Bank of Hawaii Corp. in Honolulu said Monday that its third-quarter earnings rose 20% from a year earlier, to $44.1 million, as a reduction in credit costs and an increase in mortgage banking revenue offset lower interest income.
Net interest income for the quarter fell 9.5% from a year earlier, to $98.8 million. The company attributed the decline to lower interest rates and loan balances. On a per share basis, the company earned 91 cents, well above analysts' estimate of 79 cents a share.
In a research note, Aaron James Deer, an analyst with Sandler O'Neill & Partners LP, said the surprising results were driven by securities sales and other non-recurring items.
Its net interest margin was 3.27%, down 58 basis points from a year earlier.
Bank of Hawaii's provision for loan losses was $13.4 million, half the amount it set aside a year earlier. Profit at the company's mortgage banking business rose 48% from a year earlier, to $6.8 million.
That contributed to an 11% year-over-year increase in noninterest income, which totaled $63 million.