HONOLULU, April 26, 2024 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), ("First Hawaiian" or the "Company") today reported financial results for its quarter ended March 31, 2024. "I'm pleased to report that we started 2024 with a solid first quarter," said Bob Harrison, Chairman, President, and CEO. "We had strong earnings, continued excellent credit quality and continued to grow our capital levels."  On April 24, 2024, the Company's Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on May 31, 2024, to stockholders of record at the close of business on May 20, 2024. First Quarter 2024 Highlights: Net income of $54.2 million, or $0.42 per diluted share Total loans and leases decreased $33.3 million versus prior quarter Total deposits decreased $663.2 million versus prior quarter Net interest margin increased 10 basis points to 2.91% Recorded a $6.3 million provision for credit losses $4.1 million FDIC special assessment included in expenses Board of Directors declared a quarterly dividend of $0.26 per share Balance SheetTotal assets were $24.3 billion as of March 31, 2024, a decrease of $647.3 million, or 2.6%, from $24.9 billion as of December 31, 2023. Gross loans and leases were $14.3 billion as of March 31, 2024, a decrease of $33.3 million, or 0.2%, from $14.4 billion as of December 31, 2023. Total deposits were $20.7 billion as of March 31, 2024, a decrease of $663.2 million, or 3.1%, from $21.3 billion as of December 31, 2023. Net Interest IncomeNet interest income for the first quarter of 2024 was $154.4 million, an increase of $2.6 million, or 1.7%, compared to $151.8 million for the prior quarter. The net interest margin was 2.91% in the first quarter of 2024, an increase of 10 basis points compared to 2.81% in the prior quarter. Provision ExpenseDuring the quarter ended March 31, 2024, we recorded a $6.3 million provision for credit losses. In the quarter ended December 31, 2023, we recorded a $5.3 million provision for credit losses. Noninterest IncomeNoninterest income was $51.4 million in the first quarter of 2024, a decrease of $7.0 million compared to noninterest income of $58.3 million in the prior quarter. Noninterest ExpenseNoninterest expense was $128.8 million in the first quarter of 2024, a decrease of $13.5 million compared to noninterest expense of $142.3 million in the prior quarter. The efficiency ratio was 62.2% and 67.3% for the quarters ended March 31, 2024 and December 31, 2023, respectively. TaxesThe effective tax rate was 23.3% and 24.0% for the quarters ended March 31, 2024 and December 31, 2023, respectively. Asset QualityThe allowance for credit losses was $159.8 million, or 1.12% of total loans and leases, as of March 31, 2024, compared to $156.5 million, or 1.09% of total loans and leases, as of December 31, 2023. The reserve for unfunded commitments was $34.8 million as of March 31, 2024 compared to $35.6 million as of December 31, 2023. Net charge-offs were $3.8 million, or 0.11% of average loans and leases on an annualized basis, for the quarter ended March 31, 2024, compared to net charge-offs of $5.8 million, or 0.16% of average loans and leases on an annualized basis, for the quarter ended December 31, 2023. Total non-performing assets were $18.0 million, or 0.13% of total loans and leases and other real estate owned, on March 31, 2024, compared to total non-performing assets of $18.6 million, or 0.13% of total loans and leases and other real estate owned, on December 31, 2023. CapitalTotal stockholders' equity increased $27.7 million in the first quarter, and stood at $2.5 billion on March 31, 2024 and December 31, 2023. The tier 1 leverage, common equity tier 1 and total capital ratios were 8.80%, 12.55% and 13.75%, respectively, on March 31, 2024, compared with 8.64%, 12.39% and 13.57%, respectively, on December 31, 2023. The Company did not repurchase any shares in the first quarter. 