Bank of Hawaii Corporation Third Quarter 2018 Financial Results

October 22, 2018

Supporting Materials:

Diluted Earnings Per Share $1.36
Net Income $56.9 Million
Board of Directors Declares Dividend of $0.62 Per Share

HONOLULU--(BUSINESS WIRE)--Oct. 22, 2018-- Bank of Hawaii Corporation (NYSE: BOH) today reported diluted earnings per share of $1.36 for the third quarter of 2018, up from $1.30 in the second quarter of 2018 and $1.08 in the third quarter of 2017. Net income for the third quarter of 2018 was $56.9 million, an increase of $2.2 million from net income of $54.7 million in the previous quarter and an increase of $11.0 million from net income of $45.9 million in the same quarter last year.

Loan and lease balances increased to $10.2 billion at September 30, 2018, up 1.8 percent from June 30, 2018 and up 6.9 percent compared with September 30, 2017. Deposits were $14.8 billion at the end of the third quarter of 2018, down slightly due to the planned decline in public deposits.

“We were pleased with Bank of Hawaii’s financial results during the third quarter of 2018,” said Peter S. Ho, Chairman, President, and CEO. “Loan balances continue to grow, deposits were in line with our expectations, our margin increased, asset quality remains strong, and our expenses were well controlled.”

The return on average assets for the third quarter of 2018 was 1.33 percent, up from 1.30 percent in the previous quarter and 1.07 percent in the same quarter last year. The return on average equity for the third quarter of 2018 was 18.06 percent, up from 17.68 percent for the second quarter of 2018 and up from 14.89 percent in the third quarter of 2017. The efficiency ratio for the third quarter of 2018 was 55.07 percent down from 56.12 percent in the previous quarter and 55.82 percent in the same quarter last year.

For the nine-month period ended September 30, 2018, net income was $165.7 million, an increase of $24.0 million from net income of $141.7 million for the same period last year. Diluted earnings per share were $3.93 for the nine-month period in 2018 compared with diluted earnings per share of $3.32 for the same period in 2017. The 2018 year-to-date return on average assets was 1.31 percent compared with 1.14 percent for the same period in 2017. The 2018 year-to-date return on average equity was 17.83 percent compared with 15.77 percent for the nine months ended September 30, 2017. The efficiency ratio for the nine-month period ended September 30, 2018 was 56.36 percent compared with 55.05 percent for the same period last year.

Financial Highlights

Net interest income, on a taxable equivalent basis, for the third quarter of 2018 was $124.2 million, an increase of $2.4 million from net interest income of $121.8 million in the second quarter of 2018 and an increase of $5.0 million from net interest income of $119.2 million in the third quarter of last year. Net interest income for the nine-month period in 2018 was $366.3 million, an increase of $18.8 million from net interest income of $347.5 million for the same period in 2017. Analyses of the changes in net interest income are included in Tables 8a, 8b, and 8c.

The net interest margin was 3.07 percent for the third quarter of 2018, an increase of 3 basis points from the net interest margin of 3.04 percent in the second quarter of 2018 and a 15 basis point increase from the net interest margin of 2.92 percent in the third quarter of 2017. The net interest margin for the first nine months of 2018 was 3.04 percent, an increase of 13 basis points compared with 2.91 percent for the same nine-month period last year.

Results for the third quarter of 2018 included a provision for credit losses of $3.8 million compared with a provision for credit losses of $3.5 million in the previous quarter and $4.0 million in the same quarter last year. The provision for credit losses during the first nine months of 2018 was $11.4 million compared with $12.7 million during the same period in 2017.

Noninterest income was $41.5 million in the third quarter of 2018, up $0.2 million from noninterest income of $41.3 million in the second quarter of 2018 and down $0.9 million from $42.4 million in the same quarter last year. There were no significant items in noninterest income during the third quarters of 2018 or 2017. Noninterest income during the second quarter of 2018 included a negative adjustment of $1.0 million related to a change in the Visa Class B conversion ratio. The decline in noninterest income compared to the third quarter of 2017 was largely due to a decline in mortgage banking income. Noninterest income for the nine-months ended September 30, 2018 was $126.8 million compared with noninterest income of $143.6 million for the same period in 2017. Results for the nine-month period in 2017 included a gain of $12.5 million on the sale of Visa Class B shares compared with a charge of $1.0 million for the adjustment to the conversions ratio in 2018. Excluding the Visa sale, the decrease from the previous year was primarily due to a decline in mortgage banking income.

Noninterest expense was $90.5 million in the third quarter of 2018, down $0.3 million from noninterest expense of $90.8 million in the previous quarter and up $1.9 million from $88.6 million in the same quarter last year. There were no significant items in noninterest expense during the third quarter or second quarter of 2018. Noninterest expense in the third quarter of 2017 included $2.1 million in severance which was partially offset by a reduction of $0.9 million in share-based compensation. Noninterest expense for the nine-months ended September 30, 2018 was $275.7 million compared with noninterest expense of $265.4 million for the same period in 2017. An analysis of noninterest expenses related to salaries and benefits is included in Table 9.

The effective tax rate for the third quarter of 2018 was 18.75 percent compared with 18.94 percent in the previous quarter and 30.62 percent during the same quarter last year. The effective tax rate for the nine-month period ended September 30, 2018 was 18.00 percent compared with 30.54 percent for the same period last year. The lower effective tax rate in 2018 was primarily due to the reduction in the federal corporate tax rate from 35 percent to 21 percent as a result of the Tax Cuts and Jobs Act.

The Company’s business segments are defined as Retail Banking, Commercial Banking, Investment Services and Private Banking, and Treasury and Other. Results are determined based on the Company’s internal financial management reporting process and organizational structure. Selected financial information for the business segments is included in Tables 13a and 13b.

Asset Quality

The Company’s overall asset quality remained strong during the third quarter of 2018. Total non-performing assets were $13.8 million at September 30, 2018, down from $15.2 million at June 30, 2018 and $17.0 million at September 30, 2017. As a percentage of total loans and leases and foreclosed real estate, non-performing assets were 0.13 percent at September 30, 2018 compared with 0.15 percent at June 30, 2018 and 0.18 percent at September 30, 2017.

Accruing loans and leases past due 90 days or more were $8.1 million at September 30, 2018 compared with $13.3 million at June 30, 2018 and $6.7 million at September 30, 2017. Restructured loans and leases not included in non-accrual loans or accruing loans past due 90 days or more were $49.5 million at September 30, 2018, down from $50.2 million at June 30, 2018 and $55.0 million at September 30, 2017. More information on non-performing assets and accruing loans and leases past due 90 days or more is presented in Table 11.

Net loans and leases charged off during the third quarter of 2018 were $3.3 million or 0.13 percent annualized of total average loans and leases outstanding. Loan and lease charge-offs of $6.0 million during the quarter were partially offset by recoveries of $2.7 million. Net charge-offs during the second quarter of 2018 were $3.3 million or 0.13 percent annualized of total average loans and leases outstanding and were comprised of $5.7 million in charge-offs partially offset by recoveries of $2.4 million. Net charge-offs during the third quarter of 2017 were $3.5 million or 0.15 percent annualized of total average loans and leases outstanding and were comprised of $6.2 million in charge-offs partially offset by recoveries of $2.7 million. Net charge-offs in the nine-month period ended September 30, 2018 were $10.1 million, or 0.14 percent annualized of total average loans and leases outstanding compared with net charge-offs of $10.0 million, or 0.15 percent annualized of total average loans and leases outstanding for the same period in 2017.

The allowance for loan and lease losses increased to $108.7 million at September 30, 2018 compared with $108.2 million at June 30, 2018 and $106.9 million at September 30, 2017. The ratio of the allowance for loan and lease losses to total loans and leases outstanding was 1.06 percent at September 30, 2018, a decrease of 2 basis points from the previous quarter and down 6 basis points from the end of the same quarter last year. The reserve for unfunded commitments at September 30, 2018 of $6.8 million was unchanged from June 30, 2018 and September 30, 2017. Details of loan and lease charge-offs, recoveries and the components of the total reserve for credit losses are summarized in Table 12.

