U N I T E D   S T A T E S

                 SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C.  20549

                            FORM 10-Q

  (Mark One)

[ X ]     Quarterly Report Pursuant to Section 13 or 15(d) of the
          Securities Exchange Act of 1934 for the quarterly
          period ended June 30, 1995

                                 or

[   ]     Transition Report Pursuant to Section 13 or 15(d) of
          the Securities Exchange Act of 1934 for the transition
          period from _____________ to _____________

                   Commission File Number 1-6887

                B A N C O R P   H A W A I I,   I N C.
       ------------------------------------------------------
       (Exact name of registrant as specified in its charter)

            Hawaii                          99-0148992
   ------------------------     ---------------------------------
   (State of incorporation)     (IRS Employer Identification No.)

 130 Merchant Street, Honolulu, Hawaii                    96813
----------------------------------------               ----------
(Address of principal executive offices)               (Zip Code)

                          (808) 847-8888
       ----------------------------------------------------
       (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months,
and (2) has been subject to such filing requirements for the past
90 days.

                         Yes  X      No    

Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.

Common Stock, $2 Par Value; outstanding at July 31, 1995 -
41,520,923 shares

BANCORP HAWAII, INC. and subsidiaries
June 30, 1995




PART I. - Financial Information

Item 1.  Financial Statements

     The consolidated statements of condition as of June 30, 1995
and 1994, and December 31, 1994 and related statements of income,
shareholders' equity, and cash flows are included herein.

     The unaudited financial statements listed above have been
prepared in accordance with the instructions to Form 10-Q and
therefore do not include all information and footnotes necessary
for a fair presentation of financial position, results of
operations, and changes in financial position in conformity with
generally accepted accounting principles.

     The financial statements reflect all adjustments of a normal
and recurring nature which are, in the opinion of management,
necessary to a fair statement of the results for the interim
periods.  Certain accounts have been reclassified to conform with
the 1995 presentation.

