First Hawaiian Inc's Q4 2024 Earnings: A Strong Finish to the Year

First Hawaiian, Inc. (NASDAQ:FHB) reported its financial results for the quarter ended December 31, 2024, capping off a strong year with robust performance across key earnings drivers. The company's net income for the quarter was $52.5 million, or $0.41 per diluted share, reflecting a decrease from the previous quarter's net income of $61.5 million, or $0.48 per diluted share. However, the company's net interest margin increased by 8 basis points to 3.03%, driven by its ability to reprice deposits to closely match the Federal Reserve's rate cuts in the third and fourth quarters of 2024.

First Hawaiian's loan and deposit balances grew during the quarter, with total loans and leases increasing by $166.9 million, or 1.2%, and total deposits increasing by $94.5 million, or 0.5%. The company's balance sheet remained strong, with a loan-to-deposit ratio of 71% and a well-capitalized position, as evidenced by its 12.8% common equity tier 1 (CET1) ratio. First Hawaiian also maintained its commitment to supporting its communities by contributing $1 million to the First Hawaiian Foundation.



The company's restructuring of its investment portfolio, which involved selling $290.4 million of low-yielding investment securities and reinvesting the sale proceeds into $291.5 million of higher-yielding securities, resulted in a pre-tax loss of $26.2 million ($19.2 million after-tax) on the sale of securities. However, this action is expected to contribute to the company's future earnings power and improve its net interest margin over the long term.

First Hawaiian's Board of Directors declared a quarterly cash dividend of $0.26 per share, payable on February 28, 2025, to stockholders of record at the close of business on February 14, 2025. Additionally, the Board of Directors adopted a stock repurchase program for up to $100.0 million of its outstanding common stock during 2025.

In conclusion, First Hawaiian Inc's Q4 2024 earnings call demonstrated the company's strong performance across key earnings drivers, including loan and deposit growth, an improved net interest margin, and a well-capitalized position. The company's restructuring of its investment portfolio, while resulting in a pre-tax loss in the short term, is expected to contribute to its future earnings power and improve its net interest margin over the long term. With a strong finish to the year, First Hawaiian Inc is well-positioned to continue its growth and success in 2025.