Other Financial Highlights

Total assets were $17.0 billion at September 30, 2018, a decrease of $132.4 million from total assets of $17.1 billion at June 30, 2018 and $276.6 million from total assets of $17.3 billion at September 30, 2017. Average total assets were $17.0 billion during the third quarter of 2018 compared with $16.9 billion during the previous quarter and $17.0 billion during the same quarter last year.

The investment securities portfolio was $5.7 billion at September 30, 2018, an increase of $25.4 million from total securities of $5.7 billion at June 30, 2018 and a decrease of $569.1 million from total securities of $6.3 billion at September 30, 2017. The portfolio remains largely comprised of securities issued by U. S. government agencies and included $3.7 billion in securities held to maturity and $2.0 billion in securities available for sale at September 30, 2018.

Total loans and leases were $10.2 billion at September 30, 2018, an increase of $177.7 million from total loans and leases of $10.1 billion at June 30, 2018 and $657.1 million from total loans and leases of $9.6 billion at September 30, 2017. Average total loans and leases were $10.1 billion during the third quarter of 2018 compared with $10.0 billion during the previous quarter and $9.5 billion during the same quarter last year. The commercial loan portfolio increased to $3.9 billion at the end of the third quarter of 2018, up from $3.8 billion at the end of the previous quarter and $3.7 billion at the end of the third quarter last year. Total consumer loans increased to $6.3 billion at the end of the third quarter of 2018, up from $6.2 billion at the end of the previous quarter and $5.8 billion at the end of the third quarter last year. Loan and lease portfolio balances are summarized in Table 10.

Total deposits were $14.8 billion at September 30, 2018, a decrease of $100.0 million from total deposits of $14.9 billion at June 30, 2018 and $204.8 million from total deposits of $15.0 billion at September 30, 2017. Average total deposits were $14.8 billion during the third quarter of 2018 compared with $14.7 billion during the previous quarter and the same quarter last year. Consumer deposits were $7.6 billion at the end of the third quarter of 2018, down from $7.7 billion at the end of the previous quarter and up from $7.3 billion at the end of the same quarter last year. Commercial deposits were $6.0 billion at the end of the third quarter of 2018, up from $5.9 billion at the end of the previous quarter and down from $6.1 billion at the end of the same quarter last year. Other deposits, including public funds, were $1.2 billion at September 30, 2018, down from $1.3 billion at June 30, 2018 and $1.7 billion at September 30, 2017. Deposit balances are summarized in Tables 7 and 10.

During the third quarter of 2018, the Company repurchased 296.5 thousand shares of common stock at a total cost of $24.6 million under its share repurchase program. The average cost was $83.04 per share repurchased. From the beginning of the share repurchase program initiated during July 2001 through September 30, 2018, the Company has repurchased 54.9 million shares and returned over $2.1 billion to shareholders at an average cost of $38.92 per share. Remaining buyback authority under the share repurchase program was $56.7 million at September 30, 2018. From October 1 through October 19, 2018 the Company repurchased an additional 72.0 thousand shares of common stock at an average cost of $78.79 per share.

Total shareholders’ equity was $1.25 billion at September 30, 2018 up slightly from June 30, 2018 and up from $1.23 billion at September 30, 2017. The Tier 1 Capital Ratio was 13.19 percent at September 30, 2018 compared with 13.27 percent at June 30, 2018 and September 30, 2017. The Tier 1 leverage ratio at September 30, 2018 was 7.55 percent compared with 7.53 percent at June 30, 2018 and 7.24 percent at September 30, 2017.

The Company’s Board of Directors has declared a quarterly cash dividend of $0.62 per share on the Company’s outstanding shares. The dividend will be payable on December 14, 2018 to shareholders of record at the close of business on November 30, 2018.

Hawaii Economy

General economic conditions in Hawaii remained positive during the third quarter of 2018. The statewide seasonally-adjusted unemployment rate continues to remain low at 2.2 percent in September 2018 compared to 3.7 percent nationally. Tourism continued to remain robust through the first eight months of 2018. Total visitor spending increased 8.8 percent compared to the same eight-month period in 2017 due to growth of 7.2 percent in visitor arrivals and an increase of 2.2 percent in daily spending. All four larger Hawaiian Islands saw growth in both visitor spending and visitor arrivals during the first eight months of 2018. The real estate market also remains strong. For the first nine months of 2018, the median sales price of a single-family home on Oahu increased 4.2 percent and the median price of a condominium on Oahu increased 5.5 percent compared with the same period in 2017. The volume of single-family home sales on Oahu decreased 3.7 percent and the volume of condominium sales on Oahu decreased 0.1 percent for the first nine months of 2018 compared to the same nine-month period in 2017. As of September 30, 2018, months of inventory of single-family homes and condominiums on Oahu were 2.8 months and 2.9 months, respectively. More information on current Hawaii economic trends is presented in Table 15.

Conference Call Information

The Company will review its third quarter 2018 financial results today at 2:00 p.m. Eastern Time (8:00 a.m. Hawaii Time). The call will be accessible via teleconference and via the investor relations link of Bank of Hawaii Corporation's website, www.boh.com. The toll-free number is 1 (844) 543-5235 in the United States and Canada and 1 (703) 318-2209 for other international callers. Use the password “Bank of Hawaii” to access the call. A replay will be available for one week beginning approximately 11:00 a.m. Hawaii Time on Monday, October 22, 2018. The replay number is 1 (855) 859-2056 in the United States and Canada and 1 (404) 537-3406 from other international locations. Enter the pass code 2175919 when prompted. In addition, a replay will be available on the Company's website, www.boh.com.

Forward-Looking Statements

This news release, and other statements made by the Company in connection with it may contain "forward-looking statements", such as forecasts of our financial results and condition, expectations for our operations and business prospects, and our assumptions used in those forecasts and expectations. Do not unduly rely on forward-looking statements. Actual results might differ significantly from our forecasts and expectations because of a variety of factors. More information about these factors is contained in Bank of Hawaii Corporation's Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the U.S. Securities and Exchange Commission. We have not committed to update forward-looking statements to reflect later events or circumstances.

Bank of Hawaii Corporation is an independent regional financial services company serving businesses, consumers, and governments in Hawaii, American Samoa, and the West Pacific.The Company's principal subsidiary, Bank of Hawaii, was founded in 1897.For more information about Bank of Hawaii Corporation, see the Company’s web site, www.boh.com.


Bank of Hawaii Corporation and Subsidiaries
Financial Highlights										Table 1
	Three Months Ended									Nine Months Ended
	September 30,			June 30,			September 30,			September 30,
(dollars in thousands, except per share amounts)		2018			2018			2017			2018			2017
For the Period:
Operating Results
Net Interest Income	$	122,927		$	120,496		$	116,317		$	362,379		$	338,468
Provision for Credit Losses		3,800			3,500			4,000			11,425			12,650
Total Noninterest Income		41,482			41,298			42,410			126,815			143,562
Total Noninterest Expense		90,538			90,791			88,598			275,713			265,355
Net Income		56,933			54,718			45,881			165,691			141,719
Basic Earnings Per Share		1.37			1.31			1.09			3.96			3.35
Diluted Earnings Per Share		1.36			1.30			1.08			3.93			3.32
Dividends Declared Per Share		0.60			0.60			0.52			1.72			1.52

Performance Ratios
Return on Average Assets		1.33	%		1.30	%		1.07	%		1.31	%		1.14	%
Return on Average Shareholders' Equity		18.06			17.68			14.89			17.83			15.77
Efficiency Ratio ¹		55.07			56.12			55.82			56.36			55.05
Net Interest Margin ²		3.07			3.04			2.92			3.04			2.91
Dividend Payout Ratio ³		43.80			45.80			47.71			43.43			45.37
Average Shareholders' Equity to Average Assets		7.35			7.34			7.21			7.32			7.22

Average Balances
Average Loans and Leases	$	10,081,886		$	9,962,860		$	9,451,972		$	9,950,518		$	9,231,615
Average Assets		17,015,340			16,921,820			16,972,202			16,965,075			16,636,213
Average Deposits		14,820,480			14,709,299			14,727,469			14,750,382			14,401,698
Average Shareholders' Equity		1,250,500			1,241,672			1,222,885			1,242,629			1,201,850

