BANK OF HAWAII CORP
For the period ended Jun 30, 2025. Filed Jul 28, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 28, 2025
BOH$69.64-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-29.
0000950170-25-059477
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-28.
0001628280-25-036240
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 168 previous paragraphs and 173 current paragraphs.
94 unchanged; 55 reworded; 22 added; 18 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 20 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (22)
Current report
Item 2. Management’s Discussion and Analysis (“MD&A”) of Financial Condition and Results of Operations
Current report
Although Hawai‘i’s economy began the year with modest gains in tourism and labor growth, as of June 30, 2025 we believe that expansive changes to federal policy may negatively impact our local economy. The impact of actual and threatened US tariffs, large-scale federal layoffs, and volatile immigration and fiscal policies have weakened consumer confidence and are expected to create headwinds in the Hawai‘i tourism sector. Construction remains a relative bright spot as of June 30, 2025, but tariffs on imported materials and labor are expected to cause construction employment to recede in the coming years. Hawai‘i’s unemployment rate was 2.8% in June 2025, which was below the U.S. unemployment rate of 4.1%.
Current report
•Noninterest income was $44.8 million in the second quarter of 2025, an increase of 6% compared to the same period last year.
Current report
•Noninterest expense was $110.8 million in the second quarter of 2025, an increase of 1% compared to the same period last year.
Current report
•The effective tax rate for the second quarter of 2025 was 21.19% compared with 24.77% compared to the same period last year.
Current report
The balance sheet remained stable during the second quarter of 2025. We experienced a modest decline in loans, while deposits slightly increased.
Current report
•Total assets were $23.7 billion as of June 30, 2025, an increase of 0.5% from December 31, 2024.
Current report
•Total loans and leases were $14.0 billion as of June 30, 2025, a decrease of 0.52% from December 31, 2024.
Current report
The average balance of our earning assets for the three and six months ended June 30, 2025 increased by $443.3 million or 2% and $364.6 million or 2%, respectively, compared to the same periods in 2024. These increases were due to increases in the average balances of available-for-sale investment securities and commercial mortgage loans. As compared to the same periods last year, yields on our investment securities portfolio increased by 10 and 7 basis points during the three and six months ended
Current report
June 30, 2025, respectively, primarily due to the amortization of lower yielding investments being reinvested into new investments at higher current interest rates. This increase was partially offset by lower income earned from interest rate swaps that hedge a portion of our available-for-sale (“AFS”) securities portfolio. Yields on our loan and lease portfolio increased by 4 and 6 basis points during the three and six months ended June 30, 2025, respectively, primarily due to higher rates on home equity lines and residential mortgages originated partially offset by the impact of interest rate swaps that hedge our residential mortgage portfolio.
Current report
Other income increased by $1.4 million or 34.4% in the second quarter of 2025 and $1.3 million or 13.9% for the first six months of 2025 compared to the same periods last year. These increases were primarily due to a gain on sale of an other real estate owned (“OREO”) property and the recovery of a previously charge-off bank-owned life insurance policy.
Current report
Data processing fees increased by $0.7 million or 15.0% in the second quarter of 2025 and by $1.2 million or 12.7% for the first six months of 2025 compared to the same periods in 2024, primarily due to an increase in data service fees, the commencement of amortization of our online banking platform, and an increase in debit card transactions.
Current report
Professional fees decreased by $0.7 million or 13.5% in the second quarter of 2025 and by $1.1 million or 11.2% for the first six months of 2025 compared to the same periods in 2024, primarily due to a decrease in consulting fees and reduction in outsourcing of various support functions.
Current report
FDIC insurance expense decreased by $3.5 million or 49.2% in the second quarter of 2025 compared to the same period in 2024, primarily due to a FDIC special assessment charge in the second quarter of 2024. For the first six months of 2025, FDIC insurance expense decreased by $5.5 million or 51.0% compared to the same period in 2024, primarily due to a partial recovery of the FDIC special assessment in the first quarter of 2025.
Current report
Total other expense increased by $1.2 million or 8.3% in the second quarter of 2025 and by $2.8 million or 10.0% for the first six months ended June 30, 2025, compared to the same periods in 2024, primarily due to an increase in operational losses, advertising expenses, and broker's charges.
Current report
The provision for income taxes was $25.0 million in the first six months of 2025, an increase of $1.8 million compared to the same period in 2024. The effective tax rate for the first six months of 2025 was 21.4%, a decrease from 24.8% for the same period in 2024. The lower effective tax rate for the first six months of 2025 compared to the same period in 2024 was due to a decrease in tax expense from discrete items and an increase in tax-exempt investment income.
Current report
Total loans and leases as of June 30, 2025 decreased by $73.8 million or 0.5% from December 31, 2024 due to reductions in both our commercial and consumer loans.
Current report
Derivative financial instruments decreased by $53.3 million or 33.0% due to changes in interest rates from December 2024 to June 2025 decreasing the valuation of customer swaps and fair value hedges. Accounts receivable decreased by $4.3 million due to timing of payments and changes in accruals. Deferred compensation plan assets decreased by $3.6 million primarily due to distributions from the executive deferred compensation plan in 2025.
