Bank of Hawaii delivered a stronger-than-expected third quarter, reporting $1.20 in diluted earnings per share and $53.3 million in net income as interest income and fee revenue expanded. Average deposits rose at a 7.1% annualized pace while total loans and leases increased modestly, and the bank's board declared a $0.70 quarterly cash dividend. Shares ticked higher in pre-market trading after the results were released.
According to a company press release on Business Wire, the lender's net interest income climbed to $136.7 million and net interest margin improved to 2.46%. The release also recorded the bank's sixth consecutive quarter of margin expansion and said no common shares were repurchased under the buyback program this quarter.
Investing.com reported the revenue figure net of interest expense at roughly $182.64 million and noted analysts had been looking for about $1.17 per share, making the $1.20 result a modest beat. The outlet also said shares rose about 1.9% in pre-market trading after the announcement.
Management, capital and credit quality
“Bank of Hawai‘i delivered another quarter of solid results,” CEO Peter Ho said in the release, adding that credit quality remains exceptional as the bank focuses on prudent expense management, according to the Business Wire statement. The company reported a Tier 1 capital ratio of 14.34% and total non-performing assets of $16.9 million at quarter end, metrics the release said keep capital well above regulatory minimums.
Local lending and shareholder returns
Higher deposit balances provide the Honolulu-based lender with additional liquidity to support local mortgages and business lending even as it grows loans only modestly. Investing.com noted the board approved a $0.70 per-share common dividend payable in December, while the bank retains about $126.0 million in remaining buyback authority.
The bank will host a conference call and webcast for investors and the public; replay and slides are expected to be available on the company's investor relations site. For now, the quarter looks like a confirmation that Bank of Hawaii's conservative balance-sheet strategy is steadying earnings and preserving capital.
