HONOLULU, Oct. 30, 2015 /PRNewswire/ -- American
Savings Bank, F.S.B. (American), a
wholly-owned indirect subsidiary of Hawaiian Electric Industries,
Inc. (HEI) (NYSE - HE), today reported net income for the
third quarter of 2015 of $13.5
million, compared to $12.9
million in the second (or linked) quarter of 2015 and
$13.3 million in the third
quarter of 2014.
"In the third quarter, we achieved solid revenue growth
and healthy loan growth fueled by commercial real estate
originations," said Rich Wacker,
president and chief executive officer of American. "We
continue to see good opportunities to expand our relationships with
our consumer and commercial customers, supported by favorable
Hawaii economic conditions.
Third quarter 2015 net income was $0.6
million higher than the linked quarter primarily driven by
(on an after-tax basis):
- $1 million higher net interest
income primarily driven by higher average interest-earning assets
and favorable shift to higher yielding assets; and
- $1 million higher noninterest
income primarily due to the gain on sale of an American service
center building vacated as part of our facilities consolidation
plan; partially offset by
- $1 million higher provision for loan losses primarily due
to strong loan growth in the quarter; and
- $1 million higher noninterest
expense.
Compared to the third quarter of 2014, net income was higher by
$0.2 million primarily driven by (on
an after-tax basis):
- $1 million higher net interest
income in the third quarter of 2015 primarily due to higher average
interest earnings assets; and
- $2 million higher noninterest
income primarily from the gain on sale of real estate and higher
fee income on deposit liabilities and mortgage banking in the third
quarter of 2015; offset by
- $1 million higher provision for
loan losses attributable to higher loan growth; and
- $2 million higher noninterest
expense in the third quarter of 2015 due primarily to higher
pension and benefits expense.
Note: Amounts indicated as "after-tax" in this earnings
release are based upon adjusting items for the composite statutory
tax rate of 40% for American.
Net interest income (pretax) was $47.8
million in the third quarter of 2015 compared to
$46.6 million in the linked
quarter of 2015 and $45.6 million in
the prior year quarter. Net interest margin was 3.53% in the
third quarter of 2015 compared to 3.52% in the linked quarter and
3.62% in the third quarter of 2014. Compared to the prior
year quarter, the decline in net interest margin was largely
attributable to lower yields on interest earning assets as loans
continued to re-price down.
Provision for loan losses (pretax) was $3.0 million in the third quarter of 2015
compared to $1.8 million in the
linked quarter of 2015 and $1.6 million in the third quarter of
2014. The higher provision in the third quarter of 2015 was
mainly due to loan growth in the commercial real estate
portfolio. The third quarter 2015 net charge-off ratio was
0.10%, compared to 0.11% in the linked quarter and 0.04% in the
prior year quarter due to higher overall recoveries in the third
quarter of 2014.
Noninterest income (pretax) was $18.5
million in the third quarter of 2015, compared to
$16.4 million in the linked
quarter and $15.2 million in the
third quarter of 2014. The increase in noninterest income
over both the linked quarter and the prior year quarter was mainly
due to the $2 million gain on sale of
real estate and higher deposit-related fee initiatives in the third
quarter of 2015.
Noninterest expense (pretax) was $42.4
million in the third quarter of 2015, compared to
$41.5 million in the linked
quarter and $38.7 million in the
third quarter of 2014. Noninterest expense was $0.9 million higher compared to the linked
quarter primarily due to higher medical benefits and other
expense. Noninterest expense was $3.7
million higher than the prior year quarter primarily due to
higher medical and pension benefits expense.
Total loans were $4.5 billion at
September 30, 2015, an increase of
$78 million and $101 million in the third quarter and
year-to-date 2015, respectively. Year-to-date annualized loan
growth was 3%.
Total deposits were $4.8 billion
at September 30, 2015, an increase of
$23 million and $203 million in the third quarter and
year-to-date 2015, respectively, primarily driven by the 5%
year-to-date annualized increase in low-cost core deposits.
Average cost of funds remained low at 0.22% for the third quarter
of 2015, unchanged compared to the linked quarter and just below
the prior year quarter of 0.23%.