Current report
Net income decreased by $1.6 million or 5% in the second quarter of 2025 compared to the same period in 2024, primarily due to a decrease in net interest income. Net interest income decreased by $2.9 million or 3%, primarily due to lower deposit spreads on higher deposit balances.
Current report
Net loss decreased by $22.5 million or 43% in the first six months of 2025 compared to the same period in 2024, primarily due to a decrease in net interest expense coupled with an increase in noninterest income, partially offset by an increase in noninterest expense and provision for credit losses. Net interest expense decreased by $23.8 million or 53%, primarily due to lower funding costs and an increase in interest income from higher asset yields. Noninterest income increased by $2.2 million or 43%, primarily due to increases in other income and bank-owned life insurance income. The provision for credit losses and income taxes in this business segment represent the residual amounts to arrive at the total amount for the Company.
Current report
Non-accrual loans and leases as of June 30, 2025 were $17.5 million, an increase of $0.9 million or 5% from December 31, 2024 primarily due to increases in residential mortgage and home equity partially offset by a decline in commercial and industrial. Residential mortgage non-accrual loans increased $0.8 million or 16% from December 31, 2024. As of June 30, 2025, our residential mortgage non-accrual loans were comprised of 20 loans with a weighted average current loan-to-value ratio of 77.5%. Home equity non-accrual loans increased $0.9 million or 19% from December 31, 2024. As of June 30, 2025, our home equity non-accrual loans were comprised of 56 loans with a weighted average current loan-to-value ratio of 54%. Commercial and industrial non-accrual loans decreased $0.9 million from December 31, 2024, primarily due to the partial charge-off of a significant loan.
Current report
Compared to December 31, 2024, EVE sensitivity decreased in the rising rate scenarios and increased in the falling rate scenarios. We implemented new deposit pricing and attrition models during the period, which updated the repricing beta and average life assumptions, and lowered deposit account duration compared to the prior deposit models. Additionally, we increased the notional balance of active and forward starting pay-fixed interest rate swaps. These factors resulted in generally lower asset and liability duration and improved EVE modeling results.
Removed paragraphs (18)
Previous report
Currently, Hawai‘i's economy remains on stable footing, but economic growth may be disrupted by changes in trade policies and tariffs, immigration actions, and federal spending cuts. The Maui economy continues its gradual post-wildfire recovery while the visitor industry for the rest of the Hawai‘i is expected to remain stable in the near term. Strong construction activity from both public and private sector projects continues to drive employment and serves as the primary bright spot in the local economy. However, tariffs on materials and potential labor shortages are looming concerns. Hawai‘i’s unemployment rate was 2.9% in March 2025, which was below the U.S. unemployment rate of 4.2%.
Previous report
Noninterest income was $44.1 million in the first quarter of 2025, an increase of 4% compared to the same period last year.
Previous report
Noninterest expense was $110.5 million in the first quarter of 2025, an increase of 4% compared to the same period last year.
Previous report
The effective tax rate for the first quarter of 2025 was 21.67% compared to 24.76% for the same period last year.
Previous report
We continued to maintain a strong balance sheet during the first quarter of 2025, with what we believe are appropriate reserves for credit losses and strong capital.
Previous report
Total assets were $23.9 billion as of March 31, 2025, an increase of 1.2% from December 31, 2024.
Previous report
Total loans and leases were $14.1 billion as of March 31, 2025, an increase of 0.3% from December 31, 2024.
Previous report
Analysis of Unaudited Stat ements of Income
Previous report
The average balance of our earning assets for the three months ended March 31, 2025 increased by $286.3 million, or 1%, compared to the same period last year primarily due to an increase in our commercial mortgages portfolio. Yields on our investment securities portfolio increased by 3 basis points during the three months ended March 31, 2025 compared to the same period last year primarily due to investment securities that we purchased in late 2024 and in the first quarter of 2025. This increase was partially offset by lower income earned from interest rate swaps that hedge a portion of our AFS securities portfolio. Interest income on our loan and lease portfolio increased by $4.5 million during the three months ended March 31, 2025 compared to the same period last year primarily due to an increase in new loan production. This increase was partially offset by lower income earned from interest rate swaps that hedge a portion of our residential mortgage portfolio.
Previous report
The average balance of our interest-bearing liabilities for the three months ended March 31, 2025 increased by $322.9 million, or 2%, compared to the same period last year was primarily due to an increase in savings deposits. This increase was partially offset by a private institution exercising their right to call on two repurchase agreements ($50 million in May 2024 and $50 million in February
Previous report
Trust and asset management income increased by $0.6 million or 5% in the first quarter of 2025 compared to the same period last year primarily due to an increase in assets under management. Trust and asset management income is comprised of fees earned from the management and administration of trusts and other customer assets. These fees are largely based upon the market value of the assets and the fee rate charged to customers. Total trust assets under management were $12.0 billion and $11.9 billion as of March 31, 2025 and March 31, 2024, respectively.