Consolidated Statements of Condition (Unaudited)
------------------------------------------------------------------------------------------------------------------
June 30 December 31 June 30 1995 1994 1994 ------------------------------------------------------------------------------------------------------------------ Assets Interest-Bearing Deposits $752,923 $727,016 $842,255 Investment Securities (Market Value of $3,108,419, $3,101,584 and $3,491,979, respectively) 3,117,484 3,150,885 3,532,916 Securities Purchased Under Agreements to Resell 90,000 -- -- Funds Sold 144,900 54,167 80,470 Loans 7,704,174 7,891,993 7,523,003 Unearned Income (142,084) (144,034) (146,163) Reserve for Possible Loan Losses (150,302) (148,508) (141,210) Net Loans 7,411,788 7,599,451 7,235,630 ------------------------------------------------------------------------------------------------------------------ Total Earning Assets 11,517,095 11,531,519 11,691,271 Cash and Non-Interest Bearing Deposits 474,554 508,762 460,935 Premises and Equipment 231,978 221,806 187,710 Other Assets 350,024 324,263 307,384 ------------------------------------------------------------------------------------------------------------------ Total Assets $12,573,651 $12,586,350 $12,647,300 ================================================================================================================== Liabilities Deposits $7,003,918 $7,115,054 $7,082,778 Securities Sold Under Agreements to Repurchase 2,250,738 2,136,204 2,316,161 Funds Purchased 379,473 609,574 575,220 Short-Term Borrowings 655,652 594,475 818,168 Other Liabilities 385,362 302,683 399,617 Long-Term Debt 877,640 861,572 495,991 ------------------------------------------------------------------------------------------------------------------ Total Liabilities 11,552,783 11,619,562 11,687,935 Shareholders' Equity Common Stock ($2 par value), authorized 100,000,000 shares; outstanding, June 1995 - 41,520,923; December 1994 - 41,851,466; June 1994 - 42,396,059; 83,042 83,703 84,792 Surplus 249,718 260,040 276,379 Unrealized Valuation Adjustments 12,410 (18,122) (15,758) Retained Earnings 675,698 641,167 613,952 ------------------------------------------------------------------------------------------------------------------ Total Shareholders' Equity 1,020,868 966,788 959,365 ------------------------------------------------------------------------------------------------------------------ Total Liabilities and Shareholders' Equity $12,573,651 $12,586,350 $12,647,300 ==================================================================================================================
Consolidated Statements of Income (Unaudited) ------------------------------------------------------------------------------------------------------------------
3 Months 3 Months 6 Months 6 Months Ended Ended Ended Ended June 30 June 30 June 30 June 30 (in thousands of dollars except per share amounts) 1995 1994 1995 1994 ------------------------------------------------------------------------------------------------------------------ Total Interest Income $221,830 $201,461 $436,415 $395,157 Total Interest Expense 114,683 85,254 226,947 163,043 ------------------------------------------------------------------------------------------------------------------ Net Interest Income 107,147 116,207 209,468 232,114 Provision for Possible Loan Losses 4,120 5,964 8,573 14,222 ------------------------------------------------------------------------------------------------------------------ Net Interest Income After Provision for Possible Loan Losses 103,027 110,243 200,895 217,892 Total Non-Interest Income 35,978 34,470 75,789 70,344 Total Non-Interest Expense 93,689 89,749 184,744 177,993 ------------------------------------------------------------------------------------------------------------------ Income Before Income Taxes 45,316 54,964 91,940 110,243 Provision for Income Taxes 16,768 20,802 35,144 41,689 ------------------------------------------------------------------------------------------------------------------ Net Income $28,548 $34,162 $56,796 $68,554 ================================================================================================================== Earnings Per Common Share and Common Share Equivalents $0.68 $0.79 $1.35 $1.59 ------------------------------------------------------------------------------------------------------------------ Average Common Shares and Common Share Equivalents Outstanding 42,121,368 43,056,348 42,129,385 43,006,653 ------------------------------------------------------------------------------------------------------------------
Consolidated Statements of Shareholders' Equity (Unaudited) Bancorp Hawaii, Inc. and subsidiaries ----------------------------------------------------------------------------------------------------------------
Common Unrealized Retained (in thousands of dollars except per share amounts) Total Stock Surplus Valuation Adj. Earnings ---------------------------------------------------------------------------------------------------------------- Balance at December 31, 1994 $966,788 $83,703 $260,040 ($18,122) $641,167 Net Income 56,796 - - - 56,796 Sale of Common Stock 96,251 Profit Sharing Plan 2,637 192 2,445 - - 84,332 Stock Option Plan 1,495 169 1,326 - - 132,374 Dividend Reinvestment Plan 3,735 265 3,470 - - Stock Repurchased (18,850) (1,287) (17,563) - - Unrealized Valuation Adjustments Investment Securities 24,826 - - 24,826 - Foreign Exchange Translation Adjustment 5,706 - - 5,706 - Cash Dividends Paid of $.53 Per Share (22,265) - - - (22,265) ---------------------------------------------------------------------------------------------------------------- Balance at June 30, 1995 $1,020,868 $83,042 $249,718 $12,410 $675,698 ================================================================================================================ Balance at December 31, 1993 $938,104 $56,850 $284,886 $537 $595,831 Net Income 68,554 - - - 68,554 Sale of Common Stock 142,221 Profit Sharing Plan 4,591 284 4,307 - - 87,281 Stock Option Plan 1,256 175 1,081 - - 105,515 Dividend Reinvestment Plan 3,578 211 3,367 - - Stock Repurchased (18,278) (1,016) (17,262) - - Unrealized Valuation Adjustments Investment Securities (14,900) - - (14,900) - Foreign Exchange Translation Adjustment (1,395) - - (1,395) - 50 Percent Stock Dividend (59) 28,288 - - (28,347) Cash Dividends Paid of $.52 Per Share (22,086) - - - (22,086) ---------------------------------------------------------------------------------------------------------------- Balance at June 30, 1994 $959,365 $84,792 $276,379 ($15,758) $613,952 ================================================================================================================
Consolidated Statements of Cash Flows(Unaudited) Bancorp Hawaii, Inc. and subsidiaries --------------------------------------------------------------------------------------------------------------
Six Months Ended June 30 (in thousands of dollars) 1995 1994 -------------------------------------------------------------------------------------------------------------- Operating Activities Net Income $56,796 $68,554 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses, depreciation, and amortization of income and expense 5,497 20,458 Deferred income taxes (2,459) (4,277) Realized and unrealized investment security gains 1,387 1,363 Net (increase) decrease in trading securities 13,130 288 Other assets and liabilities, net 25,879 98,438 ------------ ------------ Net cash provided by operating activities 100,230 184,824 -------------------------------------------------------------------------------------------------------------- Investing Activities Proceeds from redemptions of investment securities held to maturity 519,393 655,134 Purchases of investment securities held to maturity (307,593) (470,126) Proceeds from sales of investment securities available for sale 283,159 252,847 Purchases of investment securities available for sale (421,356) (279,991) Net increase in interest-bearing deposits placed in other banks (25,907) (4,551) Net decrease in funds sold (180,733) (22,771) Net decrease in loans and lease financing 201,405 (258,701) Premises and equipment, net (21,385) (30,394) Purchase of minority interest of Banque D'Hawaii (Vanuatu), Ltd., net of cash and non-interest bearing deposits acquired 6,808 -- ------------ ------------ Net cash provided (used) by investing activities 53,791 (158,553) -------------------------------------------------------------------------------------------------------------- Financing Activities Net decrease in demand, savings, and time deposits (122,365) 77,803 Proceeds from lines of credit and long-term debt 16,068 238,061 Principal payments on lines of credit and long-term debt -- -- Net decrease in short-term borrowings (54,390) (244,122) Proceeds from sale of stock (10,983) (8,853) Cash dividends (22,265) (22,145) ------------ ------------ Net cash provided (used) by financing activities (193,935) 40,744 Effect of exchange rate changes on cash 5,706 (1,395) ------------ ------------ Increase (decrease) in cash and non-interest bearing deposits (34,208) 65,620 ------------ ------------ Cash and non-interest bearing deposits at beginning of year 508,762 395,315 ------------ ------------ Cash and non-interest bearing deposits at end of period $474,554 $460,935 -------------------------------------------------------------------------------------------------------------- /TABLE Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Review Performance Highlights Bancorp Hawaii, Inc. (Bancorp) reported earnings for the second quarter of 1995 of $28.5 million, 16.4% below earnings for the second quarter of 1994. On a per share basis, earnings were $0.68 for the second quarter of 1995, an increase from the $0.67 reported for the first quarter of 1995, but a decrease from the $0.79 reported for the second quarter of 1994. For the six months ended June 30, 1995, Bancorp reported net income of $56.8 million, 17.2% below that for the same period in 1994. Earnings per share were $1.35 for the first half of 1995, compared with $1.59 for the same period in 1994. Earnings reflect the slower economy in Hawaii, Bancorp's main market, and the relatively flat interest rate yield curve over the one to five year time horizon. Performance ratios for the year-to-date period were short of Bancorp's objectives of 1% and 16%, for return on average assets and return on average equity, respectively. Return on average assets and return on average equity were 0.93% and 11.42%, respectively, for the first half of 1995. These