 |
| 8.38 |
| 598.1 |
| 13.4 |
| 8.89 |
| ||||||
Home Equity |
| 632.6 |
| 8.4 |
| 5.25 |
| 583.7 |
| 7.1 |
| 4.83 |
| 453.0 |
| 5.6 |
| 4.89 |
| ||||||
Purchased Home Equity |
| 134.4 |
| 1.2 |
| 3.71 |
| 155.2 |
| 1.7 |
| 4.29 |
| 104.7 |
| 0.6 |
| 2.24 |
| ||||||
Lease Financing |
| 511.1 |
| 5.1 |
| 3.97 |
| 516.0 |
| 5.4 |
| 4.17 |
| 494.0 |
| 5.5 |
| 4.44 |
| ||||||
Total Loans and Leases |
| 5,834.4 |
| 83.9 |
| 5.73 |
| 5,796.4 |
| 81.9 |
| 5.63 |
| 5,570.9 |
| 80.2 |
| 5.73 |
| ||||||
Other |
| 60.7 |
| 0.3 |
| 1.74 |
| 78.7 |
| 0.8 |
| 4.05 |
| 76.8 |
| 1.0 |
| 5.20 |
| ||||||
Total Earning Assets |
| 9,066.3 |
| 117.4 |
| 5.17 |
| 8,982.1 |
| 114.4 |
| 5.08 |
| 8,555.2 |
| 108.9 |
| 5.07 |
| ||||||
Cash and Non-Interest-Bearing Deposits |
| 307.5 |
|
|
|
|
| 316.9 |
|
|
|
|
| 323.5 |
|
|
|
|
| ||||||
Other Assets |
| 369.2 |
|
|
|
|
| 369.5 |
|
|
|
|
| 379.1 |
|
|
|
|
| ||||||
Total Assets |
| $ | 9,743.0 |
|
|
|
|
| $ | 9,668.5 |
|
|
|
|
| $ | 9,257.8 |
|
|
|
|
| |||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Interest-Bearing Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Interest-Bearing Deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Demand |
| $ | 1,500.0 |
| $ | 1.3 |
| 0.33 | % | $ | 1,471.0 |
| $ | 0.9 |
| 0.24 | % | $ | 1,293.8 |
| 0.5 |
| 0.16 | % | |
Savings |
| 2,998.5 |
| 3.6 |
| 0.48 |
| 2,998.4 |
| 3.2 |
| 0.43 |
| 2,786.6 |
| 3.2 |
| 0.46 |
| ||||||
Time |
| 1,063.7 |
| 5.1 |
| 1.92 |
| 1,078.4 |
| 4.9 |
| 1.81 |
| 1,227.9 |
| 5.7 |
| 1.83 |
| ||||||
Total Interest-Bearing Deposits |
| 5,562.2 |
| 10.0 |
| 0.71 |
| 5,547.8 |
| 9.0 |
| 0.64 |
| 5,308.3 |
| 9.4 |
| 0.71 |
| ||||||
Short-Term Borrowings |
| 776.0 |
| 3.5 |
| 1.82 |
| 816.9 |
| 2.8 |
| 1.36 |
| 608.0 |
| 1.7 |
| 1.06 |
| ||||||
Long-Term Debt |
| 252.6 |
| 3.9 |
| 6.16 |
| 246.8 |
| 3.8 |
| 6.22 |
| 324.2 |
| 4.4 |
| 5.43 |
| ||||||
Total Interest-Bearing Liabilities |
| 6,590.8 |
| 17.4 |
| 1.05 |
| 6,611.5 |
| 15.6 |
| 0.94 |
| 6,240.5 |
| 15.5 |
| 0.99 |
| ||||||
Net Interest Income |
|
|
| $ | 100.0 |
|
|
|
|
| $ | 98.8 |
|
|
|
|
| $ | 93.4 |
|
|
| |||
Interest Rate Spread |
|
|
|
|
| 4.12 | % |
|
|
|
| 4.14% |
|
|
|
|
| 4.08 | % | ||||||
Net Interest Margin |
|
|
|
|
| 4.40 | % |
|
|
|
| 4.39% |
|
|
|
|
| 4.35 | % | ||||||
Non-Interest-Bearing Demand Deposits |
| 1,954.2 |
|
|
|
|
| 1,932.0 |
|
|
|
|
| 1,836.4 |
|
|
|
|
| ||||||
Other Liabilities |
| 419.4 |
|
|
|
|
| 393.4 |
|
|
|
|
| 355.7 |
|
|
|
|
| ||||||
Shareholders’ Equity |
| 778.6 |
|
|
|
|
| 731.6 |
|
|
|
|
| 825.2 |
|
|
|
|
| ||||||
Total Liabilities and Shareholders’ Equity |
| $ | 9,743.0 |
|
|
|
|
| $ | 9,668.5 |
|
|
|
|
| $ | 9,257.8 |
|
|
|
|
| |||
Bank of Hawaii Corporation and Subsidiaries
Consolidated Average Balances and Interest Rates - Taxable Equivalent Basis (Unaudited) |
| Table 5b |
|
| Year Ended |
| Year Ended |
| |||||||||||||||||
(dollars in millions) |
| Average |
| Income/ |
| Yield/ |
| Average |
| Income/ |
| Yield/ |
| |||||||||
Earning Assets |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Interest-Bearing Deposits |
| $ | 189.7 |
| $ | 3.5 |
| 1.83 | % | $ | 227.3 |
| $ | 4.8 |
| 2.12 | % | |||||
Funds Sold |
| 85.6 |
| 1.0 |
| 1.24 |
| 162.9 |
| 1.9 |
| 1.18 |
| |||||||||
Investment Securities |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Available for Sale |
| 2,227.8 |
| 93.7 |
| 4.21 |
| 2,142.8 |
| 77.9 |
| 3.64 |
| |||||||||
Held to Maturity |
| 675.7 |
| 26.2 |
| 3.88 |
| 487.6 |
| 19.0 |
| 3.89 |
| |||||||||
Loans Held for Sale |
| 15.8 |
| 0.9 |
| 5.58 |
| 39.5 |
| 2.2 |
| 5.48 |
| |||||||||
Loans and Leases |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Commercial and Industrial |
| 810.4 |
| 42.3 |
| 5.22 |
| 860.3 |
| 41.9 |
| 4.87 |
| |||||||||
Construction |
| 99.3 |
| 4.5 |
| 4.56 |
| 96.3 |
| 4.4 |
| 4.56 |
| |||||||||
Commercial Mortgage |
| 639.1 |
| 34.5 |
| 5.40 |
| 644.8 |
| 37.4 |
| 5.81 |
| |||||||||
Residential Mortgage |
| 2,296.7 |
| 129.9 |
| 5.66 |
| 2,295.0 |
| 145.6 |
| 6.34 |
| |||||||||
Installment |
| 703.2 |
| 59.6 |
| 8.47 |
| 548.8 |
| 52.6 |
| 9.59 |
| |||||||||
Home Equity |
| 560.3 |
| 27.4 |
| 4.88 |
| 444.6 |