Previous report
Annuity and insurance income increased by $0.5 million or 49% in the first quarter of 2025 compared to the same period last year primarily due to an increase in sales volume of annuity and insurance products.
Previous report
FDIC insurance expense decreased by $2.0 million or 55% in the first quarter of 2025 compared to the same period last year, primarily due to an adjustment of our industry-wide FDIC special assessment.
Previous report
Total other expense increased by $1.6 million or 12% in the first quarter of 2025 compared to the same period last year, primarily due to increases in advertising expenses, broker's charges, and an increase in workers compensation claims in the first quarter of 2025 compared to the same period last year.
Previous report
Total loans and leases as of March 31, 2025 increased by $39.3 million from December 31, 2024, primarily due to growth in our commercial loans, partially offset by reductions in our consumer loan portfolio.
Previous report
Derivative financial instruments decreased by $35.8 million due to decrease in yield curves from December 2024 to March 2025 decreasing the valuation of customer swaps and fair value hedges. Deferred tax assets and tax receivable decreased by $6.7 million due to temporary differences between financial reporting and income tax basis of unrealized losses on investment securities.
Previous report
Non-accrual loans as of March 31, 2025 were $16.1 million, a decrease of $0.6 million or 3% from December 31, 2024 primarily due to decreases in commercial and industrial and residential mortgage non-accrual loans. Commercial and industrial non-accrual loans decreased by $1.2 million from December 31, 2024, primarily due to the partial charge-off of a loan.
Previous report
Compared to December 31, 2024, EVE sensitivity decreased in both rising and falling rate scenarios due to the longer life and higher valuation attributed to deposits. However, in the down 400 bps scenario, EVE sensitivity increased as the overall lower prevailing market rates have made the 0% floor on deposit rates more impactful.
Reworded paragraphs (55)
Previous wording
The following MD&A is intended to help the reader understand the Company and its operations and is focused on our financial results for the first quarter of 2025, including comparisons of year-to-year performance, trends, and updates from the Company’s most recent 10-K filing. Discussion and analysis of our 2024 fiscal year, as well as the year-to-year comparison between fiscal years 2024 and 2023, are included in Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 4, 2025.
Current wording
The following MD&A is intended to help the reader understand the Company and its operations and is focused on our financial results for the second quarter of 2025, including comparisons of year-to-year performance, trends, and updates from the Company’s most recent 10-K filing. Discussion and analysis of our 2024 fiscal year, as well as the year-to-year comparison between fiscal years 2024 and 2023, are included in Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 4, 2025.
Previous wording
Our forward-looking statements are based on numerous assumptions, any of which could prove to be inaccurate, and actual results may differ materially from those projected because of a variety of risks and uncertainties, including, but not limited to: (1) Our business is sensitive to regional business and economic conditions, in particular those of Hawaiʻi, Guam and other Pacific Islands; (2) Our loan portfolio is largely secured by real estate, and a downturn in the real estate market may adversely affect our results of operations; (3) Significant changes to the size, structure, powers and operations of the federal government, changes to U.S. economic policies, and uncertainties regarding the potential for these changes may cause economic disruptions that could, in turn, adversely impact our business, results of operations and financial condition; (4) A sustained period of high inflation could pose a risk to local economies and the financial performance of the Bank; (5) Climate change and the governmental responses to it could have a material adverse impact on the Bank and its customers; (6) Disruptions, instability and failures in the banking industry may negatively impact us; (7) Any reduction in defense spending by the federal government in the state of Hawaiʻi could adversely impact the economy in Hawaiʻi and the Pacific Islands; (8) Changes in interest rates could adversely impact our results of operations and capital; (9) Our allowance for credit losses may prove to be insufficient to absorb losses or appropriately reflect, at any given time, the inherent risk of loss in our loan portfolio; (10) Consumer protection initiatives and court decisions related to the foreclosure process affect our remedies as a creditor; (11) Changes in the capital markets could materially affect the level of assets under management and the demand for our other fee-based services; (12) The Parent’s liquidity is dependent on dividends from the Bank; (13) There can be no assurance that the Parent will continue to declare cash dividends; (14) Fiscal and monetary policy changes may significantly impact our profitability and liquidity; (15) Legislation and regulatory initiatives affecting the financial services industry, including new interpretations, restrictions and requirements, could detrimentally affect the Company’s business; (16) Changes in income tax laws and interpretations, or in accounting standards, could materially affect our financial condition or results of operations; (17) A failure in or breach of our operational systems, information systems, or infrastructure, or those of our third party vendors and other service providers, may result in financial losses, loss of customers, or damage to our reputation; (18) An interruption or breach in security of our information systems or those related to merchants and third party vendors, including as a result of cyber-attacks, could disrupt our business, result in the disclosure or misuse of confidential or propr…
Excerpt shortened here; the source contains the full paragraph.