ratios were 1.10% and 14.40%, respectively, for the like period in 1994. Total assets ended June 30, 1995 at $12.6 billion, the same at both June 30, 1994 and year-end 1994. Net loans outstanding decreased from both March 31, 1995 and year-end 1994 by 0.7% and 2.5%, respectively. Total investment securities also declined to $3.1 billion at June 30, 1995 representing a 1.1% decrease from year-end 1994 and 11.8% from the same date a year ago. Total deposits decreased to $7.0 billion, compared to $7.1 billion reported at year-end 1994 and decreased from the $7.1 billion reported a year ago on June 30. Securities sold under agreements to repurchase (repos) as of June 30, 1995 totaled $2.3 billion, an increase of 5.4% from year-end 1994 and a 2.8% decline from June 30, 1994. The changes in repo balances, which are mainly comprised of government funds are also explained later in this report. Non-performing assets (NPAs) have decreased to $51.0 million at June 30, 1995. This was the lowest level of non-performing assets for Bancorp since NPAs peaked on June 30, 1993 at $106.6 million. A further discussion on NPAs and Reserve for Loan Losses follows later in this report. Trust income for the second quarter of 1995 totaled $12.1 million, a 8.6% increase over the same quarter in 1994. Trust income has continued to grow as new opportunities such as the introduction of Pacific Capital family of funds gains more recognition. The average net interest margin or spread on earning assets for the second quarter of 1995 was 3.80%, which compared with 3.96% reported for the second quarter of 1994, and the 3.62% spread for the first quarter of 1995. A further discussion of spread follows in this report. Risk Elements in Lending Activities At June 30, 1995, total loans were $7.7 billion, a 2.4% decrease from year-end 1994 and 2.4% above total loans on June 30, 1994. As reported in the first quarter, Bancorp securitized $412 million in mortgage loans explaining some of the decrease. Hawaii's sluggish economy also continues to hamper loan growth. In spite of slower loan growth, Bancorp's lending policies remain unchanged and conservative. The following table presents Bancorp's total loan portfolio balances for the periods indicated. Commercial and Industrial Loans Commercial and Industrial loans outstanding were $1.9 billion as of June 30, 1995, an increase from both year-end 1994 and June 30, 1994. Real Estate Loans Real estate loans totaled $3.9 billion at June 30, 1995, a 6.7% decrease from year-end 1994 and a 1.7% decrease from the same date a year ago. The decrease since year-end 1994 was attributed to the securitization of $412 million in residential mortgage loans in the first quarter of 1995. Considering this securitization, a comparison with year-end 1994 reflects an increase of 3.4% in total real estate loans. Residential mortgage loans at June 30, 1995 were $2.6 billion, compared with $2.9 billion at year-end 1994. Construction loans at June 30, 1995 totaled $143.8 million, compared with $131.0 million at year-end 1994 and $146.1 million at June 30, 1994. Commercial mortgage loans have remained relatively consistent. Other Lending Installment loans and leases have continued to increase albeit modestly from year-end 1994. At June 30, 1995, total installment loans were $762.5 million, up from $747.7 million reported at March 31, 1995 and $741.6 million at year-end 1994. Compared with the same date in 1994 when installment loan balances were $696.8 million, installment loan balances are up 9.4%. The increase from year-end reflected evenly between Bancorp's VISA charge cards and consumer installment loans. Total leases at June 30, 1995 increased to $384.2 million from $378.1 million at year-end 1994. Foreign loan balances were $732.1 million as of June 30, 1995, an increase of 5.1% from year-end 1994, and 11.4% above June 30, 1994 balances. The rise in the foreign loan total since year-end largely reflects the movement of exchange rates against the U.S. dollar. The foreign loan total includes outstanding credits to Less Developed Countries (LDC). LDC exposure remains very limited at $1.0 million in outstanding credits and $130.4 million in confirmed letters of credit and banker's acceptances at June 30, 1995. All LDC exposure is in the Philippines. Loan Portfolio Balances Bancorp Hawaii, Inc., and subsidiaries ----------------------------------------------------------------------------
June 30 December 31 June 30 (in millions of dollars) 1995 1994 1994 ---------------------------------------------------------------------------- Domestic Loans Commercial and Industrial $1,863.0 $1,830.8 $1,751.2 Real Estate Construction -- Commercial 128.7 113.1 120.1 -- Residential 15.1 17.9 26.0 Mortgage -- Commercial 1,259.4 1,241.0 1,248.5 -- Residential 2,559.2 2,872.8 2,638.9 Installment 762.5 741.6 696.8 Lease Financing 384.2 378.1 384.4 ---------------------------------------------------------------------------- Total Domestic 6,972.1 7,195.3 6,865.9 ---------------------------------------------------------------------------- Foreign Loans 732.1 696.7 657.1 ---------------------------------------------------------------------------- Total Loans $7,704.2 $7,892.0 $7,523.0 ============================================================================
Non-Performing Assets and Past Due Loans Bancorp's non-performing assets include non-accrual loans, restructured loans and foreclosed real estate. NPAs totaled $51.0 million, representing 0.66% of total loans outstanding at June 30, 1995. This ratio compares with 0.67% at the end of both the first quarter 1995 and year-end 1994. This ratio was 0.71% at the end of the second quarter 1994. Bancorp continues its effort to monitor and manage NPAs aggressively. Non-accrual loans decreased during the quarter to $49.4 million from $51.7 million at the March 1995 quarter-end and $52.6 million at year-end 1994. The decrease from the first quarter of 1995 in the commercial loan category was largely due to charge-offs. Since year-end, past due loans have increased particularly in the residential real estate loan and commercial loan categories. Residential mortgage loans past due 90 days increased to $7.3 million, 0.29% of total residential mortgage loans, while past due commercial mortgage loans increased to $2.1 million, 0.17% of total commercial real estate loans. Both these ratios remain at modest levels. For residential mortgage loans, the underlying collateral which represented, at initial closing, loan to value ratios of 80-90%, significantly reduces loss exposure. Accruing 90 day past due loans have increased from $11.6 million at year-end 1994 to $16.0 million at June 30, 1995. Comparatively, $10.0 million in accruing 90 day past due loans were reported at June 30, 1994 and $17.7 million at March 31, 1995. The foreclosed real estate category remained at low levels, totaling $1.6 million at June 30, 1995, compared with $0.6 million at March 31, 1995 and $0.6 million at year-end 1994. There were only nine properties in Other Real Estate at June 30, 1995. Total non-performing assets and loans 90 days past due represented 0.87% of loans outstanding compared with 0.82% at year-end 1994 and 1.04% at June 30, 1994. The following table presents NPAs and past due loans for the periods indicated. Bancorp Hawaii, Inc. Consolidated Non-Performing Assets and Accruing Loans Past Due 90 Days or More -------------------------------------------------------------------------------
June 30 December 31 June 30 (in millions of dollars) 1995 1994 1994 ------------------------------------------------------------------------------- Non-Accrual Loans Commercial $15.3 $20.3 $20.2 Real Estate Construction 0.8 1.5 2.1 Commercial 16.5 14.1 5.7 Residential 15.5 15.1 14.3 Installment 1.2 0.5 0.3 Leases 0.1 0.8 -- Other -- -- -- Foreign -- 0.3 -- ------------------------------------------------------------------------------- Subtotal 49.4 52.6 42.6 Restructured Loans Commercial -- -- 2.1 Real Estate Construction -- -- -- Commercial -- -- 5.2 Residential -- -- -- Installment -- -- -- Leases -- -- -- Other -- -- -- Foreign -- -- -- ------------------------------------------------------------------------------- Subtotal -- -- 7.3 Foreclosed Real Estate Domestic 1.6 0.6 3.4 Foreign -- -- -- ------------------------------------------------------------------------------- Subtotal 1.6 0.6 3.4 ------------------------------------------------------------------------------- Total Non-Performing Assets 51.0 53.2 53.3 ------------------------------------------------------------------------------- Accruing Loans Past Due 90 Days or More Commercial 2.1 1.0 0.8 Real Estate Construction -- -- -- Commercial 0.1 0.7 0.3 Residential 7.3 3.9 5.0 Installment 6.5 5.9 3.7 Leases -- -- 0.1 Other -- 0.1 -- Foreign -- -- -- ------------------------------------------------------------------------------- Subtotal 16.0 11.6 9.9 ------------------------------------------------------------------------------- Total $67.0 $64.8 $63.2 =============================================================================== ------------------------------------------------------------------------------- Ratio of Non-Performing Assets to Total Loans 0.66% 0.67% 0.71% ------------------------------------------------------------------------------- ------------------------------------------------------------------------------- Ratio of Non-Performing Assets and Accruing Loans Past Due 90 Days or More to Total Loans 0.87% 0.82% 0.84% ------------------------------------------------------------------------------- /TABLE Summary of Loan Loss Experience The reserve for loan losses stood at $150.3 million at June 30, 1995, representing 1.99% of loans outstanding. This compares with 1.97% as of March 31, 1995, 1.92% at year-end 1994 and 1.91% on June 30, 1994. Loan loss provisions were $4.1 million for the second quarter of 1995, compared with the $4.5 million reported for the first quarter of 1995. Net charge-offs were $4.2 million for the quarter ended June 30, 1995, bringing year- to-date charge-offs to $6.8 million. Gross charge-offs totaled $9.0 million for the second quarter of 1995, compared to $6.9 million for the first quarter of 1995. Year-to-date, gross charge-offs totaled $15.9 million, compared with $11.9 million for the same period in 1994. Recoveries reported for the quarter ended June 30, 1995 were $4.8 million, bringing year-to-date recoveries to $9.1 million. The annualized ratio of net charge-offs to average loans outstanding for the second quarter 1995 of 0.22%, compares nearly with the ratio of net charge-offs to average loans of 0.14% for the first quarter of 1995 and zero reported for the full year of 1994. A detailed breakdown of charge-offs and recoveries by loan category is presented in the following table. Summary of Loss Experience Bancorp Hawaii, Inc., and subsidiaries -------------------------------------------------------------------------------------------------
