First Hawaiian Bank reaps record profit

First Hawaiian's net interest income rises 16%

First Hawaiian Bank achieved record profits in the third quarter and the first nine months of 2006 as assets, loans and leases, and deposits all increased from a year earlier.

The state's largest bank in terms of assets said yesterday its earnings rose 10.7 percent last quarter to $49.8 million, and jumped 20.4 percent during the first nine months to $150.4 million. In 2005, First Hawaiian had net income of $45 million in the third quarter and $124.9 million through the first nine months.

"Our solid earnings and asset growth was largely the result of the continued successful implementation of our customer-relationship strategy," said Don Horner, president and chief executive of First Hawaiian.

During the quarter, First Hawaiian initiated two expanded investment advisory programs -- PrivateInvest for private banking clients and Priority- Invest for personal banking clients. The bank also began offering a new Aloha AirAwards cards in Hawaii and a Continental Airlines credit card on Guam and Saipan.

First Hawaiian, which has 57 branches in Hawaii, three on Guam and two on Saipan, said assets grew 5.1 percent in the third quarter to $11.9 billion from $11.3 billion. Nonperforming assets made up 0.01 percent of total assets at the end of last quarter.

Bank of Hawaii Corp. ranks second in the state for assets with $10.4 billion.

First Hawaiian's loans and leases grew 7 percent to $6.2 billion from $5.8 billion, while deposits increased 4.3 percent to $8.6 billion from $8.3 billion.

For the first nine months, net interest income, which reflects the difference between what First Hawaiian pays depositors and what it brings in from loans, rose to 15.9 percent to $326 million. The bank's net interest margin improved to 4.52 percent from 4.28 percent. Noninterest income, which includes revenue from service charges and fees, rose 3.6 percent to $110.8 million.

First Hawaiian, a sister bank of San Francisco-based Bank of the West, is a subsidiary of Honolulu-based BancWest Corp., which is owned by French banking giant BNP Paribas SA.

Earlier this year, BancWest announced it would stop releasing quarterly earnings information, but that First Hawaiian and Bank of the West would issue individual earnings results.

Bank of the West said yesterday its net income in the third quarter rose 4 percent to $136.7 million from $131.3 million a year earlier and that total assets jumped 29 percent to $56.4 billion, due to internal growth and the acquisition of Omaha, Neb.-based Commercial Federal Bank.

BancWest's total assets were $67.8 billion at the end of the third quarter.