| 22.5 |
| 5.05 |
| |||||||||
Purchased Home Equity |
| 168.2 |
| 7.4 |
| 4.41 |
| 144.7 |
| 5.9 |
| 4.10 |
| |||||||||
Lease Financing |
| 509.5 |
| 21.5 |
| 4.21 |
| 489.9 |
| 22.3 |
| 4.55 |
| |||||||||
Total Loans and Leases |
| 5,786.7 |
| 327.1 |
| 5.65 |
| 5,524.4 |
| 332.6 |
| 6.02 |
| |||||||||
Other |
| 73.8 |
| 2.8 |
| 3.78 |
| 75.7 |
| 4.3 |
| 5.61 |
| |||||||||
Total Earning Assets |
| 9,055.1 |
| 455.2 |
| 5.03 |
| 8,660.2 |
| 442.7 |
| 5.11 |
| |||||||||
Cash and Non-Interest-Bearing Deposits |
| 314.6 |
|
|
|
|
| 328.4 |
|
|
|
|
| |||||||||
Other Assets |
| 375.8 |
|
|
|
|
| 388.9 |
|
|
|
|
| |||||||||
Total Assets |
| $ | 9,745.5 |
|
|
|
|
| $ | 9,377.5 |
|
|
|
|
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Interest-Bearing Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Interest-Bearing Deposits |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Demand |
| $ | 1,433.1 |
| $ | 3.2 |
| 0.22 | % | $ | 1,215.7 |
| $ | 2.5 |
| 0.20 | % | |||||
Savings |
| 2,945.3 |
| 13.2 |
| 0.45 |
| 2,723.9 |
| 15.7 |
| 0.58 |
| |||||||||
Time |
| 1,114.8 |
| 20.3 |
| 1.82 |
| 1,352.3 |
| 29.3 |
| 2.17 |
| |||||||||
Total Interest-Bearing Deposits |
| 5,493.2 |
| 36.7 |
| 0.67 |
| 5,291.9 |
| 47.5 |
| 0.90 |
| |||||||||
Short-Term Borrowings |
| 884.0 |
| 11.3 |
| 1.27 |
| 724.2 |
| 9.0 |
| 1.24 |
| |||||||||
Long-Term Debt |
| 284.2 |
| 16.4 |
| 5.78 |
| 352.7 |
| 20.1 |
| 5.71 |
| |||||||||
Total Interest-Bearing Liabilities |
| 6,661.4 |
| 64.4 |
| 0.97 |
| 6,368.8 |
| 76.6 |
| 1.20 |
| |||||||||
Net Interest Income |
|
|
| $ | 390.8 |
|
|
|
|
| $ | 366.1 |
|
|
| |||||||
Interest Rate Spread |
|
|
|
|
| 4.06 | % |
|
|
|
| 3.91 | % | |||||||||
Net Interest Margin |
|
|
|
|
| 4.32 | % |
|
|
|
| 4.23 | % | |||||||||
Non-Interest-Bearing Demand Deposits |
| 1,929.1 |
|
|
|
|
| 1,753.9 |
|
|
|
|
| |||||||||
Other Liabilities |
| 394.0 |
|
|
|
|
| 354.7 |
|
|
|
|
| |||||||||
Shareholders’ Equity |
| 761.0 |
|
|
|
|
| 900.1 |
|
|
|
|
| |||||||||
Total Liabilities and Shareholders’ Equity |
| $ | 9,745.5 |
|
|
|
|
| $ | 9,377.5 |
|
|
|
|
| |||||||
Bank of Hawaii Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable Equivalent Basis (Unaudited) |
| Table 6 |
|
| Year Ended December 31, 2004 Compared to December 31, 2003 |
| |||||||
(dollars in millions) |
| Volume 1 |
| Rate 1 |
| Total |
| |||
|
|
|
|
|
|
|
| |||
Change in Interest Income: |
|
|
|
|
|
|
| |||
Interest-Bearing Deposits |
| $ | (0.7 | ) | $ | (0.6 | ) | $ | (1.3 | ) |
Funds Sold |
| (1.0 | ) | 0.1 |
| (0.9 | ) | |||
Investment Securities |
|
|
|
|
|
|
| |||
Available for Sale |
| 3.2 |
| 12.6 |
| 15.8 |
| |||
Held to Maturity |
| 7.2 |
| — |
| 7.2 |
| |||
Loans Held for Sale |
| (1.3 | ) | — |
| (1.3 | ) | |||
Loans and Leases |
|
|
|
|
|
|
| |||
Commercial and Industrial |
| (2.5 | ) | 2.9 |
| 0.4 |
| |||
Construction |
| 0.1 |
| — |
| 0.1 |
| |||
Commercial Mortgage |
| (0.3 | ) | (2.6 | ) | (2.9 | ) | |||
Residential Mortgage |
| 0.1 |
| (15.8 | ) | (15.7 | ) | |||
Installment |
| 13.6 |
| (6.6 | ) | 7.0 |
| |||
Home Equity |
| 5.7 |
| (0.8 | ) | 4.9 |
| |||
Purchased Home Equity |
| 1.0 |
| 0.5 |
| 1.5 |
| |||
Lease Financing |
| 0.9 |
| (1.7 | ) | (0.8 | ) | |||
Total Loans and Leases |
| 18.6 |
| (24.1 | ) | (5.5 | ) | |||
Other |
| (0.1 | ) | (1.4 | ) | (1.5 | ) | |||
Total Change in Interest Income |
| 25.9 |
| (13.4 | ) | 12.5 |
| |||
|
|
|
|
|
|
|
| |||
Change in Interest Expense: |
|
|
|
|
|
|
| |||
Interest-Bearing Deposits |
|
|
|
|
|
|
| |||
Demand |
| 0.5 |
| 0.2 |
| 0.7 |
| |||
Savings |
| 1.2 |
| (3.7 | ) | (2.5 | ) | |||
Time |
| (4.7 | ) | (4.3 | ) | (9.0 | ) | |||
Total Interest-Bearing Deposits |
| (3.0 | ) | (7.8 | ) | (10.8 | ) | |||
Short-Term Borrowings |
| 2.1 |
| 0.2 |
| 2.3 |
| |||
Long-Term Debt |
| (3.9 | ) | 0.2 |
| (3.7 | ) | |||
Total Change in Interest Expense |
| (4.8 | ) | (7.4 | ) | (12.2 | ) | |||
|
|
|
|
|
|
|
| |||
Change in Net Interest Income |
| $ | 30.7 |
| $ | (6.0 | ) | $ | 24.7 |
|
1 The changes for each category of interest income and expense are divided between the portion of changes attributable to the variance in volume or rate for that category.
