First Hawaiian Reports 18% Increase in Q2 Net Income to $73.2 Million

First Hawaiian, Inc. reported a net income of $73.2 million for the second quarter of 2025, reflecting an 18% increase from $61.9 million in the same period of 2024. Basic and diluted earnings per share rose to $0.58, up from $0.48 year-over-year. The growth in net income was primarily driven by a $10.7 million increase in net interest income, which totaled $163.6 million, alongside a $4.0 million reduction in the provision for income taxes. However, the company also noted a $2.9 million rise in noninterest expenses and a $2.7 million increase in the provision for credit losses, which amounted to $4.5 million for the quarter.

For the first half of 2025, First Hawaiian's net income reached $132.5 million, a 14% increase compared to $116.1 million in the prior year. The company’s net interest income for this period was $324.1 million, up by $16.8 million or 5% from the previous year, attributed to lower deposit funding costs and higher average balances in interest-bearing deposits. The provision for credit losses for the first half was $15.0 million, significantly higher than the $8.1 million recorded in the same period of 2024, reflecting increased provisions for various loan categories.

Operationally, First Hawaiian's total loans and leases decreased slightly to $14.4 billion as of June 30, 2025, down from $14.4 billion at the end of 2024. The decline was primarily due to reductions in residential and commercial real estate loans, while commercial and industrial loans saw an increase. The allowance for credit losses rose to $167.8 million, representing 1.17% of total loans and leases, compared to 1.11% at the end of 2024. The company also reported a total of $28.6 million in non-performing assets, an increase of 38% from the previous year, with residential mortgage loans comprising a significant portion of this figure.

In terms of strategic developments, First Hawaiian announced a stock repurchase program in January 2025, authorizing up to $100 million in buybacks. As of June 30, 2025, the company had repurchased $50 million worth of shares. The Board of Directors also declared a quarterly cash dividend of $0.26 per share, to be paid on August 29, 2025. The company continues to maintain a strong capital position, with a Common Equity Tier 1 capital ratio of 13.03% as of June 30, 2025, an increase from 12.80% at the end of 2024, indicating a solid buffer against potential economic challenges.

Looking ahead, First Hawaiian remains focused on managing its liquidity and capital resources effectively, with a strong emphasis on maintaining adequate reserves for credit losses. The company is also closely monitoring economic conditions, particularly in Hawaii, where high consumer prices and housing affordability challenges persist. The management's outlook reflects cautious optimism, with strategies in place to navigate potential market fluctuations and maintain profitability.