2 0 17 A n n uA l R e p o R t
Navi gati N g
To m o r row
C o n t e n t s
1
3
4
Chairman’s Message
2017 Financial Summary
Year in Review
8 Our Community
12 Our Employees
14
22
24
25
Client Profiles
2017 Financial Report
Relative Stock Prices
Bank of Hawaii Locations
26 Managing Committee
28
29
Board of Directors
Shareholder Information
n A v i g A t i n g t o m oR R o w
The story of Bank of Hawaii began on Dec. 27, 1897, when Bank of Hawaii
became the first chartered and incorporated bank to do business in the
Republic of Hawaii. For more than 120 years, we have been helping generations
of families, individuals, community organizations and businesses achieve
their dreams.
The cover image was taken at Bank of Hawaii’s Main Branch grand re-opening
in August 2017, when a new Branch of Tomorrow concept was unveiled for its
flagship location in downtown Honolulu. Designed with modern technology,
digital conveniences and private spaces for personal interactions, the branch
features elements of the Hawaiian voyaging canoe, which has always had
special meaning for Bank of Hawaii.
The Bank of Hawaii canoe, Ulu o ka lā, was commissioned in 2015 and continues
to serve as a symbol for the bank. The unique circular overlay pays tribute to
the original iron gate at Main Branch.
Bank of Hawaii marked 120 years of doing business in 2017, and continues to
help its customers explore new possibilities and navigate toward their financial
and life goals.
©2017, Bank of Hawaii Corporation. Bank of Hawaii®, Bankoh® and the Bank of Hawaii logo are
registered trademarks of Bank of Hawaii. Bankoh Investment Services, Inc. is a non-banking
subsidiary of Bank of Hawaii, member FINRA and SIPC. Cardless Cash is a trademark of FIS.
Visa is a registered trademark of Visa International Service Association and used pursuant to
license from Visa U.S.A Inc. All other trademarks and service marks appearing in this report are
the property of their respective owners and no claim of ownership is made by their use.
View Bank of
Hawaii’s 2017 digital
summary annual
report, featuring
videos of our
Chairman, clients,
community and
employees at
www.boh.com.
In December 2017, Bank of Hawaii turned 120 years old as an organization.
We ended the year in strong financial standing, and our ongoing success has
allowed us to drive value back to our shareholders, customers, employees
and the community.
Successfully catering to generation after generation of families and
businesses in our core island markets could not be achieved without the
commitment of our 2,100-plus employees. Once again, we have been
recognized nationally and locally among our peers in the industry. The
readers of the Honolulu Star-Advertiser and Honolulu magazine named us
Hawaii's "Best Bank" while Forbes continued to rank Bank of Hawaii as one
of "America's Best Banks."
in 2017, we continued to invest in the
future by investing in our employees.
Bank of Hawaii began wage progression
in the state of Hawaii as a result of the
tax reform bill signed into law in
December. We increased our minimum
hourly wage to $15 from $12, which
positively impacted 565 of our full- and
part-time employees throughout our
geographic footprint.
Continued financial strength
Diluted earnings per share reached a
record high of $4.33 for 2017, up 2.4
percent compared to 2016. We
continued to show strong growth in
total loans and leases in 2017, up 9.5
percent, to $9.8 billion, from $8.9 billion
in 2016. Commercial loans were up 4.1
percent from $3.6 billion in 2016 to $3.8
billion in 2017, and consumer loans
increased 13.1 percent to $6 billion from
$5.3 billion in 2016. our deposits
expanded to $14.9 billion, an increase of
3.9 percent from $14.3 billion in 2016.
our net interest margin for 2017 grew to
2.93 percent from 2.83 percent in 2016.
in 2017, our board of directors approved
an increase in our dividend. We also
continued with our share repurchase
plan. From the start of the share
repurchase program in July 2001
through December 2017, we
repurchased 54.2 million shares
and returned over $2.0 billion to
shareholders, at an average cost
of $38.29 per share.
Hawaii's economy
our success is reflective of Hawaii's
healthy economy, which is supported
by our low unemployment and strong
tourism and real estate industries.
our visitor industry achieved record
arrival and spending results for the sixth
consecutive year. Spending increased
6.2 percent in 2017 to $16.7 billion.
arrivals increased 5 percent to 9.3
million visitors.
the Hawaii real estate market set
records in 2017. the market enjoyed its
fifth consecutive year of record median
sale prices for oahu homes. the median
sales price for single-family homes on
oahu for 2017 was $755,000, a 2.7
percent increase from 2016, and
$405,000 for condominiums, a 3.8
percent increase compared to 2016.
Sales volume of single-family oahu
homes increased 6.3 percent and sales
of oahu condominiums increased 6.9
percent in 2017. at the end of 2017, the
median days on the market for single-
family homes was 16 days, and 17 days
for condominiums. the median sales
price and sales volume for single family
homes and condominiums also
continued to trend upward on Kauai,
Maui and Hawaii island in 2017.
Statewide, Hawaii's seasonally adjusted
unemployment rate reached a historic
level of 2.0 percent in November 2017,
the lowest on record since 1976.
Continuing our transformation
a commitment to transformation is
what keeps the bank progressing
toward our long-term goals as we pivot
to offer new and updated products,
services and solutions through a variety
of channels. We have made great strides
so far and are responding to an ongoing
shift to digital by keeping pace with
changing customer preferences,
providing digital conveniences, creating
process efficiencies and applying new
technology to our business.
We continued our Branch of tomorrow
renovations in 2017 by modernizing four
branches across oahu and Maui,
including Hawaii Kai, Kihei, Main and
Manoa, and kicked off 2018 with our
sixth renovated branch in pearlridge. at
the heart of our branch transformation
concept is making connections—
whether it be by enhancing digital
options for banking on-the-go, or by
creating opportunities for face-to-face
engagement for more complex
transactions.
as our transformation continues
externally, we simultaneously pay close
attention to how we can modernize our
processes behind the scenes. in an
effort to further reduce paper
consumption, our Charitable Foundation
Services group upgraded software in
2017 to allow nonprofits to apply online
for grants from our foundation. this is
not only an achievement in reducing
paper, but another step forward in
moving to a more digital environment.
Digitizing our environment will prove to
be a benefit for our business clients. in
2017, our Commercial Banking group
created an innovation lab—the first for
Bank of Hawaii—where we are able to
test products, services and equipment
before they hit the market, and
ultimately address and solve customer
problems before they arise.
our Customers
at the same time we invest in
technology, we still hold true to our
legacy of providing customers with
options and empowering them with
financial peace of mind.
We recognize that not all customers
enjoy the same banking preferences.
BAnk of HAwAii 2017 aNNual report | 1
Dear Fellow ShareholDerS C H A I R M A N ’ S M E S S Ag E
a top priority for Bank of Hawaii is
paying close attention to those varying
preferences and providing exceptional,
personalized service. Nothing can
replace the human connection, and it
is through our daily interactions with
customers that we deepen and elevate
our relationships.
We've enhanced the customer
experience so they may enjoy
personalized spaces for more in-depth
consultation inside our branches and
encounter shorter wait times through
our Call Center.
We've also made digital improvements
that are saving customers time and
bringing them more convenience. Digital
formats such as our easy-deposit atMs
and mobile deposit feature of our BoH
Mobile Banking app make up 40
percent of our total consumer deposits.
additionally, Cardless Cash has been
well-received by the public, and this
digital enhancement earned Bank of
Hawaii "2017 project of the Year" by the
project Management institute-Hawaii
Chapter.
i'm proud of these and other
achievements we have made to provide
a robust approach in meeting the
financial services demands of our
customers.
supporting the Community
taking care of the community is a core
value at Bank of Hawaii. together, the
bank, our charitable foundation,
employees and retirees donated
approximately $2.8 million to more than
400 community organizations in 2017.
employees and retirees contributed
over $878,000 of that amount in 2017,
which includes funds raised for our live
Kōkua giving Campaign and our annual
Community Walk.
our Bankoh Blue Crew generously gave
more than 16,000 hours of its time,
surpassing our volunteer hours by 1,000
when compared to 2016.