Bank of Hawaii Corporation and Subsidiaries
Salaries and Benefits (Unaudited) |
| Table 7 |
|
| Three Months Ended |
| Year Ended |
| ||||||||
(dollars in thousands) |
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Salaries |
| $ | 27,947 |
| $ | 27,972 |
| $ | 110,851 |
| $ | 114,376 |
|
Incentive Compensation |
| 3,999 |
| 5,130 |
| 15,458 |
| 15,747 |
| ||||
Stock-Based Compensation |
| 2,926 |
| 5,128 |
| 11,726 |
| 9,215 |
| ||||
Commission Expense |
| 1,991 |
| 1,833 |
| 7,682 |
| 10,797 |
| ||||
Retirement and Other Benefits |
| 3,230 |
| 882 |
| 15,900 |
| 14,353 |
| ||||
Payroll Taxes |
| 2,115 |
| 2,009 |
| 11,063 |
| 10,454 |
| ||||
Medical, Dental, and Life Insurance |
| 2,050 |
| 1,981 |
| 8,354 |
| 7,371 |
| ||||
Separation Expense |
| 785 |
| 1,474 |
| 3,265 |
| 3,967 |
| ||||
Total Salaries and Benefits |
| $ | 45,043 |
| $ | 46,409 |
| $ | 184,299 |
| $ | 186,280 |
|
Bank of Hawaii Corporation and Subsidiaries
Loan Portfolio Balances (Unaudited) |
| Table 8 |
(dollars in thousands) |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| |||||
Domestic Loans |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and Industrial |
| $ | 871,485 |
| $ | 755,455 |
| $ | 776,815 |
| $ | 793,293 |
| $ | 816,246 |
|
Commercial Mortgage |
| 602,678 |
| 648,991 |
| 643,382 |
| 650,566 |
| 639,354 |
| |||||
Construction |
| 122,355 |
| 104,709 |
| 98,916 |
| 91,002 |
| 101,321 |
| |||||
Lease Financing |
| 446,937 |
| 447,005 |
| 447,673 |
| 442,590 |
| 435,934 |
| |||||
Total Commercial |
| 2,043,455 |
| 1,956,160 |
| 1,966,786 |
| 1,977,451 |
| 1,992,855 |
| |||||
Consumer |
|
|
|
|
|
|
|
|
|
|
| |||||
Residential Mortgage |
| 2,293,202 |
| 2,261,814 |
| 2,257,624 |
| 2,254,654 |
| 2,320,410 |
| |||||
Home Equity |
| 657,164 |
| 609,981 |
| 559,225 |
| 510,378 |
| 467,019 |
| |||||
Purchased Home Equity |
| 122,728 |
| 143,300 |
| 162,730 |
| 191,066 |
| 212,514 |
| |||||
Other Consumer |
| 751,821 |
| 729,747 |
| 721,386 |
| 671,893 |
| 658,831 |
| |||||
Lease Financing |
| 32,535 |
| 33,796 |
| 34,676 |
| 34,816 |
| 35,320 |
| |||||
Total Consumer |
| 3,857,450 |
| 3,778,638 |
| 3,735,641 |
| 3,662,807 |
| 3,694,094 |
| |||||
Total Domestic Loans |
| 5,900,905 |
| 5,734,798 |
| 5,702,427 |
| 5,640,258 |
| 5,686,949 |
| |||||
Foreign Loans |
| 86,025 |
| 80,777 |
| 84,887 |
| 74,738 |
| 70,226 |
| |||||
Total Loans and Leases |
| $ | 5,986,930 |
| $ | 5,815,575 |
| $ | 5,787,314 |
| $ | 5,714,996 |
| $ | 5,757,175 |
|
Selected Concentrations of Credit Exposure (Unaudited)
(dollars in thousands) |
| Outstanding |
| December 31, 2004 |
| Total |
| Sept. 30, 2004 |
| Dec. 31, 2003 1 |
| |||||
Air Transportation |
|
|
|
|
|
|
|
|
|
|
| |||||
United States Regional Passenger Carriers |
| $ | 41,057 |
| $ | 11,707 |
| $ | 52,764 |
| $ | 57,505 |
| $ | 59,231 |
|
United States National Passenger Carriers |
| 39,594 |
| — |
| 39,594 |
| 37,771 |
| 37,259 |
| |||||
Passenger Carriers Based Outside United States |
| 25,910 |
| — |
| 25,910 |
| 28,540 |
| 31,549 |
| |||||
Cargo Carriers |
| 13,771 |
| — |
| 13,771 |
| 13,771 |
| 14,405 |
| |||||
Total Air Transportation |
| $ | 120,332 |
| $ | 11,707 |
| $ | 132,039 |
| $ | 137,587 |
| $ | 142,444 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Guam |
|
|
|
|
|
|
|
|
|
|
| |||||
Hotel |
| $ | 6,014 |
| $ | — |
| $ | 6,014 |
| $ | 9,348 |
| $ | 17,733 |
|
Other Commercial |
| 143,819 |
| 42,467 |
| 186,286 |
| 197,460 |
| 184,129 |
| |||||
Consumer |
| 376,948 |
| 13,486 |
| 390,434 |
| 321,657 |
| 288,831 |
| |||||
Total Guam |
| $ | 526,781 |
| $ | 55,953 |
| $ | 582,734 |
| $ | 528,465 |
| $ | 490,693 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Syndicated Exposure |
| $ | 201,359 |
| $ | 588,399 |
| $ | 789,758 |
| $ | 790,354 |
| $ | 925,864 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Other Large Borrowers 2 |
| $ | 109,921 |
| $ | 192,481 |
| $ | 302,402 |
| $ | 298,026 |
| $ | 336,748 |
|
Exposure includes loans, leveraged leases and operating leases.