Second Second First Six First Six Quarter Quarter Months Months (in millions of dollars) 1995 1994 1995 1994 ------------------------------------------------------------------------------------------------- Average Loans Outstanding $7,587.8 $7,278.5 $7,599.1 $7,230.9 Balance of Reserve for Possible Loan Losses at Beginning of Period $150.4 $130.1 $148.5 $125.3 Loans Charged Off Commercial and Industrial 4.9 0.5 6.9 5.7 Real Estate - Construction -- -- 2.1 -- Real Estate - Mortgage Commercial 0.4 1.0 0.5 1.0 Residential 0.2 0.1 0.2 0.1 Installment 3.4 2.4 6.1 4.3 Foreign -- 0.7 -- 0.7 Leases 0.1 0.1 0.1 0.1 ------------------------------------------------------------------------------------------------- Total Charged Off 9.0 4.8 15.9 11.9 Recoveries on Loans Previously Charged Off Commercial and Industrial 2.3 8.4 5.5 11.1 Real Estate - Construction -- -- -- -- Real Estate - Mortgage Commercial -- 0.7 -- 0.7 Residential -- 0.1 -- 0.2 Installment 0.9 0.8 1.7 1.6 Foreign 1.3 -- 1.3 -- Leases 0.3 -- 0.6 -- ------------------------------------------------------------------------------------------------- Total Recoveries 4.8 10.0 9.1 13.6 ------------------------------------------------------------------------------------------------- Net Charge Offs (4.2) 5.2 (6.8) 1.7 Provision Charged to Operating Expenses 4.1 5.9 8.6 14.2 ------------------------------------------------------------------------------------------------- Balance at End of Period $150.3 $141.2 $150.3 $141.2 ================================================================================================= Ratio of Net Charge Offs to Average Loans Outstanding (annualized) -0.22% 0.29% -0.18% 0.05% ------------------------------------------------------------------------------------------------- Ratio of Reserve to Loans Outstanding 1.99% 1.91% 1.99% 1.91% -------------------------------------------------------------------------------------------------
Capital Bancorp continues to manage its capital levels through the target ratios outlined in Bancorp's 1994 Annual Report. The target of a minimum 6% ratio of average equity to average assets keeps both objectives of a return on assets of 1% and a return on equity of 16% in reasonable balance. Bancorp's average equity to average assets ratio for the second quarter of 1995 was 8.16%, an increase from the 7.71% reported for 1994 and 7.99% for the first quarter of 1995. Bancorp's total capital at June 30, 1995 totaled $1.0 billion. New shares issued for the profit sharing, stock option and dividend reinvestment plans increased capital by $2.6 million during the quarter. Under Bancorp's continuing stock repurchase programs, $14.7 million of shares were repurchased during the second quarter of 1995. Dividends for the quarter increased to $11.4 million, compared with $10.9 million for the first quarter of 1995. The dividends were paid at $0.2725 and $0.26 per share for the second and first quarters of 1995, respectively. Regulatory risk-based capital remain well above minimum guidelines. At June 30, 1995, Bancorp's Total Capital and Tier 1 Capital ratios were 13.11% and 10.54%, respectively. This compares with year-end 1994, when the Total Capital Ratio was 12.99% and the Tier 1 Capital Ratio was 10.39%. Regulatory guidelines prescribe a minimum Total Capital Ratio of 10.00% and a Tier 1 Capital Ratio of 6.00% for an institution to qualify as well capitalized. Bancorp's strategy is to maintain its capital ratios at levels to meet this qualification to benefit from the financial and regulatory incentives provided to well capitalized companies. In addition, the leverage ratio, which represents the ratio of Tier 1 Capital to Total Average Assets, was 7.81% at June 30, 1995, compared to 7.21% at June 30, 1994 and 7.28% at year-end 1994. The required minimum ratio is 5.00%, to qualify an institution as well capitalized. Spread Management The average net interest margin or spread on earning assets for the second quarter of 1995 improved to 3.80% from 3.62% reported in the first quarter of 1995. Prior year comparisons reflect the impact of the increasing interest rates in 1994. Although the spread has improved compared to the first quarter of 1995, the rise in interest rates in 1994 is reflected in the comparison between the year-to-date spread for 1995 and 1994. Year-to-date spread through June 1995 was 3.71% compared to 3.98% for the same period in 1994. The cost of funds rate for the second quarter of 1995 was 4.80%, which was well above the 3.40% reported for the second quarter of 1994. The rise in the cost of funds reflects the impact of higher interest rates last year. The earning asset yield was 7.84% for the second quarter of 1995, an increase over the second quarter 1994 yield of 6.85%, and an increase over the 7.58% yield reported in the first quarter of 1995. Consolidated Average Balances and Interest Rates Taxable Equivalent Bancorp Hawaii, Inc. and subsidiaries ----------------------------------------------------------------------------------------------------------
Three Months Ended Three Months Ended June 30, 1995 June 30, 1994 Average Income/Yield/ Average Income/Yield/ (in millions of dollars) Balance Expense Rate Balance Expense Rate ---------------------------------------------------------------------------------------------------------- Earning Assets Interest Bearing Deposits $626.9 $10.2 6.51% $903.7 $9.2 4.07% Investment Securities -Taxable 1,481.8 23.7 6.42 2,637.3 35.6 5.41 -Tax-Exempt 16.7 0.5 12.97 18.6 0.6 13.46 1,598.8 26.3 6.61 946.1 12.2 5.20 Funds Sold 57.7 0.9 6.20 36.6 0.4 4.14 Net Loans -Domestic 6,851.9 143.3 8.39 6,640.6 128.9 7.78 -Foreign 735.9 11.3 6.17 637.9 6.9 4.34 Loan Fees 6.1 8.1 ------------------------ ------------------------ Total Earning Assets 11,369.7 222.3 7.84 11,820.8 201.9 6.85 Cash and Due From Banks 474.3 470.4 Other Assets 388.1 345.6 ---------- ---------- Total Assets $12,232.1 $12,636.8 ========== ========== Interest Bearing Liabilities Domestic Deposits - Demand $1,747.0 12.9 2.96 $1,882.4 9.3 1.98 - Savings 1,069.9 7.8 2.94 1,267.1 7.2 2.27 - Time 1,805.3 22.7 5.04 1,521.7 15.6 4.12 ------------------------ ------------------------ Total Domestic 4,622.2 43.4 3.77 4,671.2 32.1 2.75 Total Foreign 904.8 15.6 6.90 1,215.3 12.2 4.03 ------------------------ ------------------------ Total Deposits 5,527.0 59.0 4.28 5,886.5 44.3 3.02 Short-Term Borrowings 3,076.6 41.9 5.46 3,722.1 35.0 3.77 Long-Term Debt 983.8 13.8 5.64 462.6 6.0 5.23 ------------------------ ------------------------ Total Interest Bearing Liabilities 9,587.4 114.7 4.80 10,071.2 85.3 3.40 ------------------------ ------------------------ Net Interest Income 107.6 3.04 116.6 3.45 Average Spread on Earning Assets 3.80% 3.96% Demand Deposits 1,370.9 1,389.0 Other Liabilities 254.1 209.9 Shareholders' Equity 1,019.7 966.7 ---------- ---------- Total Liabilities and Shareholders' Equity $12,232.1 $12,636.8 ========== ========== Provision for Possible Losses 4.1 5.9 Net Overhead 57.7 55.3 ------- ------- Income Before Income Taxes 45.8 55.4 Provision for Income Taxes 16.8 20.8 Tax-Equivalent Adjustment 0.5 0.4 ------- ------- Net Income $28.5 $34.2 ======= =======
Consolidated Average Balances and Interest Rates Taxable Equivalent Bancorp Hawaii, Inc. and subsidiaries ----------------------------------------------------------------------------------------------------------
Six Months Ended Six Months Ended June 30, 1995 June 30, 1994 Average Income/Yield/ Average Income/Yield/ (in millions of dollars) Balance Expense Rate Balance Expense Rate ---------------------------------------------------------------------------------------------------------- Earning Assets Interest Bearing Deposits $623.7 $18.4 5.94% $886.4 $16.9 3.83% Investment Securities -Taxable 1,542.9 46.8 6.11 2,706.4 73.8 5.50 -Tax-Exempt 17.2 1.1 13.02 19.3 1.3 13.58 1,591.2 51.2 6.49 934.4 21.7 4.69 Funds Sold 62.5 1.8 5.96 39.3 0.8 4.07 Net Loans -Domestic 6,881.5 281.2 8.24 6,587.4 250.9 7.68 -Foreign 717.6 23.8 6.69 643.5 13.6 4.27 Loan Fees 13.1 17.0 ------------------------ ------------------------ Total Earning Assets 11,436.6 437.4 7.71 11,816.7 396.0 6.76 Cash and Due From Banks 477.8 457.7 Other Assets 380.3 343.4 ---------- ---------- Total Assets $12,294.7 $12,617.8 ========== ========== Interest Bearing Liabilities Domestic Deposits - Demand $1,780.2 25.9 2.93 $1,923.3 18.7 1.96 - Savings 1,091.3 15.4 2.84 1,264.6 14.2 2.27 - Time 1,747.1 41.8 4.83 1,535.6 31.7 4.16 ------------------------ ------------------------ Total Domestic 4,618.6 83.1 3.63 4,723.5 64.6 2.76 Total Foreign 916.0 30.9 6.80 1,200.2 21.8 3.67 ------------------------ ------------------------ Total Deposits 5,534.6 114.0 4.15 5,923.7 86.4 2.94 Short-Term Borrowings 3,154.7 85.6 5.47 3,727.4 65.3 3.53 Long-Term Debt 980.9 27.4 5.62 422.7 11.3 5.41 ------------------------ ------------------------ Total Interest Bearing Liabilities 9,670.2 227.0 4.73 10,073.8 163.0 3.26 ------------------------ ------------------------ Net Interest Income 210.4 2.98 233.0 3.50 Average Spread on Earning Assets 3.71% 3.98% Demand Deposits 1,403.6 1,392.7 Other Liabilities 217.6 191.3 Shareholders' Equity 1,003.3 960.0 ---------- ---------- Total Liabilities and Shareholders' Equity $12,294.7 $12,617.8 ========== ========== Provision for Possible Losses 8.6 14.2 Net Overhead 108.9 107.7 ------- ------- Income Before Income Taxes 92.9 111.1 Provision for Income Taxes 35.1 41.7 Tax-Equivalent Adjustment 1.0 0.8 ------- ------- Net Income $56.8 $68.6 ======= =======
Interest Rate Risk and Derivatives As discussed in Bancorp's 1994 Annual Report, Bancorp utilizes interest rate sensitivity analysis and computer simulation techniques to measure the exposure of its earnings to interest rate movements. The objective of the process is to position its balance sheet to optimize earnings without unduly increasing risk. The Interest Rate Sensitivity Table presents the possible exposure to interest rate movements for various time frames at June 30, 1995. As the table indicates, Bancorp's one year cumulative liability sensitivity gap totaled $0.03 billion, representing 0.23% of total assets. Comparatively, the one year cumulative gap was $0.2 billion at year-end 1994, 1.8% of total assets. Bancorp uses interest rate swaps as a cost effective risk management tool for dealing with interest rate risk. Swap activity during the second quarter of 1995 was limited to maturities of existing swap agreements. At June 30, 1995, the notional amount of swaps totaled $1.3 billion, compared with $1.6 billion at year-end 1994. Net expense on interest rate swap agreements totaled $2.8 million for the second quarter of 1995 (and totals $6.9 million for 1995 year-to-date). Comparatively, net revenue of $7.7 million was recognized for all of 1994. Interest Rate Sensitivity Table Bancorp Hawaii, Inc. and subsidiaries --------------------------------------------------------------------------------------------