From serving on boards to participating
in hands-on service projects to teaching
financial literacy, our employees are
dedicated to ensuring our local
communities thrive.
For the seventh consecutive year, Bank
of Hawaii received the Financial Services
roundtable's Corporate Social
responsibility leadership award for
volunteerism, which speaks to the
generosity of our employees to our local
nonprofits and the individuals and
families they serve.
nurturing our employees
We can't predict what our rapidly
changing workforce will look like in 10
years or how technology will influence
how we respond to those changes, but
we can ensure that our greatest asset—
our employees—are supported with the
engagement, education and training
that will help them succeed.
Creating a workforce of tomorrow
means investing heavily in developing
and supporting our 2,100-plus
employees. this means not only
preparing them for the changing
landscape in banking, but preparing
them for our future community.
one such example is our Bank of Hawaii
College assistance program. last
august marked the first anniversary of
the program, through which we partner
with Chaminade university of Honolulu
to offer tuition reimbursement and
access to a college education to
employees who do not yet have a first
bachelor's degree. Since the program's
inception, 30 employees from across
the bank have participated. the
flexibility of this program allows
employees the freedom to choose from
select majors, regardless of whether or
not they relate to their role at the bank.
our commitment to fostering education
continues with our Bank of Hawaii
Foundation Scholarship. in 2017, we
honored 30 scholars with scholarships
totaling $105,000 for undergraduate
studies. Since the program's inception
in 2014, the Foundation has awarded
scholarships to 123 children and
grandchildren of Bank of Hawaii
employees totaling more than
$400,000.
For these efforts and more, we were
named among Hawaii's "Best places to
Work" by Hawaii Business magazine
for the fourth year in a row, and were
ranked No. 1 "Most Family-Friendly"
large company in the state.
i applaud the accomplishments and
incredible work of our employees!
in Conclusion
i would like to recognize vice Chair
Derek Norris, who retired after 18 years
with Bank of Hawaii, for his many
contributions over the years. as a
member of our Managing Committee
since 2009, we are grateful for his
leadership. Derek has held many
positions at the bank, including auditor,
controller, and most recently manager
of the residential and Consumer
lending group, which includes our
Mortgage, Direct and indirect lending.
vice Chair James C. polk has
transitioned to managing the residential
and Consumer lending group.
in December, we announced two key
promotions. our Chief Financial officer
Dean Shigemura was promoted to vice
chair from senior executive vice
president, and will continue to supervise
the bank's treasury, Financial reporting
and investor relations departments.
Shigemura has been a member of Bank
of Hawaii's Managing Committee since
2008.
additionally, tony Mizuno was promoted
to senior executive vice president of the
Commercial Banking group. as the
newest member of our Managing
Committee, tony oversees our
Commercial real estate loan business,
Corporate Banking, Commercial
Banking Centers, Dealer Commercial
services and equipment leasing.
i look forward to the leadership,
expertise and financial oversight that
Dean and tony will continue to bring
to the bank.
in closing, i want to thank our
employees for their dedication, our
board of directors for its support as well
as our shareholders and customers for
their continued confidence in Bank of
Hawaii. i am deeply proud of what Bank
of Hawaii has achieved in 2017 and look
forward to our collective success and
progress in 2018.
Mahalo nui loa,
peter S. Ho
Chairman, president and Ceo
2 0 1 7 F i n a n c i a l S u m m a r y
Bank of Hawaii Corporation and Subsidiaries (dollars in thousands, except per-share amounts)
For the Year ended december 31
2017
2016
Earnings Highlights and Performance Ratios
net Income
basic earnings Per Share
diluted earnings Per Share
dividends declared Per Share
net Income to average total assets (roa)
net Income to average Shareholders’ equity (roe)
net Interest margin 1
efficiency ratio 2
market Price Per Share of common Stock:
closing
high
Low
aS oF december 31
Statements of Condition Highlights and Performance Ratios
Loans and Leases
total assets
total deposits
other debt
total Shareholders’ equity
book Value Per common Share
allowance to Loans and Leases outstanding
Full-time equivalent employees
branches and offices
For the Quarter ended december 31
Earnings Highlights and Performance Ratios
net Income
basic earnings Per Share
diluted earnings Per Share
net Income to average total assets (roa)
net Income to average Shareholders’ equity (roe)
net Interest margin 1
efficiency ratio 2
$
$
184,672
4.37
4.33
2.04
1.10 %
15.27 %
2.93 %
55.66 %
85.70
90.80
74.72
$ 9,796,947
17,089,052
14,883,968
260,716
1,231,868
29.05
$
1.10 %
2,132
69
$
42,953
1.02
1.01
1.00 %
13.85 %
2.98 %
57.49 %
$
$
181,461
4.26
4.23
1.89
1.15 %
15.79 %
2.83 %
57.01 %
88.69
89.72
54.55
$
8,949,785
16,492,367
14,320,240
267,938
1,161,537
27.24
$
$
1.17 %
2,122
69
43,513
1.03
1.02
1.07 %
14.90 %
2.83 %
58.33 %
1 net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets.
2 efficiency ratio is defined as noninterest expense divided by total revenue (net interest income and total noninterest income).
BAnk of HAwAii 2017 aNNual report | 3
Y e a r i N r e v i e W
0.2083 in
transforming Banking to Create
A BetteR tomoRRow
responding not just to the needs of today, but always looking to provide value for the future,
Bank of Hawaii has served generations of Hawaii’s people and businesses for 120 years. across a
constantly changing economic landscape, as sugar and pineapple plantations gave way to the visitor
industry of the jet age, and now into the 21st century, we have provided expert financial advice and
solutions that changed with the times. Combining new technology capabilities with our financial
expertise, we are committed to bringing innovation that provides value for our shareholders,
customers, employees and community.
one way to get a snapshot of how well
we continue to succeed is to look at
the acknowledgment we receive locally
and nationally. Here are some of our
accolades for 2017:
• Corporate Social Responsibility Leadership Award, seventh
consecutive year by Financial Services roundtable
• Among Hawaii’s 14 Best Places to Work, and No. 1 in
Most Family-Friendly category among large companies,
Hawaii Business magazine
• Best Bank, by Honolulu Star-Advertiser readers
• Best Bank, by Honolulu magazine readers
Above: Bank of Hawaii’s Main Branch celebrated its grand re-opening in August 2017. The renovated branch features a large-scale digital
screen, an open floor plan and private consultation rooms. Main Branch was one of four Branch of Tomorrow renovations in 2017.
0.2083 in
enHAnCing BAnking
expeRienCes tHRougH
teCHnology And seRviCe
New and upgraded technology and a
renovated branch network are some of
the more obvious innovations in which
we have invested to lead the way for
customer convenience in 21st-century
banking in Hawaii. However, our focus
always begins with providing the most
valuable advice, products and services
to guide our customers to the future of
their dreams. Behind-the-scenes
investments, ongoing upgrades to
online security and professional
development of our employees help
ensure that we continue to provide
exceptional service that is relevant for
generations to come.
