American Savings Bank, FSB (American), a wholly owned subsidiary of Hawaiian Electric Industries, Inc. (NYSE – HE), today announced a net gain of $ 19.3 million for the second quarter compared to last quarter 2021, compared to $ 30.3 million in the second quarter of 2021 and $ 12.2 million in the second compared to the last quarter of 2020. We are satisfied with our monetary results for the second compared to the last quarter, which reflect strong execution and excellent credit quality, the latter of which resulted in additional release of reserves. The governor’s recent statement encouraging visitors to return is a positive sign to our nearby economy and region, said Ann Teranishi, President and CEO of American.
We continue to build our capabilities to deliver even more value to our customers through digital banking and personalized financial solutions, while delivering the superior customer experience we are known for, said Teranishi.
Third quarter 2021 net interest income was $ 60.3 million, compared to $ 60.8 million in the related quarter and $ 57.3 million in the third quarter of 2020. Net interest income relatively stable from the related quarter reflected the impact of lower yields and lower expense recognition associated with the Paycheck Protection Program (P3) loan portfolio, partially offset by higher income assets. high levels driven by increased liquidity due to continued growth in deposits. The increase in net interest income compared to the third quarter of 2020 is mainly due to the growth of productive assets, lower cost of funds and higher fees associated with the PPP loan portfolio. The net interest margin for the third quarter of 2021 was 2.90% compared to 2.98% in the related quarter and 3.12% in the third quarter of 2020. The net interest margin for the first nine months of 2021 was 2.94% against 3.34% for the same quarter. period in 2020.
The net amortization ratio for the third quarter of 2021 was 0.03%, compared to 0.04% in the related quarter and 0.32% in the third quarter of 2020. Unrecognized loans as a percentage of total loans receivable held at investment purposes were 0.97% in the third quarter of 2021, compared to 1.03% in the related quarter and 0.77% in the previous year quarter.
The third quarter 2021 results included a negative allowance for credit losses of $ 1.7 million, reflecting credit improvements in commercial and commercial real estate loan portfolios and consumer loan repayments. This compares to a negative allowance for credit losses of $ 12.2 million in the related quarter and an allowance for credit losses of $ 14.0 million in the third quarter of 2020. As at September 30, 2021, the American’s allowance for credit losses on loans receivable was 1.48%. compared to 1.51% as of June 30, 2021 and 1.67% as of September 30, 2020.
Non-interest income was $ 14.8 million in the third quarter of 2021, compared to $ 15.2 million in the related quarter and $ 19.0 million in the third quarter of 2020. The decrease in other income The related quarter’s interest rate is mainly due to lower income from financial services and lower mortgage banking income, partially offset by higher income from life insurance held by banks and commissions on liabilities- deposits. The decrease in non-interest income compared to the last fiscal quarter is mainly attributable to lower mortgage banking income.
Non-interest expense for the third quarter of 2021 was $ 51.5 million, compared to $ 48.2 million in the related quarter and $ 47.3 million in the third quarter of 2020. The increase in expenses other than interest compared to the related quarters and the previous year is mainly due to the strong performance of the bank during the first nine months of the year. The third quarter of 2021 also included an increase in data processing spend as the bank upgrades its technology and data analytics capabilities, partially offset by lower occupancy costs as the bank continues to optimize the imprint of its branches as part of its digital transformation.
Total productive assets as at September 30, 2021 stood at $ 8.4 billion, up 9.3% from December 31, 2020. Total loans stood at $ 5.1 billion as at December 30, 2020. September 2021, down 1.3% from June 30, 2021 and down 4.0% from December 31, 2020. The reduction in the loan portfolio during the quarter included approximately $ 111 million in loans P3s canceled, as well as declines in home equity line of credit and consumer portfolios. The decrease in these portfolios was partially offset by the growth in residential, commercial and commercial real estate loan portfolios. Excluding PPP loan forgiveness, the loan portfolio increased $ 46 million or 0.9% from June 30, 2021.
The investment securities portfolio stood at $ 3.1 billion as of September 30, 2021, up 39.8% from December 31, 2020, as growth in deposits continues to outpace that of loans. The portfolio is primarily composed of securities issued or guaranteed by US government agencies or agencies sponsored by the US government. Total deposits stood at $ 8.0 billion as of September 30, 2021, an increase of 1.3% from June 30, 2021 and an increase of 8.0% from December 31, 2020. For the third quarter of 2021, the average cost of funds was 0.06%. , down one basis point from the related quarter and down seven basis points from the previous year quarter.
For the third quarter of 2021, the return on average equity was 10.3%, compared to 16.8% in the related quarter and 6.8% in the third quarter of 2020. The return on average assets was 0.86% for the third quarter 2021, compared to 1.38% in the linked quarter and 0.61% in the same quarter last year. In the third quarter of 2021, American paid dividends of $ 12.0 million to HEI. American had a Tier 1 leverage ratio of 8.0% as of September 30, 2021.
HEI EARNINGS RELEASE, WEB BROADCAST AND HEI CONFERENCE TO DISCUSS 2021 RESULTS AND DIRECTIONS Along with American’s regulatory filing 30 days after quarter end, American today announced its third quarter 2021 financial results. Reported results are for American only and are not necessarily indicative of HEI’s consolidated financial results for the third quarter of 2021.
HEI plans to report its third quarter 2021 consolidated financial results on Friday, November 5, 2021 and will also host a webcast and conference call at 10:15 a.m. Hawaii time (4:15 p.m. EST) the same day. to discuss its consolidated results. , including American earnings, and forecast for 2021. To listen to the conference call, dial 1-844-200-6205 (US) or 1-929-526-1599 (international) and enter passcode 181692. Participants can also access the presentation materials and / or listen to the conference call by visiting the conference call link on the HEI website at www.hei.com under the “Relationships” section. with investors ”, subtitle“ News and events – Events and presentations ”.
Summary of the news:
- American Savings Bank Reports Third Quarter 2021 Financial Results
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