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Management also addressed taxes. Harrison said the effective tax rate in the fourth quarter was 24.8% due to the reversal of a previously accrued tax benefit, and said the company expects the effective tax rate to return to about 23.2% going forward.On results, Harrison said the company posted “another strong quarter,” pointing to net interest margin (NIM) expansion, growth in net interest income, contained expenses, and strong credit quality. He said return on average tangible equity was 15.8% in the fourt ...

Financial Data and Key Metrics Changes - The company reported a return on average tangible equity of 15.8% for Q4 and 16.3% for the full year, with an effective tax rate of 24.8% in Q4, expected to normalize to 23.2% going forward [7][17] - Net interest income for Q4 was $170.3 million, a $1 million increase from the prior quarter, with a net interest margin (NIM) of 3.21%, up 2 basis points from the previous quarter [12][7] - Total loans grew by $183 million in the quarter, representing a 5.2% annualized growth rate [10] Business Line Data and Key Metrics Changes - Retail and commercial deposits increased by $233 million, while public deposits declined by $447 million, resulting in a net increase of $214 million in deposits for Q4 [11] - Non-interest income was reported at $55.6 million, while non-interest expense for Q4 was $125.1 million [13] Market Data and Key Metrics Changes - The unemployment rate in the state was 2.2% in November, significantly lower than the national rate of 4.5% [6] - Year-to-date spending through November was $19.6 billion, up about 6% compared to the same period last year [6] Company Strategy and Development Direction - The company anticipates full-year loan growth in the range of 3%-4%, primarily driven by commercial real estate (CRE) and commercial and industrial (C&I) loans [17] - The company has a new stock repurchase authorization of $250 million, indicating a strong capital position and flexibility for future growth initiatives [9][60] Management's Comments on Operating Environment and Future Outlook - Management noted that credit risk remains low and stable, with no broad signs of weakness observed in consumer or commercial books [14] - The company expects non-interest income to remain stable at approximately $220 million for the year, with expenses projected to be around $520 million in 2026 [17][54] Other Important Information - The company repurchased about 1 million shares during the quarter, utilizing the remaining $26 million of its $100 million purchase authorization for 2025 [9] - The allowance for credit losses increased to $168.5 million, with coverage rising to 118 basis points of total loans and leases [16] Q&A Session Summary Question: Loan growth trends and pipeline - Management indicated that loan growth was broad-based, with some payoffs in the CRE portfolio affecting expectations, but they anticipate more normalized growth in the second half of the year [24][25] Question: Payoffs and paydowns in the industry - Management noted that payoffs have been occurring sooner than expected due to increased competition from permanent lenders, but they expect this trend to normalize [26][28] Question: Deposit trends and NIM expansion - Management confirmed that the margin guide reflects the ability to continue cutting deposit rates, with expectations of a lower deposit beta going forward [30][31] Question: Full year loan growth guidance - Management suggested that loan growth may start lower in the first half of the year but expects a pickup in the second half [44] Question: M&A activity and ideal targets - Management reiterated their focus on organic growth but remains open to M&A opportunities, looking for well-managed firms with strong deposit franchises [72][73]