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, 7:00 a.m. Hawaii Time. To access the call by phone, please register via the following link: https://register.vevent.com/register/BIb74728f7f2a14341b3028eb985e2ddf0, 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 StatementsThis 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. Use of Non-GAAP Financial MeasuresReturn 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 12 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures. Investor Relations Contact: Kevin Haseyama, CFA(808) Media Contact:Lindsay Chambers(808)   Financial Highlights   Table 1     For the Three Months Ended       March 31,    December 31,    March 31,    (dollars in thousands, except per share data)   2024   2023   2023   Operating Results:                     Net interest income   $ 154,427   $ 151,793   $ 167,247   Provision for credit losses     6,300     5,330     8,800   Noninterest income     51,371     58,347     49,023   Noninterest expense     128,813     142,307     118,567   Net income     54,220     47,502     66,818   Basic earnings per share     0.42     0.37     0.52   Diluted earnings per share     0.42     0.37     0.52   Dividends declared per share     0.26     0.26     0.26   Dividend payout ratio     61.90 %   70.27 %   50.00 % Performance Ratios(1):                     Net interest margin     2.91 %    2.81 %   3.11 % Efficiency ratio     62.15 %    67.28 %   54.46 % Return on average total assets     0.90 %    0.77 %   1.10 % Return on average tangible assets (non-GAAP)(2)     0.94 %    0.81 %   1.15 % Return on average total stockholders' equity     8.73 %    7.94 %   11.78 % Return on average tangible stockholders' equity (non-GAAP)(2)     14.53 %    13.66 %   20.78 % Average Balances:                     Average loans and leases   $ 14,312,563   $ 14,349,322   $ 14,079,337   Average earning assets     21,481,890     21,688,816     21,873,259   Average assets     24,187,207     24,404,727     24,548,124   Average deposits     20,571,930     20,908,221     21,468,624   Average stockholders' equity     2,496,840     2,374,669     2,299,422   Market Value Per Share:                     Closing     21.96     22.86     20.63   High     23.12     23.22     28.28   Low     20.37     17.18     19.68                             As of   As of   As of       March 31,    December 31,    March 31,    (dollars in thousands, except per share data)   2024   2023   2023   Balance Sheet Data:                     Loans and leases   $ 14,320,208   $ 14,353,497   $ 14,221,272   Total assets     24,279,186     24,926,474     24,884,207   Total deposits     20,669,481     21,332,657     21,281,500   Short-term borrowings     500,000     500,000     250,000   Long-term borrowings     —     —     500,000   Total stockholders' equity     2,513,761     2,486,066     2,329,012                         Per Share of Common Stock:                     Book value   $ 19.66   $ 19.48   $ 18.26   Tangible book value (non-GAAP)(2)     11.88     11.68     10.45                         Asset Quality Ratios:                     Non-accrual loans and leases / total loans and leases     0.13 %    0.13 %   0.10 % Allowance for credit losses for loans and leases / total loans and leases     1.12 %    1.09 %   1.03 %                       Capital Ratios:                     Common Equity Tier 1 Capital Ratio     12.55 %    12.39 %   11.97 % Tier 1 Capital Ratio     12.55 %    12.39 %   11.97 % Total Capital Ratio     13.75 %   13.57 %   13.09 % Tier 1 Leverage Ratio     8.80 %   8.64 %   8.26 % Total stockholders' equity to total assets     10.35 %   9.97 %   9.36 % Tangible stockholders' equity to tangible assets (non-GAAP)(2)     6.52 %   6.23 %   5.58 %                       Non-Financial Data:                     Number of branches     50     50     51   Number of ATMs     275     275     296   Number of Full-Time Equivalent Employees     2,065     2,089     2,100   _____________________________ (1) Except for the efficiency ratio, amounts are annualized for the three months ended March 31, 2024, December 31, 2023 and March 31, 2023. (2) 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 compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders' equity as the ratio of net income to average tangible stockholders' equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders' equity. We compute our tangible book value per share as the ratio of tangible stockholders' equity to outstanding shares. Tangible stockholders' equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders' equity. We compute our tangible stockholders' equity to tangible assets as the ratio of tangible stockholders' equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. For a reconciliation to the most directly comparable GAAP financial measure, see Table 12, GAAP to Non-GAAP Reconciliation.   