JUNE 30, 1995 OVER NON-INTEREST (in millions of dollars) 0 - 90 DAYS 91-365 DAYS 1 - 5 YEARS 5 YEARS SENSITIVE -------------------------------------------------------------------------------------------- ASSETS (1) INVESTMENT SECURITIES $1,260.3 $928.9 $797.0 $131.4 - SHORT TERM INVESTMENTS 229.9 5.0 - - - INTERNATIONAL ASSETS 1,009.9 321.5 48.9 0.3 - DOMESTIC LOANS (2) 3,249.4 1,526.9 1,565.3 519.4 - TRADING SECURITIES - - 0.5 - - OTHER ASSETS 224.0 2.0 98.0 30.0 $625.1 -------------------------------------------------------------------------------------------- TOTAL ASSETS $5,973.5 $2,784.3 $2,509.7 $681.1 $625.1 ============================================================================================ LIABILITIES AND CAPITAL (1) NON-INT BEARING DEMAND (3) $247.7 $247.7 $880.8 - - INT-BEARING DEMAND (3) 346.5 346.5 952.8 - - SAVINGS (3) 231.3 231.3 588.9 - - TIME DEPOSITS 484.8 780.5 558.3 75.7 - FOREIGN DEPOSITS 972.3 56.0 2.6 - - S/T BORROWINGS 2,780.5 491.3 14.1 - - LONG-TERM DEBT 588.8 10.0 158.8 120.0 - OTHER LIABILITIES - - - - $385.4 CAPITAL - - - - 1,020.9 -------------------------------------------------------------------------------------------- TOTAL LIABILITIES AND CAPITAL $5,651.9 $2,163.4 $3,156.3 $195.8 $1,406.2 ============================================================================================ INTEREST RATE SWAPS ($1,162.5) $191.2 $971.3 - - -------------------------------------------------------------------------------------------- INTEREST SENSITIVITY GAP ($841.0) $812.1 $324.6 $485.4 ($781.1) -------------------------------------------------------------------------------------------- CUMULATIVE GAP ($841.0) ($28.9) $295.7 $781.1 - PERCENTAGE OF TOTAL ASSETS (6.69)% (0.23)% 2.35% 6.21% - ============================================================================================ Assumptions used: (1) Based on repricing date. (2) Includes the effect of estimated amortization. (3) Historical analysis shows that these deposit categories, while technically subject to immediate withdrawal, actually display sensitivity characteristics that generally fall within one and five years. The allocation presented is based on that historic analysis.
Liquidity The ability to meet day-to-day financial needs of Bancorp's customer base is essential. Much of the strategy of meeting liquidity needs was described in Bancorp Hawaii's 1994 Annual Report and remains in place. At June 30, 1995, deposits were $7.0 billion, compared to $7.1 billion and $6.8 billion reported at year-end 1994 and March 31, 1995, respectively. The competition for deposits, not only by banks and savings and loan companies, but also by securities brokerage firms continues to impact the level of deposits. Repos which are offered to government depositors as an alternative to deposits were $2.3 billion at June 30, 1995, compared to $2.1 billion at both March 31, 1995 and year-end 1994. Short term borrowings, including Fed Funds, decreased to $1.0 billion at June 30, 1995, compared with $1.1 billion at March 31, 1995 and $1.2 billion at year-end 1994. Long term debt remained level at $0.9 billion at both June 30, 1995 and year-end 1994. Bank of Hawaii, Bancorp's largest subsidiary, finalized a new $1 billion bank note program in the second quarter. The program has a revolving feature and is intended to facilitate liquidity needs and the refunding, as necessary, of the bank notes presently outstanding. Net Overhead Bancorp manages net overhead by focusing on its net overhead ratio. The net overhead ratio at Bancorp is defined as the ratio of non-interest expense to non-interest income. Bancorp's long term goal is to have a ratio of 2 to 1, where fee income offsets at least half of the cost of operations. The ratio for the year- to-date through June 30, 1995 was 2.43, compared to 2.71 for the same period in 1995, 2.29 for the first quarter of 1995 and 2.81 for all of 1994. Additionally, Bancorp's management places an emphasis on the amount of net income generated per full-time equivalent staff (FTE) with the objective of improving net income with existing or lesser staff levels. For the first half of 1995, net income per FTE (excluding securities gains (losses)), was $26,131 on an annualized basis, reflecting the lower reported earnings. This compares to $29,700 and $29,500 reported for the full years of 1994 and 1993, respectively. Non-interest income for the second quarter was $36.0 million, a 4.4% increase over the same quarter in 1994. A year- to-date comparison reports a 7.7% increase between 1995 and 1994. Trust income for the second quarter 1995 was $12.1 million, up 9.6% from the same period last year. Year-to-date, trust fees are up 10.1%, compared with the same period last year. The improvement reflects the increase in fees earned on the proprietary Pacific Capital Management family of mutual funds introduced in 1994. Fees earned based on market value of trust assets have also increased in concert with the appreciation in the stock market. Service charges on deposit accounts for the first half of 1995 was $22.2 million, compared to $23.7 million for the like period last year. Service charges on deposit accounts have declined as larger business customers opt to "pay for services" with higher balances instead of fees. Fees, exchange and other service charges for the second quarter of 1995 remained level with the first quarter at $12.4 million. Compared to the first half of 1994, fees, exchange and other service charges were up 24.4%. The increase reflects an increase in foreign exchange gains, ATM transaction fees and VISA merchant services income. Other operating income totaled $10.5 million for the year-to-date, compared with $14.6 million for the same period last year. The decrease is attributable to the gains in the sale of certain leased assets at lease maturity and the cash basis recognition of the interest collected on previously charged-off loans, both in 1994. During the first quarter of 1995, Bancorp reported a securities gain of $1.8 million, compared to a loss of $1.0 million for the same period in 1994. Activity during the second quarter remained limited with gains and losses reported at modest levels. Year-to-date 1995 gains totaled $2.1 million, compared with losses of $1.6 million for the same period in 1994. Bancorp continues to emphasize the importance of control over non-interest expenses as a key factor in its effort to remain competitive among its peers. Non-interest expense in the second quarter was $93.7 million, an increase of 4.3% over the same period in 1994. For the year-to-date, non-interest expense was $184.7 million, an increase of 3.8% over the same period in 1994. Salary and benefit expenses totaled $46.3 million for the second quarter of 1995, slightly below the $46.9 million for the first quarter of 1995 and 2.4% above the second quarter of 1994. For the year-to-date, $93.2 million in salary and benefit has been incurred, compared with $92.3 million for the same period in 1994, an increase of 0.95%. During the first quarter, Bancorp announced a restructuring of its retirement plans, including an early retirement option for certain qualifying staff and a curtailment of its defined benefit plan. The first group of staff members electing the option retired during the second quarter. The final group will be retiring in the third quarter. Pursuant to accounting rules, since a loss on this curtailment is not expected, the final financial impact will be determined later this year. Premises and equipment expenses totaled $20.9 million for the second quarter of 1995, an increase from the $17.1 million for the same period of 1994. For the year-to-date, premises and equipment expenses rose to $37.0 million, an increase of 11.9% over the same period in 1994. Bancorp continues to invest in technology as more efficient operations with existing staff counts become increasingly important. Other operating expenses for the first half of 1995 increased 3.7% over last year during the same period. PART II. - Other Information Items 1, 2, 3 and 5 omitted pursuant to instructions. Item 4 - Submission of Matters to a Vote of Security Holders (a) Bancorp's Annual Shareholders' Meeting was held on April 26, 1995. (b) Omitted per instructions. (c) A brief description of each matter voted upon at the Annual Shareholders' Meeting held on April 26, 1995 and number of votes cast for, against or withheld, including a separate tabulation with respect to each nominee for office is presented below: (1) Election of four Class III directors for terms expiring in 1998 and the successor to fill the unexpired terms of one retiring Class I director, whose term expires in 1996. Class I director: Richard J. Dahl - Votes cast for: 35,010,413 Votes cast against: 0 Votes withheld: 318,626 Class III directors: Mary G. F. Bitterman - Votes cast for: 34,881,973 Votes cast against: 0 Votes withheld: 447,066 Herbert M. Richards, Jr. - Votes cast for: 34,992,824 Votes cast against: 0 Votes withheld: 336,215 H. Howard Stephenson - Votes cast for: 34,914,465 Votes cast against: 0 Votes withheld: 414,574 Charles R. Wichman - Votes cast for: 35,006,958 Votes cast against: 0 Votes withheld: 322,081 (2) Election of Ernst & Young as Auditor. Votes cast for: 35,050,599 Votes cast against: 190,372 Votes abstained: 88,068 (d) None. Item 6 - Exhibits and Reports on Form 8-K (a) The following exhibits are filed herewith: Exhibit #11 - Statement regarding computation of per share earnings. Exhibit #20 - Report furnished to shareholders for the quarter ended March 31, 1995. Exhibit #27 - Financial Data Schedule. (b) No Form 8-K was filed during the quarter. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Date August 14, 1995 BANCORP HAWAII, INC. LAWRENCE M. JOHNSON (Signature) Lawrence M. Johnson Chairman and Chief Executive Officer DAVID A. HOULE (Signature) David A. Houle Senior Vice President and Chief Financial Officer