Financial Data and Key Metrics Changes - The net interest margin (NIM) expanded to 3.21%, up 2 basis points from the prior quarter [10] - Net interest income increased to $170.3 million, $1 million higher than the previous quarter [10] - Return on average tangible equity was 15.8% for the fourth quarter and 16.3% for the full year [6] - The effective tax rate for the fourth quarter was 24.8%, expected to return to about 23.2% going forward [6] Business Line Data and Key Metrics Changes - Total loans grew by $183 million in the quarter, or 5.2% on an annualized basis, with significant growth in commercial and industrial (C&I) loans [8] - Retail and commercial deposits increased by $233 million, while public deposits declined by $447 million, resulting in a net increase of $214 million in deposits [10] - Non-interest income was reported at $55.6 million, while non-interest expense was $125.1 million for the fourth quarter [11] Market Data and Key Metrics Changes - The state unemployment rate was 2.2% in November, significantly lower than the national rate of 4.5% [5] - Total visitor arrivals were down 0.2% year-over-year, with spending up 6% to $19.6 billion [5] - The median single-family home price on Oahu was $1.1 million, up 4.3% from the previous year, while the median condo sales price was $512,000, down 5.2% [5][6] Company Strategy and Development Direction - The company expects full-year loan growth to be in the 3%-4% range, driven primarily by commercial real estate (CRE) and C&I loans [15] - Non-interest income is anticipated to remain stable at about $220 million for the year, with expenses expected to be around $520 million in 2026 [15] - The company has a new stock repurchase authorization of $250 million, providing flexibility for capital return [8][59] Management's Comments on Operating Environment and Future Outlook - Management noted that credit risk remains low and stable, with no broad signs of weakness in consumer or commercial books [12] - The company expects to see more normalized growth in the second half of the year, following a period of payoffs in the CRE portfolio [22][28] - Management expressed confidence in maintaining a strong capital position, with a CET1 target of 12% and current levels above 13% [59] Other Important Information - The company repurchased about 1 million shares, utilizing the remaining $26 million of its $100 million purchase authorization for 2025 [8] - The allowance for credit losses increased to $168.5 million, with coverage at 118 basis points of total loans and leases [13] Q&A Session Summary Question: Loan growth trends and pipeline - Management indicated that loan growth was broad-based, with some payoffs in the CRE portfolio affecting expectations, but they anticipate more normalized growth in the future [22][23] Question: Payoffs and paydowns in the industry - Management noted that payoffs have been occurring sooner than expected due to increased competition from permanent lenders, but they expect this trend to normalize [27][28] Question: Deposit trends and NIM expansion - Management confirmed that the interest-bearing deposit beta is expected to decrease to 30%-35% after two rate cuts, with continued focus on reducing deposit costs [29][48] Question: Full year loan growth guidance - Management suggested that loan growth may start lower in the first half of the year but expects a pickup in the second half [44] Question: M&A activity and ideal targets - Management remains open to M&A opportunities, focusing on strong management teams and disciplined lending cultures, particularly in the western U.S. [71][72]

Financial Data and Key Metrics Changes - The bank's net interest margin (NIM) expanded to 3.21%, up 2 basis points from the prior quarter [6][7] - Return on average tangible equity was 15.8% for the fourth quarter and 16.3% for the full year [4] - Net interest income for the fourth quarter was $170.3 million, an increase of $1 million from the previous quarter [6][7] - The effective tax rate for the fourth quarter was 24.8%, expected to return to about 23.2% going forward [4] Business Line Data and Key Metrics Changes - Total loans grew by $183 million in the quarter, or 5.2% on an annualized basis, with significant growth in commercial and industrial (C&I) loans [5] - Retail and commercial deposits increased by $233 million, while public deposits declined by $447 million, resulting in a net increase of $214 million in deposits [6] - Non-interest income was reported at $55.6 million, while non-interest expense was $125.1 million for the fourth quarter [7] Market Data and Key Metrics Changes - The state unemployment rate was 2.2% in November, significantly lower than the national rate of 4.5% [3] - Total visitor arrivals in Hawaii were down 0.2% year-over-year, but spending increased by 6% to $19.6 billion [3] - The median single-family home price in Oahu rose to $1.1 million, a 4.3% increase from the previous year [3] Company Strategy and Development Direction - The company aims for full-year loan growth in the range of 3%-4%, primarily driven by C&I and commercial real estate (CRE) loans [11] - The bank plans to maintain a conservative approach to credit losses, with an allowance for credit losses increasing to $168.5 million [9] - The new stock repurchase authorization is for $250 million, providing flexibility for capital return strategies [5][54] Management's Comments on Operating Environment and Future Outlook - Management noted that credit risk remains low and stable, with no broad signs of weakness in consumer or commercial books [8] - The outlook for NIM is projected to be in the range of 3.16%-3.18%, with expectations of tailwinds from fixed asset repricing [11] - Management expressed confidence in the growth of multifamily loans and anticipated a normalization of growth in the second half of the year [18][39] Other Important Information - The bank repurchased about 1 million shares, utilizing the remaining $26 million of its $100 million purchase authorization for 2025 [5] - The bank's capital position remains strong, with a common equity tier 1 (CET1) ratio above the targeted 12% [54] Q&A Session Summary Question: Loan growth trends and pipeline - Management indicated that loan growth was broad-based, with C&I growth driven by existing lines and new dealer relationships [17] Question: Payoffs and paydowns in the industry - Management noted that payoffs have been occurring sooner than expected due to increased competition from permanent lenders [21] Question: Deposit trends and NIM expansion - Management confirmed that the margin guide reflects the ability to continue cutting deposit rates and fixed asset repricing [25] Question: Expense growth expectations - Management expects a normalization of expense growth in 2026, with a projected expense of about $520 million [45] Question: Capital return and buyback strategy - Management expressed a strong appetite for continuing the share buyback program while considering organic growth opportunities [51]

