First Hawaiian Bank set aside $55.4 million in the second quarter to cover potential bad loans as the state reels from a tourism shutdown, millions of people out of work and a surge in coronavirus cases.

With the economic fallout from the virus continuing to mount, the state’s largest bank has now put in reserve an additional $96.6 million through midyear, including the $41.2 million loan-loss provision it took in the first quarter for businesses and consumers unable to pay their debts.

The latest provision resulted in parent company First Hawaiian Inc. reporting today that its net income plunged 72.3% to $20 million, or 15 cents a share, from $72.4 million, or 54 cents a share, from the second quarter of 2019. The company’s nonperforming assets — delinquent loans not accruing interest and foreclosed real estate — swelled 755% to $33.3 million from $3.9 million in the year-earlier quarter.

“During the quarter, we updated our outlook for the economy and completed a comprehensive review on the commercial loan portfolio,” First Hawaiian Chief Risk Officer Ralph Mesick said on an earnings conference call with analysts. “The review focused on customers who took deferrals, those in industries that were impacted by the shutdown, and larger exposures regardless of payment status or industry. These activities led to reclassifications and increase in provisioning, and write-downs to a few credits that were already classified prior to the onset of the pandemic.”

First Hawaiian’s revenue fell 10.8% to $173.5 million during the quarter from the year-earlier period. Both its earnings per share and revenue missed analysts’ expectations and the stock tumbled 95 cents, or 5.1%, to $17.64 after the earnings were announced. Analysts were expecting earnings per share of 22 cents and revenue of $178.9 million.

The bank did keep its dividend intact at 26 cents a share and said it will be payable on Sept. 4 to stockholders of record at the close of business on Aug. 24.

“Based on our current economic outlook, we expect to generate sufficient earnings to remain well capitalized, support future loan growth, and sustain the current dividend,” First Hawaiian Chairman, President and CEO Bob Harrison said on the conference call. “If economic conditions become significantly worse than we anticipate, we’ll reassess our ability to maintain the dividend at existing levels.”

First Hawaiian’s loans rose 3.8% to $13.8 billion from the year-earlier period and increased 2.9% from the first quarter. The bank said loan growth was driven by Paycheck Protection Program (PPP) loans and that as of June 30 it had secured over $940 million in PPP loans for 6,000 small-business customers.

Deposits, which included a portion of PPP loan proceeds, jumped 15.3% to $19.4 billion from the year-earlier quarter.

However, the bank’s net interest margin, which is the difference between what the bank generates from its loans and pays out in deposits, considerably worsened by 67 basis points to 2.58% from 3.25% in the year-earlier quarter and was down 54 basis points from 3.12% in the first quarter. The bank said the lower margin was due to interest rate cuts and a higher cash level it carried in the quarter.

The bank said it also successfully launched the Aloha for Hawaii Fund, which supported the restaurant industry, and donated $1 million to nonprofits for COVID-19 relief. It also donated $1 million to the Stronger Together Fund to support the 2020 public high school graduates as they transition to the next phase of their lives.

“During this difficult time for our local economy, we focused our efforts on creating stability by offering relief assistance to customers and support to the community,” Harrison said in a news release.