Branch and Community Banking
With the successful launch of our
Branch of tomorrow in pearl City in
November 2016, four more branches
were transformed in 2017 to meet the
changing ways that people bank now
and into the future. integrating
technological enhancements with
modern design, renovations were made
to our Hawaii Kai Branch and Main
Branch on oahu, and Kihei Branch on
Maui, while our Manoa Branch became
our first standalone Branch of
tomorrow and was moved to a more
visible and convenient location on east
Manoa road. the transformations will
continue with several more scheduled
for remodeling in 2018, which started
with the relocation of our pearlridge
Branch in January.
our Branch of tomorrow concept
utilizes digital displays to provide
financial tips and glimpses of
community activities, and staff
members use tablets to reach out to
customers directly to provide them with
secure, personalized services. the
renovations also include artwork and
other references to polynesian
navigation, which continue to inspire us
with their vision of teamwork in action
to explore new horizons.
these branch transformations involve
more than physical remodeling and new
technology. a large investment has
been made in supporting our staff’s
abilities to provide an exceptional
banking experience. as more customers
choose to conduct transactions on their
own via online and mobile banking
technology, their branch visits can now
involve more complex financial matters.
our staff is being given specialized
training and improved access to
collaborate with colleagues in different
areas of the bank to provide person-
alized banking for clients no matter
what their needs.
innovative Branch designs feature
Renewable energy
utilizing sustainable resources to
improve and conserve energy is part
of our branch transformation initiative.
all of our renovated branches are being
upgraded with roof-mounted photo-
voltaic solar panels, where possible, to
reduce energy consumption. the new
Manoa and pearlridge branches are
among those upgraded with 128 pv
panels providing an estimated savings
of 66,000 kilowatt-hours per year for
these two branches alone.
other examples of energy-efficient
branch innovations include replacing
hot water heaters with point-of-use
hot water dispensers in employee
lunchrooms, and large-screen leD
monitors that reduce staff travel time
by allowing employees to attend
meetings and training sessions online.
digital Banking solutions for Consumers
Banking online and via smartphones
continues to increase in popularity with
our customers, especially as we invested
in a communication program to
promote these options. as customers
learned that they could apply for loans
online, applications through this channel
rose by 17 percent in 2017.
our BoH Mobile Banking app was
updated with a new interface and more
functionality, resulting in continuing
growth in customers using their
smartphones for banking transactions.
in 2017, there was a 32 percent increase
in mobile deposits.
to provide our customers with the most
secure online access, Bank of Hawaii
continually upgrades our online
services. in 2018, we plan to pilot video
authentication, which will ensure secure
access when customers place video
calls to bankers.
Atms
We installed our atMs at some new
locations on oahu in 2017, including Salt
at our Kakaako, international Market
place and the Waikiki Shopping plaza,
and we continually look for new
locations where our atMs are a good fit
for people who need cash.
However, convenience is about more
than having the largest atM network
in the state. it also includes enhanced
functionality. We became the first
financial institution in Hawaii to
introduce Cardless Cash at the end of
2016. this addition to our BoH Mobile
Banking app allows customers to
withdraw cash from select atMs using
their smartphones instead of a card. in
2017, we continued expanding our
Cardless Cash locations, making the
technology available throughout our
entire atM network. this added
convenience is proving popular with
clients. We are also working on Cardless
Deposit, which would offer customers
the option of making deposits at an atM
with a mobile device instead of a card.
Call Center
We know how important our Call Center
is in delivering an exceptional customer
experience. in 2017, we began to add
more functionality to the interactive
voice response (ivr) system, to more
quickly route calls to the right person
and reduce wait times.
mortgage, Consumer and dealer
indirect lending
We understand that buying or
constructing a new home, and
refinancing or cashing out the equity
in a home is a huge part of building a
better future for our customers. our
mortgage professionals are dedicated
to providing the personal guidance to
help customers throughout the
financing process, and to be sure they
have the best loan to fit their unique
needs. We are honored to be named
Hawaii’s No. 1 residential lender for the
fifth year in a row, both for the number
of residential loans recorded and total
dollars loaned in 2017.
in order to increase accessibility to our
loan officer professionals, we added a
loan center to our ala Moana Branch in
april, and we added additional staff to
BAnk of HAwAii 2017 aNNual report | 5
YE A R I N R E V I E W
handle lending at our West oahu
locations. We continue to utilize our
extensive branch network and have
streamlined our online lending
application processes to be available
to customers at their convenience.
Bank of Hawaii continues to be Hawaii’s
No. 1 home equity lender.
We made improvements to personal
lending using preapproved mailers to
help simplify the process for our clients
and non-clients. We also broadened the
program with higher limits, longer terms
and better rates to make it more
competitive. our partnerships with
Hawaii auto dealers continued to
flourish in 2017 due in large part to our
efficient, flexible loan servicing, which is
all handled locally. our combined auto
loan and leasing portfolios grew to
$601.7 million in 2017, and we continue
to be the No. 2 lender in the state.
Commercial Real estate lending
our team continues to partner with
developers to finance affordable and
workforce housing options in Hawaii
and the Western pacific, including
housing for the elderly and for people
who are just starting their careers. in
2017, nearly 700 affordable housing
units commenced or completed
construction within the year, thanks
in part to Bank of Hawaii.
the bank helped finance 49 affordable
housing units at Hausten gardens and
49 units at river pauahi apartments
Bank of Hawaii continued to partner with
developer Gary Furuta of GSF LLC. and
Catholic Charities Housing Development
Corporation on Meheula Vista Phase II, an
affordable housing complex for the elderly,
in Mililani Mauka, where seniors are
provided supportive services and amenities
while they age in place.
he- group and
-
developed by a
Macdonald ladd Development, 72 units
at Waipahu Hall developed by
Macdonald ladd Development llC, 30
units at Mohouli Senior phase ii
developed by Hawaii island Community
Development Corporation, 62 units at
ainahau vista phase ii developed by
Hawaii Housing Development
Corporation, 75 units at Meheula vista
phase ii developed by Catholic Charities
Housing Development Corporation, 39
units at Hale Mahaolu ewalu phase iii
developed by Hale Mahaolu, and 40
units at Saipan Comfort Homes
developed by triple J in Saipan, all for
low-income seniors or families. Bank of
Hawaii also made equity investments in
affordable housing for the elderly,
including 75 units at phase ii of Meheula
vista, 62 units at phase ii of ainahau
vista, 30 units at phase ii of Mohouli, 39
units at Hale Mahaolu ewalu, and 64
family units at Waipahu towers.
Bank of Hawaii is committed to
supporting affordable housing solutions,
and has more projects in the pipeline
for the future.
tHe pRivAte BAnk
With new technology and enhanced
client offerings, the private Bank at
Bank of Hawaii has also been
transformed to better tailor services
for high-value clients as they pursue
their dreams. With more than 120 years
of experience meeting the complex and
unique needs of these clients, new
resources have been dedicated to
provide exclusive services and
expedited processing for added
convenience. the private Bank is taking
wealth management to the next level
with its full array of personalized
services, including customized lending;
investments; financial, estate and tax
planning; charitable giving and trust
services, in addition to basic banking.
trust, estate and financial planning
the private Bank relationship managers
design a personalized plan to help each
client meet his or her immediate and
long-term financial goals, offering
guidance in analyzing assets and tax
implications, and investment
opportunities to optimize returns. as
part of this plan, we can help ensure
that a legacy is preserved, protected
and transferred to the people and
institutions that our customers choose.
as the largest administrator of
irrevocable trusts in the state,
Bank of Hawaii has the depth of
expertise necessary to handle every
aspect of our clients’ trust accounts.
in 2017, we refined our estate planning
and exit planning review processes.
Feedback from clients indicates they
have found this review to be a useful
tool in clarifying plans for the future and
identifying areas that may have been
overlooked. an upgrade in technology
for these presentations now allows us
to input different scenarios during a
presentation and show new results to
clients on the spot.
estate settlement is a process that can
take up to two years to complete, and
we are committed to assisting heirs
when a client passes away. in addition
to having a dedicated trust settlement
team in place for clients of the private
Bank, we also provide education and
support to other clients through our
branch network whenever there is a
death in a family.
one of our wealth management services
includes setting up and administering
nonprofit foundations to preserve
legacies. Many of these nonprofits
distribute grants, and our Charitable
Foundation Services group is
responsible for overseeing grant
requests, review and distributions.
in 2017, we converted to upgraded
software so that grant requests for
all of the foundations can now be
submitted electronically, simplifying the
application process and streamlining
review of requests by board members.
investment services
Bank of Hawaii is the premiere provider
of fiduciary and investment services in
Hawaii and the pacific. our trusted team
manages over $9 billion of investment
assets through a wide array of advisory
and broker services. as short-term rates
went up in 2017, our investment team
rolled out new, ultra-short-term
investment options and liquidity
management strategies to meet clients’
short-term liquidity and longer term
investment needs.
in November, Bankoh investment
Services inc. launched its new life
insurance program that offers a
comprehensive suite of insurance
options including term, whole life,
universal and ltC hybrid policies.