American's return on average equity was 9.7% for the third
quarter of 2015, compared to 9.4% in the linked quarter and 9.9% in
the third quarter of last year. Return on average assets was
0.92% for the third quarter of 2015, compared to 0.89% for the
linked quarter and 0.98% in the same quarter last year.
American's solid results enabled it to pay a dividend of
$7.5 million to HEI in the quarter
while maintaining healthy capital levels - leverage ratio of 8.8%
and total capital ratio of 13.4% at September 30, 2015.
HEI EARNINGS RELEASE, HEI WEBCAST AND CONFERENCE CALL TO
DISCUSS EARNINGS AND 2015 EPS GUIDANCE
Concurrent with American's regulatory filing 30 days after the
end of the quarter, American announced its third quarter 2015
financial results today. Please note that these reported
results relate only to American and are not necessarily indicative
of HEI's consolidated financial results for the third quarter of
2015.
HEI plans to announce its third quarter 2015 consolidated
financial results on Thursday, November 5, 2015, and will
conduct a webcast and conference call to discuss its consolidated
earnings, including American's earnings, and 2015 EPS guidance on
Thursday, November 5, 2015, at 12:00
noon Hawaii time (5:00 p.m. Eastern time). Interested parties
may listen to the conference call by dialing (888) 311-8190 and
entering passcode: 22822426. International parties may listen
to the conference call by calling the following toll free number,
(330) 863-3378 and entering passcode: 22822426. The
event can also be accessed through HEI's website at www.hei.com
under the heading "Investor Relations." HEI and Hawaiian
Electric Company, Inc. (Hawaiian Electric) intend to continue to
use HEI's website, www.hei.com, as a means of disclosing additional
information which will be included in the Investor Relations
section. Accordingly, investors should routinely monitor such
portions of HEI's website, in addition to following HEI's, Hawaiian
Electric's and American's press releases, HEI's and Hawaiian
Electric's Securities and Exchange Commission (SEC) filings and
HEI's public conference calls and webcasts. The information
on HEI's website is not incorporated by reference in this document
or in HEI's and Hawaiian Electric's SEC filings unless, and except
to the extent, specifically incorporated by reference.
Investors may also wish to refer to the Public Utilities Commission
of the State of Hawaii (PUC)
website at dms.puc.hawaii.gov/dms in order to review documents
filed with and issued by the PUC. No information on the PUC
website is incorporated by reference in this document or in HEI's
and Hawaiian Electric's SEC filings.
An on-line replay of the webcast will be available at the same
website beginning about two hours after the event. Audio
replays of the teleconference will also be available approximately
two hours after the event through November
19, 2015, by dialing (855) 859-2056 or (404) 537-3406
and entering passcode: 22822426.
HEI supplies power to approximately 450,000 customers or 95% of
Hawaii's population through its
electric utilities, Hawaiian Electric Company, Inc., Hawaii
Electric Light Company, Inc. and Maui Electric Company, Limited and
provides a wide array of banking and other financial services to
consumers and businesses through American, one of Hawaii's largest financial institutions.
FORWARD-LOOKING STATEMENTS
This release may contain "forward-looking statements," which
include statements that are predictive in nature, depend upon or
refer to future events or conditions, and usually include words
such as "expects," "anticipates," "intends," "plans," "believes,"
"predicts," "estimates" or similar expressions. In addition,
any statements concerning future financial performance, ongoing
business strategies or prospects or possible future actions are
also forward-looking statements. Forward-looking statements
are based on current expectations and projections about future
events and are subject to risks, uncertainties and the accuracy of
assumptions concerning HEI and its subsidiaries, the performance of
the industries in which they do business and economic and market
factors, among other things. These forward-looking statements
are not guarantees of future performance.
Forward-looking statements in this release should be read in
conjunction with the "Forward-Looking Statements" and "Risk
Factors" discussions (which are incorporated by reference herein)
set forth in HEI's Annual Report on Form 10-K for the year ended
December 31, 2014, HEI's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2015 and HEI's future periodic reports
that discuss important factors that could cause HEI's results to
differ materially from those anticipated in such statements.
