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Bank of Hawaii Corp. Reports Operating Results (10-Q)

April 23, 2012 | About:
10qk

10qk

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Bank of Hawaii Corp. (BOH) filed Quarterly Report for the period ended 2012-03-31.

Bank Of Hawaii has a market cap of $2.19 billion; its shares were traded at around $48.11 with a P/E ratio of 14.1 and P/S ratio of 3.4. The dividend yield of Bank Of Hawaii stocks is 3.8%. Bank Of Hawaii had an annual average earning growth of 3.1% over the past 10 years.
This is the annual revenues and earnings per share of BOH over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of BOH.


Highlight of Business Operations:

Gross gains on the sales of investment securities were $0.2 million and $10.3 million for the three months ended March 31, 2012 and 2011, respectively. Gross losses on the sales of investment securities were $0.3 million and $4.2 million for the three months ended March 31, 2012 and 2011, respectively.

Hawaii’s economy was stable with continued improvement in certain aspects, particularly in tourism, during the first two months of 2012. For the first two months of 2012, total visitor arrivals increased by 6.7% and visitor spending increased by 11.4% compared to the same period in 2011. The increase in visitor spending was primarily due to strong spending growth from visitors from Japan and Canada. Hotel occupancy and revenue per available room also continued to improve. Overall, state job growth has begun to stabilize as the statewide seasonally-adjusted unemployment rate was 6.4% in March 2012, compared to 8.2% nationally. For the first three months of 2012, the volume of single-family home sales on Oahu was slightly lower than the same period in 2011, while the median price of single-family homes sold was higher compared to the same period in 2011. Months of inventory continued to remain low at approximately 4 months as of March 31, 2012.

Net income for the first quarter of 2012 was $43.8 million, an increase of $1.5 million or 3% compared to the same period in 2011. Diluted earnings per share were $0.95 for the first quarter of 2012, an increase of $0.07 or 8% compared to the same period in 2011. Higher net income for the first quarter of 2012 was primarily due to the following:

Average balances of our earning assets increased by $700.4 million or 6% in the first quarter of 2012 compared to the same period in 2011, primarily due to a $641.0 million increase in average balances of our investment securities portfolio. In 2011 and during the first quarter of 2012, we reduced our holdings in mortgage-backed securities issued by the Government National Mortgage Association (“Ginnie Mae”). Average balances of our mortgage-backed securities issued by Ginnie Mae decreased by $487.8 million in the first quarter of 2012 compared to the same period in 2011. We invested our excess liquidity into U. S. Treasury notes, municipal bonds, and securities issued by the Small Business Administration (the “SBA”) in an effort to manage extension risk related to our mortgage-backed securities. Average balances of our investments in U.S. Treasury notes increased by $263.8 million, average balances of our municipal bond holdings increased by $426.6 million, and average balances of our SBA securities increased by $419.9 million in the first quarter of 2012 compared to the same period in 2011. Also contributing to the increase in our average balances of earning assets was a $251.5 million increase in average loan and lease balances primarily due to a $163.8 million increase in the average balance of our residential mortgage loan portfolio primarily due to our decision to retain additional conforming saleable loans in our portfolio as well as a $90.4 million increase in the average balance of our commercial mortgage portfolio due to new business activity.

Mortgage banking income is highly influenced by mortgage interest rates and the housing market. Mortgage banking income increased by $1.9 million or 62% in the first quarter of 2012 compared to the same period in 2011. This increase was primarily due to a $2.3 million increase in net gains related to the fair value of mortgage-related derivative financial instruments, the result of higher loan origination volume and favorable interest rate movements. Residential mortgage loan originations were $293.8 million in the first quarter of 2012, a $42.1 million or 17% increase compared to the same period in 2011. Residential mortgage loan sales were $98.7 million in the first quarter of 2012, a $60.8 million or 38% decrease compared to the same period in 2011. This decrease was primarily due to our decision to retain additional conforming saleable loans in our portfolio.

Read the The complete Report

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