First Hawaiian assets top $20 billion

Hawaii is now home to a $20 billion bank.

First Hawaiian Bank took in $1.3 billion in new deposits over the past year to push its assets above $20 billion for the first time and help the holding company of the state’s largest bank increase its second- quarter profit.

First Hawaiian Inc. on Thursday reported net income of $56.9 million in the three months ended June 30, up 3.6 percent from $54.9 million in the same period last year.

The bank produced higher income from interest it earns primarily from lending and on investments, as it received more money from customer deposits that grew to a record level.

Bob Harrison, First Hawaiian’s chairman and CEO, said the bank reached records for deposits, loans and total assets.

“We had records across the board,” he said in an interview. “It was a very good quarter. We’re very happy with the growth.”

Deposits at First Hawaiian rose 8.3 percent to $17.5 billion in the recent quarter from $16.1 billion a year earlier.

Loans held by First Hawaiian rose 7.8 percent to $12.1 billion from $11.2 billion in the same period.

Total company assets rose to $20.4 billion. That was up from $19.1 billion in last year’s second quarter and $19.8 billion at the end of the first quarter. Bank assets include cash, government securities and interest-earning loans, such as mortgages.

Harrison said the growth largely reflects Hawaii’s robust economy, given that First Hawaiian’s deposits mostly come from within the state, including consumer deposits and deposits from state and county governments. Some deposits also come from customers on Guam and Saipan.

About 80 percent of First Hawaiian’s loans are made in the same geographic area, and include a roughly even split between commercial loans and consumer loans, the later of which include residential mortgages, credit cards and automobile loans.

Net interest income, the difference between interest the bank pays on deposits and interest it receives on loans and investment securities, rose to $131.3 million in the second quarter from $120.4 million a year earlier.

Other income, which includes service charges, fees and bank-owned life insurance, rose to $48.9 million from $46.4 million in the same period a year ago.

First Hawaiian said its asset quality remains “solid” and that less than 0.1 percent of assets were nonperforming. This amounted to $8.1 million of nonperforming assets, or 0.07 percent at the end of June, which was down from $13.5 million a year earlier.

Profit in the second quarter for First Hawaiian broke down to 41 cents per share of company stock, which is what five of six stock analysts had expected. A year earlier First Hawaiian’s earnings equated to 39 cents per share.

First Hawaiian has had its stock traded publicly on the Nasdaq stock market since Aug. 4, after Paris-based banking giant BNP Paribas sold a partial stake in the Hawaii bank. BNP still owns 62 percent of First Hawaiian stock.

Shares of First Hawaiian closed Thursday at $30.16 before the earnings announcement. The stock’s high was $35.19 on Dec. 27 and compared with a closing price of $24.25 after its first day of trading nearly a year ago.