Bank of Hawaii (BOH) Q1 2025 earnings summary

Executive summary

• Net income for Q1 2025 was $44.0 million, up 21% year-over-year and 12.3% sequentially; diluted EPS was $0.97, up from $0.87 in Q1 2024.

• Net interest margin expanded to 2.32% for the fourth consecutive quarter, with net interest income rising to $125.8 million.

• Credit quality remained strong, with net charge-offs at 0.13% and non-performing assets at 0.12%.

• Return on average common equity improved to 11.80% from 11.20% a year ago.

• The company maintained strong capital and liquidity positions, with regulatory capital ratios well above required thresholds.

Financial highlights

• Net interest income was $125.8 million, up 10% year-over-year and 4.7% sequentially; net interest margin rose 21 bps to 2.32%.

• Noninterest income was $44.1 million, up 4% year-over-year; noninterest expense was $110.5 million, up 4.3%.

• Provision for credit losses was $3.3 million; allowance for credit losses was $147.7 million (1.05% of loans/leases).

• Total deposits grew 1.8% year-over-year to $21.0 billion; loans and leases up 1.9% to $14.1 billion.

• Effective tax rate decreased to 21.67% from 24.76% year-over-year.

Outlook and guidance

• Margin target of 2.50% by year-end is considered attainable, contingent on deposit mix and rate cuts.

• Loan growth guidance remains in the low single digits, with solid commercial pipelines and improving consumer applications.

• Core expenses projected to increase 2-3% from 2024, with initiatives expected to reduce costs in the second half.

• Management expects stable economic conditions in Hawai'i, with ongoing construction activity and a recovering Maui economy.

• Forward-looking statements caution about risks and uncertainties impacting future results.