Per Share of Common Stock
Book Value	$	29.98		$	29.65		$	28.88		$	29.98		$	28.88
Tangible Book Value		29.22			28.90			28.14			29.22			28.14
Market Value
Closing		78.91			83.42			83.36			78.91			83.36
High		86.53			88.92			86.19			89.09			90.80
Low		78.30			80.20			74.72			78.30			74.72

				September 30,			June 30,			December 31,			September 30,
					2018			2018			2017			2017
As of Period End:
Balance Sheet Totals
Loans and Leases				$	10,231,062		$	10,053,323		$	9,796,947		$	9,573,956
Total Assets					16,991,734			17,124,162			17,089,052			17,268,302
Total Deposits					14,843,335			14,943,358			14,883,968			15,048,160
Other Debt					185,662			235,681			260,716			267,887
Total Shareholders' Equity					1,253,327			1,247,717			1,231,868			1,227,893

Asset Quality
Non-Performing Assets				$	13,798		$	15,157		$	16,120		$	17,035
Allowance for Loan and Lease Losses					108,690			108,188			107,346			106,881
Allowance to Loans and Leases Outstanding					1.06	%		1.08	%		1.10	%		1.12	%

Capital Ratios
Common Equity Tier 1 Capital Ratio					13.19	%		13.27	%		13.24	%		13.27	%
Tier 1 Capital Ratio					13.19			13.27			13.24			13.27
Total Capital Ratio					14.38			14.47			14.46			14.51
Tier 1 Leverage Ratio					7.55			7.53			7.26			7.24
Total Shareholders' Equity to Total Assets					7.38			7.29			7.21			7.11
Tangible Common Equity to Tangible Assets ⁴					7.20			7.12			7.04			6.94
Tangible Common Equity to Risk-Weighted Assets⁴					12.55			12.68			12.84			12.96

Non-Financial Data
Full-Time Equivalent Employees					2,143			2,173			2,132			2,120
Branches					69			69			69			69
ATMs					382			385			387			388


¹		Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income).
²		Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets.
³		Dividend payout ratio is defined as dividends declared per share divided by basic earnings per share.
⁴		Tangible common equity to tangible assets and tangible common equity to risk-weighted assets are Non-GAAP financial measures. See Table 2 “Reconciliation of Non-GAAP Financial Measures."


Bank of Hawaii Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures							Table 2
	September 30,			June 30,			December 31,			September 30,
(dollars in thousands)	2018			2018			2017			2017

Total Shareholders' Equity	$	1,253,327		$	1,247,717		$	1,231,868		$	1,227,893
Less: Goodwill		31,517			31,517			31,517			31,517
Tangible Common Equity	$	1,221,810		$	1,216,200		$	1,200,351		$	1,196,376

Total Assets	$	16,991,734		$	17,124,162		$	17,089,052		$	17,268,302
Less: Goodwill		31,517			31,517			31,517			31,517
Tangible Assets	$	16,960,217		$	17,092,645		$	17,057,535		$	17,236,785

Risk-Weighted Assets, determined in accordance with prescribed regulatory requirements	$	9,732,618		$	9,593,242		$	9,348,296		$	9,234,050

Total Shareholders' Equity to Total Assets		7.38	%		7.29	%		7.21	%		7.11	%
Tangible Common Equity to Tangible Assets (Non-GAAP)		7.20	%		7.12	%		7.04	%		6.94	%

Tier 1 Capital Ratio		13.19	%		13.27	%		13.24	%		13.27	%
Tangible Common Equity to Risk-Weighted Assets (Non-GAAP)		12.55	%		12.68	%		12.84	%		12.96	%


Note: Risk-Weighted Assets as of September 30, 2017 was revised from $9,233,969.


Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Income										Table 3
	Three Months Ended									Nine Months Ended
	September 30,			June 30,			September 30,			September 30,
(dollars in thousands, except per share amounts)	2018			2018			2017			2018			2017
Interest Income
Interest and Fees on Loans and Leases	$	104,248		$	101,311		$	94,621		$	303,193		$	273,467
Income on Investment Securities
Available-for-Sale		12,588			12,380			11,987			37,109			34,906
Held-to-Maturity		20,821			20,711			20,334			62,828			59,958
Deposits		10			(4	)		5			24			12
Funds Sold		1,393			846			1,579			2,996			3,165
Other		364			341			235			1,005			673
Total Interest Income		139,424			135,585			128,761			407,155			372,181
Interest Expense
Deposits		10,931			9,459			6,663			27,971			15,352
Securities Sold Under Agreements to Repurchase		4,667			4,617			4,664			13,848			14,928
Funds Purchased		33			83			-			169			42
Short-Term Borrowings		28			13			-			57			64
Other Debt		838			917			1,117			2,731			3,327
Total Interest Expense		16,497			15,089			12,444			44,776			33,713
Net Interest Income		122,927			120,496			116,317			362,379			338,468
Provision for Credit Losses		3,800			3,500			4,000			11,425			12,650
Net Interest Income After Provision for Credit Losses		119,127			116,996			112,317			350,954			325,818
Noninterest Income
Trust and Asset Management		10,782			11,356			11,050			33,319			34,325
Mortgage Banking		1,965			2,179			3,237			6,289			10,356
Service Charges on Deposit Accounts		7,255			6,865			8,188			21,249			24,522
Fees, Exchange, and Other Service Charges		14,173			14,400			13,764			42,906			41,061
Investment Securities Gains (Losses), Net		(729	)		(1,702	)		(566	)		(3,097	)		11,047
Annuity and Insurance		1,360			1,847			1,429			4,413			5,585
Bank-Owned Life Insurance		1,620			1,796			1,861			5,258			4,908
Other		5,056			4,557			3,447			16,478			11,758
Total Noninterest Income		41,482			41,298			42,410			126,815			143,562
Noninterest Expense
Salaries and Benefits		51,782			52,148			51,190			158,352			152,031
Net Occupancy		8,702			8,588			7,727			25,824			24,026
Net Equipment		6,116			5,845			5,417			17,488			16,624
Data Processing		4,241			4,563			3,882			12,695			11,173
Professional Fees		2,206			2,546			3,044			7,525			8,415
FDIC Insurance		2,057			2,182			2,107			6,396			6,413
Other		15,434			14,919			15,231			47,433			46,673
Total Noninterest Expense		90,538			90,791			88,598			275,713			265,355
Income Before Provision for Income Taxes		70,071			67,503			66,129			202,056			204,025
Provision for Income Taxes		13,138			12,785			20,248			36,365			62,306
Net Income	$	56,933		$	54,718		$	45,881		$	165,691		$	141,719
Basic Earnings Per Share	$	1.37		$	1.31		$	1.09		$	3.96		$	3.35
Diluted Earnings Per Share	$	1.36		$	1.30		$	1.08		$	3.93		$	3.32
Dividends Declared Per Share	$	0.60		$	0.60		$	0.52		$	1.72		$	1.52
Basic Weighted Average Shares		41,620,776			41,884,221			42,251,541			41,846,080			42,336,441
Diluted Weighted Average Shares		41,899,401			42,152,200			42,565,364			42,133,776			42,662,163

Note: Certain prior period information has been reclassified to conform to current presentation.


Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income									Table 4
	Three Months Ended								Nine Months Ended
	September 30,			June 30,			September 30,		September 30,
(dollars in thousands)	2018			2018			2017		2018			2017
Net Income	$	56,933		$	54,718		$	45,881	$	165,691		$	141,719
Other Comprehensive Income (Loss), Net of Tax:
Net Unrealized Gains (Losses) on Investment Securities		(5,599	)		(2,974	)		444		(17,694	)		8,444
Defined Benefit Plans		216			216			146		648			439
Other Comprehensive Income (Loss)		(5,383	)		(2,758	)		590		(17,046	)		8,883
Comprehensive Income	$	51,550		$	51,960		$	46,471	$	148,645		$	150,602


Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Condition							Table 5
	September 30,			June 30,			December 31,			September 30,
(dollars in thousands)		2018			2018			2017			2017
Assets
Interest-Bearing Deposits in Other Banks	$	3,725		$	3,524		$	3,421		$	3,161
Funds Sold		104,199			361,933			181,413			512,868
Investment Securities
Available-for-Sale		2,049,687			2,092,870			2,232,979			2,322,668
Held-to-Maturity (Fair Value of $3,549,235; $3,500,497; $3,894,121; and $3,960,956)		3,664,487			3,595,891			3,928,170			3,960,598
Loans Held for Sale		18,063			16,025			19,231			9,752
Loans and Leases		10,231,062			10,053,323			9,796,947			9,573,956
Allowance for Loan and Lease Losses		(108,690	)		(108,188	)		(107,346	)		(106,881	)
Net Loans and Leases		10,122,372			9,945,135			9,689,601			9,467,075
Total Earning Assets		15,962,533			16,015,378			16,054,815			16,276,122
Cash and Due from Banks		227,049			312,303			263,017			245,487
Premises and Equipment, Net		142,928			142,791			130,926			125,162
Accrued Interest Receivable		54,839			50,594			50,485			51,526
Foreclosed Real Estate		1,909			2,926			1,040			1,393
Mortgage Servicing Rights		24,463			24,583			24,622			24,436
Goodwill		31,517			31,517			31,517			31,517
Bank-Owned Life Insurance		282,637			281,018			280,034			278,425
Other Assets		263,859			263,052			252,596			234,234
Total Assets	$	16,991,734		$	17,124,162		$	17,089,052		$	17,268,302

Liabilities
Deposits
Noninterest-Bearing Demand	$	4,678,981		$	4,729,203		$	4,724,300		$	4,825,643
Interest-Bearing Demand		2,975,069			3,111,069			3,082,563			2,896,559
Savings		5,444,053			5,389,763			5,389,013			5,363,866
Time		1,745,232			1,713,323			1,688,092			1,962,092
Total Deposits		14,843,335			14,943,358			14,883,968			15,048,160
Short-Term Borrowings		629			330			-			-
Securities Sold Under Agreements to Repurchase		504,293			504,193			505,293			505,293
Other Debt		185,662			235,681			260,716			267,887
Retirement Benefits Payable		36,288			36,730			37,312			38,308
Accrued Interest Payable		7,689			7,395			6,946			6,717
Taxes Payable and Deferred Taxes		15,549			15,136			24,009			31,360
Other Liabilities		144,962			133,622			138,940			142,684
Total Liabilities		15,738,407			15,876,445			15,857,184			16,040,409
Shareholders' Equity
Common Stock ($.01 par value; authorized 500,000,000 shares; issued / outstanding: September 30, 2018 - 58,070,578 / 41,809,551; June 30, 2018 - 58,070,285 / 42,084,066; December 31, 2017 - 57,959,074 / 42,401,443; and September 30, 2017 - 57,958,200 / 42,513,348)		577			577			576			576
Capital Surplus		569,223			566,436			561,161			558,530
Accumulated Other Comprehensive Loss		(59,238	)		(53,855	)		(34,715	)		(25,023	)
Retained Earnings		1,612,998			1,581,168			1,512,218			1,491,830
Treasury Stock, at Cost (Shares: September 30, 2018 - 16,261,027; June 30, 2018 - 15,986,219; December 31, 2017 - 15,557,631; and September 30, 2017 - 15,444,852)		(870,233	)		(846,609	)		(807,372	)		(798,020	)
Total Shareholders' Equity		1,253,327			1,247,717			1,231,868			1,227,893
Total Liabilities and Shareholders' Equity	$	16,991,734		$	17,124,162		$	17,089,052		$	17,268,302


Bank of Hawaii Corporation and Subsidiaries
Consolidated Statements of Shareholders' Equity													Table 6
							Accum.
							Other
							Compre-
							hensive
	Common Shares		Common		Capital		Income			Retained			Treasury
(dollars in thousands)	Outstanding		Stock		Surplus		(Loss)			Earnings			Stock			Total
Balance as of December 31, 2017	42,401,443		$	576	$	561,161	$	(34,715	)	$	1,512,218		$	(807,372	)	$	1,231,868
Net Income	-			-		-		-			165,691			-			165,691
Other Comprehensive Loss	-			-		-		(17,046	)		-			-			(17,046	)
Reclassification of the Income Tax Effects of the Tax Cuts and Jobs Act from AOCI	-			-		-		(7,477	)		7,477			-			-
Share-Based Compensation	-			-		6,208		-			-			-			6,208
Common Stock Issued under Purchase and Equity Compensation Plans	203,289			1		1,854		-			251			4,127			6,233
Common Stock Repurchased	(795,181	)		-		-		-			-			(66,988	)		(66,988	)
Cash Dividends Declared ($1.72 per share)	-			-		-		-			(72,639	)		-			(72,639	)
Balance as of September 30, 2018	41,809,551		$	577	$	569,223	$	(59,238	)	$	1,612,998		$	(870,233	)	$	1,253,327

Balance as of December 31, 2016	42,635,978		$	576	$	551,628	$	(33,906	)	$	1,415,440		$	(772,201	)	$	1,161,537
Net Income	-			-		-		-			141,719			-			141,719
Other Comprehensive Income	-			-		-		8,883			-			-			8,883
Share-Based Compensation	-			-		5,332		-			-			-			5,332
Common Stock Issued under Purchase and Equity Compensation Plans	319,377			-		1,570		-			(383	)		10,552			11,739
Common Stock Repurchased	(442,007	)		-		-		-			-			(36,371	)		(36,371	)
Cash Dividends Declared ($1.52 per share)	-			-		-		-			(64,946	)		-			(64,946	)
Balance as of September 30, 2017	42,513,348		$	576	$	558,530	$	(25,023	)	$	1,491,830		$	(798,020	)	$	1,227,893


Bank of Hawaii Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable-Equivalent Basis														Table 7a
	Three Months Ended						Three Months Ended							Three Months Ended
	September 30, 2018						June 30, 2018							September 30, 2017
	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	$	3.6	$	-	1.09	%	$	2.9	$	-	(0.52	)	%	$	3.5	$	-	0.48	%
Funds Sold		281.9		1.4	1.93			185.2		0.8	1.81				575.2		1.6	1.07
Investment Securities
Available-for-Sale
Taxable		1,512.1		9.5	2.51			1,564.5		9.2	2.35				1,658.2		8.6	2.08
Non-Taxable		567.5		3.9	2.75			583.6		4.0	2.78				636.7		5.2	3.26
Held-to-Maturity
Taxable		3,413.7		19.3	2.26			3,471.7		19.2	2.22				3,631.1		18.8	2.07
Non-Taxable		236.1		1.9	3.16			237.1		1.9	3.17				239.9		2.4	3.87
Total Investment Securities		5,729.4		34.6	2.41			5,856.9		34.3	2.35				6,165.9		35.0	2.27
Loans Held for Sale		14.9		0.2	4.45			14.8		0.2	4.44				20.6		0.2	3.88
Loans and Leases ¹
Commercial and Industrial		1,279.4		13.0	4.04			1,307.6		12.8	3.92				1,251.5		11.3	3.58
Commercial Mortgage		2,180.5		23.0	4.19			2,123.5		21.9	4.13				2,015.0		19.6	3.87
Construction		187.0		2.2	4.65			183.4		2.2	4.82				241.0		2.9	4.73
Commercial Lease Financing		175.0		1.0	2.30			179.4		1.0	2.24				204.7		1.2	2.30
Residential Mortgage		3,563.5		34.0	3.82			3,526.9		33.6	3.81				3,333.3		31.8	3.82
Home Equity		1,622.4		15.7	3.83			1,612.7		15.1	3.76				1,502.9		13.8	3.65
Automobile		606.3		5.9	3.84			573.6		5.7	3.97				493.2		5.9	4.71
Other ²		467.8		9.3	7.90			455.8		8.9	7.86				410.4		8.2	7.98
Total Loans and Leases		10,081.9		104.1	4.11			9,962.9		101.2	4.07				9,452.0		94.7	3.99
Other		38.9		0.4	3.74			39.8		0.4	3.43				40.2		0.2	2.34
Total Earning Assets ³		16,150.6		140.7	3.47			16,062.5		136.9	3.41				16,257.4		131.7	3.23
Cash and Due from Banks		252.1						251.0							151.2
Other Assets		612.6						608.3							563.6
Total Assets	$	17,015.3					$	16,921.8						$	16,972.2

Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand	$	2,999.5		1.3	0.17		$	2,969.8		1.2	0.16			$	2,880.0		0.5	0.07
Savings		5,482.4		3.8	0.28			5,392.2		3.1	0.23				5,374.4		1.8	0.13
Time		1,683.0		5.8	1.37			1,705.7		5.2	1.21				1,788.2		4.4	0.97
Total Interest-Bearing Deposits		10,164.9		10.9	0.43			10,067.7		9.5	0.38				10,042.6		6.7	0.26
Short-Term Borrowings		11.6		0.1	2.06			21.0		0.1	1.80				-		-	-
Securities Sold Under Agreements to Repurchase		504.3		4.7	3.62			505.1		4.6	3.62				505.3		4.7	3.61
Other Debt		208.5		0.8	1.60			235.7		0.9	1.56				267.9		1.1	1.66
Total Interest-Bearing Liabilities		10,889.3		16.5	0.60			10,829.5		15.1	0.56				10,815.8		12.5	0.45
Net Interest Income			$	124.2					$	121.8						$	119.2
Interest Rate Spread					2.87	%					2.85		%					2.78	%
Net Interest Margin					3.07	%					3.04		%					2.92	%
Noninterest-Bearing Demand Deposits		4,655.6						4,641.6							4,684.9
Other Liabilities		219.9						209.0							248.6
Shareholders' Equity		1,250.5						1,241.7							1,222.9
Total Liabilities and Shareholders' Equity	$	17,015.3					$	16,921.8						$	16,972.2

¹		Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.
²		Comprised of other consumer revolving credit, installment, and consumer lease financing.
³		Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21% for 2018 and 35% for 2017, of $1,265,000 for the three months ended September 30, 2018, $1,298,000 for the three months ended June 30, 2018, and $2,920,000 for the three months ended September 30, 2017.


Bank of Hawaii Corporation and Subsidiaries
Average Balances and Interest Rates - Taxable-Equivalent Basis									Table 7b
	Nine Months Ended						Nine Months Ended
	September 30, 2018						September 30, 2017
	Average		Income/		Yield/		Average		Income/		Yield/
(dollars in millions)	Balance		Expense		Rate		Balance		Expense		Rate
Earning Assets
Interest-Bearing Deposits in Other Banks	$	3.2	$	-	0.99	%	$	3.5	$	-	0.44	%
Funds Sold		224.3		3.0	1.76			491.1		3.2	0.85
Investment Securities
Available-for-Sale
Taxable		1,556.9		27.6	2.36			1,655.8		24.6	1.98
Non-Taxable		585.1		12.1	2.76			652.0		15.9	3.26
Held-to-Maturity
Taxable		3,504.8		58.4	2.22			3,605.8		55.4	2.05
Non-Taxable		237.0		5.6	3.17			240.9		7.0	3.88
Total Investment Securities		5,883.8		103.7	2.35			6,154.5		102.9	2.23
Loans Held for Sale		14.6		0.5	4.23			24.9		0.7	3.98
Loans and Leases ¹
Commercial and Industrial		1,289.3		37.6	3.90			1,255.4		32.7	3.49
Commercial Mortgage		2,133.8		65.5	4.10			1,948.1		55.5	3.81
Construction		186.6		6.5	4.64			246.7		8.6	4.66
Commercial Lease Financing		178.0		3.0	2.25			207.1		3.5	2.25
Residential Mortgage		3,523.1		100.9	3.82			3,269.7		93.8	3.82
Home Equity		1,610.2		45.4	3.77			1,439.2		38.9	3.61
Automobile		574.1		17.1	3.99			476.4		17.5	4.90
Other ²		455.4		26.9	7.89			389.0		23.2	7.98
Total Loans and Leases		9,950.5		302.9	4.07			9,231.6		273.7	3.96
Other		39.8		1.0	3.37			40.4		0.7	2.22
Total Earning Assets ³		16,116.2		411.1	3.41			15,946.0		381.2	3.19
Cash and Due from Banks		244.0						134.8
Other Assets		604.9						555.4
Total Assets	$	16,965.1					$	16,636.2

Interest-Bearing Liabilities
Interest-Bearing Deposits
Demand	$	2,982.5		3.2	0.15		$	2,869.7		1.3	0.06
Savings		5,414.1		9.1	0.22			5,385.7		4.7	0.12
Time		1,700.6		15.7	1.23			1,529.2		9.4	0.82
Total Interest-Bearing Deposits		10,097.2		28.0	0.37			9,784.6		15.4	0.21
Short-Term Borrowings		17.2		0.2	1.73			15.3		0.1	0.91
Securities Sold Under Agreements to Repurchase		504.9		13.9	3.62			507.7		14.9	3.88
Other Debt		233.6		2.7	1.56			267.9		3.3	1.66
Total Interest-Bearing Liabilities		10,852.9		44.8	0.55			10,575.5		33.7	0.42
Net Interest Income			$	366.3					$	347.5
Interest Rate Spread					2.86	%					2.77	%
Net Interest Margin					3.04	%					2.91	%
Noninterest-Bearing Demand Deposits		4,653.2						4,617.1
Other Liabilities		216.4						241.7
Shareholders' Equity		1,242.6						1,201.9
Total Liabilities and Shareholders' Equity	$	16,965.1					$	16,636.2

¹		Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.
²		Comprised of other consumer revolving credit, installment, and consumer lease financing.
³		Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21% for 2018 and 35% for 2017, of $3,907,000 for the nine months ended September 30, 2018 and $9,035,000 for the nine months ended September 30, 2017.


Bank of Hawaii Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis							Table 8a
	Three Months Ended September 30, 2018
	Compared to June 30, 2018
(dollars in millions)	Volume ¹			Rate ¹			Total
Change in Interest Income:
Funds Sold	$	0.5		$	0.1		$	0.6
Investment Securities
Available-for-Sale
Taxable		(0.3	)		0.6			0.3
Non-Taxable		(0.1	)		-			(0.1	)
Held-to-Maturity
Taxable		(0.3	)		0.4			0.1
Total Investment Securities		(0.7	)		1.0			0.3
Loans and Leases
Commercial and Industrial		(0.3	)		0.5			0.2
Commercial Mortgage		0.7			0.4			1.1
Construction		0.1			(0.1	)		-
Residential Mortgage		0.4			-			0.4
Home Equity		0.1			0.5			0.6
Automobile		0.4			(0.2	)		0.2
Other ²		0.3			0.1			0.4
Total Loans and Leases		1.7			1.2			2.9
Total Change in Interest Income		1.5			2.3			3.8

Change in Interest Expense:
Interest-Bearing Deposits
Demand		-			0.1			0.1
Savings		0.1			0.6			0.7
Time		(0.1	)		0.7			0.6
Total Interest-Bearing Deposits		-			1.4			1.4
Securities Sold Under Agreements to Repurchase		0.1			-			0.1
Other Debt		(0.1	)		-			(0.1	)
Total Change in Interest Expense		-			1.4			1.4

Change in Net Interest Income	$	1.5		$	0.9		$	2.4

¹		The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.
²		Comprised of other consumer revolving credit, installment, and consumer lease financing.