Current wording
Our forward-looking statements are based on numerous assumptions, any of which could prove to be inaccurate, and actual results may differ materially from those projected because of a variety of risks and uncertainties, including, but not limited to: (1) Our business is sensitive to regional business and economic conditions, in particular those of Hawaiʻi, Guam and other Pacific Islands; (2) Our loan portfolio is largely secured by real estate, and a downturn in the real estate market may adversely affect our results of operations; (3) Significant changes to the size, structure, powers and operations of the federal government, changes to U.S. economic policies, and uncertainties regarding the potential for these changes may cause economic disruptions that could, in turn, adversely impact our business, results of operations and financial condition; (4) A sustained period of high inflation could pose a risk to local economies and the financial performance of the Bank; (5) Climate change and the governmental responses to it could have a material adverse impact on the Bank and its customers; (6) Disruptions, instability and failures in the banking industry may negatively impact us; (7) Any reduction in defense spending by the federal government in the state of Hawaiʻi could adversely impact the economy in Hawaiʻi and the Pacific Islands; (8) Changes in interest rates could adversely impact our results of operations and capital; (9) Our allowance for credit losses may prove to be insufficient to absorb losses or appropriately reflect, at any given time, the inherent risk of loss in our loan portfolio; (10) Consumer protection initiatives and court decisions related to the foreclosure process affect our remedies as a creditor; (11) Changes in the capital markets could materially affect the level of assets under management and the demand for our other fee-based services; (12) The Parent’s liquidity is dependent on dividends from the Bank; (13) There can be no assurance that the Parent will continue to declare cash dividends; (14) Fiscal and monetary policy changes may significantly impact our profitability and liquidity; (15) Legislation and regulatory initiatives affecting the financial services industry, including new interpretations, restrictions and requirements, could detrimentally affect the Company’s business; (16) Changes in income tax laws and interpretations, or in accounting standards, could materially affect our financial condition or results of operations; (17) A failure in or breach of our operational systems, information systems, or infrastructure, or those of our third party vendors and other service providers, may result in financial losses, loss of customers, or damage to our reputation; (18) An interruption or breach in security of our information systems or those related to merchants and third party vendors, including as a result of cyber-attacks, could disrupt our business, result in the disclosure or misuse of confidential or propr…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
SEC filings. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by the federal securities laws.
Current wording
The risks and uncertainties that could cause actual results to differ materially from our historical experience and our expectations and projections include but are not limited to those described in Item 1A. “Risk Factors,” Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in our most recent Annual Report on Form 10-K and in subsequent SEC filings, including our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by the federal securities laws.
Previous wording
For the first three months of 2025, the median price of single-family home and condominium sales on Oahu increased by 7.5% and 1.0%, respectively, compared to the same period in 2024. The volume of single-family homes sales on Oahu decreased 4.0% and condominium sales increased 0.4% compared to the same period in 2024. Inventory of single-family homes and condominiums on Oahu was 3.3 months and 6.2 months, respectively, for the first quarter of 2025.
Current wording
For the first six months of 2025, the median price of single-family home and condominium sales on Oahu increased by 6.0% and decreased by 0.5%, respectively, compared to the same period in 2024. The volume of single-family homes sales on Oahu decreased 2.1% and condominium sales decreased 6.0% compared to the same period in 2024. Inventory of single-family homes and condominiums on Oahu was 3.7 months and 7.0 months, respectively, for the second quarter of 2025.
Previous wording
Net income for the first quarter of 2025 was $44.0 million, an increase of $7.6 million or 21% compared to the same period in 2024. Diluted earnings per common share was $0.97 for the first quarter of 2025, an increase of $0.10 or 11% compared to the same period in 2024.
Current wording
Net income for the second quarter of 2025 was $47.6 million, an increase of $13.6 million or 40% compared to the same period in 2024. Diluted earnings per common share was $1.06 for the second quarter of 2025, an increase of $0.25 or 31% compared to the same period in 2024.
Previous wording
The return on average common equity for the first quarter of 2025 was 11.80% compared with 11.20% in the same quarter of 2024.
Current wording
•The return on average common equity for the second quarter of 2025 was 12.50% compared with 10.41% in the same quarter of 2024.
Previous wording
Net interest income for the first quarter of 2025 was $125.8 million, an increase of 10% compared to the same period last year.
Current wording
•Net interest income for the second quarter of 2025 was $129.7 million, an increase of 13% compared to the same period last year.
Previous wording
Net interest margin was 2.32% in the first quarter of 2025, an increase of 21 basis points from the same period in 2024.
Current wording
•Net interest margin was 2.39% in the second quarter of 2025, an increase of 24 basis points from the same period in 2024.
Previous wording
The provision for credit losses for the first quarter of 2025 and 2024 was $3.3 million and $2.0 million, respectively.
Current wording
•The provision for credit losses for the second quarter of 2025 and 2024 was $3.3 million and $2.4 million, respectively.
Previous wording
The allowance for credit losses on loans and leases was $147.7 million as of March 31, 2025, a decrease of $0.8 million from December 31, 2024. The ratio of the allowance for credit losses to total loans and leases outstanding was 1.05% at the end of the quarter, down 1 basis point from December 31, 2024.
Current wording
•The allowance for credit losses on loans and leases was $148.5 million as of June 30, 2025, flat from December 31, 2024. The ratio of the allowance for credit losses to total loans and leases outstanding was 1.06% at the end of the quarter, flat from December 31, 2024.