1 For three borrowers, reclassifications occurred between Regional and National Carriers. Syndicated Exposure was restated.
2 Other Large Borrowers is defined as exposure with commitments of $25 million and greater, excluding those collateralized by cash and those separately identified as Air Transportation, Guam, and Syndicated Exposure.
Bank of Hawaii Corporation and Subsidiaries
Consolidated Non-Performing Assets and Accruing Loans Past Due 90 Days or More (Unaudited) |
| Table 9 |
(dollars in thousands) |
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Non-Performing Assets |
|
|
|
|
|
|
|
|
|
|
| |||||
Non-Accrual Loans |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and Industrial |
| $ | 683 |
| $ | 775 |
| $ | 680 |
| $ | 6,009 |
| $ | 6,015 |
|
Commercial Mortgage |
| 2,106 |
| 5,552 |
| 5,649 |
| 7,388 |
| 9,337 |
| |||||
Lease Financing |
| 2,973 |
| 1,913 |
| 1,948 |
| 1,962 |
| 2,181 |
| |||||
Total Commercial |
| 5,762 |
| 8,240 |
| 8,277 |
| 15,359 |
| 17,533 |
| |||||
Consumer |
|
|
|
|
|
|
|
|
|
|
| |||||
Residential Mortgage |
| 7,688 |
| 7,278 |
| 7,688 |
| 7,685 |
| 9,354 |
| |||||
Home Equity |
| 218 |
| 251 |
| 306 |
| 406 |
| 460 |
| |||||
Total Consumer |
| 7,906 |
| 7,529 |
| 7,994 |
| 8,091 |
| 9,814 |
| |||||
Total Non-Accrual Loans |
| 13,668 |
| 15,769 |
| 16,271 |
| 23,450 |
| 27,347 |
| |||||
Foreclosed Real Estate |
| 191 |
| 208 |
| 4,889 |
| 4,416 |
| 4,377 |
| |||||
Total Non-Performing Assets |
| $ | 13,859 |
| $ | 15,977 |
| $ | 21,160 |
| $ | 27,866 |
| $ | 31,724 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Accruing Loans Past Due 90 Days or More |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and Industrial |
| $ | 52 |
| $ | 65 |
| $ | 19 |
| $ | 707 |
| $ | 725 |
|
Commercial Mortgage |
| — |
| 688 |
| 693 |
| 702 |
| — |
| |||||
Lease Financing |
| — |
| — |
| — |
| — |
| 117 |
| |||||
Total Commercial |
| 52 |
| 753 |
| 712 |
| 1,409 |
| 842 |
| |||||
Consumer |
|
|
|
|
|
|
|
|
|
|
| |||||
Residential Mortgage |
| 387 |
| 2,588 |
| 698 |
| 595 |
| 1,430 |
| |||||
Purchased Home Equity |
| 183 |
| 97 |
| 32 |
| 107 |
| — |
| |||||
Other Consumer |
| 1,433 |
| 1,533 |
| 1,142 |
| 1,180 |
| 1,210 |
| |||||
Lease Financing |
| 30 |
| 32 |
| 57 |
| — |
| — |
| |||||
Total Consumer |
| 2,033 |
| 4,250 |
| 1,929 |
| 1,882 |
| 2,640 |
| |||||
Total Accruing and Past Due |
| $ | 2,085 |
| $ | 5,003 |
| $ | 2,641 |
| $ | 3,291 |
| $ | 3,482 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Loans and Leases |
| $ | 5,986,930 |
| $ | 5,815,575 |
| $ | 5,787,314 |
| $ | 5,714,996 |
| $ | 5,757,175 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of Non-Accrual Loans to Total Loans |
| 0.23 | % | 0.27 | % | 0.28 | % | 0.41 | % | 0.48 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of Non-Performing Assets to Total Loans and Foreclosed Real Estate |
| 0.23 | % | 0.27 | % | 0.37 | % | 0.49 | % | 0.55 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of Non-Performing Assets and Accruing Loans Past Due 90 Days or More to Total Loans |
| 0.27 | % | 0.36 | % | 0.41 | % | 0.55 | % | 0.61 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Quarter to Quarter Changes in Non-Performing Assets |
