American Savings Bank Reports Third Quarter 2024 Financial Results
3Q 2024 Net Income of
-
Net interest margin expanded to
2.82% , up 3 basis points from the prior quarter - Continued strong credit quality and capital position
“American Savings Bank continues to perform well, generating strong net income and profitability while continuing the net interest margin expansion we’ve seen throughout 2024. We remain well-positioned to support our customers and community for the long term, with a strong capital and liquidity position, strong credit quality, and ample lending capacity,” said Ann Teranishi, president and chief executive officer of ASB.
__________
1 See the “Explanation of ASB’s Use of Certain Unaudited Non-GAAP Measures” and the related GAAP reconciliation at the end of this release. |
Financial Highlights
Third quarter 2024 net interest income was
In the third quarter of 2024, ASB recorded a provision for credit losses of
The net charge-off ratio for the third quarter of 2024 was
Noninterest income was
Noninterest expense was
Total loans were
Total deposits were
Wholesale funding totaled
In the third quarter of 2024, ASB did not pay a dividend to HEI, supporting ASB’s healthy capital levels. ASB had a Tier 1 leverage ratio of
HEI EARNINGS RELEASE, HEI WEBCAST AND CONFERENCE CALL TO DISCUSS EARNINGS
Concurrent with ASB’s regulatory filing 30 days after the end of the quarter, ASB announced its third quarter 2024 financial results today. Please note that these reported results relate only to ASB and are not necessarily indicative of HEI’s consolidated financial results for the third quarter 2024.
HEI plans to announce its third quarter 2024 consolidated financial results on Friday, November 8, 2024 and will also conduct a webcast and conference call at 11:30 a.m.
To listen to the conference call, dial 1-888-660-6377 (
A replay will be available online and via phone. The online replay will be available on HEI’s website about two hours after the event. An audio replay will also be available about two hours after the event through November 22, 2024. To access the audio replay, dial 1-800-770-2030 (
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; such disclosures will be included in the Investor Relations section of the website. Accordingly, investors should routinely monitor the Investor Relations section of HEI’s website, in addition to following HEI’s, Hawaiian Electric’s and ASB’s press releases, HEI’s and Hawaiian Electric’s Securities and Exchange Commission (SEC) filings and HEI’s public conference calls and webcasts. Investors may sign up to receive e-mail alerts via the Investor Relations section of the website. The information on HEI’s website is not incorporated by reference into this document or into 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
The HEI family of companies provides the energy and financial services that empower much of the economic and community activity of
NON-GAAP MEASURES
Measures described as “core” are non-GAAP measures which exclude after-tax
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 “will,” “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, political 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 “Cautionary Note Regarding 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, 2023 and HEI’s other 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, ASB 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,