With more than 20 different product
solutions from nine well-respected and
vetted insurance carriers, our financial
advisors are positioned to help evaluate
and identify the best options to meet
our clients' needs. For clients who
already have an existing insurance
policy, our team provides a
complimentary review to determine if
lower premiums or increased benefits
are available.
BAnking foR Business
Bank of Hawaii understands the needs
of businesses of all sizes, and has been
helping them grow for generations.
From small, family-owned businesses
to corporations, from local health care
or legal practices to international
businesses, we have the expertise and
products to help them all succeed.
digital Banking solutions for Businesses
New technology is just as important an
investment for building a brighter future
for our business clients as it is for
consumers.
in 2017, more of our corporate
customers began adopting our
purchase card (p-Card) products,
which provide increased efficiency
and management of spending while
improving cash flow. in addition to the
ability to reduce time and costs of
manual payment processing by setting
up automated purchasing, the system
offers a variety of reporting tools that
can help identify and manage spending
patterns. For example, our corporate
customers are enjoying the increased
insight and control that our travel and
entertainment solution offers them,
while simplifying reimbursements.
Because the Bank of Hawaii p-Card is
accepted anywhere a visa card is
accepted, customers can use it for
international, national and local
purchases, making it one of the
most versatile p-Cards offered in
our market.
our upgrades to Bankoh Business
Connections (BBC) that we started in
2016 continued throughout 2017.
the latest versions of online access to
payments and reporting through BBC
helped streamline complex banking
for our commercial and corporate
clients, and further improvements
are planned for 2018.
as we continue to invest in digital
upgrades, we are increasing our
emphasis on testing, including how
these innovations integrate with
our current online banking and other
commercial and business banking
services. the commercial banking
group launched a product innovation
lab in early 2017 to test and validate
new products, services and equipment
to help our team better gauge their
effectiveness and to avoid any potential
complications for all of our business
banking customers, including
small businesses.
Commercial/Corporate Banking
the depth of experience among our
commercial and corporate bankers is
one of our greatest assets. their deep
financial knowledge combined with
their keen understanding of the market
allows them to come up with
competitive solutions for our clients.
the team is highly experienced in
working with many different industries
and works closely with other financial
services experts across the bank to
help provide tailored strategies and
recommendations for a broad range
of needs including real estate and
construction loans, liquidity manage-
ment and equipment financing. We have
established a reputation as the financial
partner of choice in several areas
including commercial real estate and
captive insurance.
Bankoh Investment Services Inc. launched
its new life insurance program in 2017. BISI
President Christopher Otto starts the process
with a complimentary “Life Insurance Needs
Analysis” to help determine the appropriate
level of insurance clients may need.
in 2017, we continued to be the largest
commercial mortgage lender in the
state of Hawaii, offering customized
financial solutions for owners,
developers and investors with multi-
family, retail, industrial, office and
mixed-use properties.
Bank of Hawaii continues to lead
Hawaii’s captive insurance industry,
providing a full range of banking and
investment products to more than 80
diverse captive clients—including
government entities—for more than
30 years. our Captive insurance
Services team continues to support the
Hawaii domicile (since inception in
1986), helping businesses find the right
resources to get a detailed analysis
done to determine whether owners
and operators are suited for captive
insurance. We can help in evaluating
businesses' current risk and financing
structures, as well as in developing
feasible portfolio alternatives that can
allow for increased coverage options
while improving cash flow and expense
management. No longer just for large
corporations, businesses in a range of
sizes and industries are using captives.
Bank of Hawaii currently oversees more
than $1 billion in investment assets and
deposits for Hawaii domiciled captives.
Business Banking
our local bankers understand the
unique challenges of doing business
in Hawaii, and we recognize that
entrepreneurs and small businesses are
the backbone of our economy. along
with new and improved technology to
make banking more convenient for
business owners, we also have the
expertise to guide and support small-
business owners. Whether it’s finding
the best option for merchants' payment
card acceptance or helping a customer
apply for a Small Business
administration loan, Bank of Hawaii is
helping small businesses succeed and
grow.
BAnk of HAwAii 2017 aNNual report | 7
O U R C O M M U N I T Y
Creating a Better tomorrow
foR ouR Community
Steering a course for a better future for our community, and making sure that no one
in our ‘ohana is left behind, are central to the way we interact in our island home.
In addition to supporting the visions of local nonprofits through sponsorships or
grants from our Bank of Hawaii Foundation, our generous employees take a hands-on
approach to helping out in the community through their fundraising and volunteerism,
including regular financial education efforts.
totAl employee giving
$6.3 million
since 2007 to more than
200 local nonprofits
Community walk 2017
$156,077
9 nonprofits
giving Campaign 2017
$722,248
24 nonprofits
volunteerism
16,135 hours
359 community events
Bank of Hawaii,
its foundation and employees
contributed approximately:
$2,800,000
in 2017 to
400 oRgAnizAtions
on the following pages
are three examples of our
community support in 2017.
LIVE KŌKUA
B A n k o f H AwA i i f o u n d At i o n g R A n t s A n d s p o n s oR sHi p s
Polynesian Voyaging Society and the Mālama Honua Worldwide Voyage
in 2017, master navigators using natural elements, such as stars, sun and
ocean swells, returned home to oahu after completing a three-year voyage
circumnavigating the globe in Hawaiian voyaging canoes Hōkūle‘a and
Hikianalia.
Bank of Hawaii Foundation was proud to help support the 60,000-nautical-
mile voyage —Mālama Honua, “Caring for our island earth”—with a multi-year
$125,000 grant. this special voyage bridged pacific voyaging traditions with
new technology, using modern videos to connect the experiences of crew
members with classrooms on every step of the journey, and inspired people
of all ages to learn from cultures around the world.
the Hōkūle‘a continues to travel throughout the Hawaiian island chain in
2018, sharing the inspiration of responsibly caring for the earth.
Photos courtesy of Polynesian Voyaging Society
O U R C O M M U N I T Y
l i v e k Ō k uA vo l u n t e e R p R o g R A m
2017 Community Service Day—Caring for Veterans and Homeless
Bank of Hawaii’s Bankoh Blue Crew volunteers are out in the community
almost every weekend, and donated more than 16,000 hours of their time
to 359 community service projects in 2017. one of the biggest projects each
year is Community Service Day, a nationwide community service initiative
for financial service institutions.
this is the 12th year that Bank of Hawaii participated in the event, which
brought together volunteers from across the state of Hawaii and the Western
pacific to nonprofit organizations serving veterans, families and individuals
affected by homelessness. the event had its largest community impact ever,
as more than 300 BoH volunteers turned out on veterans Day, Nov. 11, to
make a difference. on oahu, volunteers worked at four different institute for
Human Services locations, plus Kahauiki village (the planned housing
community of one- and two-bedroom homes for homeless families in
Honolulu), Mental Health Kōkua, YWCa Fernhurst residence and u.S. vets.
in addition to serving brunch to veterans, volunteers painted, cleaned and
built facilities, cleaned out garages, improved landscaping and provided
financial education to adults and children.
Neighbor island service projects included collecting and donating outerwear
for those in need on Hawaii island to Hope Services Hawaii, preparing and
serving meals at Hale Kau Kau at St. theresa Church on Maui and assisting
with three informational events on three days for Kaua‘i Habitat for Humanity.