4 th Quarter 2025 Earnings Call January 30, 2026 | | Q4 2025 | Q3 2025 | | --- | --- | --- | | Net Income ($mm) | $69.9 | $73.8 | | Diluted EPS | $0.56 | $0.59 | | Net Interest Margin | 3.21% | 3.19% | | Efficiency Ratio | 55.1% | 55.3% | | ROA / ROATA2 | 1.16% / 1.21% | 1.22% / 1.27% | | ROE / ROATCE2 | 10.07% / 15.76% | 10.81% / 17.08% | | Tier 1 Leverage Ratio | 9.27% | 9.16% | | CET1 Capital Ratio | 13.17% | 13.24% | | Total Capital ratio | 14.42% | 14.49% | | Dividend3 | $0.26 / share | $0.26 / share | ...

Core Insights - First Hawaiian (FHB) reported a revenue of $225.85 million for the quarter ended December 2025, reflecting a year-over-year increase of 39.5% [1] - The earnings per share (EPS) for the quarter was $0.56, up from $0.41 in the same quarter last year, with an EPS surprise of +1.08% compared to the consensus estimate of $0.55 [1] - The stock has returned +9% over the past month, outperforming the Zacks S&P 500 composite's +0.9% change, and currently holds a Zacks Rank 3 (Hold) [3] Financial Metrics - Net charge-offs were reported at 0.1%, matching the three-analyst average estimate [4] - Total Non-Accrual Loans and Leases amounted to $41.03 million, exceeding the average estimate of $31.93 million [4] - The net interest margin was 3.2%, consistent with the three-analyst average estimate [4] - The efficiency ratio was reported at 55.1%, better than the average estimate of 56.3% [4] - Average balance of total earning assets was $21.22 billion, slightly below the average estimate of $21.41 billion [4] - Total Non-Performing Assets were $41.03 million, higher than the average estimate of $34.1 million [4] - Total Noninterest Income reached $55.55 million, surpassing the average estimate of $54.26 million [4] - Net Interest Income (FTE) was $171.3 million, slightly below the average estimate of $171.7 million [4] - Net Interest Income was reported at $170.3 million, compared to the average estimate of $171.09 million [4] - Service charges on deposit accounts were $8.18 million, slightly above the average estimate of $8.16 million [4] - Other service charges and fees totaled $13.83 million, exceeding the average estimate of $13.36 million [4] - Noninterest income from other sources was $3.57 million, higher than the average estimate of $2.91 million [4]