|
|
June 30,
|
|
September 30,
|
|
|
2024 |
|
|
|
2023 |
|||||
Interest and dividend income |
|
|
|
|
|
|
|
|
|
|
||||||||
Interest and fees on loans |
|
$ |
73,654 |
|
$ |
72,960 |
|
|
$ |
71,540 |
|
|
$ |
219,585 |
|
|
$ |
204,348 |
Interest and dividends on investment securities |
|
|
14,001 |
|
|
13,218 |
|
|
|
14,096 |
|
|
|
42,183 |
|
|
|
42,508 |
Total interest and dividend income |
|
|
87,655 |
|
|
86,178 |
|
|
|
85,636 |
|
|
|
261,768 |
|
|
|
246,856 |
Interest expense |
|
|
|
|
|
|
|
|
|
|
||||||||
Interest on deposit liabilities |
|
|
19,018 |
|
|
18,015 |
|
|
|
14,446 |
|
|
|
54,465 |
|
|
|
30,944 |
Interest on other borrowings |
|
|
6,403 |
|
|
6,479 |
|
|
|
8,598 |
|
|
|
21,036 |
|
|
|
25,171 |
Total interest expense |
|
|
25,421 |
|
|
24,494 |
|
|
|
23,044 |
|
|
|
75,501 |
|
|
|
56,115 |
Net interest income |
|
|
62,234 |
|
|
61,684 |
|
|
|
62,592 |
|
|
|
186,267 |
|
|
|
190,741 |
Provision for credit losses |
|
|
248 |
|
|
(1,910 |
) |
|
|
8,835 |
|
|
|
(3,821 |
) |
|
|
10,053 |
Net interest income after provision for credit losses |
|
|
61,986 |
|
|
63,594 |
|
|
|
53,757 |
|
|
|
190,088 |
|
|
|
180,688 |
Noninterest income |
|
|
|
|
|
|
|
|
|
|
||||||||
Fees from other financial services |
|
|
5,188 |
|
|
5,133 |
|
|
|
4,703 |
|
|
|
15,195 |
|
|
|
14,391 |
Fee income on deposit liabilities |
|
|
5,156 |
|
|
4,630 |
|
|
|
4,924 |
|
|
|
14,684 |
|
|
|
14,027 |
Fee income on other financial products |
|
|
3,131 |
|
|
2,960 |
|
|
|
2,440 |
|
|
|
8,834 |
|
|
|
7,952 |
Bank-owned life insurance |
|
|
2,993 |
|
|
2,255 |
|
|
|
2,303 |
|
|
|
8,832 |
|
|
|
5,683 |
Mortgage banking income |
|
|
363 |
|
|
364 |
|
|
|
341 |
|
|
|
1,151 |
|
|
|
701 |
Gain on sale of real estate |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
495 |
Other income, net |
|
|
658 |
|
|
423 |
|
|
|
627 |
|
|
|
1,767 |
|
|
|
2,106 |
Total noninterest income |
|
|
17,489 |
|
|
15,765 |
|
|
|
15,338 |
|
|
|
50,463 |
|
|
|
45,355 |
Noninterest expense |
|
|
|
|
|
|
|
|
|
|
||||||||
Compensation and employee benefits |
|
|
31,485 |
|
|
29,802 |
|
|
|
29,902 |
|
|
|
93,746 |
|
|
|
89,500 |
Occupancy |
|
|
5,630 |
|
|
5,220 |
|
|
|
5,154 |
|
|
|
15,913 |
|
|
|
16,281 |
Data processing |
|
|
4,974 |
|
|
4,960 |
|
|
|
5,133 |
|
|
|
14,780 |
|
|
|
15,240 |
Services |
|
|
3,816 |
|
|
4,250 |
|
|
|
3,627 |
|
|
|
12,217 |
|
|
|
8,911 |
Equipment |
|
|
2,436 |
|
|
2,477 |
|
|
|
3,125 |
|
|
|
7,562 |
|
|
|
8,728 |
Office supplies, printing and postage |
|
|
1,014 |
|
|
1,006 |
|
|
|
1,022 |
|
|
|
3,038 |
|
|
|
3,296 |
Marketing |
|
|
885 |
|
|
747 |
|
|
|
984 |
|
|
|
2,408 |
|
|
|
2,834 |
Goodwill impairment |
|
|
— |
|
|
82,190 |
|
|
|
— |
|
|
|
82,190 |
|
|
|
— |
Other expense |
|
|
5,806 |
|
|
5,813 |
|
|
|
7,399 |
|
|
|
16,561 |
|
|
|
19,742 |
Total noninterest expense |
|
|
56,046 |
|
|
136,465 |
|
|
|
56,346 |
|
|
|
248,415 |
|
|
|
164,532 |
Income (loss) before income taxes |
|
|
23,429 |
|
|
(57,106 |
) |
|
|
12,749 |
|
|
|
(7,864 |
) |
|
|
61,511 |
Income tax expense (benefit) |
|
|
4,651 |
|
|
(11,319 |
) |
|
|
1,384 |
|
|
|
(1,789 |
) |
|
|
11,380 |
Net income (loss) |
|
$ |
18,778 |
|
$ |
(45,787 |
) |
|
$ |
11,365 |
|
|
$ |
(6,075 |
) |
|
$ |
50,131 |
Comprehensive income (loss) |
|
$ |
58,982 |
|
$ |
(44,154 |
) |
|
$ |
(22,866 |
) |
|
$ |
25,994 |
|
|
$ |
27,120 |
OTHER BANK INFORMATION (annualized %, except as of period end) |
|
|
|
|
|
|
|
|
||||||||||
