夏威夷银行二季度电话会重申年末净息差接近2.9%并计划三季度回购2000万美元

Earnings Call Insights: Bank of Hawaii (BOH) Q2 2026
CEO James Polk said, "Bank of Hawaii delivered another solid quarter, reflecting continued progress in the underlying earnings power of the franchise," highlighting Q2 diluted EPS of $1.47 and net income of $63.8 million, and noting return on average common equity of 15.5%.
CEO Polk said net interest margin expanded 4 basis points to 2.78% and described it as "our ninth consecutive quarter of margin expansion," attributing the improvement to "the continued repricing of our fixed rate assets along with disciplined deposit pricing," while warning "the competitive environment for deposits remains elevated as customers continue to prioritize yield."
CEO Polk said total loans increased $94 million (annualized growth of approximately 2.6%), with C&I and residential leading, while "CRE growth was affected by payoff activity and the timing of deal closings" and residential growth benefited from "the completion and closing of a large condominium project." He added, "We continue to expect full year loan growth in the lower mid-single-digit range."
CFO Bradley Satenberg said, "For the quarter, we reported net income of $63.8 million and a diluted EPS of $1.47," and added, "Compared to the first quarter, NII increased $2.6 million, and NIM improved 4 basis points to 2.78%."
Chief Risk Officer S. Shairson said credit metrics stayed favorable, while noting, "The 1 notable change this quarter was an increase in the criticized asset ratio to 2.81% and from 2.12%," and added that the increase "was driven by a single borrower relationship" that is "well secured by real estate."
CEO Polk reiterated a year-end margin target, saying, "we continue to trend toward a net interest margin approaching 2.9% by year-end," while also stating, "the composition of margin opportunity has shifted somewhat in the current rate environment."
CFO Satenberg guided deposit costs and deposit actions, saying, "In the current rate environment, I expect our cost of deposits to settle in the range of 1.25% to 1.3% in the near term," and adding, "I also expect public deposits to decline in the third quarter as we strategically allow certain higher cost funds to run off."
CFO Satenberg guided Q3 fees and expenses, stating, "My forecast for the third quarter is that normalized noninterest income will be approximately $43 million," and "Third quarter normalized noninterest expense is expected to be approximately $112.5 million."
Compared with Q1, management’s rate framing shifted from "forecasting no rate cuts in 2026" (CFO Satenberg, Q1) to, "now we're forecasting 1 rate hike this year" (CFO Satenberg, Q2), tied to the year-end margin path.
CEO Polk reported Q2 net interest income of $153.6 million and said margin expansion reflected "disciplined deposit pricing," while adding that "Average deposits declined modestly from the prior quarter" and that noninterest-bearing deposits were "approximately 27% of total deposits" at quarter-end.
CFO Satenberg said noninterest income was $43.3 million, and described the main driver as Wealth Management, which "benefited from a strong market as well as increased customer demand for annuity investments and other advisory-related fees."
CFO Satenberg said noninterest expense declined to $111.2 million from $116.1 million in Q1, and emphasized Q1 had several items, including "a seasonal payroll tax and benefits charge of $2.8 million" and "nonrecurring charges related to the accelerated vesting of restricted stock awards of $3.5 million" plus "an unrelated severance charge of $750,000."
CFO Satenberg said the company repurchased $17 million of common shares at "an average price of approximately $78 per share," and added, "I am currently planning to purchase an additional $20 million of stock during the third quarter," with $89 million remaining under the plan.
Jeff Rulis, D.A. Davidson: asked about the durability of wealth management momentum; CEO James Polk said fee growth in Q2 was "driven probably half by market and half by production" and added that annuity income is improving as the company sees "the partnership with Cetera" and "the advisers that we're adding to the team just helping to drive overall sales."
Jeff Rulis, D.A. Davidson: asked for more color on the path to a ~2.9% margin; CFO Bradley Satenberg said, "we're forecasting 1 rate hike this year" and, "I think we get to 2.90% by the end of the year," later clarifying, "my expectation is December would be just about $290 million" when discussing the exit level.