Bank of Hawaii volunteers in the West pacific region served and delivered
meals in guam, Saipan and Koror for a total of 11 days as they worked with
Kamalen Karidat, the Salvation army and the palau old age Center.
Clockwise from top: Jurieness Su, Mina
Sooalo, IHS Director Connie Mitchell, Ronni
Keliihoomalu and Lisa Revilla.
Mental Health Kōkua’s facility in the Kalihi
area of Honolulu gets a facelift with fresh
paint by BOH SVP Diane Murakami, VP
Darren Ota and BOH Foundation President
Donna Tanoue.
Scott Taber paints drywall in one- and
two-bedroom homes at Kahauiki Village,
a planned development of 153 one- and
two-bedroom homes for homeless families
in Honolulu.
2 0 1 7 f i n A n C i A l e d u C At i o n /C o m m u n i t y R e i n v e s t m e n t AC t (C R A )
Mentoring Students at Central Middle School
our commitment to financial education is one of the many ways that we try
to meet the community development needs in the places we serve, earning
us an “outstanding” rating in consecutive Cra evaluations since 1997. each
year, Bank of Hawaii employee volunteers visit elementary, middle school and
high school classrooms across Hawaii and in the Western pacific to help
students build financial knowledge and skills to help set them on a course
to a better future.
this year, in addition to these annual financial education outreach efforts,
BoH volunteers helped launch a new mentoring program at the historic
Central Middle School located in downtown Honolulu. More than 20 BoH
employee volunteers partnered with the Nu‘uanu YMCa and university of
Hawaii students from the atherton YMCa’s College Camp, and together
mentored 12 students from January to May. the school has low scores in
federal proficiency measures for basics like math, reading and science, and
this new mentoring program was designed to help steer students to future
opportunities by guiding them to successfully continue on to high school and
college. additionally, bank volunteers taught Central Middle School students
financial lessons as part of "teach Children to Save" Day in april and "get
Smart about Credit" Day in october.
other employees at the bank also shared the spirit of supporting these
young people, donating food to a food drive to supplement free meals for
needy students, and donating gently used sneakers and brand new socks
to sixth- and seventh-graders who needed covered shoes for a track meet
and a field trip.
Left: At Bank of Hawaii’s downtown location,
Angela Munoz, Sky Cushnie, BOH’s Rosetta
Narvaez, Eleina Olap and YMCA College
Camp Counselor and UH Pre-Med student
Kellie Goya reunited on Wednesday, May 24,
for a “Completion Ceremony” honoring
students of the Central Middle School
mentoring program.
Above: BOH’s David Lammay facilitates
discussion about saving and spending
scenarios with Central Middle School
students Jillian De Vera and Yanli He
(far right).
BAnk of HAwAii 2017 aNNual report | 11
o u r e M p l o Y e e S
Developing a
woRkfoRCe of tomoRRow
tHe KeY For DeliveriNg exceptional banking throughout our
Branch of tomorrow network and in every other business channel
is our people. as we transform to meet the changing needs of
customers now and into the future, we are also addressing the
expectations and skills of the talented professionals of our current
employees and those we hire.
We recognize that an engaging work environment is essential for employees, as
well as for customers. We’re proud that, once again, Bank of Hawaii was voted as
one of Hawaii’s “Best places to Work” in 2017. a more relaxed dress code, a paid
birthday holiday, annual family-friendly celebrations, along with other generous
benefits that recognize the important contributions of our employees are some
of the reasons that Bank of Hawaii received the recognition and came in first
place for most family-friendly company.
“Before my dad passed,
finishing college was
something that he would
always talk to me about…
Having this program opened
that door to keep my
promise to him.”
— Ronni Keliihoomalu,
universal banker at
Bank of Hawaii
At left: Ronni Keliihoomalu, universal banker at BOH's Main Branch, talks with Service
Manager Lisa Revilla. Ronni is participating in the Bank of Hawaii College Assistance
Program to keep her promise to her late father by completing her college education,
which she first started after high school with a basketball scholarship to Graceland
University. More of Ronni’s story is available on video through Bank of Hawaii’s digital
annual report at www.boh.com.
employee training, skills training,
leadership and development courses—
Bank of Hawaii has always believed in
the value of investing in personal and
professional development to expand the
knowledge and abilities of our people.
With the changing nature of modern
banking, and looking ahead to the
future, we have been updating our
training to ensure it remains relevant to
our workforce of tomorrow.
sessions. remote training for branch
staff via computer is being established
so that they may get the training they
need while still remaining accessible to
customers. this is especially helpful for
reaching our neighbor island and
Western pacific employees. Specialized
training is also being developed to help
managers hone their mentoring skills
and give them the tools to improve
communication with their teams.
ongoing professional development is a
key offering for employees at Bank of
Hawaii. as technology continues to
expand in banking, it is even more
important for branch staff to cater to
the needs of our customers through
relationship growth and issue resolution,
with an emphasis on excellent customer
service. to acknowledge the new skills
needed to deliver this personalized
banking experience, we have created
new positions in branches called
universal bankers. in addition to training
our employees for these new
responsibilities, in 2017 Bank of Hawaii
helped create universal banker training
that is now being offered through
Hawaii’s university system.
in addition to updating our curriculum
to address the need for changing skills,
we are investing in updating modes of
training delivery to incorporate videos
and e-learning with in-person classroom
in 2017, more than 24,000 hours of
training was provided by Bank of
Hawaii, with an additional 7,500 hours
focused on training for our branch
employees.
to assist employees in accelerating their
career or for those who may wish to
take advantage of new career track
opportunities within the bank, we offer
continuing education and development
programs. our pathways to professional
excellence and Bank associate
programs help identify and develop
leadership potential across the bank.
Nearly 30 employees were enrolled in
the october 2017 term of Bank of
Hawaii’s College assistance program.
this program, which was introduced in
august 2016 as a benefit for employees
without a bachelor’s degree, enables
employees to start on the path of a
college education. one of our
participants, universal Banker ronni
Keliihoomalu, is pictured on the facing
page and shares her experience in the
digital annual report.
We are better preparing our employees
to develop lasting customer
relationships—giving them the skills and
ability to be poised and ready to
connect, engage and advise—making
training an investment in the future of
our company, our customers and the
community at large. We know that the
banking industry will continue to evolve
and that investing in the immediate and
future success of our employees will
help us create a fulfilling future
together as we continue to adapt to
the changing times.
www.boh.com
BAnk of HAwAii 2017 aNNual report | 13
C O M M U N I T Y B A N K I N g C L I E N T
p Ro f i l e :
KRISTIN KATO
A Cake Life
k r i s t i n k a t o ,
o w n e r o f
A C a k e l i f e .
C O M M U N I T Y B A N K I N g C L I E N T
p Ro f i l e :
KRISTIN KATO
A Cake Life
"We’ve been a client of
Bank of Hawaii since
i started a Cake life in July
2009. My plan was to become
a lawyer and after being in the
field for a couple of years
i realized it wasn’t very
fulfilling. one day i took a
cake decorating class at Ben
Franklin to take my mind off a
case, and found that creating
custom cake designs made
me happy. i learned a lot on
my own about design, sugar
artistry, and especially starting
a business since i didn’t
know anyone else trying to
accomplish the same at 25."
k R i s t i n k A to : i put up my own capital to get the business started, and we grew
very fast. in 2010 i was able to hire my first employee. By 2011 we needed a bigger
space, so we started looking for a new location along with the funding. at first,
everyone kept turning me down for a loan with the reason being i was too young
(and a woman). this only made me more determined to work harder and succeed.
My banker, reid Hinaga, is the one who got us the funding we needed to expand
into our King Street location. With his nomination we were able to win the Small
Business administration’s “Young entrepreneur of the Year” award in 2013. this
qualified us for an SBa loan through Bank of Hawaii. reid’s confidence in us and his
nomination for our small business award opened the doors to a lot of different
opportunities.
it’s really a personal relationship for me at the bank. all of our banking services—
merchant services, loans, and deposits—are with Bank of Hawaii, and reid’s been
able to help me with all of them. He is always there for us, always accessible.