Previous wording
Net loan and lease charge-offs during the first quarter of 2025 were $4.4 million or 13 basis points annualized of total average loans and leases outstanding. Net loan and lease charge-offs for the first quarter of 2025 were comprised of charge-offs of $5.7 million partially offset by recoveries of $1.3 million. Compared to the same quarter of 2024, net loan and lease charge-offs increased by $2.1 million or 6 basis points annualized on total average loans and leases outstanding.
Current wording
•Net loan and lease charge-offs during the second quarter of 2025 were $2.6 million or 7 basis points annualized of total average loans and leases outstanding. Net loan and lease charge-offs for the second quarter of 2025 were comprised of charge-offs of $4.0 million partially offset by recoveries of $1.4 million. Compared to the same quarter of 2024, net loan and lease charge-offs decreased by $0.8 million or 3 basis points annualized on total average loans and leases outstanding.
Previous wording
Total non-performing assets (“NPAs”) were $17.5 million as of March 31, 2025, down $1.8 million from December 31, 2024. NPAs were 12 basis points of total loans and leases and foreclosed real estate at the end of the quarter, down 2 basis points from December 31, 2024.
Current wording
•Total non-performing assets (“NPAs”) were $17.9 million as of June 30, 2025, down $1.4 million from December 31, 2024. NPAs were 13 basis points of total loans and leases and foreclosed real estate at the end of the quarter, down 1 basis point from December 31, 2024.
Previous wording
The investment securities portfolio was $7.4 billion as of March 31, 2025, an increase of 2% from December 31, 2024. The investment portfolio remains largely comprised of securities issued by U.S. government agencies and U.S. government-sponsored enterprises. Floating rate securities represented 17.4% of the investment securities portfolio as of March 31, 2025, compared to 16.5% as of December 31, 2024.
Current wording
•The investment securities portfolio was $7.6 billion as of June 30, 2025, an increase of 3.3% from December 31, 2024. The investment portfolio remains largely comprised of securities issued by U.S. government agencies and U.S. government-sponsored enterprises. Floating rate securities represented 18.8% of the investment securities portfolio as of June 30, 2025, compared to 16.5% as of December 31, 2024.
Previous wording
Total deposits were $21.0 billion as of March 31, 2025 and $20.6 billion as of December 31, 2024.
Current wording
•Total deposits were $20.8 billion as of June 30, 2025 and $20.6 billion as of December 31, 2024.
Previous wording
Total shareholders’ equity was $1.7 billion as of March 31, 2025, an increase of 2% from December 31, 2024.
Current wording
•Total shareholders’ equity was $1.7 billion as of June 30, 2025, an increase of 4.5% from December 31, 2024.
Previous wording
No shares of common stock were repurchased under the share repurchase program in the first quarter of 2025. Total remaining buyback authority under the share repurchase program was $126.0 million at March 31, 2025.
Current wording
•No shares of common stock were repurchased under the share repurchase program in the second quarter of 2025. Total remaining buyback authority under the share repurchase program was $126.0 million at June 30, 2025.
Previous wording
Due to rounding, the amounts presented in this schedule may not tie to other amounts presented elsewhere in this report.
Current wording
1 Due to rounding, the amounts presented in this table may not tie to other amounts presented elsewhere in this report.
Previous wording
Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21% of $1.5 million and $0.7 million for the three months ended March 31, 2025 and 2024, respectively.
Current wording
2 Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21%, of $1.6 million and $3.1 million for the three and six months ended June 30, 2025, respectively, and $0.8 million and $1.5 million for the three and six months ended June 30, 2024, respectively.
Previous wording
Non-performing loans and leases are included in the respective average loan and lease balances.
Current wording
3 Non-performing loans and leases are included in the respective average loan and lease balances.
Previous wording
The change in interest income or expense due to both rate and volume has been allocated between the factors in proportion to the relationship of the absolute dollar amounts of the change in each.
Current wording
1 The change in interest income or expense due to both rate and volume has been allocated between the factors in proportion to the relationship of the absolute dollar amounts of the change in each.
Previous wording
2025). As compared to the same period last year, the cost of our interest-bearing liabilities decreased by 23 basis points during the three months ended March 31, 2025 primarily due to a decrease in prevailing interest rate environment, which was driven by 100 basis points of interest rate cuts by the Federal Open Market Committee in late 2024.
Current wording
The average balance of our interest-bearing liabilities for the three and six months ended June 30, 2025 increased by $273.5 million or 2% and $364.5 million or 2%, respectively, compared to the same periods in 2024 primarily due to an increase in savings deposits. As compared to the same periods last year, the cost of our interest-bearing liabilities decreased by 29 and 26 basis points during the three and six months ended June 30, 2025, respectively, primarily due to a decrease in the prevailing interest rate environment, which was driven by 100 basis points of interest rate cuts by the Federal Open Market Committee in late 2024.
Previous wording
Total salaries and benefits expense increased by $4.7 million or 8% in the first quarter of 2025 compared to the same period last year, primarily due to increases in incentive compensation and medical, dental, and life insurance expense, partially offset by decreases in share-based compensation and separation expense.