Bank of Hawaii Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis							Table 8b
	Three Months Ended September 30, 2018
	Compared to September 30, 2017
(dollars in millions)	Volume ¹			Rate ¹			Total
Change in Interest Income:
Funds Sold	$	(1.1	)	$	0.9		$	(0.2	)
Investment Securities
Available-for-Sale
Taxable		(0.8	)		1.7			0.9
Non-Taxable		(0.5	)		(0.8	)		(1.3	)
Held-to-Maturity
Taxable		(1.2	)		1.7			0.5
Non-Taxable		(0.1	)		(0.4	)		(0.5	)
Total Investment Securities		(2.6	)		2.2			(0.4	)
Loans Held for Sale		(0.1	)		0.1			-
Loans and Leases
Commercial and Industrial		0.2			1.5			1.7
Commercial Mortgage		1.7			1.7			3.4
Construction		(0.6	)		(0.1	)		(0.7	)
Commercial Lease Financing		(0.2	)		-			(0.2	)
Residential Mortgage		2.2			-			2.2
Home Equity		1.1			0.8			1.9
Automobile		1.2			(1.2	)		-
Other ²		1.2			(0.1	)		1.1
Total Loans and Leases		6.8			2.6			9.4
Other		-			0.2			0.2
Total Change in Interest Income		3.0			6.0			9.0

Change in Interest Expense:
Interest-Bearing Deposits
Demand		-			0.8			0.8
Savings		-			2.0			2.0
Time		(0.3	)		1.7			1.4
Total Interest-Bearing Deposits		(0.3	)		4.5			4.2
Short-Term Borrowings		-			0.1			0.1
Other Debt		(0.3	)		-			(0.3	)
Total Change in Interest Expense		(0.6	)		4.6			4.0

Change in Net Interest Income	$	3.6		$	1.4		$	5.0

¹		The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.
²		Comprised of other consumer revolving credit, installment, and consumer lease financing.


Bank of Hawaii Corporation and Subsidiaries
Analysis of Change in Net Interest Income - Taxable-Equivalent Basis							Table 8c
	Nine Months Ended September 30, 2018
	Compared to September 30, 2017
(dollars in millions)	Volume ¹			Rate ¹			Total
Change in Interest Income:
Funds Sold	$	(2.4	)	$	2.2		$	(0.2	)
Investment Securities
Available-for-Sale
Taxable		(1.5	)		4.5			3.0
Non-Taxable		(1.5	)		(2.3	)		(3.8	)
Held-to-Maturity
Taxable		(1.6	)		4.6			3.0
Non-Taxable		(0.1	)		(1.3	)		(1.4	)
Total Investment Securities		(4.7	)		5.5			0.8
Loans Held for Sale		(0.3	)		0.1			(0.2	)
Loans and Leases
Commercial and Industrial		0.9			4.0			4.9
Commercial Mortgage		5.5			4.5			10.0
Construction		(2.1	)		-			(2.1	)
Commercial Lease Financing		(0.5	)		-			(0.5	)
Residential Mortgage		7.2			(0.1	)		7.1
Home Equity		4.8			1.7			6.5
Automobile		3.2			(3.6	)		(0.4	)
Other ²		3.9			(0.2	)		3.7
Total Loans and Leases		22.9			6.3			29.2
Other		-			0.3			0.3
Total Change in Interest Income		15.5			14.4			29.9

Change in Interest Expense:
Interest-Bearing Deposits
Demand		0.1			1.8			1.9
Savings		-			4.4			4.4
Time		1.1			5.2			6.3
Total Interest-Bearing Deposits		1.2			11.4			12.6
Short-Term Borrowings		-			0.1			0.1
Securities Sold Under Agreements to Repurchase		(0.1	)		(0.9	)		(1.0	)
Other Debt		(0.4	)		(0.2	)		(0.6	)
Total Change in Interest Expense		0.7			10.4			11.1

Change in Net Interest Income	$	14.8		$	4.0		$	18.8

¹		The change in interest income and expense not solely due to changes in volume or rate has been allocated on a pro-rata basis to the volume and rate columns.
²		Comprised of other consumer revolving credit, installment, and consumer lease financing.


Bank of Hawaii Corporation and Subsidiaries
Salaries and Benefits								Table 9
	Three Months Ended							Nine Months Ended
	September 30,			June 30,		September 30,		September 30,
(dollars in thousands)	2018			2018		2017		2018		2017
Salaries	$	33,308		$	33,269	$	31,224	$	99,281	$	91,202
Incentive Compensation		5,378			4,416		4,857		14,972		15,756
Share-Based Compensation		2,153			2,423		1,962		6,657		7,144
Commission Expense		1,034			1,272		1,439		3,260		5,066
Retirement and Other Benefits		3,925			4,178		3,843		12,944		12,169
Payroll Taxes		2,372			2,568		2,353		9,112		8,724
Medical, Dental, and Life Insurance		3,616			3,820		3,444		10,897		9,859
Separation Expense		(4	)		202		2,068		1,229		2,111
Total Salaries and Benefits	$	51,782		$	52,148	$	51,190	$	158,352	$	152,031

Note: Certain prior period information has been reclassified to conform to current presentation.


Bank of Hawaii Corporation and Subsidiaries
Loan and Lease Portfolio Balances							Table 10
	September 30,		June 30,		March 31,		December 31,		September 30,
(dollars in thousands)		2018		2018		2018		2017		2017
Commercial
Commercial and Industrial	$	1,314,609	$	1,282,967	$	1,329,096	$	1,279,347	$	1,252,238
Commercial Mortgage		2,237,020		2,169,357		2,097,339		2,103,967		2,050,998
Construction		176,447		185,350		186,530		202,253		232,487
Lease Financing		172,232		178,598		179,771		180,931		204,240
Total Commercial		3,900,308		3,816,272		3,792,736		3,766,498		3,739,963
Consumer
Residential Mortgage		3,596,627		3,548,444		3,505,239		3,466,773		3,366,634
Home Equity		1,625,208		1,622,314		1,601,698		1,585,455		1,528,353
Automobile		625,086		592,705		558,468		528,474		506,102
Other ¹		483,833		473,588		458,487		449,747		432,904
Total Consumer		6,330,754		6,237,051		6,123,892		6,030,449		5,833,993
Total Loans and Leases	$	10,231,062	$	10,053,323	$	9,916,628	$	9,796,947	$	9,573,956


Deposits
	September 30,		June 30,		March 31,		December 31,		September 30,
(dollars in thousands)		2018		2018		2018		2017		2017
Consumer	$	7,627,527	$	7,672,435	$	7,665,926	$	7,478,228	$	7,303,546
Commercial		5,967,343		5,921,414		5,897,194		5,973,763		6,091,800
Public and Other		1,248,465		1,349,509		1,394,013		1,431,977		1,652,814
Total Deposits	$	14,843,335	$	14,943,358	$	14,957,133	$	14,883,968	$	15,048,160


¹ Comprised of other revolving credit, installment, and lease financing.


Bank of Hawaii Corporation and Subsidiaries
Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More													Table 11
	September 30,			June 30,			March 31,			December 31,			September 30,
(dollars in thousands)		2018			2018			2018			2017			2017
Non-Performing Assets
Non-Accrual Loans and Leases
Commercial
Commercial and Industrial	$	1,205		$	917		$	986		$	448		$	901
Commercial Mortgage		652			659			1,367			1,398			1,425
Total Commercial		1,857			1,576			2,353			1,846			2,326
Consumer
Residential Mortgage		6,359			6,722			6,725			9,243			9,188
Home Equity		3,673			3,933			3,890			3,991			4,128
Total Consumer		10,032			10,655			10,615			13,234			13,316
Total Non-Accrual Loans and Leases		11,889			12,231			12,968			15,080			15,642
Foreclosed Real Estate		1,909			2,926			2,768			1,040			1,393
Total Non-Performing Assets	$	13,798		$	15,157		$	15,736		$	16,120		$	17,035

Accruing Loans and Leases Past Due 90 Days or More
Commercial
Commercial and Industrial	$	-		$	2		$	-		$	-		$	5
Commercial Mortgage		-			5,680			-			-			-
Total Commercial		-			5,682			-			-			5
Consumer
Residential Mortgage	$	2,426		$	2,281		$	2,927		$	2,703		$	2,933
Home Equity		3,112			3,016			3,013			1,624			1,392
Automobile		829			674			333			886			806
Other¹		1,727			1,660			1,895			1,934			1,528
Total Consumer		8,094			7,631			8,168			7,147			6,659
Total Accruing Loans and Leases Past Due 90 Days or More	$	8,094		$	13,313		$	8,168		$	7,147		$	6,664
Restructured Loans on Accrual Status and Not Past Due 90 Days or More	$	49,462		$	50,212		$	56,743		$	55,672		$	55,038
Total Loans and Leases	$	10,231,062		$	10,053,323		$	9,916,628		$	9,796,947		$	9,573,956