                         Bancorp Hawaii, Inc.
   Exhibit 11 - Statement Regarding Computation of Per Share Earnings
                       Six Months Ended June 30

Fully Primary Diluted -------------- -------------- 1995 ---- Net Income $56,796,000 $56,796,000 ============== ============== Daily Average Shares Outstanding 41,814,199 41,814,199 Shares Assumed Issued for Stock Options 315,186 342,317 -------------- -------------- 42,129,385 42,156,516 ============== ============== Earnings Per Common Share and Common Share Equivalents $1.35 $1.35 ============== ============== 1994 ---- Net Income $68,554,000 $68,554,000 ============== ============== Daily Average Shares Outstanding 42,485,825 42,485,825 Shares Assumed Issued for Stock Options 520,828 520,828 -------------- -------------- 43,006,653 43,006,653 ============== ============== Earnings Per Common Share amd Common Share Equivalents $1.59 $1.59 ============== ============== /TABLE
To Our Shareholders:

     Bancorp Hawaii, Inc. reported first quarter earnings of
$28.2 million, 17.9% lower than for the same period last year. 
Earnings per share for the first quarter were $.67 compared to
$.80 for the first quarter of 1994.  Return on average assets was
0.93% and return on average equity was 11.61%.  The decline in
earnings, a result of margin compression due to the continual
rise in interest rates, was within Bancorp Hawaii's expectations. 