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at Beginning of Quarter |
| $ | 15,977 |
| $ | 21,160 |
| $ | 27,866 |
| $ | 31,724 |
| $ | 40,144 |
|
Additions1 |
| 5,164 |
| 2,094 |
| 3,909 |
| 3,293 |
| 2,340 |
| |||||
Reductions |
|
|
|
|
|
|
|
|
|
|
| |||||
Payments1 |
| (6,435 | ) | (1,386 | ) | (4,232 | ) | (4,555 | ) | (3,416 | ) | |||||
Return to Accrual |
| (456 | ) | (1,122 | ) | (2,700 | ) | (1,444 | ) | (839 | ) | |||||
Sales of Foreclosed Assets |
| (206 | ) | (682 | ) | (147 | ) | (310 | ) | (4,418 | ) | |||||
Charge-offs/Write-downs |
| (185 | ) | (88 | ) | (3,536 | ) | (842 | ) | (2,087 | ) | |||||
Transfer to Premises |
| — |
| (3,999 | ) | — |
| — |
| — |
| |||||
Total Reductions1 |
| (7,282 | ) | (7,277 | ) | (10,615 | ) | (7,151 | ) | (10,760 | ) | |||||
Balance at End of Quarter |
| $ | 13,859 |
| $ | 15,977 |
| $ | 21,160 |
| $ | 27,866 |
| $ | 31,724 |
|
1 Fourth quarter 2004 balances corrected from January 24, 2005 earnings release.
Bank of Hawaii Corporation and Subsidiaries
Consolidated Allowance for Loan and Lease Losses (Unaudited) |
| Table 10 |
|
| Three Months Ended |
| Year Ended |
| |||||||||||
|
| December 31, |
| September 30, |
| December 31, |
| December 31, |
| |||||||
(dollars in thousands) |
| 2004 |
| 2004 |
| 2003 |
| 2004 |
| 2003 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance at Beginning of Period |
| $ | 124,651 |
| $ | 124,904 |
| $ | 132,675 |
| $ | 129,080 |
| $ | 142,853 |
|
Loans Charged-Off |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and Industrial |
| 465 |
| 227 |
| 1,997 |
| 4,408 |
| 5,311 |
| |||||
Commercial Mortgage |
| — |
| — |
| — |
| 575 |
| 548 |
| |||||
Construction |
| — |
| — |
| — |
| — |
| 529 |
| |||||
Lease Financing |
| 774 |
| — |
| — |
| 1,381 |
| 353 |
| |||||
Consumer |
|
|
|
|
|
|
|
|
|
|
| |||||
Residential Mortgage |
| 128 |
| 226 |
| 462 |
| 819 |
| 1,877 |
| |||||
Home Equity |
| — |
| 11 |
| 250 |
| 20 |
| 339 |
| |||||
Purchased Home Equity |
| 343 |
| 173 |
| 143 |
| 807 |
| 257 |
| |||||
Other Consumer |
| 4,903 |
| 4,268 |
| 3,919 |
| 18,390 |
| 17,412 |
| |||||
Lease Financing |
| 47 |
| 45 |
| 100 |
| 155 |
| 267 |
| |||||
Total Loans Charged-Off |
| 6,660 |
| 4,950 |
| 6,871 |
| 26,555 |
| 26,893 |
| |||||
Recoveries on Loans Previously Charged-Off |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial |
|
|
|
|
|
|
|
|
|
|
| |||||
Commercial and Industrial |
| 542 |
| 1,206 |
| 936 |
| 3,973 |
| 3,878 |
| |||||
Commercial Mortgage |
| 119 |
| 1,093 |
| 23 |
| 2,052 |
| 129 |
| |||||
Construction |
| — |
| 94 |
| 3 |
| 529 |
| 958 |
| |||||
Lease Financing |
| 1 |
| 2 |
| 88 |
| 19 |
| 106 |
| |||||
Consumer |
|
|
|
|
|
|
|
|
|
|
| |||||
Residential Mortgage |
| 109 |
| 207 |
| 115 |
| 915 |
| 1,027 |
| |||||
Home Equity |
| 5 |
| 14 |
| 4 |
| 158 |
| — |
| |||||
Purchased Home Equity |
| 16 |
| 51 |
| — |
| 125 |
| 133 |
| |||||
Other Consumer |
| 1,267 |
| 1,502 |
| 2,015 |
| 6,136 |
| 6,177 |
| |||||
Lease Financing |
| 23 |
| 9 |
| 30 |
| 103 |
| 82 |
| |||||
Foreign |
| 23 |
| 519 |
| 62 |
| 7,061 |
| 630 |
| |||||
Total Recoveries on Loans Previously Charged-Off |
| 2,105 |
| 4,697 |
| 3,276 |
| 21,071 |
| 13,120 |
| |||||
Net Loan Recoveries (Charge-Offs) |
| (4,555 | ) | (253 | ) | (3,595 | ) | (5,484 | ) | (13,773 | ) | |||||
Provision for Loan and Lease Losses |
| (6,500 | ) | — |
| — |
| (10,000 | ) | — |
| |||||
Other Adjustments |
| (6,800 | ) | — |
| — |
| (6,800 | ) | — |
| |||||
Balance at End of Period |
| $ | 106,796 |
| $ | 124,651 |
| $ | 129,080 |
| $ | 106,796 |
| $ | 129,080 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Average Loans Outstanding |
| $ | 5,834,379 |
| $ | 5,796,350 |
| $ | 5,570,844 |
| $ | 5,786,663 |
| $ | 5,524,423 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Ratio of Net Loan Charge-Offs to Average Loans Outstanding (annualized) |
| 0.31 | % | 0.02 | % | 0.26 | % | 0.09 | % | 0.25 | % | |||||
Ratio of Allowance to Loans and Leases Outstanding |