分组1 - First Hawaiian (FHB) reported quarterly earnings of $0.56 per share, exceeding the Zacks Consensus Estimate of $0.55 per share, and up from $0.41 per share a year ago, representing an earnings surprise of +1.08% [1] - The company achieved revenues of $225.85 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 0.10%, and an increase from $161.96 million year-over-year [2] - First Hawaiian has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] 分组2 - The stock has gained approximately 9% since the beginning of the year, compared to the S&P 500's gain of 1.8% [3] - The current consensus EPS estimate for the upcoming quarter is $0.54 on revenues of $221.57 million, and for the current fiscal year, it is $2.27 on revenues of $906.02 million [7] - The Zacks Industry Rank for Banks - West is in the top 24% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Performance - Net income for Q4 2025 was $69.9 million, or $0.56 per diluted share[10]. - Net income for the year ended December 31, 2025, reached $276,266 thousand, an increase from $230,129 thousand in 2024, representing a growth of approximately 20%[25]. - Return on average total stockholders' equity was 10.07% for the three months ended December 31, 2025, compared to 9.00% for the same period in the previous year[43]. - Total stockholders' equity increased to $2,769,365 as of December 31, 2025, up from $2,617,486 a year earlier[43]. - The tangible book value per share increased to $14.46 from $12.83 year-over-year, indicating improved shareholder value[43]. Assets and Liabilities - Total assets were $24.0 billion as of December 31, 2025, a slight decrease from $24.1 billion at September 30, 2025[5]. - Total assets decreased slightly to $23,955,252 thousand as of December 31, 2025, from $24,098,728 thousand as of September 30, 2025[24]. - Average total assets as of December 31, 2025, were $23,925,000, slightly down from $23,996,723 in the previous year[43]. - Total deposits decreased by $213.9 million to $20.5 billion from the previous quarter[5]. - Total deposits were $20,515,668 thousand as of December 31, 2025, down from $20,729,557 thousand as of September 30, 2025[24]. Loans and Leases - Gross loans and leases increased by $183.1 million to $14.3 billion compared to the prior quarter[5]. - Total loans and leases increased to $14,312,529 thousand as of December 31, 2025, up from $14,129,383 thousand as of September 30, 2025[24]. - Net loans and leases increased to $14,144,061 as of December 31, 2025, up 1.3% from $13,964,114 as of September 30, 2025[26]. - Total Loans and Leases outstanding reached $14,312,529 thousand as of December 31, 2025, compared to $14,129,383 thousand in the previous quarter[39]. - Total loans and leases amounted to $14,264.6 million, with a yield of 5.45% for 2025, compared to a yield of 5.65% in 2024[30]. Income and Expenses - Net interest income for Q4 2025 was $170.3 million, up $1.0 million from $169.3 million in Q3 2025[6]. - The net interest margin increased by 2 basis points to 3.21% in Q4 2025[6]. - Net interest income for the three months ended December 31, 2025, was $170,302 thousand, compared to $169,331 thousand for the previous quarter[25]. - The interest rate spread for the three months ended December 31, 2025, was 2.55%, an increase from 2.44% for the three months ended September 30, 2025[27]. - The interest rate spread increased to 2.42% for the year ended December 31, 2025, up from 2.05% in 2024[32]. Credit Quality - The company recorded a provision for credit losses of $7.7 million in Q4 2025, compared to $4.5 million in Q3 2025[7]. - Total Non-Performing Assets increased to $41,028 thousand as of December 31, 2025, up from $30,933 thousand in the previous quarter, representing a 32.5% increase[38]. - Total Non-Accrual Loans and Leases rose to $41,028 thousand, compared to $20,679 thousand a year ago, marking a 98.5% year-over-year increase[38]. - The Allowance for Credit Losses at the end of the period was $168,468 thousand, up from $160,393 thousand a year earlier, reflecting a 5.5% increase[39]. - Net Loans and Leases Charged-Off for the year totaled $16,275 thousand, compared to $13,648 thousand in the previous year, indicating a 19.1% increase[39]. Stockholder Actions - The company adopted a stock repurchase program for up to $250.0 million of its outstanding common stock[3]. - Stockholders' equity increased to $2,769,365 as of December 31, 2025, up from $2,733,921 as of September 30, 2025[26]. Branch and Operational Metrics - The number of branches remained stable at 49 as of December 31, 2025, consistent with the previous quarter[24]. - Interest-bearing deposits totaled $13,842.7 million for the three months ended December 31, 2025, with an average yield of 1.90%[27].

Core Viewpoint - First Hawaiian, Inc. reported strong financial results for the fourth quarter of 2025, highlighting growth in loans and deposits, and maintaining its position as the most profitable bank in Hawaii [1][12]. Financial Performance - Net income for the fourth quarter of 2025 was $69.9 million, or $0.56 per diluted share, compared to $73.8 million in the prior quarter [12][27]. - Net interest income increased to $170.3 million, up by $1.0 million from the previous quarter, with a net interest margin of 3.21%, an increase of 2 basis points [5][12]. - Noninterest income was $55.6 million, a decrease of $1.5 million from the prior quarter [7][12]. - Noninterest expense decreased slightly to $125.1 million from $125.7 million in the previous quarter, resulting in an efficiency ratio of 55.1% [8][12]. Balance Sheet Highlights - Total assets were $24.0 billion as of December 31, 2025, down from $24.1 billion at the end of the previous quarter [4][12]. - Gross loans and leases increased to $14.3 billion, up by $183.1 million from the prior quarter [4][12]. - Total deposits decreased to $20.5 billion, down by $213.9 million from the previous quarter [4][12]. - Total stockholders' equity rose to $2.8 billion, compared to $2.7 billion at the end of the previous quarter [11][12]. Credit Quality - The allowance for credit losses was $168.5 million, or 1.18% of total loans and leases, compared to $165.3 million, or 1.17%, in the prior quarter [10][12]. - Net charge-offs for the quarter were $5.0 million, or 0.14% of average loans and leases, compared to $4.2 million, or 0.12%, in the previous quarter [10][12]. Capital Management - The Board of Directors declared a quarterly cash dividend of $0.26 per share, payable on February 27, 2026 [1][12]. - A stock repurchase program was adopted for up to $250.0 million of outstanding common stock [2][12]. - The company repurchased approximately 1.0 million shares at a total cost of $26.0 million during the fourth quarter [13][12]. Taxation - The effective tax rate for the fourth quarter was 24.8%, up from 23.2% in the prior quarter [9][12].