Consolidated Statements of Income   Table 2     For the Three Months Ended     March 31,    December 31,    March 31,  (dollars in thousands, except per share amounts)   2024   2023   2023 Interest income                   Loans and lease financing   $ 199,844   $ 196,276   $ 172,339 Available-for-sale investment securities     14,546     19,033     18,688 Held-to-maturity investment securities     17,793     17,987     18,957 Other     12,769     7,734     3,561 Total interest income     244,952     241,030     213,545 Interest expense                   Deposits     84,143     82,215     43,284 Short-term and long-term borrowings     5,953     6,232     2,563 Other     429     790     451 Total interest expense     90,525     89,237     46,298 Net interest income     154,427     151,793     167,247 Provision for credit losses     6,300     5,330     8,800 Net interest income after provision for credit losses     148,127     146,463     158,447 Noninterest income                   Service charges on deposit accounts     7,546     7,646     7,231 Credit and debit card fees     16,173     16,381     16,298 Other service charges and fees     9,904     9,535     9,162 Trust and investment services income     10,354     9,645     9,614 Bank-owned life insurance     4,286     5,063     5,120 Investment securities gains, net     —     792     — Other     3,108     9,285     1,598 Total noninterest income     51,371     58,347     49,023 Noninterest expense                   Salaries and employee benefits     59,262     55,882     56,032 Contracted services and professional fees     15,739     16,219     16,313 Occupancy     6,941     7,561     7,782 Equipment     13,413     12,547     9,736 Regulatory assessment and fees     8,120     20,412     3,836 Advertising and marketing     2,612     1,441     1,994 Card rewards program     8,508     7,503     8,085 Other     14,218     20,742     14,789 Total noninterest expense     128,813     142,307     118,567 Income before provision for income taxes     70,685     62,503     88,903 Provision for income taxes     16,465     15,001     22,085 Net income   $ 54,220   $ 47,502   $ 66,818 Basic earnings per share   $ 0.42   $ 0.37   $ 0.52 Diluted earnings per share   $ 0.42   $ 0.37   $ 0.52 Basic weighted-average outstanding shares     127,707,354     127,612,734     127,453,820 Diluted weighted-average outstanding shares     128,217,689     128,028,964     128,033,812     Consolidated Balance Sheets   Table 3     March 31,    December 31,    March 31,  (dollars in thousands, except share amount)   2024   2023   2023 Assets                   Cash and due from banks   $ 202,121     $ 185,015     $ 253,705   Interest-bearing deposits in other banks     1,072,145       1,554,882       611,887   Investment securities:                   Available-for-sale, at fair value (amortized cost: $2,466,109 as of March 31, 2024, $2,558,675 as of December 31, 2023 and $3,427,708 as of March 31, 2023)     2,159,338       2,255,336       3,054,280   Held-to-maturity, at amortized cost (fair value: $3,470,710 as of March 31, 2024, $3,574,856 as of December 31, 2023 and $3,824,478 as of March 31, 2023)     3,988,011       4,041,449       4,261,361   Loans held for sale     —       190       —   Loans and leases     14,320,208       14,353,497       14,221,272   Less: allowance for credit losses     159,836       156,533       147,122   Net loans and leases     14,160,372       14,196,964       14,074,150                       Premises and equipment, net     281,181       281,461       278,121   Other real estate owned and repossessed personal property     —       —       91   Accrued interest receivable     85,715       84,417       79,200   Bank-owned life insurance     484,193       479,907       473,255   Goodwill     995,492       995,492       995,492   Mortgage servicing rights     5,533       5,699       6,299   Other assets     845,085       845,662       796,366   Total assets   $ 24,279,186     $ 24,926,474     $ 24,884,207   Liabilities and Stockholders' Equity                   Deposits:                   Interest-bearing   $ 13,620,928     $ 13,749,095     $ 12,579,155   Noninterest-bearing     7,048,553       7,583,562       