Being able to bank when it’s convenient for me is very helpful since i work long
hours. there are countless things we can handle online and making a deposit on my
phone is just one thing i love. the branch here in Moiliili is open seven days a week,
and i can use their smart atMs when i go during off hours.
as my business continues to expand and grow, i’ve been learning more about my
role as an employer and how to effectively run a team. i’ve discovered that building
a team is about bringing people together and allowing their talents to shine. this
gives me a responsibility to continue bringing in business and to grow not just for
myself, but to support my entire team.
after just a few years, we have outgrown our King Street location and need a bigger
space to increase our production and productivity. i’ve been looking for the right
space over the last year, and reid’s been helping me a lot with that.
Bank of Hawaii has shown me that they really want to help small businesses move
forward. running a small business is hard work, so i appreciate that they give us a
lot of attention. i know we’ll keep doing more projects together.
i want to encourage other girls and women who want to start their own business to
go for it. a lot of people told me i couldn’t do this, and with the help of reid and
Bank of Hawaii i’m glad i could prove them wrong.
BAnk of HAwAii 2017 aNNual report | 15
C O M M E R C I A L B A N K I N g C L I E N T S
p Ro f i l e :
CHAD &
STEPHANIE BUCK
Hawaii Foodservice Alliance
H a w a i i fo o d s e r v i c e
A l l i a n c e o w n e r a n d
C e o C h a d B u c k a n d
C f o s t e p h a n i e B u c k .
C O M M E R C I A L B A N K I N g C L I E N T S
p Ro f i l e :
CHAD &
STEPHANIE BUCK
Hawaii Foodservice Alliance
CH A d B u Ck : Fifteen years ago we were running our operations from a card
table in the basement of our house. Since then, we’ve added a new full-time job
every two-and-a-half weeks straight. growing at this rate and building on
multiple islands simultaneously made conserving cash through an SBa loan
a real advantage.
Starting out, we carried 17 items in one category for one grocery chain. Now we
manage several hundred items for every grocery, retailer, club and convenience
store on every island.
StepHaNie BuCK:
"our relationship with
st e p H A n i e : to continue moving forward we needed to invest in a statewide
cold chain, an unbroken temperature-controlled supply chain, for all our vehicles
and facilities.
Bankoh started in 2012 when
we were building out our
new oahu and Maui facilities.
Bank of Hawaii worked with
us, and helped us navigate the
SBa loan process."
CH A d : through the Food Safety Modernization act, the federal government
dramatically raised safety standards and procedures for food handling and
distribution.
these new laws required us to build state-of-the-art facilities on all islands and on
the West Coast to meet stringent safety standards. During this time, the business
has grown from a card table to tracking over $100 million in annual sales. to
accomplish this required us to partner with a bank that understands our business
in depth. From compliance to how we manage the continuing rapid growth across
all channels, Bankoh has been by our side as a trusted partner.
Bankoh understands the complexity of doing business in Hawaii on this scale.
Bankoh understands the regulatory and competitive environments as well as the
real estate and construction nuances across each island. Driving and managing
growth in Hawaii is significantly more complex than in other places. Having a bank
that understands this and is also rooted and committed to our local communities
is a huge advantage.
st e p H A n i e : lyle tamagawa has worked with us on each of our facilities. We’ve
collaborated with lyle so much that we have really gotten to know him over this
time. typically, the first part of any meeting is spent catching up with how our kids
are doing, and relating to each other as parents. We have a level of trust that has
been built over the years through our interactions and knowing that lyle continues
to watch out for us. our Bankoh relationship is more relational than transactional.
Having a solid relationship with Bankoh has enabled us to invest in our facilities
and grow as a company. the Bankoh relationship gives us a true advantage
because they know us, and they know our business. this partnership has been
one of the keys to our success. as we look back and see how important the
facilities are, Bankoh made that possible.
BAnk of HAwAii 2017 aNNual report | 17
C O M M E R C I A L B A N K I N g C L I E N T
p Ro f i l e :
MAKANI MAEVA
Āhe- group
m a k a n i m a e v a ,
p r e s i d e n t a n d
Ce o o f Ā h ē g r o u p ,
a H a w a i i - b a s e d
a f f o r d a b l e h o u s i n g
d e v e l o p e r.
C O M M E R C I A L B A N K I N g C L I E N T
p Ro f i l e :
MAKANI MAEVA
Āhe- group
m A k A n i m A e vA : Working with an investor partner, we raise tax credit equity to
offset the amount of debt that would otherwise be needed to acquire and develop
housing. a lower loan means a lower mortgage payment. that’s what allows us to
keep our rents low for the residents.
Bank of Hawaii (BoH) has a strong lending vision that you might not get from other
lenders. i work with BoH both in their capacity as a lender and as an equity investor.
BoH is an active investor in affordable housing tax credits.
"i’m passionate about affordable
housing; i believe it’s critical
to our community and a
cornerstone on which individuals
and families thrive. i began my
career in affordable housing in
1995. after 22 years of building
housing nationwide, i decided
to focus exclusively on helping
solve Hawaii’s affordable housing
problem. to this end, i formed
Āhē group in late 2014.
Āhē group develops affordable
rental housing for people earning
up to 60 percent of the area
median income. people of all
backgrounds fall into this income
bracket, including those starting
their careers as school teachers,
firemen, retail clerks and bank
tellers or others at the end of
their careers—people simply
need a safe, clean, decent and
affordable place to live."
BoH gave Āhē group the loan for its first project in 2015, acquiring and
rehabilitating Kaneohe elderly apartments, a 44-unit affordable rental housing
project for seniors. over the past three years BoH has provided loans and equity
investments in several other Āhē group projects.
i need flexibility in a banking relationship. the needs of affordable housing projects
are complex and cannot always be synthesized into a preprinted brochure so it’s key
that my bankers are creative thinkers. a recent example of this unique relationship is
our recent acquisition of Hausten gardens apartments, a 50-unit project in Moiliili.
When the opportunity to acquire Hausten gardens came our way, we had to act on
it immediately because the seller was very impatient. the project was at risk of
being converted into a market-rate project and we knew that to keep it affordable
we would have to move on it right away.
Carole lau, our commercial real estate banker, suggested a bridge loan, which
allowed me to acquire the property ahead of the bond financing. By parsing out the
transaction into two phases, we were able to acquire the real estate and then close
on the construction financing nine months later. renovations on Hausten gardens
are scheduled to begin in January 2018. With some creative thinking, together we
were able to preserve valuable affordable rental housing, which we’ll continue to
operate for another 60 years at affordable rates.
Carole looks at projects as an investor, as a lender, and she has current information
about Āhē group’s financial position. in other words, Carole understands the risk
that BoH and Āhē group are taking on. another reason she’s so great with
affordable housing is Carole understands the lending programs available in the
affordable housing market and she uses this knowledge to put the best package
together. Her programs are unbelievably competitive.
at Āhē group we acquire and own properties, we maintain them, and we manage
them. We have a lot of bank accounts, sometimes several for each of our projects.
it’s very convenient to give our accountants and bookkeepers online access to our
financial information so they can prepare taxes and create reports easily.
When i opened my own development company, people reached out to me and said
they were behind me, that they wanted to partner on my deals. Bank of Hawaii was
among those who called on me. they identified my focus on affordable housing for
Hawaii, which aligned with their focus. they saw the possibilities; i’m really fortunate
that they did.
Āhē group will grow as it needs to, but our goal is focused as much on quality
as quantity. We strive to provide quality homes for the people we serve. our
commitment to our projects run deep. We aren’t just building structures. We don’t
just acquire and renovate buildings. We recognize and respect that these are
people’s homes and we impact people’s lives. BoH understands that, and that
makes them a perfect partner for Āhē group.
