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First Hawaiian’s earnings jump 13.1%

First Hawaiian Inc.’s net income jumped 13.1% in the fourth quarter partly due to accelerating loan growth as the company capped off its first year back as a fully independent bank.

The parent company of the state’s largest bank said today it earned $67.8 million, or 52 cents a share, during the final three months compared with $60 million, or 44 cents a share, in the year-earlier quarter. Loans edged up just 1% to $13.21 billion year over year but increased 2.9% from the third quarter. The year-over-year loan increase would have been even higher at 4.2% had the bank not sold off $409 million in loans during the third quarter that reduced its loan balance.

“We ended 2019 with a great quarter, driven by strong loan growth, improved deposit mix, prudent expense management and excellent credit quality,” First Hawaiian Chairman, President and CEO Bob Harrison said on the bank’s earnings conference call.”

First Hawaiian Bank’s full-year net income rose 7.6% to $284.4 million

Chief Financial Officer Ravi Mallela said on the conference call that the bank expects loan growth this year to be in the 3% to 4% range.

First Hawaiian’s earnings also benefited from a 41.2% jump in noninterest income that was primarily due to a $24.1 million loss the bank incurred in a securities portfolio restructuring in the fourth quarter of 2018. There was no such restructuring last quarter.

The bank’s net interest income, which is the difference between what it collects on loans and what it pays for deposits, slipped 3% to $139.6 million while its net interest margin fell 8 basis points to 3.15%.

Deposits fell 4.1% to $16.45 billion from the year-earlier quarter.

French banking giant BNP Paribas, which at one time had owned 100% of First Hawaiian sold off its remaining stake on Feb. 1.

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