8,702,345   Total deposits     20,669,481       21,332,657       21,281,500   Short-term borrowings     500,000       500,000       250,000   Long-term borrowings     —       —       500,000   Retirement benefits payable     102,242       103,285       101,622   Other liabilities     493,702       504,466       422,073   Total liabilities     21,765,425       22,440,408       22,555,195                       Stockholders' equity                   Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 141,687,612 / 127,841,908 shares as of March 31, 2024, issued/outstanding: 141,340,539 / 127,618,761 shares as of December 31, 2023 and issued/outstanding: 141,291,086 / 127,573,680 shares as of March 31, 2023)     1,417       1,413       1,413   Additional paid-in capital     2,551,488       2,548,250       2,540,653   Retained earnings     858,494       837,859       769,791   Accumulated other comprehensive loss, net     (523,780 )     (530,210 )     (611,679 ) Treasury stock (13,845,704 shares as of March 31, 2024, 13,721,778 shares as of December 31, 2023 and 13,717,406 shares as of March 31, 2023)     (373,858 )     (371,246 )     (371,166 ) Total stockholders' equity     2,513,761       2,486,066       2,329,012   Total liabilities and stockholders' equity   $ 24,279,186     $ 24,926,474     $ 24,884,207       Average Balances and Interest Rates                                               Table 4     Three Months Ended   Three Months Ended   Three Months Ended       March 31, 2024   December 31, 2023   March 31, 2023       Average   Income/   Yield/   Average   Income/   Yield/   Average   Income/   Yield/   (dollars in millions)   Balance   Expense   Rate   Balance   Expense   Rate   Balance   Expense   Rate   Earning Assets                                                   Interest-Bearing Deposits in Other Banks   $ 858.6   $ 11.6   5.45 % $ 568.0   $ 7.8   5.39 % $ 299.6   $ 3.4   4.60 % Available-for-Sale Investment Securities                                                   Taxable     2,210.6     14.5   2.63     2,598.4     19.0   2.92     3,081.4     18.4   2.39   Non-Taxable     1.8     —   5.61     1.9     —   5.12     31.1     0.4   5.55   Held-to-Maturity Investment Securities                                                   Taxable     3,416.4     14.6   1.71     3,472.1     14.8   1.70     3,683.8     15.7   1.70   Non-Taxable     603.4     4.0   2.65     603.9     3.9   2.58     612.2     4.1   2.74   Total Investment Securities     6,232.2     33.1   2.13     6,676.3     37.7   2.25     7,408.5     38.6   2.09   Loans Held for Sale     0.7     —   6.92     0.7     —   7.41     0.1     —   5.53   Loans and Leases(1)                                                   Commercial and industrial     2,164.9     37.2   6.92     2,148.1     36.7   6.78     2,192.9     32.4   5.98   Commercial real estate     4,323.5     70.1   6.53     4,356.3     71.4   6.51     4,105.7     58.3   5.76   Construction     924.7     17.4   7.55     888.7     16.7   7.45     873.9     14.7   6.83   Residential:                                                   Residential mortgage     4,264.1     42.0   3.94     4,294.8     38.8   3.61     4,307.0     38.4   3.57   Home equity line     1,172.1     12.0   4.13     1,174.8     11.3   3.83     1,074.9     8.7   3.27   Consumer     1,083.5     18.1   6.71     1,132.4     18.4   6.43     1,213.5     17.2   5.75   Lease financing     379.8     3.7   3.91     354.2     3.6   4.03     311.4     3.1   4.10   Total Loans and Leases     14,312.6     200.5   5.63     14,349.3     196.9   5.45     14,079.3     172.8   4.96   Other Earning Assets     77.8     1.2   5.90     94.5     —   0.06     85.8     0.2   0.76   Total Earning Assets(2)     21,481.9     246.4   4.61     21,688.8     242.4   4.44     21,873.3     215.0   3.97   Cash and Due from Banks     244.3               240.8               286.1             Other Assets     2,461.0               2,475.1               2,388.7             Total Assets   $ 24,187.2             $ 24,404.7             $ 24,548.1                                                                 Interest-Bearing Liabilities                                                   Interest-Bearing Deposits                                                   Savings   $ 6,059.7   $ 23.4   1.56 % $ 6,067.2