BOH Stock Jumps 6% as Q4 Earnings Beat on Higher NII & Fee Income

Shares of Bank of Hawaii Corporation BOH gained nearly 6.1% in yesterday’s trading session after reporting better-than-expected results. The company posted fourth-quarter 2025 earnings per share (EPS) of $1.39, which beat the Zacks Consensus Estimate of $1.25. The bottom line compared favorably with 85 cents in the year-ago quarter.

BOH’s results benefited from an increase in net interest income (NII) and fee income growth. Also, higher loan and deposit balances, along with lower provisions, were encouraging. However, an increase in expenses acted as a key spoilsport.

The company’s net income (GAAP basis) came in at $60.9 million, up 55.6% year over year.

For 2025, EPS was $4.63, which surpassed the Zacks Consensus Estimate of $4.50. This compares favorably with $3.46 reported in 2024. The company reported a net income (GAAP basis) of $205.9 million, which rose 37.3% year over year.

Bank of Hawaii’s Quarterly Revenues & Expenses Rise

BOH’s quarterly revenues increased 16.2% year over year to $189.6 million. The top line surpassed the Zacks Consensus Estimate by 3.9%.

Full-year revenues were $716.6 million, which increased 12.1% year over year. The top line surpassed the Zacks Consensus Estimate of $714.1 million.

NII was $145.4 million, up 20.9% year over year. NIM increased 42 basis points to 2.61%. Our estimate for NII and NIM was pegged at $135.8 million and 2.54%, respectively.

Non-interest income came in at $44.3 million, up 2.8% year over year. This included an $18.1 million gain from the sale of the merchant services portfolio, a $16.8 million loss on the sale of investments and a $0.8 million charge related to a Visa Class B share conversion ratio change. Adjusted for these items, non-interest income increased 3.1% year over year. This rise was primarily driven by higher trust and asset management income and other loan fees. Our estimate for the metric was pinned at $43 million.

Non-interest expenses rose 1.5% year over year to $109.5 million. It included a $1.4 million reduction in the FDIC special assessment charge, a $1.1 million donation to the Bank of Hawai‘i Foundation, and approximately $2.2 million in non-recurring Merchant Services expenses. Adjusted for these items, non-interest expense increased 3.9% from adjusted non-interest expenses recorded in the year-ago quarter. The increase was primarily driven by higher salaries and benefits and other expenses, partially offset by lower professional fees. Our estimate for the metric was pinned at $109 million.

The efficiency ratio was 57.75%, down from 66.12% in the year-ago period. A fall in the efficiency ratio reflects increased profitability.

BOH’s Loans & Deposits Increase

As of Dec. 31, 2025, total loans and leases increased slightly from the prior-quarter end to $14.1 billion. Our estimate for total loans and leases was the same as the reported figure.

Total deposits rose marginally on a sequential basis to $21.2 billion. Our estimate for total deposits was $21.3 billion.

Bank of Hawaii’s Credit Quality: Mixed Bag

As of Dec. 31, 2025, non-performing assets were $14.2 million, which declined 26.6% year over year. Our estimate for the metric was $16.6 million.

Net loan and lease charge-offs were $4.1 million, up $0.7 million from the year-ago quarter. Our estimate for the metric was $2.5 million.

Provision for credit losses was $2.5 million, down 33.3% from the year-ago quarter. Our estimate for the metric was $3.3 million.

The allowance for credit losses declined 1.2% to $146.8 million. Our estimate for the metric was $149.6 million.

BOH’s Capital Ratios Improve

As of Dec. 31, 2025, the Tier 1 capital ratio was 14.49%, up from 13.95% as of Dec. 31, 2024. The total capital ratio was 15.54%, which rose from 15.00% in the year-ago period.

The ratio of tangible common equity to risk-weighted assets was 10.35%, which increased from 9.08% at the end of the year-ago quarter.

Bank of Hawaii’s Profitability Ratios Improve

Return on average assets was 1.01% at the end of the fourth quarter of 2025, which increased from 0.66% in the prior-year quarter. Return on average shareholders' equity was 13.33%, up from 9.42% as of Dec. 31, 2024.

BOH's Share Repurchase Update

In the reported quarter, Bank of Hawaii repurchased 76.5 thousand shares of common stock at a total cost of $5 million. As of Dec. 31, 2025, the total remaining buyback authority under the share repurchase program was $121 million.

Our View on Bank of Hawaii

A rise in NII and fee income will support top-line growth. A solid capital position was another positive. Further, higher loan and deposit balances strengthen its balance sheet. However, rising expenses continue to weigh on overall performance.

Bank of Hawaii Corporation Price, Consensus and EPS Surprise

Bank of Hawaii Corporation price-consensus-eps-surprise-chart | Bank of Hawaii Corporation Quote

Currently, BOH carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Banks

BOK Financial Corporation's BOKF fourth-quarter 2025 adjusted net income per share of $2.48 surpassed the Zacks Consensus Estimate of $2.13. The bottom line increased 16.9% from the prior-year quarter.

BOKF’s results benefited from higher NII and total fees and commissions. An increase in loans and deposit balances was another positive. However, the increase in operating expenses was a major undermining factor.

First Horizon Corporation’s FHN fourth-quarter 2025 adjusted earnings per share of 52 cents surpassed the Zacks Consensus Estimate of 47 cents. This compares favorably with 43 cents in the year-ago quarter.

FHN’s results benefited from higher NII and a significant rise in non-interest income, along with the absence of provision for credit losses. However, the rise in expenses remains a headwind.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research