O‘AHU — Bank of Hawaii Corporation reported on Monday diluted earnings per share of $0.61 for the third quarter of 2003, up 27.1 percent from diluted earnings per share of $0.48 in the second quarter of 2003 and up 41.9
O‘AHU — Bank of Hawaii Corporation reported on Monday diluted earnings per share of $0.61 for the third quarter of 2003, up 27.1 percent from diluted earnings per share of $0.48 in the second quarter of 2003 and up 41.9 percent from $0.43 in the third quarter last year.
Net income for the quarter was $36.7 million, up 22.2 percent from $30.0 million in the previous quarter and up 21.5 percent from $30.2 million in the same quarter last year.
The return on average assets for the third quarter of 2003 was 1.53 percent,, up from 1.27 percent in the second quarter of 2003 and up from 1.22 percent in the third quarter of 2002.
The return on average equity was 16.69 percent during the quarter, up 29-1 percent from 12.93 percent in the previous quarter and up 60.5 percent from 10-40 percent in the same quarter last year.
“I am pleased by the Company’s third quarter financial results,” said Michael E. O’Neill, Chairman, CEO and President. “Our credit quality measures continued to improve, our margin increased, total revenue was up and our expenses am coming down. The Hawai‘i economy is strengthening and, importantly, our businesses are growing. This gives us the confidence to increase our quarterly dividend from $0. 19 per share to $0.30 per share.”
For nine months ended Sept. 30, net income was $96.5 million, up $4.2 million or 4.6 percent from net income of $92.3 million for the same period last year.
Diluted earnings per share were $1.56 for the first nine months of 2003, up 23.8 percent from diluted earnings per share.
The year-to-date return on average assets was
1.37 percent, tip from 1.22 percent for the same nine months in 2002.
The year-to-date return on average equity was 13.95 percent, up from 10. 10 percent for the nine-month period ended Sept. 30, 2002.
Net interest income for the third quarter of 2003 on a fully taxable equivalent basis was $91.1 million, up $0.6 million from the second quarter of 2003 and down $1.1 million from net interest income of S92.2 million in the third quarter of 2002.
The decrease in net interest income from the previous year was largely due to reductions in interest rates. An analysis of the change in net interest income is included in Table 6.
The net interest margin was 4.15 percent for the third quarter of 2003, a 3 basis point increase from 4.12 percent in the previous quarter and a 12 basis point increase from 4.03 percent in the same quarter last year.
The Company did not recognize a provision for loan and lease losses during the third quarter of 2003 and has not recorded a provision for the last five quarters. The allowance for loan and lease losses was reduced $5.3 million from June 30, 2003, which equaled the amount of net charge-offs for the third quarter of 2003.
Non-interest income was $53.8 million for the quarter, an increase of $3.1 million or 6.0 percent compared to non-interest income of $50.7 million in the second quarter of 2003. This improvement was primarily due to a prepayment penalty on a commercial real estate loan and higher insurance income- Non-interest income was up $6.8 million, or 14.4 percent from noninterest income of $47.0 million in the third quarter of 2002.
The improvement from the prior year quarter was largely due to higher levels of service charge and fee income, growth in insurance revenue and increased mortgage banking income.
Non-interest expense was $88.9 million in the third quarter of 2003, including $4.4 million in systems replacement costs. Non-interest expense for the second quarter of 2003 included $10.1 million in systems replacement costs. Excluding these costs, non-interest expense was $84.5 million in the third quarter of 2003, down $0.9 million compared to the previous quarter as reductions in salary and equipment expenses related to the systems replacement project were partially offset by a contribution to the Bank of Hawaii Charitable Foundation.
Non-interest expense for the third quarter of 2002 included $6.6 million in systems replacement costs. Excluding these costs, non-interest expense decreased 5O.6 million from the same quarter last year.
The efficiency ratio was 61-3 percent for the third quarter of 2003. Excluding systems replacement costs, the efficiency ratio was 58.3 percent, a significant improvement compared to 60.4 percent in the previous quarter and 61.2 percent in the same quarter last year. For the ninemonth period ended Sept. 30, 2003, the efficiency ratio, excluding systems replacement and net restructuring costs was 59.9 percent compared to 61.7 percent in the comparable period last year.
The Company’s business segments are defined as Retail Banking, Commercial Banking, Investment Services Group, and Treasury and Other Corporate.
Results are determined based on the Company’s internal financial management reporting process and organizational structure.
Previously reported results have been reclassified to conform to current methodology for allocating interest income among the segments.