Current wording
Total salaries and benefits expense increased by $4.3 million or 7.5% in the second quarter of 2025, primarily due to an increase in incentive compensation, base salaries, and separation expense. Total salaries and benefits expense increased by $8.9 million or 7.8% for the first six months ended June 30, 2025, compared to the same period in 2024 primarily due to an increase in incentive compensation, medical, dental, and life insurance, and base salaries.
Previous wording
The provision for income taxes was $12.2 million in the first quarter of 2025, an increase of $0.2 million compared to the same period last year. The effective tax rate for the first quarter of 2025 was 21.67%, a decrease from 24.76% for the same period last year. The lower effective tax rate in the first quarter of 2025 compared to the same period last year was primarily due to an increase in tax-exempt income, an increase in net tax benefits from low-income housing investments, and a decrease in tax expense from discrete items.
Current wording
The provision for income taxes was $12.8 million in the second quarter of 2025, an increase of $1.6 million compared to the same period in 2024. The effective tax rate for the second quarter of 2025 was 21.2%, a decrease from 24.8% for the same period in 2024. The lower effective tax rate in the second quarter of 2025 compared to the same period in 2024 was primarily due to a decrease in tax expense from discrete items and an increase in tax-exempt investment income.
Previous wording
The carrying value of our investment securities portfolio was $7.4 billion and $7.3 billion as of March 31, 2025 and December 31, 2024, respectively. The increase is primarily due to the purchase of $241.9 million in available-for-sale investment securities during the three months ended March 31, 2025, of which $105.8 million were floating rate securities. Floating rate securities represented 17.4% of the investment securities portfolio as of March 31, 2025, compared to 16.5% as of December 31, 2024.
Current wording
The carrying value of our investment securities portfolio was $7.6 billion and $7.3 billion as of June 30, 2025 and December 31, 2024, respectively. The increase was primarily due to the purchase of $517.1 million in available-for-sale investment securities during the six months ended June 30, 2025, of which $259.1 million were floating rate securities. The increase was partially offset by the amortization of existing securities. Floating rate securities represented 18.8% of the investment securities portfolio as of June 30, 2025, compared to 16.5% as of December 31, 2024.
Previous wording
We continually evaluate our investment securities portfolio in conjunction with our response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which we are exposed. These evaluations may cause us to change the level of funds we deploy into investment securities, change the composition of our investment securities portfolio, adjust hedge positions, and change the proportion of investments made into the AFS and HTM investment categories.
Current wording
We continually evaluate our investment securities portfolio in conjunction with our response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which we are exposed. These evaluations may cause us to change the level of funds we deploy into investment securities, change the composition of our investment securities portfolio, adjust hedge positions, and change the proportion of investments made into the AFS and held-to-maturity (“HTM”) investment categories.
Previous wording
Mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac are the largest concentration in our portfolio. As of March 31, 2025, these mortgage-backed securities were all AAA-rated, with a low probability of a change in their credit ratings in the near future.
Current wording
Mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac represent the largest concentration in our portfolio. As of June 30, 2025, the issuers of these securities carry credit ratings equivalent to those of the U.S. Government, reflecting the explicit and/or implicit guarantees provided.
Previous wording
Net unrealized losses in our investment securities portfolio were $0.9 billion as of March 31, 2025 and $1.1 billion as of December 31, 2024. See Note 2 Investment Securitiesto the unaudited Consolidated Financial Statements for more information.
Current wording
Net unrealized losses in our AFS and HTM investment securities were $0.9 billion as of June 30, 2025 and $1.1 billion as of December 31, 2024. See Note 2 Investment Securities to the unaudited Consolidated Financial Statements for more information.
Previous wording
Commercial loans and leases as of March 31, 2025 increased by $72.3 million or 1.2% from December 31, 2024, primarily due to increased loan production in our construction loan portfolio, which increased by $54.8 million or 17.7%. Consumer loans and leases as of March 31, 2025 decreased by $33.0 million or 0.4% from December 31, 2024, primarily due to paydowns in our home equity portfolio and a slowdown in production for our automobile loans.
Current wording
Commercial loans and leases as of June 30, 2025 decreased by $21.3 million or 0.3% from December 31, 2024, primarily due to a decline in commercial and industrial loans, which decreased by $107.6 million or 6.3% largely as a result of paydowns. This was partially offset by construction loans, which increased by $65.9 million or 21.3%, primarily due to increased construction activity during the quarter. Consumer loans and leases as of June 30, 2025 decreased by $52.5 million or 0.7% from December 31, 2024, primarily due to paydowns in our home equity portfolio and a slowdown in production for our automobile loans.
Previous wording
For secured loans and leases, classification is made based on where the collateral is located. For unsecured loans and leases, classification is made based on the location where the majority of the borrower’s business operations are conducted.
Current wording
1 For secured loans and leases, classification is made based on where the collateral is located. For unsecured loans and leases, classification is made based on the location where the majority of the borrower’s business operations are conducted.
