First Hawaiian, Inc. Reports Fourth Quarter 2024 Financial Results and Declares Dividend

HONOLULU, Jan. 31, 2025 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), ("First Hawaiian” or the "Company”) today reported financial results for its quarter ended December 31, 2024.

"I'm pleased to report that we finished 2024 with a very strong quarter that was highlighted by good performance across our key earnings drivers. Our loan and deposit balances grew, net interest margin expanded, expenses were well controlled and credit quality remained excellent. We also maintained our commitment to supporting our communities with a $1 million contribution to the First Hawaiian Foundation,” said Bob Harrison, Chairman, President, and CEO. "During the fourth quarter we took action to strengthen our balance sheet and increase our future earnings power by restructuring a portion of our investment portfolio. This action, along with the positive trends we saw in the fourth quarter, positions us very well entering 2025.” 

On January 29, 2025, the Company's Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on February 28, 2025, to stockholders of record at the close of business on February 14, 2025.

Additionally, the Company's Board of Directors adopted a stock repurchase program for up to $100.0 million of its outstanding common stock during 2025.

Fourth Quarter 2024 Highlights:

• Restructured a portion of the investment portfolio by selling $290.4 million of low-yielding investment securities and reinvested the sale proceeds into $291.5 million of higher-yielding securities. Recognized a $26.2 million pre-tax ($19.2 million after-tax) loss on the sale of securities.
• Net income of $52.5 million, or $0.41 per diluted share
• Total loans and leases increased $166.9 million versus prior quarter
• Total deposits increased $94.5 million versus prior quarter
• Net interest margin increased 8 basis points to 3.03%
• Recorded a $0.8 million negative provision for credit losses
• Board of Directors declared a quarterly dividend of $0.26 per share

Balance Sheet

Total assets were $23.8 billion at December 31, 2024 and September 30, 2024.

Gross loans and leases were $14.4 billion as of December 31, 2024, an increase of $166.9 million, or 1.2%, from $14.2 billion as of September 30, 2024.

Total deposits were $20.3 billion as of December 31, 2024, an increase of $94.5 million, or 0.5%, from $20.2 billion as of September 30, 2024.

Net Interest Income

Net interest income for the fourth quarter of 2024 was $158.8 million, an increase of $2.0 million, or 1.3%, compared to $156.7 million for the prior quarter.

The net interest margin was 3.03% in the fourth quarter of 2024, an increase of 8 basis points compared to 2.95% in the prior quarter.

Provision Expense

During the quarter ended December 31, 2024, we recorded a $0.8 million negative provision for credit losses. In the quarter ended September 30, 2024, we recorded a $7.4 million provision for credit losses.

Noninterest Income

Noninterest income was $29.4 million in the fourth quarter of 2024, a decrease of $23.9 million compared to noninterest income of $53.3 million in the prior quarter. Noninterest income in the fourth quarter of 2024 included a $26.2 million loss on the sale of investment securities.

Noninterest Expense

Noninterest expense was $124.1 million in the fourth quarter of 2024, a decrease of $2.0 million compared to noninterest expense of $126.1 million in the prior quarter.

The efficiency ratio was 65.5% and 59.8% for the quarters ended December 31, 2024 and September 30, 2024, respectively.

Taxes

The effective tax rate was 18.9% and 19.6% for the quarters ended December 31, 2024 and September 30, 2024, respectively.

Asset Quality

The allowance for credit losses was $160.4 million, or 1.11% of total loans and leases, as of December 31, 2024, compared to $163.7 million, or 1.15% of total loans and leases, as of September 30, 2024. The reserve for unfunded commitments was $32.8 million as of December 31, 2024, compared to $33.7 million as of September 30, 2024. Net charge-offs were $3.4 million, or 0.09% of average loans and leases on an annualized basis, for the quarter ended December 31, 2024, compared to net charge-offs of $3.9 million, or 0.11% of average loans and leases on an annualized basis, for the quarter ended September 30, 2024. Total non-performing assets were $20.7 million, or 0.14% of total loans and leases and other real estate owned, on December 31, 2024, compared to total non-performing assets of $17.8 million, or 0.13% of total loans and leases and other real estate owned, on September 30, 2024.

Capital

Total stockholders' equity was $2.6 billion on December 31, 2024 and September 30, 2024.

The tier 1 leverage, common equity tier 1 and total capital ratios were 9.14%, 12.80% and 13.99%, respectively, on December 31, 2024, compared with 9.14%, 13.03% and 14.25%, respectively, on September 30, 2024.

The Company repurchased 1.5 million shares of common stock at a total cost of $40.0 million under the stock repurchase program in the fourth quarter. The average cost was $27.14 per share repurchased. Total repurchases in 2024 were $40.0 million.

As to the stock repurchase program approved for 2025, repurchases of shares of the Company's common stock may be conducted through open-market purchases, which may include purchases under a trading plan adopted pursuant to Securities and Exchange Commission Rule 10b5-1, or through privately negotiated transactions. The timing and exact amount of share repurchases, if any, will be subject to management's discretion and various factors, including the Company's capital position and financial performance, as well as market conditions. The repurchase program may be suspended, terminated or modified at any time for any reason.

First Hawaiian, Inc.

First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii's oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company's website, www.fhb.com.

Conference Call Information

First Hawaiian will host a conference call to discuss the Company's results today at 1:00 p.m. Eastern Time, 8:00 a.m. Hawaii Time.

To access the call by phone, please register via the following link: https://register.vevent.com/register/BI80003c73e95b445aa5fe62db794097bb, and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as "may”, "might”, "should”, "could”, "predict”, "potential”, "believe”, "expect”, "continue”, "will”, "anticipate”, "seek”, "estimate”, "intend”, "plan”, "projection”, "would”, "annualized” and "outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission ("SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2023 and our Quarterly Report on Form 10-Q for the quarters ended March 31, 2024, June 30, 2024 and September 30, 2024.

Use of Non-GAAP Financial Measures

Return on average tangible assets, return on average tangible stockholders' equity, tangible book value per share and tangible stockholders' equity to tangible assets are non-GAAP financial measures. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy.

Table 14 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.