Matthew Clark, Piper Sandler: asked about deposit spot rates and promotional/exception pricing; CFO Satenberg said, "the spot rate was $1.26," and added CDs may move higher "slightly in the 3- and 12-month categories," while calling it "nothing material."
Jared Shaw, Barclays: asked if DDA weakness was unique; CEO Polk said it was "the normal ebbs and flows and the seasonality of Q2" and cited project-related funds that "moved out."
Andrew Terrell, Stephens: asked what supports loan growth with softer consumer expectations; CEO Polk said about 25% of residential production came from the condo closing and added, "the pipeline remains pretty good from my standpoint healthy" for commercial, keeping the company in "that low mid-single-digit range."
Andrew Liesch, StoneX: asked about earning asset levels and public outflows; CFO Satenberg said average earning assets "definitely took a step down" and he expected them to be "in probably in the range of $100 million to $200 million" lower/around recent levels, while CEO Polk added public deposits strategy "could have an impact on the ultimate earning asset base."
Kelly Motta, KBW: pressed on the expense run-rate and public deposit runoff; CFO Satenberg said, "the 2.5% to 3% is still consistent," and quantified, "our public deposits are about $2 billion" with "about 10% to 15%" expected to run off, at costs "somewhere in the range of 3.5% to 4%."
Analysts’ tone was slightly negative to neutral, centering on deposit competition, earning asset pressure, the sustainability of wealth fees, and whether expense guidance implies a lower run-rate, including KBW’s question on running "below" the expense guide range.
Management’s tone was slightly positive in prepared remarks and more measured in Q&A, emphasizing confidence in margin trajectory and wealth execution while acknowledging constraints, including CEO James Polk’s comment that deposit competition "may limit opportunities for deposit cost improvement in the near term."
Versus Q1, the tone shifted from highlighting benefits of deposit repricing after prior Fed cuts to framing a "rates now expected to remain elevated for longer" environment (CEO Polk, Q2) and incorporating a forecasted hike into the margin path (CFO Satenberg, Q2).
Q2 emphasized higher-for-longer rates and competitive deposit pricing, while Q1 emphasized deposit repricing benefits following prior Fed cuts and described a "meaningful decline in total deposit costs" (CEO Polk, Q1).
Loan-growth framing moved from Q1’s caution about needing "a little bit more certainty in the overall environment" (CEO Polk, Q1) to Q2 maintaining "lower mid-single-digit" expectations, with added detail that Q3 consumer growth could moderate due to "the absence of similar residential project closings" (CEO Polk, Q2).
Credit discussion changed from Q1’s storm-related qualitative overlay disclosures to Q2’s focus on a single-borrower criticized-loan increase, with Chief Risk Officer S. Shairson attributing the criticized ratio move to "a single borrower relationship" (Q2).
CEO Polk flagged deposit competition risk, stating, "the competitive environment for deposits remains elevated," and added it "may limit opportunities for deposit cost improvement in the near term," while CFO Satenberg indicated the bank will let higher-cost public deposits run off.
Chief Risk Officer Shairson highlighted a portfolio monitoring point, stating the criticized asset ratio rose to 2.81% due to "a single borrower relationship," while also stating the loans "continue to perform" and are "well secured by real estate."
Management described Q2 as continued improvement in earnings power, driven by a ninth consecutive quarter of margin expansion and higher net interest income, while positioning for an elevated-rate environment. The company reiterated a net interest margin approaching 2.9% by year-end, paired with near-term actions on higher-cost public deposits, and guided to roughly stable normalized fee income and expenses in Q3. Management also highlighted momentum in Wealth Management and maintained a lower mid-single-digit full-year loan growth outlook, while acknowledging that consumer growth could moderate without large residential project closings and that deposit competition remains a constraint.