Previous wording
Total deposits were $21.0 billion as of March 31, 2025, an increase of $375.2 million or 1.8% from December 31, 2024. Consumer deposits increased by $124.9 million due to an increase of $167.2 million in core deposits, defined as all deposits exclusive of time deposits, partially offset by a decrease of $42.3 million in time deposits. Commercial deposits increased by $112.2 million primarily from increases of $68.3 million in core deposits and $43.9 million in time deposits. Public and other deposits increased by $138.1 million due to an increase of $160.4 million in core deposits, partially offset by a decrease of $22.3 million in time deposits.
Current wording
Total deposits were $20.8 billion as of June 30, 2025, an increase of $165.9 million or 0.8% from December 31, 2024. Consumer deposits increased by $31.5 million due to increases of $144.4 million in savings deposits and $29.6 million in non-interest bearing deposits, partially offset by a decrease of $142.5 million in interest-bearing deposits. Commercial deposits decreased by $55.7 million primarily from decreases of $97.6 million in core deposits, defined as all deposits exclusive of time deposits, partially offset by an increase of $41.9 million in time deposits. Public and other deposits increased by $190.1 million due to an increase of $208.2 million in interest-bearing deposits, partially offset by a decrease of $18.1 million in non-interest bearing deposits.
Previous wording
The increase in Money Market was primarily due to an increase in commercial deposits of $28.8 million partially offset by $3.1 million decrease in consumer deposits. The increase in Regular Savings was primarily due to increases in public deposits of $182.8 million, $124.0 million in consumer deposits and $2.7 million in commercial deposits.
Current wording
The increase in Regular Savings was primarily due to increases in consumer deposits of $153.0 million, public deposits of $43.7 million, and commercial deposits of $2.5 million. The decrease in Money Market was primarily due to decreases in commercial deposits of $74.2 million and consumer deposits of $8.6 million.
Previous wording
Balances presented as of March 31, 2025 are preliminary.
Current wording
1 Balances presented as of June 30, 2025 are preliminary.
Previous wording
Balances presented as of December 31, 2024 were revised to reflect changes made in our Call Report.
Current wording
2 Balances presented as of December 31, 2024 were revised to reflect changes made in our Call Report.
Previous wording
Securities sold under agreements to repurchase were $50.0 million and $100.0 million as of March 31, 2025 and December 31, 2024, respectively. In February 2025, a private institution exercised its right to call on a repurchase agreement with a balance of $50.0 million, resulting in its termination. As of March 31, 2025, our remaining repurchase agreement was at a fixed interest rate of 3.89%. with a remaining maturity of 4.63 years. Our repurchase agreement was accounted for as a collateralized financing arrangement (i.e., a secured borrowing) and not as a sale and subsequent repurchase of securities.
Current wording
Securities sold under agreements to repurchase were $50.0 million and $100.0 million as of June 30, 2025 and December 31, 2024, respectively. In February 2025, a private institution exercised its right to call on a repurchase agreement with a balance of $50.0 million, resulting in its termination. As of June 30, 2025, our remaining repurchase agreement was at a fixed interest rate of 3.89% with a remaining maturity of 4.38 years. Our repurchase agreement was accounted for as a collateralized financing arrangement (i.e., a secured borrowing) and not as a sale and subsequent repurchase of securities.
Previous wording
Net income decreased by $3.4 million or 10% in the first quarter of 2025 compared to the same period last year primarily due to an increase in noninterest expense, a decrease in net interest income, and an increase in the provision for credit losses. This was partially offset by an increase in noninterest income. Noninterest expense decreased by $3.7 million or 4% primarily due to higher allocated administrative and support unit costs. Net interest income decreased by $1.4 million or 1% primarily due to lower deposit spreads on higher deposit balances, as well as lower loan balances. The provision for credit losses increased by $1 million or 44% primarily due to higher net charge-offs in the auto loan and installment loan portfolios. Noninterest income increased by $1.5 million or 5% primarily due to higher trust and asset management income, annuity and insurance income, and monthly service fees.
Current wording
Net income decreased by $4.9 million or 8% in the first six months of 2025 compared to the same period in 2024, primarily due to a decrease in net interest income, coupled with an increase in noninterest expense and the provision for credit losses. This was partially offset by an increase in noninterest income. Net interest income decreased by $4.2 million or 2%, primarily due to lower deposit spreads on higher deposit balances, as well as lower loan balances. Noninterest expense increased by $3.5 million or 2%, primarily due to higher operational losses, salaries and benefits, and online banking platform costs, and allocated administrative and support unit costs. The provision for credit losses increased by $0.8 million or 15%, primarily due to higher net charge-offs in the auto loan portfolio. Noninterest income increased by $1.8 million or 3%, primarily due to higher monthly service fees, trust and asset management income, credit card commissions, annuity and insurance income, and debit card income.