These forward-looking statements speak only as of the date of the
report, presentation or filing in which they are made. Except
to the extent required by the federal securities laws, HEI,
Hawaiian Electric, American and their subsidiaries undertake no
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
|
American Savings
Bank, F.S.B.
|
|
STATEMENTS OF INCOME
DATA
|
|
(Unaudited)
|
|
|
|
Three months
ended
|
|
Nine months ended
September 30
|
|
(in thousands)
|
|
September 30,
2015
|
|
June 30,
2015
|
|
September 30,
2014
|
|
2015
|
|
2014
|
|
Interest and
dividend income
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on
loans
|
|
$
|
46,413
|
|
|
$
|
46,035
|
|
|
$
|
45,532
|
|
|
$
|
137,646
|
|
|
$
|
133,065
|
|
|
Interest and
dividends on investment securities
|
|
4,213
|
|
|
3,306
|
|
|
2,773
|
|
|
10,570
|
|
|
8,758
|
|
|
Total interest and
dividend income
|
|
50,626
|
|
|
49,341
|
|
|
48,305
|
|
|
148,216
|
|
|
141,823
|
|
|
Interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
Interest on deposit
liabilities
|
|
1,355
|
|
|
1,266
|
|
|
1,312
|
|
|
3,881
|
|
|
3,774
|
|
|
Interest on other
borrowings
|
|
1,515
|
|
|
1,487
|
|
|
1,438
|
|
|
4,468
|
|
|
4,263
|
|
|
Total interest
expense
|
|
2,870
|
|
|
2,753
|
|
|
2,750
|
|
|
8,349
|
|
|
8,037
|
|
|
Net interest
income
|
|
47,756
|
|
|
46,588
|
|
|
45,555
|
|
|
139,867
|
|
|
133,786
|
|
|
Provision for loan
losses
|
|
2,997
|
|
|
1,825
|
|
|
1,550
|
|
|
5,436
|
|
|
3,566
|
|
|
Net interest
income after provision for loan losses
|
|
44,759
|
|
|
44,763
|
|
|
44,005
|
|
|
134,431
|
|
|
130,220
|
|
|
Noninterest
income
|
|
|
|
|
|
|
|
|
|
|
|
Fees from other
financial services
|
|
5,639
|
|
|
5,550
|
|
|
5,642
|
|
|
16,544
|
|
|
15,987
|
|
|
Fee income on deposit
liabilities
|
|
5,883
|
|
|
5,424
|
|
|
5,109
|
|
|
16,622
|
|
|
14,175
|
|
|
Fee income on other
financial products
|
|
2,096
|
|
|
2,103
|
|
|
1,971
|
|
|
6,088
|
|
|
6,325
|
|
|
Bank-owned life
insurance
|
|
1,021
|
|
|
1,058
|
|
|
1,000
|
|
|
3,062
|
|
|
2,945
|
|
|
Mortgage banking
income
|
|
1,437
|
|
|
2,068
|
|
|
875
|
|
|
5,327
|
|
|
1,749
|
|
|
Gains on sale of
investment securities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,847
|
|
|
Other income,
net
|
|
2,389
|
|
|
239
|
|
|
634
|
|
|
3,363
|
|
|
1,920
|
|
|
Total noninterest
income
|
|
18,465
|
|
|
16,442
|
|
|
15,231
|
|
|
51,006
|
|
|
45,948
|
|
|
Noninterest
expense
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
employee benefits
|
|
22,728
|
|
|
22,319
|
|
|
19,892
|
|
|
66,813
|
|
|
60,050
|
|
|
Occupancy
|
|
4,128
|
|
|
4,009
|
|
|
4,517
|
|
|
12,250
|
|
|
12,959
|
|
|
Data
processing
|
|
3,032
|
|
|
2,953
|
|
|
2,684
|
|
|
9,101
|
|
|
8,715
|
|
|
Services
|
|
2,556
|
|
|
2,833
|
|
|
2,580
|
|
|
7,730
|
|
|
7,708
|
|
|
Equipment
|
|
1,608
|
|
|
1,690
|
|
|
1,672
|
|
|
4,999
|
|
|
4,926
|
|
|
Office supplies,
printing and postage
|
|
1,511
|
|
|
1,303
|
|
|
1,415
|
|
|
4,297
|
|
|
4,487
|
|
|