     Bancorp's total assets at the end of March 1995 were $12.2
billion, down 5.3% from $12.9 billion at March 31, 1994. 
Deposits and repurchase agreements stood at $8.9 billion, down
9.4% from the same period last year.  Net loans at the end of the
first quarter were $7.5 billion, up 5.3% from last year's first
quarter.   

     Asset quality remained very high.  Non-performing assets
(NPAs) dropped to $52.3 million on March 31, 1995, reflecting a
22% decrease from $66.8 million reported March 31, 1994, and 
relatively unchanged from $53.2 million reported at year end
1994.  Reserve for loan losses totaled $150.4 million,
representing 1.97% of loans outstanding.

     Bancorp continues to face the challenges of a low-growth
economy and a rising interest rate environment, and to seek
opportunities within this context.  We are particularly pleased
with the growth in loans this quarter, which is a reflection of
the geographic diversification strategy Bancorp has followed for 
some time.  We are also pleased with the significant increase in 
non-interest income to $39.8 million, an 11% increase from last
year's first quarter, which is due largely to rising trust income
and the success of our Investment and Trust Services Group.
     
     Non-interest expense rose by 3.2%, in line with your
company's initiative to control costs but continue to invest in
technology.  This investment will enable Bancorp to focus more
heavily on relationship banking and was partially offset by our
success in managing other expenses, particularly compensation.

     Early in 1995, Bancorp offered a voluntary early retirement 
option to approximately 440 eligible Bancorp Hawaii staff members
and approved a new defined contribution retirement plan and an
enhanced profit sharing program.

     Bank of Hawaii has opened two additional in-store branches
(ISBs) in Safeway Stores on Oahu recently.  Your company is
aggressively taking ownership of the ISB market niche in Hawaii
and has signed agreements to develop ISB networks with Star and
KTA supermarkets throughout the state.  In March, First National 
Bank of Arizona, another Bancorp subsidiary, opened its fifth
branch, the Camelback Banking Center, to service the bank's
growing number of customers in Phoenix's Camelback corridor area.

     At the annual shareholders meeting on April 26, 1995, Bank
of Hawaii President Richard J. Dahl was named to the Bancorp
Hawaii board of directors, succeeding Retired Admiral Thomas B.
Hayward who reached mandatory retirement age.  Also, Mary G.F.
Bitterman, Herbert M. Richards, Jr., H. Howard Stephenson, and
Charles R. Wichman were re-elected to three-year terms on the
Bancorp board.  Shareholders also re-elected Ernst & Young LLP as
Bancorp's auditor for 1995.

     Also in April, the Board of Directors declared a quarterly
dividend of 27 1/4 cents payable on June 14, 1995 to shareholders
of record on May 22, 1995.

     Bancorp Hawaii will continue to focus on its long range
objectives, leveraging its dominant position in Hawaii and
expanding throughout the Pacific Rim region consistent with the
company's goals.  We appreciate your continuing support as we
take the bold steps necessary for your company to build a
framework for growth and success in the next century.