| 1.78 | % | 2.14 | % | 2.24 | % | 1.78 | % | 2.24 | % | |||||
Bank of Hawaii Corporation and Subsidiaries
Business Segment Selected Financial Information (Unaudited) |
| Table 11a |
(dollars in thousands) |
| Retail |
| Commercial |
| Investment |
| Treasury |
| Consolidated |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Three Months Ended December 31, 2004 |
|
|
|
|
|
|
|
|
|
|
| |||||
Net Interest Income |
| $ | 52,531 |
| $ | 33,905 |
| $ | 2,995 |
| $ | 10,500 |
| $ | 99,931 |
|
Provision for Loan and Lease Losses |
| 2,991 |
| 1,602 |
| — |
| (11,093 | ) | (6,500 | ) | |||||
Net Interest Income After Provision for Loan and Lease Losses |
| 49,540 |
| 32,303 |
| 2,995 |
| 21,593 |
| 106,431 |
| |||||
Non-Interest Income |
| 22,590 |
| 9,410 |
| 13,747 |
| 2,603 |
| 48,350 |
| |||||
|
| 72,130 |
| 41,713 |
| 16,742 |
| 24,196 |
| 154,781 |
| |||||
Non-Interest Expense |
| (43,287 | ) | (21,758 | ) | (12,377 | ) | (4,681 | ) | (82,103 | ) | |||||
Income Before Income Taxes |
| 28,843 |
| 19,955 |
| 4,365 |
| 19,515 |
| 72,678 |
| |||||
Provision for Income Taxes |
| (10,672 | ) | (7,379 | ) | (1,615 | ) | (6,771 | ) | (26,437 | ) | |||||
Allocated Net Income |
| 18,171 |
| 12,576 |
| 2,750 |
| 12,744 |
| 46,241 |
| |||||
Allowance Funding Value |
| (162 | ) | (608 | ) | (6 | ) | 776 |
| — |
| |||||
GAAP Provision |
| 2,991 |
| 1,602 |
| — |
| (11,093 | ) | (6,500 | ) | |||||
Economic Provision |
| (3,565 | ) | (2,463 | ) | (91 | ) | (1 | ) | (6,120 | ) | |||||
Tax Effect of Adjustments |
| 272 |
| 544 |
| 36 |
| 3,817 |
| 4,669 |
| |||||
Income Before Capital Charge |
| 17,707 |
| 11,651 |
| 2,689 |
| 6,243 |
| 38,290 |
| |||||
Capital Charge |
| (5,461 | ) | (4,672 | ) | (1,289 | ) | (9,992 | ) | (21,414 | ) | |||||
Net Income (Loss) After Capital Charge (NIACC) |
| $ | 12,246 |
| $ | 6,979 |
| $ | 1,400 |
| $ | (3,749 | ) | $ | 16,876 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
RAROC (ROE for the Company) |
| 35 | % | 27 | % | 23 | % | 16 | % | 24 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Assets at December 31, 2004 |
| $ | 3,773,950 |
| $ | 2,376,776 |
| $ | 117,602 |
| $ | 3,497,863 |
| $ | 9,766,191 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Three Months Ended December 31, 2003 1 |
|
|
|
|
|
|
|
|
|
|
| |||||
Net Interest Income |
| $ | 49,691 |
| $ | 33,685 |
| $ | 2,888 |
| $ | 7,088 |
| $ | 93,352 |
|
Provision for Loan and Lease Losses |
| 2,288 |
| 1,694 |
| — |
| (3,982 | ) | — |
| |||||
Net Interest Income After Provision for Loan and Lease Losses |
| 47,403 |
| 31,991 |
| 2,888 |
| 11,070 |
| 93,352 |
| |||||
Non-Interest Income |
| 23,229 |
| 11,218 |
| 12,461 |
| 2,529 |
| 49,437 |
| |||||
|
| 70,632 |
| 43,209 |
| 15,349 |
| 13,599 |
| 142,789 |
| |||||
Non-Interest Expense |
| (44,340 | ) | (21,102 | ) | (12,716 | ) | (5,246 | ) | (83,404 | ) | |||||
Income Before Income Taxes |
| 26,292 |
| 22,107 |
| 2,633 |
| 8,353 |
| 59,385 |
| |||||
Provision for Income Taxes |
| (9,728 | ) | (8,049 | ) | (974 | ) | (1,961 | ) | (20,712 | ) | |||||
Allocated Net Income |
| 16,564 |
| 14,058 |
| 1,659 |
| 6,392 |
| 38,673 |
| |||||
Allowance Funding Value |
| (130 | ) | (806 | ) | (8 | ) | 944 |
| — |
| |||||
GAAP Provision |
| 2,288 |
| 1,694 |
| — |
| (3,982 | ) | — |
| |||||
Economic Provision |
| (3,309 | ) | (2,879 | ) | (98 | ) | (4 | ) | (6,290 | ) | |||||
Tax Effect of Adjustments |
| 426 |
| 737 |
| 39 |
| 1,126 |
| 2,328 |
| |||||
Income Before Capital Charge |
| 15,839 |
| 12,804 |
| 1,592 |
| 4,476 |
| 34,711 |
| |||||
Capital Charge |
| (5,663 | ) | (5,367 | ) | (1,271 | ) | (10,396 | ) | (22,697 | ) | |||||
Net Income (Loss) After Capital Charge (NIACC) |
| $ | 10,176 |
| $ | 7,437 |
| $ | 321 |
| $ | (5,920 | ) | $ | 12,014 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
RAROC (ROE for the Company) |
| 31 | % | 26 | % | 14 | % | 21 | % | 19 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Assets at December 31, 2003 |