Marketing
|
|
934
|
|
|
844
|
|
|
948
|
|
|
2,619
|
|
|
2,690
|
|
|
FDIC
insurance
|
|
809
|
|
|
773
|
|
|
840
|
|
|
2,393
|
|
|
2,441
|
|
|
Other
expense
|
|
5,116
|
|
|
4,755
|
|
|
4,182
|
|
|
14,076
|
|
|
11,198
|
|
|
Total noninterest
expense
|
|
42,422
|
|
|
41,479
|
|
|
38,730
|
|
|
124,278
|
|
|
115,174
|
|
|
Income before
income taxes
|
|
20,802
|
|
|
19,726
|
|
|
20,506
|
|
|
61,159
|
|
|
60,994
|
|
|
Income
taxes
|
|
7,351
|
|
|
6,875
|
|
|
7,253
|
|
|
21,382
|
|
|
21,806
|
|
|
Net
income
|
|
$
|
13,451
|
|
|
$
|
12,851
|
|
|
$
|
13,253
|
|
|
$
|
39,777
|
|
|
$
|
39,188
|
|
|
Comprehensive
income
|
|
$
|
17,678
|
|
|
$
|
9,544
|
|
|
$
|
11,804
|
|
|
$
|
44,540
|
|
|
$
|
41,521
|
|
|
OTHER BANK
INFORMATION (annualized %, except as of period end)
|
|
|
|
|
|
|
|
|
|
Return on average
assets
|
|
0.92
|
|
|
0.89
|
|
|
0.98
|
|
|
0.92
|
|
|
0.97
|
|
|
Return on average
equity
|
|
9.73
|
|
|
9.38
|
|
|
9.88
|
|
|
9.69
|
|
|
9.83
|
|
|
Return on average
tangible common equity
|
|
11.43
|
|
|
11.04
|
|
|
11.67
|
|
|
11.40
|
|
|
11.63
|
|
|
Net interest
margin
|
|
3.53
|
|
|
3.52
|
|
|
3.62
|
|
|
3.52
|
|
|
3.60
|
|
|
Net charge-offs to
average loans outstanding
|
|
0.10
|
|
|
0.11
|
|
|
0.04
|
|
|
0.08
|
|
|
0.01
|
|
|
As of period
end
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming assets
to loans outstanding and real estate owned *
|
|
1.00
|
|
|
0.70
|
|
|
0.88
|
|
|
|
|
|
|
Allowance for loan
losses to loans outstanding
|
|
1.06
|
|
|
1.04
|
|
|
1.00
|
|
|
|
|
|
|
Tangible common
equity to tangible assets
|
|
8.23
|
|
|
8.16
|
|
|
8.48
|
|
|
|
|
|
|
Tier-1 leverage ratio
*
|
|
8.8
|
|
|
8.8
|
|
|
9.1
|
|
|
|
|
|
|
Total capital ratio
*
|
|
13.4
|
|
|
13.5
|
|
|
12.6
|
|
|
|
|
|
|
Dividend paid to HEI
(via ASB Hawaii, Inc.) ($ in millions)
|
|
$
|
7.5
|
|
|
$
|
7.5
|
|
|
$
|
8.8
|
|
|
|
|
|
|
|
|
*
|
Regulatory basis.
Capital ratios as of September 30, 2015 and June 30, 2015
calculated under Basel III rules, which became effective January 1,
2015.
|
|
|
|
Prior period
financial statements reflect the retrospective application of
Accounting Standards Update (ASU) No. 2014-01, "Investments-Equity
Method and Joint Ventures (Topic 323): Accounting for Investments
in Qualified Affordable Housing Projects," which was adopted as of
January 1, 2015 and did not have a material impact on ASB's
financial condition or results of operations.
|
|
|
This information
should be read in conjunction with the consolidated financial
statements and the notes thereto in HEI's Annual Report on
SEC Form 10-K for the year ended December 31, 2014, ASB Hawaii,
Inc.'s Form 10 filed with the SEC on March 30, 2015 and HEI's
Quarterly Reports on SEC Form 10-Q for the quarters ended March 31,
2015, June 30, 2015 and September 30, 2015 (when filed), as updated
by SEC Forms 8-K. Results of operations for interim periods are not
necessarily indicative of results to be expected for future interim
periods or the full year.