Sincerely,

LAWRENCE M. JOHNSON

Lawrence M. Johnson
Chairman and Chief Executive Officer


Corporate Offices:
Financial Plaza of the Pacific
130 Merchant Street
Honolulu, Hawaii  96813

Investor or Analyst Inquiries:
David A. Houle
Senior Vice President, Treasurer and Chief Financial Officer
(808) 537-8288

   or

Sharlene K. Bliss
Assistant Vice President and Investor Relations Officer
(808) 537-8037

   or

Cori C. Weston
Corporate Secretary
(808) 537-8272

Highlights  (Unaudited)                                                            Bancorp Hawaii, Inc., and subsidiaries
--------------------------------------------------------------------------------------------------------------------------
March 31 March 31 1995 1994 -------------------------------------------------------------------------------------------------------------------------- Return on Average Assets 0.93% 1.11% -------------------------------------------------------------------------------------------------------------------------- Return on Average Equity 11.61% 14.63% -------------------------------------------------------------------------------------------------------------------------- Average Spread on Earning Assets 3.62% 3.99% -------------------------------------------------------------------------------------------------------------------------- Book Value Per Common Share $23.92 $22.40 -------------------------------------------------------------------------------------------------------------------------- Loss Reserve/Loans and Leases Outstanding 1.97% 1.80% -------------------------------------------------------------------------------------------------------------------------- Average Equity/Average Assets 7.99% 7.57% -------------------------------------------------------------------------------------------------------------------------- Common Stock Price Range High Low Dividend -------------------------------------------------------------------------------------------------------------------------- 1994 ..................................... $34.75 $24.13 $1.04 -------------------------------------------------------------------------------------------------------------------------- 1995 First Quarter........................ $28.50 $24.88 $0.26 --------------------------------------------------------------------------------------------------------------------------
Consolidated Statements of Income (Unaudited) ------------------------------------------------------------------------------------------------------------
Three Months Ended March 31 (in thousands of dollars except per share amounts) 1995 1994 ------------------------------------------------------------------------------------------------------------ Total Interest Income $214,585 $193,696 Total Interest Expense 112,264 77,789 ------------------------------------------------------------------------------------------------------------ Net Interest Income 102,321 115,907 Provision for Possible Loan Losses 4,453 8,258 ------------------------------------------------------------------------------------------------------------ Net Interest Income After Provision for Possible Loan Losses 97,868 107,649 Total Non-Interest Income 39,811 35,874 Total Non-Interest Expense 91,055 88,244 ------------------------------------------------------------------------------------------------------------ Income Before Income Taxes 46,624 55,279 Provision for Income Taxes 18,376 20,887 ------------------------------------------------------------------------------------------------------------ Net Income $28,248 $34,392 ============================================================================================================ Earnings Per Common Share and Common Share Equivalents $0.67 $0.80 ------------------------------------------------------------------------------------------------------------ Average Common Shares and Common Share Equivalents Outstanding 42,137,738 42,943,711 ------------------------------------------------------------------------------------------------------------
Consolidated Statements of Condition (Unaudited) ------------------------------------------------------------------------------------------------------------
March 31 December 31 March 31 1995 1994 1994 ------------------------------------------------------------------------------------------------------------ Assets Interest-Bearing Deposits $532,726 $727,016 $999,991 Investment Securities (Market Value of $3,122,587, $3,101,584 and $3,593,559, respectively) 3,152,518 3,150,885 3,582,077 Funds Sold 79,755 54,167 115,747 Loans 7,756,208 7,891,993 7,366,639 Unearned Income (141,860) (144,034) (146,610) Reserve for Possible Loan Losses (150,377) (148,508) (130,064) Net Loans 7,463,971 7,599,451 7,089,965 ------------------------------------------------------------------------------------------------------------ Total Earning Assets 11,228,970 11,531,519 11,787,780 Cash and Non-Interest Bearing Deposits 387,505 508,762 596,504 Premises and Equipment 227,700 221,806 176,765 Other Assets 353,674 324,263 316,834 ------------------------------------------------------------------------------------------------------------ Total Assets $12,197,849 $12,586,350 $12,877,883 ============================================================================================================ Liabilities Deposits $6,776,133 $7,115,054 $7,339,933 Securities Sold Under Agreements to Repurchase 2,139,973 2,136,204 2,500,148 Funds Purchased 489,549 609,574 610,471 Short-Term Borrowings 574,148 594,475 766,177 Other Liabilities 353,219 302,683 318,010 Long-Term Debt 862,445 861,572 389,882 ------------------------------------------------------------------------------------------------------------ Total Liabilities 11,195,467 11,619,562 11,924,621 Shareholders' Equity Common Stock ($2 par value), authorized 100,000,000 shares; outstanding, March 1995 - 41,908,241; December 1994 - 41,851,466; March 1994 - 42,564,920; 83,816 83,703 85,130 Surplus 261,003 260,040 282,280 Unrealized Valuation Adjustments (977) (18,122) (4,995) Retained Earnings 658,540 641,167 590,847 ------------------------------------------------------------------------------------------------------------ Total Shareholders' Equity 1,002,382 966,788 953,262 ------------------------------------------------------------------------------------------------------------ Total Liabilities and Shareholders' Equity $12,197,849 $12,586,350 $12,877,883 ============================================================================================================
Starting in 1995, Bancorp Hawaii will discontinue mailing quarterly reports to shareholders whose stock is held in "street name," for example through brokerage houses. Bancorp can more quickly communicate the company's performance through direct mail to these shareholders. If your Bancorp stock is held in "street name" and you wish to continue receiving Bancorp's quarterly reports, please complete the address form and return it to Bancorp. Bancorp shareholders with stock held in their own name are not affected and will continue to receive quarterly reports as usual. Annual reports and proxy materials will continue to be sent to all shareholders. ----------------------------------------------------------------- My Bancorp Hawaii stock is held in "street name." Please continue to send me Bancorp Hawaii, Inc., quarterly reports during 1995 at the following address. Please print or type NAME_____________________________________________________________ ADDRESS__________________________________________________________ CITY_____________________________STATE_____________ZIP___________ TELEPHONE________________________________________________________ Clip and mail this form to: Bancorp Hawaii, Inc. Corporate Secretary P. O. Box 2900 Honolulu, Hawaii 96846
 

9 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED STATEMENTS OF CONDITION AND CONSOLIDATED STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 6-MOS DEC-31-1994 JUN-30-1995 474554 752923 234900 566 1543324 1574160 1565095 7704174 150302 12573651 7003918 3285863 362714 877640 83042 0 0 937826 12573651 317506 98687 20222 436415 113969 226947 209468 8573 2104 184744 91940 91940 0 0 56796 1.35 1.35 3.71 49420 15966 0 0 148508 15907 8484 150302 0 0 0