Previous wording
Net income increased by $2.0 million or 7% in the first quarter of 2025 compared to the same period last year primarily due to increases in net interest income and noninterest income, partially offset by an increase in noninterest expense. Net interest income increased by $4.1 million or 8% primarily due to increases in loan balances, primarily in commercial mortgages, and allocated interest income due to increases in balances and spreads on interest bearing and savings deposits, partially offset by a reduction in noninterest bearing deposit balances. Noninterest income increased by $1.0 million or 14% primarily due to increases in loan fees and customer derivative program revenue, and a gain on sale of leased equipment, partially offset by a decrease in merchant revenue. Noninterest expense increased by $1.0 million or 5% primarily due to higher allocated administrative and support unit expenses and merchant processing fees, partially offset by lower salaries & benefits.
Current wording
Net income increased by $1.5 million or 5% in the second quarter of 2025 compared to the same period in 2024, primarily due to an increase in net interest income, partially offset by a decrease in noninterest income and an increase in noninterest expense. Net interest income increased by $3.1 million or 6%, primarily due to an increase in loan balances, primarily in commercial mortgages and allocated interest income due to increases in balances and spreads on interest bearing and savings deposits, partially offset by a reduction in noninterest bearing deposit balances. Noninterest income decreased by $0.5 million or 8%, primarily due to lower customer derivative program revenue, partially offset by an increase in merchant revenue. Noninterest expense increased by $0.9 million or 5%, primarily due to higher allocated administrative and support unit expenses, partially offset by lower salaries & benefits and broker charges related to the customer derivative program.
Previous wording
Net loss decreased by $8.9 million or 34% in the first quarter of 2025 compared to the same period last year primarily due to higher net interest income, partially offset by lower noninterest income. The net interest income increased by $9.2 million or 27% primarily due to a decrease in funding costs reflecting lower rate environment. Noninterest income decreased by $0.7 million or 19% primarily due to a decrease in other income. The provision for income taxes in this business segment represents the residual amount to arrive at the total tax expense for the Company.
Current wording
Net loss decreased by $13.6 million or 52% in the second quarter of 2025 compared to the same period in 2024, primarily due to a decrease in net interest expense coupled with an increase in noninterest income, partially offset with an increase in the provision for credit losses. Net interest expense decreased by $14.6 million or 43%, primarily due to a decrease in funding costs reflecting the current lower rate environment. Noninterest income increased by $2.9 million or 168%, primarily due to a decrease in other income. The provision for credit losses and income taxes in this business segment represent the residual amounts to arrive at the total amount for the Company.
Previous wording
Excludes loans that are fully charged-off and placed on non-accrual status during the same period.
Current wording
1 Excludes loans that are fully charged-off and placed on non-accrual status during the same period.
Previous wording
Foreclosed real estate represents property acquired as the result of borrower defaults on loans. Foreclosed real estate is recorded at fair value, less estimated selling costs, at the time of foreclosure. On an ongoing basis, properties are appraised as required by market conditions and applicable regulations. Foreclosed real estate was $1.4 million as of March 31, 2025 compared to $2.7 million as of December 31, 2024. The decrease was due to the sale of two foreclosed properties during the three months ended March 31, 2025.
Current wording
Foreclosed real estate represents property acquired as the result of borrower defaults on loans. Foreclosed real estate is recorded at fair value, less estimated selling costs, at the time of foreclosure. On an ongoing basis, properties are appraised as required by market conditions and applicable regulations. Foreclosed real estate was $0.3 million as of June 30, 2025 compared to $2.7 million as of December 31, 2024. The decrease was due to the sale of two foreclosed properties during the six months ended June 30, 2025.
Previous wording
Loans and leases past due 90 days or more and still accruing interest were $7.6 million as of March 31, 2025, a $0.7 million or 9% decrease from December 31, 2024. The decrease was primarily in our home equity portfolio. This category includes loans and leases that are well-secured and in the process of collection, as well as loans and leases that have not reached the specified past due status to be placed on non-accrual.
Current wording
Loans and leases past due 90 days or more and still accruing interest were $12.2 million as of June 30, 2025, a $4.0 million or 48% increase from December 31, 2024. The increase was primarily in our residential mortgage portfolio. This category includes loans and leases that are well-secured and in the process of collection, as well as loans and leases that have not reached the specified past due status to be placed on non-accrual.
Showing the first 40 of 55 pairs. Open the source sections for the rest.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Analysis of Unaudited Statements of Income
Current report — wording carried from elsewhere
Net income increased by $3.5 million or 6% in the first six months of 2025 compared to the same period in 2024, primarily due to an increase in net interest income and noninterest income, partially offset by an increase in noninterest expense. Net interest income increased by $7.1 million or 7%, primarily due to an increase in loan balances, primarily in commercial mortgages, and an increase in allocated interest income due to increases in balances and spreads on interest bearing and savings deposits, partially offset by a reduction in noninterest bearing deposit balances. Noninterest expense increased by $1.9 million or 5%, primarily due to higher allocated administrative and support unit expenses, merchant processing fees, data services, and other professional services, partially offset by lower salaries & benefits.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The risks and uncertainties that could cause actual results to differ materially from our historical experience and our expectations and projections include but are not limited to those described in Item 1A. “Risk Factors,” Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in our most recent Annual Report on Form 10-K and in subsequent