|
|
American Savings
Bank, F.S.B.
|
|
BALANCE SHEETS
DATA
|
|
(Unaudited)
|
|
|
September 30,
2015
|
December 31,
2014
|
|
(in
thousands)
|
|
|
|
|
|
Assets
|
|
|
|
|
|
Cash and due from
banks
|
|
$
|
103,934
|
|
|
$
|
107,233
|
|
|
Interest-bearing
deposits
|
|
73,041
|
|
|
54,230
|
|
|
Available-for-sale
investment securities, at fair value
|
|
785,837
|
|
|
550,394
|
|
|
Stock in Federal Home
Loan Bank, at cost
|
|
10,678
|
|
|
69,302
|
|
|
Loans receivable held
for investment
|
|
4,535,404
|
|
|
4,434,651
|
|
|
Allowance for loan
losses
|
|
(48,274)
|
|
|
(45,618)
|
|
|
Net loans
|
|
4,487,130
|
|
|
4,389,033
|
|
|
Loans held for sale,
at lower of cost or fair value
|
|
5,598
|
|
|
8,424
|
|
|
Other
|
|
307,089
|
|
|
305,416
|
|
|
Goodwill
|
|
82,190
|
|
|
82,190
|
|
|
Total
assets
|
|
$
|
5,855,497
|
|
|
$
|
5,566,222
|
|
|
Liabilities and
shareholder's equity
|
|
|
|
|
|
Deposit
liabilities–noninterest-bearing
|
|
$
|
1,422,843
|
|
|
$
|
1,342,794
|
|
|
Deposit
liabilities–interest-bearing
|
|
3,403,111
|
|
|
3,280,621
|
|
|
Other
borrowings
|
|
368,593
|
|
|
290,656
|
|
|
Other
|
|
103,553
|
|
|
118,363
|
|
|
Total
liabilities
|
|
5,298,100
|
|
|
5,032,434
|
|
|
Common
stock
|
|
1
|
|
|
1
|
|
|
Additional paid in
capital
|
|
339,980
|
|
|
338,411
|
|
|
Retained
earnings
|
|
229,211
|
|
|
211,934
|
|
|
Accumulated other
comprehensive loss, net of tax benefits
|
|
|
|
|
|
Net unrealized gains on
securities
|
$
|
4,070
|
|
|
$
|
462
|
|
|
|
Retirement benefit
plans
|
(15,865)
|
|
(11,795)
|
|
(17,020)
|
|
(16,558)
|
|
|
Total
shareholder's equity
|
|
557,397
|
|
|
533,788
|
|
|
Total liabilities
and shareholder's equity
|
|
$
|
5,855,497
|
|
|
$
|
5,566,222
|
|
|
Prior period
financial statements reflect the retrospective application of
Accounting Standards Update (ASU) No. 2014-01, "Investments-Equity
Method and Joint Ventures (Topic 323): Accounting for Investments
in Qualified Affordable Housing Projects," which was adopted as of
January 1, 2015 and did not have a material impact on ASB's
financial condition or results of operations.
|
|
|
This information
should be read in conjunction with the consolidated financial
statements and the notes thereto in HEI's Annual Report on SEC Form
10-K for the year ended December 31, 2014, ASB Hawaii, Inc.'s Form
10 filed with the SEC on March 30, 2015 and HEI's Quarterly Reports
on SEC Form 10-Q for the quarters ended March 31, 2015, June 30,
2015 and September 30, 2015 (when filed), as updated by SEC Forms
8-K.
|
|
Contact:
|
Clifford H.
Chen
|
|
|
Manager, Investor
Relations &
|
Telephone: (808)
543-7300
|
|
Strategic
Planning
|
E-mail:
ir@hei.com
|
Logo -
http://photos.prnewswire.com/prnh/20110411/LA80136LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/american-savings-bank-reports-third-quarter-2015-earnings-300169401.html
SOURCE Hawaiian Electric Industries, Inc.