Return on average assets |
|
|
0.81 |
|
|
(1.97 |
) |
|
|
0.47 |
|
|
|
(0.09 |
) |
|
|
0.70 |
Return on average equity |
|
|
14.28 |
|
|
(33.97 |
) |
|
|
9.19 |
|
|
|
(1.52 |
) |
|
|
13.62 |
Return on average tangible common equity |
|
|
14.28 |
|
|
(39.84 |
) |
|
|
11.02 |
|
|
|
(1.69 |
) |
|
|
16.36 |
Net interest margin |
|
|
2.82 |
|
|
2.79 |
|
|
|
2.70 |
|
|
|
2.78 |
|
|
|
2.77 |
Efficiency ratio |
|
|
70.30 |
|
|
176.20 |
|
|
|
72.30 |
|
|
|
104.94 |
|
|
|
69.69 |
Net charge-offs to average loans outstanding |
|
|
0.15 |
|
|
0.15 |
|
|
|
0.07 |
|
|
|
0.15 |
|
|
|
0.11 |
As of period end |
|
|
|
|
|
|
|
|
|
|
||||||||
Nonaccrual loans to loans receivable held for investment |
|
|
0.42 |
|
|
0.53 |
|
|
|
0.16 |
|
|
|
|
|
|||
Allowance for credit losses to loans outstanding |
|
|
1.07 |
|
|
1.11 |
|
|
|
1.23 |
|
|
|
|
|
|||
Tangible common equity to tangible assets |
|
|
6.0 |
|
|
5.4 |
|
|
|
3.9 |
|
|
|
|
|
|||
Tier-1 leverage ratio |
|
|
8.6 |
|
|
8.4 |
|
|
|
7.7 |
|
|
|
|
|
|||
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) |
|
$ |
— |
|
$ |
— |
|
|
$ |
14.0 |
|
|
$ |
— |
|
|
$ |
39.0 |
This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. 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) |
||||||||||||
(in thousands) |
September 30, 2024 |
December 31, 2023 |
||||||||||
Assets |
|
|
|
|
||||||||
Cash and due from banks |
|
$ |
155,869 |
|
|
$ |
184,383 |
|
||||
Interest-bearing deposits |
|
|
176,784 |
|
|
|
251,072 |
|
||||
Cash and cash equivalents |
|
|
332,653 |
|
|
|
435,455 |
|
||||
Investment securities |
|
|
|
|
||||||||
Available-for-sale, at fair value |
|
|
1,084,083 |
|
|
|
1,136,439 |
|
||||
Held-to-maturity, at amortized cost |
|
|
1,159,229 |
|
|
|
1,201,314 |
|
||||
Stock in Federal Home Loan Bank, at cost |
|
|
29,204 |
|
|
|
14,728 |
|
||||
Loans held for investment |
|
|
6,037,410 |
|
|
|
6,180,810 |
|
||||
Allowance for credit losses |
|
|
(64,796 |
) |
|
|
(74,372 |
) |
||||
Net loans |
|
|
5,972,614 |
|
|
|
6,106,438 |
|
||||
Loans held for sale, at lower of cost or fair value |
|
|
2,704 |
|
|
|
15,168 |
|
||||
Other |
|
|
687,359 |
|
|
|
681,460 |
|
||||
Goodwill |
|
|
— |
|
|
|
82,190 |
|
||||
Total assets |
|
$ |
9,267,846 |
|
|
$ |
9,673,192 |
|
||||
Liabilities and shareholder’s equity |
|
|
|
|
||||||||
Deposit liabilities–noninterest-bearing |
|
$ |
2,486,717 |
|
|
$ |
2,599,762 |
|
||||
Deposit liabilities–interest-bearing |
|
|
5,512,493 |
|
|
|
5,546,016 |
|
||||
Other borrowings |
|
|
520,000 |
|
|
|
750,000 |
|
||||
Other |
|
|
191,512 |
|
|
|
247,563 |
|
||||
Total liabilities |
|
|
8,710,722 |
|
|
|
9,143,341 |
|
||||
Common stock |
|
|
1 |
|
|
|
1 |
|
||||
Additional paid-in capital |
|
|
359,346 |
|
|
|
358,067 |
|
||||
Retained earnings |
|
|
457,980 |
|
|
|
464,055 |
|
||||
Accumulated other comprehensive loss, net of tax benefits |
|
|
|
|
||||||||
Net unrealized losses on securities |
$ |
(251,703 |
) |
|
$ |
(282,963 |
) |
|
||||
Retirement benefit plans |
|
(8,500 |
) |
|
(260,203 |
) |
|
(9,309 |
) |
|
(292,272 |
) |
Total shareholder’s equity |
|
|
557,124 |
|
|
|
529,851 |
|
||||
Total liabilities and shareholder’s equity |
|
$ |
9,267,846 |
|
|
$ |
9,673,192 |
|
||||
This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. |
Explanation of ASB’s Use of Certain Unaudited Non-GAAP Measures
HEI and ASB management use certain non-GAAP measures to evaluate the performance of HEI and the bank.