BAnk of HAwAii 2017 aNNual report | 19
d r. t a m m y C h a n g -
m o t o o k a , o w n e r o f
H a w a i i o r t h o d o n t i s t ,
a n d d r. R a n d a l m o t o o k a ,
c o - o w n e r o f H a w a i i
d e n t a l w e l l n e s s .
T H E P R I VAT E B A N K C L I E N T S
p Ro f i l e :
DR. TAMMY CHANg-
MOTOOKA &
DR. RANDAL MOTOOKA
raNDal MotooKa:
"i look for ease in
communication in a
relationship with a bank.
and trust is a big factor,
trust that they are taking
good care of our financial
needs and well-being."
tA m m y: When we got back to the islands, i had an opportunity to purchase
a practice. i was fresh out of school, and i had no idea what to do. Someone
introduced me to tom Koide, who’s now retired as a senior executive vice president
from the bank. at the time, he was in the loan department at the ala Moana Branch,
and he helped me get the loan to purchase my practice. He could see the value in
the business and understood what we wanted to do.
R A n dA l : Starting out we had nothing. Bank of Hawaii gave us the break.
tA m m y: there were no doctors or dentists in our families at that time, so we didn’t
understand how to run a business. Bank of Hawaii understands that dental school
doesn’t teach those essentials. tom Koide guided me in how to create a business
plan, and other steps in running a business.
R A n dA l : We’ve had a lot of good people help us out over the years. Jared
Kashiwabara is our private banker now; we call him for everything: personal loans,
refinancing, business loans.
tA m m y: Jared’s been very helpful introducing us to many different services that the
bank provides that we never utilized before. Now that our kids are going off to
college, he’s helping us look forward to retirement and estate and trust planning,
and he’s invited us to various seminars. this is more than a banking relationship
around loans and finances: He’s helping us do our life.
taMMY CHaNg-MotooKa:
"We started our relationship
with Bank of Hawaii in the
mid- ’90s when we returned
to Hawaii after our training
on the mainland. i had just
finished my orthodontic
residency at Northwestern,
and randy had been working
with me in Chicago."
R A n dA l : Jared seems to understand the health care market really well. as things
come up at work, he’ll make recommendations; he’s always had good advice for us.
He’s really looking out for our best interests; he’s preparing us for the future.
tA m m y: in terms of wanting to purchase my own space or lease a new location for
my practice, Jared recently helped us with a large equity line. So when the time
comes to purchase commercial space for my practice, cash is already available to
help us move forward, everything is in place.
R A n dA l : online banking is very convenient. also the multiple branches make
banking much more accessible. over the years we’ve used Hawaii Kai, ala Moana,
Kahala . . . the downtown branch is very convenient for me. the renovated
downtown branch is awesome—it looks like a hotel lobby, with concierge services
and everything. they’re really changing the whole atmosphere of banking. Not just
physically, but also with the personal service.
tA m m y: it’s very important to us to have the accessibility of a bank based here in
the islands. i think there were times when i didn’t want to bother anyone at the bank,
and i wasn’t sure who to speak to when i called with a question. But knowing that
i have this relationship at the bank with Jared, who i can just call or text anytime,
and knowing that he’ll answer or direct me to the right people has brought me
peace of mind. i want to thank the bank for almost 25 years of great service, loyalty,
and a great relationship.
R A n dA l : For that trust. they gave us our break when we first started, and they
basically held our hands as we grew from the ground up and serviced our every
financial need. they provide very personable service that makes communication
easier.
BAnk of HAwAii 2017 aNNual report | 21
2 0 1 7 F i NaN C i a l r e p o r t
c onS olidated Statemen t S o F i n c o me
Bank of Hawaii Corporation and Subsidiaries (dollars in thousands, except per-share amounts)
For the Year ended december 31
2017
2016
Interest Income
Interest and Fees on Loans and Leases
Income on Investment Securities
available-for-Sale
held-to-maturity
deposits
Funds Sold
other
total Interest Income
Interest Expense
deposits
Securities Sold under agreements to repurchase
Funds Purchased
Short-term borrowings
other debt
total Interest expense
net Interest Income
Provision for credit Losses
net Interest Income after Provision for credit Losses
Noninterest Income
trust and asset management
mortgage banking
Service charges on deposit accounts
Fees, exchange, and other Service charges
Investment Securities Gains, net
annuity and Insurance
bank-owned Life Insurance
other
total noninterest Income
Noninterest Expense
Salaries and benefits
net occupancy
net equipment
data Processing
Professional Fees
FdIc Insurance
other
total noninterest expense
Income before Provision for Income taxes
Provision for Income taxes
Net Income
basic earnings Per Share
diluted earnings Per Share
dividends declared Per Share
basic Weighted average Shares
diluted Weighted average Shares
$
370,441
$
333,239
46,772
81,740
15
3,882
944
503,794
22,332
19,592
123
64
4,445
46,556
457,238
16,900
440,338
45,430
12,949
32,575
54,845
10,430
6,858
6,517
15,813
185,417
205,536
32,536
22,078
15,483
11,681
8,666
61,711
357,691
268,064
83,392
41,892
79,087
9
2,861
812
457,900
12,647
23,406
12
—
4,256
40,321
417,579
4,750
412,829
46,203
19,895
33,654
55,176
10,203
7,017
6,561
18,634
197,343
201,150
30,252
20,578
15,208
10,072
8,615
64,703
350,578
259,594
78,133
$
$
$
$
184,672
$
181,461
4.37
4.33
2.04
42,280,931
42,607,057
4.26
$
4.23
$
$
1.89
42,644,100
42,879,783
refer to the company's annual report on Form 10-K for the fiscal year ended december 31, 2017 for the consolidated Financial Statements,
including the related report of Independent registered Public accounting Firm.