Ratio of Non-Accrual Loans and Leases to Total Loans and Leases		0.12	%		0.12	%		0.13	%		0.15	%		0.16	%

Ratio of Non-Performing Assets to Total Loans and Leases and Foreclosed Real Estate		0.13	%		0.15	%		0.16	%		0.16	%		0.18	%

Ratio of Commercial Non-Performing Assets to Total Commercial Loans and Leases and Commercial Foreclosed Real Estate		0.05	%		0.04	%		0.06	%		0.05	%		0.06	%

Ratio of Consumer Non-Performing Assets to Total Consumer Loans and Leases and Consumer Foreclosed Real Estate		0.19	%		0.22	%		0.22	%		0.24	%		0.25	%

Ratio of Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More to Total Loans and Leases and Foreclosed Real Estate		0.21	%		0.28	%		0.24	%		0.24	%		0.25	%

Quarter to Quarter Changes in Non-Performing Assets
Balance at Beginning of Quarter	$	15,157		$	15,736		$	16,120		$	17,035		$	16,368
Additions		2,030			1,949			2,332			2,109			2,212
Reductions
Payments		(415	)		(1,847	)		(1,251	)		(368	)		(199	)
Return to Accrual Status		(1,420	)		(126	)		(1,270	)		(1,779	)		(305	)
Sales of Foreclosed Real Estate		(1,301	)		(421	)		-			(353	)		(951	)
Charge-offs/Write-downs		(253	)		(134	)		(195	)		(524	)		(90	)
Total Reductions		(3,389	)		(2,528	)		(2,716	)		(3,024	)		(1,545	)
Balance at End of Quarter	$	13,798		$	15,157		$	15,736		$	16,120		$	17,035

¹Comprised of other revolving credit, installment, and lease financing.


Bank of Hawaii Corporation and Subsidiaries
Reserve for Credit Losses										Table 12
	Three Months Ended									Nine Months Ended
	September 30,			June 30,			September 30,			September 30,
(dollars in thousands)	2018			2018			2017			2018			2017
Balance at Beginning of Period	$	115,010		$	114,760		$	113,175		$	114,168			110,845
Loans and Leases Charged-Off
Commercial
Commercial and Industrial		(449	)		(485	)		(611	)		(1,140	)		(909	)
Consumer
Residential Mortgage		-			(3	)		(36	)		(100	)		(725	)
Home Equity		(124	)		(44	)		(129	)		(259	)		(774	)
Automobile		(2,114	)		(1,515	)		(1,921	)		(5,883	)		(5,723	)
Other ¹		(3,340	)		(3,614	)		(3,521	)		(10,294	)		(9,278	)
Total Loans and Leases Charged-Off		(6,027	)		(5,661	)		(6,218	)		(17,676	)		(17,409	)
Recoveries on Loans and Leases Previously Charged-Off
Commercial
Commercial and Industrial		542			366			597			1,236			1,198
Lease Financing		-			-			1			-			2
Consumer
Residential Mortgage		261			214			89			695			457
Home Equity		558			451			837			1,634			2,183
Automobile		616			738			692			1,953			1,919
Other ¹		752			642			530			2,077			1,608
Total Recoveries on Loans and Leases Previously Charged-Off		2,729			2,411			2,746			7,595			7,367
Net Loans and Leases Charged-Off		(3,298	)		(3,250	)		(3,472	)		(10,081	)		(10,042	)
Provision for Credit Losses		3,800			3,500			4,000			11,425			12,650
Provision for Unfunded Commitments		-			-			-			-			250
Balance at End of Period ²	$	115,512		$	115,010		$	113,703		$	115,512		$	113,703

Components
Allowance for Loan and Lease Losses	$	108,690		$	108,188		$	106,881			108,690			106,881
Reserve for Unfunded Commitments		6,822			6,822			6,822			6,822			6,822
Total Reserve for Credit Losses	$	115,512		$	115,010		$	113,703		$	115,512		$	113,703

Average Loans and Leases Outstanding	$	10,081,886		$	9,962,860		$	9,451,972		$	9,950,518		$	9,231,615

Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding (annualized)		0.13	%		0.13	%		0.15	%		0.14	%		0.15	%
Ratio of Allowance for Loan and Lease Losses to Loans and Leases Outstanding		1.06	%		1.08	%		1.12	%		1.06	%		1.12	%

¹		Comprised of other revolving credit, installment, and lease financing.
²		Included in this analysis is activity related to the Company's reserve for unfunded commitments, which is separately recorded in other liabilities in the Consolidated Statements of Condition.


Bank of Hawaii Corporation and Subsidiaries
Business Segments Selected Financial Information										Table 13a
							Investment
							Services and
	Retail			Commercial			Private			Treasury			Consolidated
(dollars in thousands)	Banking			Banking			Banking			and Other			Total
Three Months Ended September 30, 2018
Net Interest Income	$	66,927		$	46,240		$	10,574		$	(814	)	$	122,927
Provision for Credit Losses		3,229			69			-			502			3,800
Net Interest Income After Provision for Credit Losses		63,698			46,171			10,574			(1,316	)		119,127
Noninterest Income		19,814			6,241			13,526			1,901			41,482
Noninterest Expense		(51,806	)		(20,242	)		(15,657	)		(2,833	)		(90,538	)
Income Before Provision for Income Taxes		31,706			32,170			8,443			(2,248	)		70,071
Provision for Income Taxes		(7,943	)		(7,218	)		(2,226	)		4,249			(13,138	)
Net Income	$	23,763		$	24,952		$	6,217		$	2,001		$	56,933
Total Assets as of September 30, 2018	$	6,246,126		$	3,873,454		$	340,793		$	6,531,361		$	16,991,734


Three Months Ended September 30, 2017
Net Interest Income	$	67,128		$	43,438		$	7,321		$	(1,570	)	$	116,317
Provision for Credit Losses		3,512			(35	)		(5	)		528			4,000
Net Interest Income After Provision for Credit Losses		63,616			43,473			7,326			(2,098	)		112,317
Noninterest Income		21,287			5,137			13,593			2,393			42,410
Noninterest Expense		(51,507	)		(17,721	)		(14,925	)		(4,445	)		(88,598	)
Income Before Provision for Income Taxes		33,396			30,889			5,994			(4,150	)		66,129
Provision for Income Taxes		(11,908	)		(10,891	)		(2,218	)		4,769			(20,248	)
Net Income	$	21,488		$	19,998		$	3,776		$	619		$	45,881
Total Assets as of September 30, 2017	$	5,758,799		$	3,695,606		$	305,015		$	7,508,882		$	17,268,302


Bank of Hawaii Corporation and Subsidiaries
Business Segments Selected Financial Information										Table 13b
							Investment
							Services and
	Retail			Commercial			Private			Treasury			Consolidated
(dollars in thousands)	Banking			Banking			Banking			and Other			Total
Nine Months Ended September 30, 2018
Net Interest Income	$	197,007		$	133,148		$	30,987		$	1,237		$	362,379
Provision for Credit Losses		10,417			(276	)		(60	)		1,344			11,425
Net Interest Income After Provision for Credit Losses		186,590			133,424			31,047			(107	)		350,954
Noninterest Income		58,665			17,395			41,941			8,814			126,815
Noninterest Expense		(158,344	)		(60,432	)		(48,264	)		(8,673	)		(275,713	)
Income Before Provision for Income Taxes		86,911			90,387			24,724			34			202,056
Provision for Income Taxes		(21,707	)		(20,782	)		(6,518	)		12,642			(36,365	)
Net Income	$	65,204		$	69,605		$	18,206		$	12,676		$	165,691
Total Assets as of September 30, 2018	$	6,246,126		$	3,873,454		$	340,793		$	6,531,361		$	16,991,734