| $ | 3,667,095 |
| $ | 2,323,267 |
| $ | 109,003 |
| $ | 3,362,282 |
| $ | 9,461,647 |
|
1 Certain 2003 information has been reclassified to conform to 2004 presentation.
Bank of Hawaii Corporation and Subsidiaries
Business Segment Selected Financial Information (Unaudited) |
| Table 11b |
|
|
|
|
|
| Investment |
| Treasury |
|
|
| |||||
|
| Retail |
| Commercial |
| Services |
| and Other |
| Consolidated |
| |||||
(dollars in thousands) |
| Banking |
| Banking |
| Group |
| Corporate |
| Total |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Year Ended December 31, 2004 |
|
|
|
|
|
|
|
|
|
|
| |||||
Net Interest Income |
| $ | 203,541 |
| $ | 135,477 |
| $ | 11,524 |
| $ | 40,048 |
| $ | 390,590 |
|
Provision for Loan and Lease Losses |
| 10,446 |
| 3,232 |
| 47 |
| (23,725 | ) | (10,000 | ) | |||||
Net Interest Income After Provision for Loan and Lease Losses |
| 193,095 |
| 132,245 |
| 11,477 |
| 63,773 |
| 400,590 |
| |||||
Non-Interest Income |
| 90,424 |
| 47,470 |
| 53,847 |
| 13,353 |
| 205,094 |
| |||||
|
| 283,519 |
| 179,715 |
| 65,324 |
| 77,126 |
| 605,684 |
| |||||
Non-Interest Expense |
| (174,670 | ) | (91,097 | ) | (52,018 | ) | (16,655 | ) | (334,440 | ) | |||||
Income Before Income Taxes |
| 108,849 |
| 88,618 |
| 13,306 |
| 60,471 |
| 271,244 |
| |||||
Provision for Income Taxes |
| (40,274 | ) | (32,790 | ) | (4,924 | ) | (19,917 | ) | (97,905 | ) | |||||
Allocated Net Income |
| 68,575 |
| 55,828 |
| 8,382 |
| 40,554 |
| 173,339 |
| |||||
Allowance Funding Value |
| (605 | ) | (2,653 | ) | (25 | ) | 3,283 |
| — |
| |||||
GAAP Provision |
| 10,446 |
| 3,232 |
| 47 |
| (23,725 | ) | (10,000 | ) | |||||
Economic Provision |
| (14,054 | ) | (10,528 | ) | (370 | ) | (8 | ) | (24,960 | ) | |||||
Tax Effect of Adjustments |
| 1,559 |
| 3,681 |
| 129 |
| 7,566 |
| 12,935 |
| |||||
Income Before Capital Charge |
| 65,921 |
| 49,560 |
| 8,163 |
| 27,670 |
| 151,314 |
| |||||
Capital Charge |
| (22,157 | ) | (19,905 | ) | (5,209 | ) | (36,458 | ) | (83,729 | ) | |||||
Net Income (Loss) After Capital Charge (NIACC) |
| $ | 43,764 |
| $ | 29,655 |
| $ | 2,954 |
| $ | (8,788 | ) | $ | 67,585 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
RAROC (ROE for the Company) |
| 33 | % | 27 | % | 17 | % | 22 | % | 23 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Assets at December 31, 2004 |
| $ | 3,773,950 |
| $ | 2,376,776 |
| $ | 117,602 |
| $ | 3,497,863 |
| $ | 9,766,191 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Year Ended December 31, 2003 1 |
|
|
|
|
|
|
|
|
|
|
| |||||
Net Interest Income |
| $ | 208,189 |
| $ | 137,164 |
| $ | 11,515 |
| $ | 9,074 |
| $ | 365,942 |
|
Provision for Loan and Lease Losses |
| 6,909 |
| 8,415 |
| (5 | ) | (15,319 | ) | — |
| |||||
Net Interest Income After Provision for Loan and Lease Losses |
| 201,280 |
| 128,749 |
| 11,520 |
| 24,393 |
| 365,942 |
| |||||
Non-Interest Income |
| 95,168 |
| 40,975 |
| 49,998 |
| 12,579 |
| 198,720 |
| |||||
|
| 296,448 |
| 169,724 |
| 61,518 |
| 36,972 |
| 564,662 |
| |||||
Information Technology Systems Replacement Project |
| (986 | ) | (23 | ) | (333 | ) | (20,529 | ) | (21,871 | ) | |||||
Non-Interest Expense |
| (180,484 | ) | (91,376 | ) | (49,174 | ) | (14,970 | ) | (336,004 | ) | |||||
Income Before Income Taxes |
| 114,978 |
| 78,325 |
| 12,011 |
| 1,473 |
| 206,787 |
| |||||
Provision for Income Taxes |
| (42,542 | ) | (28,502 | ) | (4,444 | ) | 3,896 |
| (71,592 | ) | |||||
Allocated Net Income |
| 72,436 |
| 49,823 |
| 7,567 |
| 5,369 |
| 135,195 |
| |||||
Allowance Funding Value |
| (595 | ) | (3,987 | ) | (32 | ) | 4,614 |
| — |
| |||||
GAAP Provision |
| 6,909 |
| 8,415 |
| (5 | ) | (15,319 | ) | — |
| |||||
Economic Provision |
| (11,932 | ) | (12,120 | ) | (432 | ) | (25 | ) | (24,509 | ) | |||||
Tax Effect of Adjustments |
| 2,079 |
| 2,846 |
| 174 |
| 3,969 |
| 9,068 |
| |||||
Income (Loss) Before Capital Charge |
| 68,897 |
| 44,977 |
| 7,272 |
| (1,392 | ) | 119,754 |
| |||||
Capital Charge |
| (22,715 | ) | (21,889 | ) | (5,032 | ) | (49,405 | ) | (99,041 | ) | |||||
Net Income (Loss) After Capital Charge (NIACC) |
| $ | 46,182 |
| $ | 23,088 |
| $ | 2,240 |
| $ | (50,797 | ) | $ | 20,713 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
RAROC (ROE for the Company) |
| 33 | % | 23 | % | 16 | % | (1 | )% | 15 | % | |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total Assets at December 31, 2003 |