Management believes these non-GAAP measures provide useful information and are a better indicator of the companies’ core operating activities. Core earnings and other financial measures as presented here may not be comparable to similarly titled measures used by other companies. The accompanying tables provide a reconciliation of reported GAAP1 earnings to non-GAAP core earnings and returns on average equity and average assets for the bank.
The reconciling adjustments from GAAP earnings to core earnings are limited to the costs related to the
Reconciliation of GAAP to non-GAAP Measures American Savings Bank F.S.B. Unaudited |
||||||||||||||||
|
|
Three months ended September 30 |
|
Nine months ended September 30 |
||||||||||||
(in thousands) |
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
||||||||
Pretax expenses: |
|
|
|
|
|
|
|
|
||||||||
Provision for credit losses |
|
$ |
(200 |
) |
|
$ |
5,900 |
|
|
$ |
(2,500 |
) |
|
$ |
5,900 |
|
Professional services expense |
|
|
1,134 |
|
|
|
1,300 |
|
|
|
4,043 |
|
|
|
1,300 |
|
Other expenses, net |
|
|
(42 |
) |
|
|
1,357 |
|
|
|
(308 |
) |
|
|
1,357 |
|
Pretax Maui wildfire related costs, net |
|
|
892 |
|
|
|
8,557 |
|
|
|
1,235 |
|
|
|
8,557 |
|
Pretax goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
82,190 |
|
|
|
— |
|
Income tax benefit |
|
|
(239 |
) |
|
|
(2,293 |
) |
|
|
(16,391 |
) |
|
|
(2,293 |
) |
After-tax expenses |
|
$ |
653 |
|
|
$ |
6,264 |
|
|
$ |
67,034 |
|
|
$ |
6,264 |
|
|
|
|
|
|
|
|
|
|
||||||||
ASB net income (loss) |
|
|
|
|
|
|
|
|
||||||||
GAAP (as reported) |
|
$ |
18,778 |
|
|
$ |
11,365 |
|
|
$ |
(6,075 |
) |
|
$ |
50,131 |
|
Excluding expense relating to |
|
|
|
|
|
|
|
|
||||||||
Provision for credit losses |
|
|
(146 |
) |
|
|
4,319 |
|
|
|
(1,830 |
) |
|
|
4,319 |
|
Professional services expense |
|
|
830 |
|
|
|
952 |
|
|
|
2,960 |
|
|
|
952 |
|
Other expenses, net |
|
|
(31 |
) |
|
|
993 |
|
|
|
(226 |
) |
|
|
993 |
|
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
66,130 |
|
|
|
— |
|
|
|
|
653 |
|
|
|
6,264 |
|
|
|
67,034 |
|
|
|
6,264 |
|
Non-GAAP (core) net income |
|
$ |
19,431 |
|
|
$ |
17,629 |
|
|
$ |
60,959 |
|
|
$ |
56,395 |
|
1 Accounting principles generally accepted in |
|
|
Three months ended September 30 |
|
Nine months ended September 30 |
|||||
|
|
2024 |
|
2023 |
|
2024 |
|
|
2023 |
Ratios (annualized %) |
|
|
|
|
|
|
|
|
|
Based on GAAP |
|
|
|
|
|
|
|
|
|
Return on average assets |
|
0.81 |
|
0.47 |
|
(0.09 |
) |
|
0.70 |
Return on average equity |
|
14.28 |
|
9.19 |
|
(1.52 |
) |
|
13.62 |
Return on average tangible common equity |
|
14.28 |
|
11.02 |
|
(1.69 |
) |
|
16.36 |
Efficiency ratio |
|
70.30 |
|
72.30 |
|
104.94 |
|
|
69.69 |
Based on Non-GAAP (core) |
|
|
|
|
|
|
|
|
|
Return on average assets |
|
0.84 |
|
0.73 |
|
0.87 |
|
|
0.78 |
Return on average equity |
|
14.78 |
|
14.25 |
|
15.24 |
|
|
15.32 |
Return on average tangible common equity |
|
14.78 |
|
17.09 |
|
16.94 |
|
|
18.40 |
Efficiency ratio |
|
68.93 |
|
68.89 |
|
68.64 |
|
|
68.56 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241030464231/en/
Mateo Garcia
Director, Investor Relations
Telephone: (808) 543-7300
E-mail: ir@hei.com
Source: American Savings Bank