Nine Months Ended September 30, 2017
Net Interest Income	$	198,633		$	127,106		$	20,685		$	(7,956	)	$	338,468
Provision for Credit Losses		10,413			(355	)		(16	)		2,608			12,650
Net Interest Income After Provision for Credit Losses		188,220			127,461			20,701			(10,564	)		325,818
Noninterest Income		64,132			16,451			43,389			19,590			143,562
Noninterest Expense		(155,786	)		(54,483	)		(45,692	)		(9,394	)		(265,355	)
Income Before Provision for Income Taxes		96,566			89,429			18,398			(368	)		204,025
Provision for Income Taxes		(34,323	)		(31,472	)		(6,807	)		10,296			(62,306	)
Net Income	$	62,243		$	57,957		$	11,591		$	9,928		$	141,719
Total Assets as of September 30, 2017	$	5,758,799		$	3,695,606		$	305,015		$	7,508,882		$	17,268,302


Bank of Hawaii Corporation and Subsidiaries
Selected Quarterly Financial Data													Table 14
	Three Months Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
(dollars in thousands, except per share amounts)		2018				2018				2018				2017				2017
Quarterly Operating Results
Interest Income
Interest and Fees on Loans and Leases	$	104,248			$	101,311			$	97,634			$	96,974			$	94,621
Income on Investment Securities
Available-for-Sale		12,588				12,380				12,141				11,866				11,987
Held-to-Maturity		20,821				20,711				21,296				21,782				20,334
Deposits		10				(4	)			18				3				5
Funds Sold		1,393				846				757				717				1,579
Other		364				341				300				271				235
Total Interest Income		139,424				135,585				132,146				131,613				128,761
Interest Expense
Deposits		10,931				9,459				7,581				6,980				6,663
Securities Sold Under Agreements to Repurchase		4,667				4,617				4,564				4,664				4,664
Funds Purchased		33				83				53				81				-
Short-Term Borrowings		28				13				16				-				-
Other Debt		838				917				976				1,118				1,117
Total Interest Expense		16,497				15,089				13,190				12,843				12,444
Net Interest Income		122,927				120,496				118,956				118,770				116,317
Provision for Credit Losses		3,800				3,500				4,125				4,250				4,000
Net Interest Income After Provision for Credit Losses		119,127				116,996				114,831				114,520				112,317
Noninterest Income
Trust and Asset Management		10,782				11,356				11,181				11,105				11,050
Mortgage Banking		1,965				2,179				2,145				2,593				3,237
Service Charges on Deposit Accounts		7,255				6,865				7,129				8,053				8,188
Fees, Exchange, and Other Service Charges		14,173				14,400				14,333				13,784				13,764
Investment Securities Gains (Losses), Net		(729	)			(1,702	)			(666	)			(617	)			(566	)
Annuity and Insurance		1,360				1,847				1,206				1,273				1,429
Bank-Owned Life Insurance		1,620				1,796				1,842				1,609				1,861
Other		5,056				4,557				6,865				4,055				3,447
Total Noninterest Income		41,482				41,298				44,035				41,855				42,410
Noninterest Expense
Salaries and Benefits		51,782				52,148				54,422				51,698				51,190
Net Occupancy		8,702				8,588				8,534				8,510				7,727
Net Equipment		6,116				5,845				5,527				5,454				5,417
Data Processing		4,241				4,563				3,891				4,310				3,882
Professional Fees		2,206				2,546				2,773				3,266				3,044
FDIC Insurance		2,057				2,182				2,157				2,253				2,107
Other		15,434				14,919				17,080				16,845				15,231
Total Noninterest Expense		90,538				90,791				94,384				92,336				88,598
Income Before Provision for Income Taxes		70,071				67,503				64,482				64,039				66,129
Provision for Income Taxes		13,138				12,785				10,442				21,086				20,248
Net Income	$	56,933			$	54,718			$	54,040			$	42,953			$	45,881

Basic Earnings Per Share	$	1.37			$	1.31			$	1.29			$	1.02			$	1.09
Diluted Earnings Per Share	$	1.36			$	1.30			$	1.28			$	1.01			$	1.08

Balance Sheet Totals
Loans and Leases	$	10,231,062			$	10,053,323			$	9,916,628			$	9,796,947			$	9,573,956
Total Assets		16,991,734				17,124,162				17,136,030				17,089,052				17,268,302
Total Deposits		14,843,335				14,943,358				14,957,133				14,883,968				15,048,160
Total Shareholders' Equity		1,253,327				1,247,717				1,241,193				1,231,868				1,227,893

Performance Ratios
Return on Average Assets		1.33		%		1.30		%		1.29		%		1.00		%		1.07		%
Return on Average Shareholders' Equity		18.06				17.68				17.74				13.85				14.89
Efficiency Ratio ¹		55.07				56.12				57.91				57.49				55.82
Net Interest Margin ²		3.07				3.04				3.00				2.98				2.92

¹		Efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and noninterest income).
²		Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets.
Note: Certain prior period information has been reclassified to conform to current presentation.


Bank of Hawaii Corporation and Subsidiaries
Hawaii Economic Trends														Table 15
	Eight Months Ended				Year Ended
($ in millions; jobs in thousands)	August 31, 2018				December 31, 2017						December 31, 2016
Hawaii Economic Trends
State General Fund Revenues¹	$	4,677.1	7.3	%	$	6,485.0			4.3	%	$	6,215.4		3.6	%
General Excise and Use Tax Revenue¹	$	2,298.3	2.1	%	$	3,349.8			4.5	%	$	3,205.7		2.0	%
Jobs ²		672.7				668.2						669.4

									September 30,		December 31,
(spot rates)									2018			2017		2016
Unemployment³
Statewide, seasonally adjusted									2.2	%		2.1	%	2.9	%

Oahu									2.4			1.7		2.4
Island of Hawaii									3.0			2.0		3.1
Maui									2.5			1.8		2.7
Kauai									2.9			1.7		2.8

					September 30,				December 31,
(percentage change, except months of inventory)						2018			2017			2016		2015
Housing Trends (Single Family Oahu) ⁴
Median Home Price						4.2		%	2.7	%		5.0	%	3.7	%
Home Sales Volume (units)						(3.7	)	%	6.3	%		6.5	%	5.2	%
Months of Inventory						2.8			2.1			2.5		2.6

					Monthly Visitor Arrivals,						Percentage Change
(in thousands)					Not Seasonally Adjusted						from Previous Year
Tourism ⁵

August 31, 2018									845.1					3.2
July 31, 2018									939.4					5.3
June 30, 2018									897.1					7.3
May 31, 2018									804.1					7.0
April 30, 2018									803.0					6.6
March 31, 2018									903.6					12.5
February 28, 2018									778.6					10.3
January 31, 2018									796.5					5.4
December 31, 2017									880.4					6.3
November 30, 2017									748.3					7.3
October 31, 2017									737.0					2.8
September 30, 2017									701.8					5.1
August 31, 2017									818.6					4.8
July 31, 2017									891.9					6.8
June 30, 2017									835.9					4.5
May 31, 2017									751.2					4.5
April 30, 2017									753.0					7.5
March 31, 2017									802.8					2.1
February 28, 2017									706.1					2.5
January 31, 2017									756.0					4.9
December 31, 2016									828.2					3.6
November 30, 2016									697.1					4.7
October 31, 2016									717.0					4.3
September 30, 2016									667.6					3.1
August 31, 2016									780.7					3.1
July 31, 2016									835.4					2.1
June 30, 2016									800.3					4.2
May 31, 2016									718.9					1.3
April 30, 2016									700.6					3.4
March 31, 2016									786.3					0.8
February 29, 2016									688.8					4.1
January 31, 2016									721.0					6.2

¹		Source: Hawaii Department of Business, Economic Development & Tourism
²		Source: U. S. Bureau of Labor Statistics
³		Source: Hawaii Department of Labor and Industrial Relations, County jobs data not seasonally adjusted.
⁴		Source: Honolulu Board of REALTORS
⁵		Source: Hawaii Tourism Authority

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Source: Bank of Hawaii Corporation

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Financial Release

Bank of Hawaii Corporation Third Quarter 2018 Financial Results