Why Bank Of Hawaii Shares Are Falling Today

  • Bank Of Hawaii Corp BOH shares are down nearly 7% Monday morning as its first-quarter results missed Street expectations.
  • BOH reported Q1 revenues of $176.7 million, which missed the consensus of $179.4 million.
  • Net interest income rose 8.5% Y/Y to $136.0 million, led by higher loans and increased earning asset yields. Consequently, net interest margin expanded 13 basis points to 2.47%. 
  • Noninterest expense rose 7.7% Y/Y to $111.9, including seasonal payroll expenses of around $4.0 million and separation expenses of $3.1 million. 
  • Net income came in at $46.8 million, down 14.6% Y/Y.
  • EPS of $1.14 missed the consensus of $1.23.
  • Provision for credit losses stood at $2.0 million compared with a net benefit of $5.5 million a year ago.
  • The efficiency ratio was 63.34% compared with 61.53% in the year-ago period, reflecting decreased profitability.
  • The average yield on loans and leases stood at 4.03% in Q1, up 93 basis points Y/Y, reflecting higher benchmark interest rates.
  • As of Mar 31, 2023, total loans and leases balance increased 10.2% Y/Y to $13.8 billion, while total deposits decreased 1.1% to $20.5 billion.
  • As of Mar 31, 2023, Tier 1 capital ratio was 12.10%, down from 13.22% as of Mar 31, 2022. 
  • Return on average assets contracted to 0.80% from 0.97% a year ago, while return on average shareholders' equity expanded to 14.25% from 14.18% a year ago.
  • Repurchase: BOH repurchased shares worth $9.9 million in Q1, with $126.0 million remaining under share buyback authority as of Mar 31, 2023.
  • Dividend: The Board of Directors declared a dividend of $0.70, payable on Jun 14, 2023, to shareholders of record as on May 31, 2023.
  • "Spot deposit balances were down 0.6% from the prior quarter and down 1.1% from the prior year. Deposit costs, while rising, continue to show the benefits of our unique Hawai'i deposit base which is diversified and long tenured. Loans grew 1.3% on a linked quarter basis with growth across both our consumer and commercial portfolios. Credit quality remains excellent. Non-performing assets were lower on both a linked quarter and year on year basis," stated Peter Ho, Chairman, President, and CEO.
  • Price Action: BOH shares traded lower by 6.56% at $45.60 on the last check Monday.
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