| $ | 3,667,095 |
| $ | 2,323,267 |
| $ | 109,003 |
| $ | 3,362,282 |
| $ | 9,461,647 |
|
1 Certain 2003 information has been reclassified to conform to 2004 presentation.
Bank of Hawaii Corporation and Subsidiaries
Quarterly Summary of Selected Consolidated Financial Data (Unaudited) |
| Table 12 |
|
| Three Months Ended |
| |||||||||||||
|
| December 31, |
| September 30, |
| June 30, |
| March 31, |
| December 31, |
| |||||
(dollars in thousands except per share amounts) |
| 2004 |
| 2004 |
| 2004 |
| 2004 |
| 2003 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Quarterly Operating Results |
|
|
|
|
|
|
|
|
|
|
| |||||
Interest Income |
|
|
|
|
|
|
|
|
|
|
| |||||
Interest and Fees on Loans and Leases |
| $ | 84,100 |
| $ | 82,079 |
| $ | 80,346 |
| $ | 81,428 |
| $ | 80,351 |
|
Income on Investment Securities - Available for Sale |
| 26,394 |
| 24,543 |
| 21,745 |
| 20,846 |
| 19,032 |
| |||||
Income on Investment Securities — Held to Maturity |
| 6,147 |
| 6,370 |
| 6,711 |
| 6,976 |
| 7,183 |
| |||||
Deposits |
| 107 |
| 496 |
| 1,646 |
| 1,231 |
| 1,169 |
| |||||
Funds Sold |
| 356 |
| 108 |
| 177 |
| 417 |
| 85 |
| |||||
Other |
| 267 |
| 801 |
| 865 |
| 858 |
| 1,007 |
| |||||
Total Interest Income |
| 117,371 |
| 114,397 |
| 111,490 |
| 111,756 |
| 108,827 |
| |||||
Interest Expense |
|
|
|
|
|
|
|
|
|
|
| |||||
Deposits |
| 9,993 |
| 8,990 |
| 8,560 |
| 9,200 |
| 9,433 |
| |||||
Securities Sold Under Agreements to Repurchase |
| 3,120 |
| 2,085 |
| 2,222 |
| 1,926 |
| 1,359 |
| |||||
Funds Purchased |
| 395 |
| 683 |
| 506 |
| 231 |
| 249 |
| |||||
Short-Term Borrowings |
| 39 |
| 15 |
| 13 |
| 15 |
| 17 |
| |||||
Long-Term Debt |
| 3,893 |
| 3,845 |
| 4,340 |
| 4,353 |
| 4,417 |
| |||||
Total Interest Expense |
| 17,440 |
| 15,618 |
| 15,641 |
| 15,725 |
| 15,475 |
| |||||
Net Interest Income |
| 99,931 |
| 98,779 |
| 95,849 |
| 96,031 |
| 93,352 |
| |||||
Provision for Loan and Lease Losses |
| (6,500 | ) | — |
| (3,500 | ) | — |
| — |
| |||||
Net Interest Income After Provision for Loan and Lease Losses |
| 106,431 |
| 98,779 |
| 99,349 |
| 96,031 |
| 93,352 |
| |||||
Non-Interest Income |
|
|
|
|
|
|
|
|
|
|
| |||||
Trust and Asset Management |
| 13,934 |
| 12,672 |
| 12,995 |
| 13,864 |
| 12,759 |
| |||||
Mortgage Banking |
| 1,516 |
| 1,711 |
| 2,808 |
| 1,977 |
| 3,324 |
| |||||
Service Charges on Deposit Accounts |
| 10,155 |
| 9,472 |
| 9,540 |
| 9,950 |
| 9,442 |
| |||||
Fees, Exchange, and Other Service Charges |
| 13,684 |
| 13,741 |
| 14,243 |
| 13,239 |
| 13,725 |
| |||||
Investment Securities Gains (Losses) |
| (757 | ) | — |
| (37 | ) | — |
| (20 | ) | |||||
Insurance |
| 4,234 |
| 5,423 |
| 4,926 |
| 4,658 |
| 4,762 |
| |||||
Other |
| 5,584 |
| 10,035 |
| 10,373 |
| 5,154 |
| 5,445 |
| |||||
Total Non-Interest Income |
| 48,350 |
| 53,054 |
| 54,848 |
| 48,842 |
| 49,437 |
| |||||
Non-Interest Expense |
|
|
|
|
|
|
|
|
|
|
| |||||
Salaries and Benefits |
| 45,043 |
| 46,566 |
| 46,689 |
| 46,001 |
| 46,409 |
| |||||
Net Occupancy Expense |
| 9,606 |
| 9,812 |
| 9,543 |
| 9,386 |
| 9,933 |
| |||||
Net Equipment Expense |
| 6,316 |
| 5,847 |
| 5,799 |
| 5,964 |
| 7,395 |
| |||||
Other |
| 21,138 |
| 21,965 |
| 23,094 |
| 21,671 |
| 19,667 |
| |||||
Total Non-Interest Expense |
| 82,103 |
| 84,190 |
| 85,125 |
| 83,022 |
| 83,404 |
| |||||
Income Before Income Taxes |
| 72,678 |
| 67,643 |
| 69,072 |
| 61,851 |
| 59,385 |
| |||||
Provision for Income Taxes |
| 26,437 |
| 24,576 |
| 24,840 |
| 22,052 |
| 20,712 |
| |||||
Net Income |
| $ | 46,241 |
| $ | 43,067 |
| $ | 44,232 |
| $ | 39,799 |
| $ | 38,673 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Basic Earnings Per Share |
| $ | 0.86 |
| $ | 0.82 |
| $ | 0.84 |
| $ | 0.73 |
| $ | 0.70 |
|
Diluted Earnings Per Share |
| $ | 0.82 |
| $ | 0.78 |
| $ | 0.79 |
| $ | 0.69 |
| $ | 0.66 |
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Balance Sheet Totals |
|
|
|
|
|
|
|
|
|
|
| |||||
Total Assets |
| 9,766,191 |
| 9,594,809 |
| 9,688,769 |
| 10,013,442 |
| 9,461,647 |
| |||||
Net Loans |
| 5,880,134 |
| 5,690,924 |
| 5,662,410 |
| 5,587,811 |
| 5,628,095 |
| |||||
Total Deposits |
| 7,564,667 |
| 7,413,240 |
| 7,469,288 |
| 7,363,922 |
| 7,332,779 |
| |||||
Total Shareholders’ Equity |
| 814,834 |
| 756,707 |
| 699,438 |
| 785,768 |
| 793,132 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Performance Ratios |
|
|
|
|
|
|
|
|
|
|
| |||||
Net Income to Average Total Assets (ROA) |
| 1.89 | % | 1.77 | % | 1.80 | % | 1.65 | % | 1.66 | % | |||||
Net Income to Average Shareholders’ Equity (ROE) |
| 23.63 | % | 23.42 | % | 24.28 | % | 19.98 | % | 18.59 | % | |||||
Efficiency Ratio 1 |
| 55.37 | % | 55.45 | % | 56.49 | % | 57.31 | % | 58.41 | % | |||||
1 The efficiency ratio is defined as non-interest expense divided by total revenue (net interest income and non-interest income).