c onS olidated Statemen t S o F c onditio n
Bank of Hawaii Corporation and Subsidiaries (dollars in thousands)
aS oF december 31
ASSEtS
Interest-bearing deposits in other banks
Funds Sold
Investment Securities
available-for-Sale
held-to-maturity (Fair Value of $3,894,121 and $3,827,527)
Loans held for Sale
Loans and Leases
allowance for Loan and Lease Losses
net Loans and Leases
total earning assets
cash and due From banks
Premises and equipment, net
accrued Interest receivable
Foreclosed real estate
mortgage Servicing rights
Goodwill
bank-owned Life Insurance
other assets
total Assets
LIAbILItIES
deposits
noninterest-bearing demand
Interest-bearing demand
Savings
time
total deposits
Funds Purchased
Securities Sold under agreements to repurchase
other debt
retirement benefits Payable
accrued Interest Payable
taxes Payable and deferred taxes
other Liabilities
total Liabilities
2017
2016
$
3,421
181,413
2,232,979
3,928,170
19,231
9,796,947
(107,346)
9,689,601
16,054,815
263,017
130,926
50,485
1,040
24,622
31,517
280,034
252,596
$ 17,089,052
$
4,724,300
3,082,563
5,389,013
1,688,092
14,883,968
—
505,293
260,716
37,312
6,946
24,009
138,940
15,857,184
$
3,187
707,343
2,186,041
3,832,997
62,499
8,949,785
(104,273)
8,845,512
15,637,579
169,077
113,505
46,444
1,686
23,663
31,517
274,188
194,708
$ 16,492,367
$
4,772,727
2,934,107
5,395,699
1,217,707
14,320,240
9,616
523,378
267,938
48,451
5,334
21,674
134,199
15,330,830
SHAREHoLdERS’ EquIty
common Stock ($.01 par value; authorized 500,000,000 shares;
issued / outstanding: december 31, 2017 - 57,959,074 / 42,401,443
and december 31, 2016 - 57,856,672 / 42,635,978)
capital Surplus
accumulated other comprehensive Loss
retained earnings
treasury Stock, at cost (Shares: december 31, 2017 - 15,557,631
and december 31, 2016 - 15,220,694)
total Shareholders’ Equity
total Liabilities and Shareholders’ Equity
576
561,161
(34,715)
1,512,218
576
551,628
(33,906)
1,415,440
(807,372)
1,231,868
$ 17,089,052
(772,201)
1,161,537
$ 16,492,367
BAnk of HAwAii 2017 aNNual report | 23
R E L A T I V E S T O C K P R I C E S
RE L AT I V E P R I C E P E R F O R M A N C E
For the Year Ended December 31, 2017
BOH
S&P Banks
KBW Regional Bank Index
S&P 500
$130
$125
$120
$115
$110
$105
$100
$95
$90
$85
$80
$75
MARCH 31
JUNE 30
SEPTEMBER 30
U N B R O K E N H I S TO RY O F D I V I D E N D S
Bank of Hawaii Corporation
RECESSION
RECESSION
FINANCIAL CRISES
$2.25
$2.00
$1.75
$1.50
$1.25
$1.00
$0.75
$0.50
$0.25
$0.00
1987
1992
1997
2002
2007
2012
2017
Historical dividends adjusted for stock splits
B a N K o F H a W a i i l o C a t i o N S
fAC t s : H AwA i i , g uA m A n d A m e R i C A n s A m oA
H Aw A i i
Hawaii business establishments in 2016: 97.5 percent have fewer than 100
employees, 94.8 percent have fewer than 50 employees, and 61.9 percent
have fewer than five employees.1
Hawaii gross domestic product in 2016: $83.9 billion (in current dollars)2
21.1% government (federal civilian & military, and state and local)
19.1% real estate, rental and leasing
8.7% accommodation and food services
6.8% retail trade
6.7% Health care and social assistance
6.3% Construction
4.9% transportation and warehousing
4.0% professional and technical services
3.4% Finance and insurance
B A n k o f H AwA i i B R A n C H e s
A n d At m s
(As of December 31, 2017)
BR A N C H E S A N D
I N - S TO R E
B R A N C H E S
state of Hawaii
island of oahu
island of Hawaii
island of Maui
island of Kauai
island of lanai
island of Molokai
64
36
11
10
5
1
1
west pacific
CNMi/Saipan
guam
palau
4
1
2
1
AT MS
353
247
47
33
24
1
1
35
5
27
3
tourism’s direct and indirect impact on Hawaii gross domestic product
(in current dollars) in 2016: 16.6%3
State of Hawaii resident population as of July 1, 2017: 1,427,5384
American samoa 1
5
total
69
393
g uA m
- u.S. territory
- Capital: Hagatna (agana)
- resident population: July 2017 estimate 167,3585
- Main industries: u.S. military and tourism
Am e R i C An s Am o A
- u.S. territory
- Capital: pago pago
- resident population: July 2017 estimate 51,5045
- Main industries: tuna canneries and handicrafts
C o m m o n w e A lt H o f t H e n oR t H e Rn
mA R i An A i s l An d s
- Commonwealth in political union with the u.S.
- Capital: Saipan
- resident population: July 2017 estimate 52,2635
- Main industries: tourism, banking and construction
pA l Au
- Constitutional government in free association with the u.S.
- Capital: Melekeok
- resident population: July 2017 estimate 21,4315
- Main industries: tourism, craft items and construction
1 Hawaii Department of labor & industrial r elations, 2016
employment and payrolls in Hawaii: https://www.hiwi.org/
admin/gsipub/htmlarea/uploads/lFr _QCeW_eS2016.pdf
2 table 13.05, Hawaii DBeDt State of Hawaii Data Book 2016:
http://files.hawaii.gov/dbedt/economic/databook/2016-
individual/13/130516.xls from the u.S. Bureau of economic
analysis, gross Domestic product by industry 1963 to
2016: www.bea.gov/regional/index.htm
3 tables 7.34, Hawaii DBeDt State of Hawaii Data Book 2016:
http://files.hawaii.gov/dbedt/economic/databook/2016-
individual/07/073416.xls
4 Hawaii DBeDt, Hawaii State Data Center, latest population
estimates Data, 2017 State population estimates: http://
census.hawaii.gov/whats-new-releases/2017-state-
population-estimates/ and http://files.hawaii.gov/dbedt/
census/popestimate/2017_state_pop_hi/nst-est2017-01.
xlsx
5 Central intelligence agency, the World Factbook: https://
www.cia.gov/library/publications/the-world-factbook/
BAnk of HAwAii 2017 aNNual report | 25
M A N A g I N g C O M M I T T E E
B A n k o f H AwA i i C o R p o R At i o n / B A n k o f H AwA i i (as of Dec. 31, 2017)
peter s. Ho
Chairman, president and
Chief executive officer
sharon m. Crofts
vice Chair
Client Solutions group
wayne y. Hamano
vice Chair
and Chief Commercial officer
Alton t. kuioka
vice Chair of Board of Directors
of Bank of Hawaii
kent t. lucien
vice Chair
and Chief Strategy officer
derek J. norris
vice Chair
residential and Consumer lending
James C. polk
vice Chair
Mortgage Banking
mark A. Rossi
vice Chair, Chief administrative officer,
general Counsel & Corporate Secretary
mary e. sellers
vice Chair
and Chief risk officer
dean y. shigemura
vice Chair
and Chief Financial officer
donna A. tanoue
vice Chair
Client and Community relations
Top from left:
Mark A. Rossi, Peter S. Ho, Kent T. Lucien and Mary E. Sellers
Bottom from left:
Derek J. Norris, Donna A. Tanoue, James C. Polk, Jill F.S. Higa and Wayne Y. Hamano
vincent e. Barfield
Senior executive vice president
the private Bank
sheh Bertram
Senior executive vice president
and Chief information officer
Jill f.s. Higa
Senior executive vice president
people Services group
susan l. ing
Senior executive vice president
and Chief Marketing officer
david oyadomari
Senior executive vice president
Digital Channels Division
kevin t. sakamoto
Senior executive vice president
Branch Delivery
Top from left:
Vincent E. Barfield, Susan L. Ing, David Oyadomari and Kevin T. Sakamoto
Bottom from left:
Sheh Bertram, Alton T. Kuioka, Sharon M. Crofts and Dean Y. Shigemura
BAnk of HAwAii 2017 aNNual report | 27
B O A R D O F D I R E C T O R S
B A n k o f H AwA i i C o R p o R At i o n / B A n k o f H AwA i i (as of Dec. 31, 2017)
Board of Directors (seated, from left): Kent T. Lucien, Mary G.F. Bitterman, Peter S. Ho, S. Haunani Apoliona and Victor K. Nichols.
Standing from left: Barbara J. Tanabe, Robert A. Huret, Clinton R. Churchill, Raymond P. Vara, Alicia Moy, Michael J. Chun, Mark A. Burak,
Robert W. Wo, Alton T. Kuioka and Donna A. Tanoue.
s. Haunani Apoliona*
Former trustee
office of Hawaiian affairs
mary g.f. Bitterman*
president and Director
the Bernard osher Foundation
mark A. Burak*
retired executive
vice president
Bank of america
michael J. Chun*
retired president and Headmaster
Kamehameha Schools-Kapalama
Clinton R. Churchill*
Former trustee
the estate of James Campbell
peter s. Ho*
Chairman, president and
Chief executive officer
Bank of Hawaii Corporation
and Bank of Hawaii
Robert A. Huret*
Managing Member
Ftv Management Company lp
Alton t. kuioka
vice Chair
Client relations
Bank of Hawaii
kent t. lucien*
vice Chair and Chief
Strategy officer
Bank of Hawaii Corporation
and Bank of Hawaii
Alicia moy*
president and Chief executive officer
of Hawai‘i gas
victor k. nichols*
Chief executive officer
of Harland Clarke Holdings
Barbara J. tanabe*
owner and partner
Ho‘akea Communications llC
donna A. tanoue
vice Chair
Client and Community relations
Bank of Hawaii
Raymond p. vara*
president and Chief
executive officer
Hawai‘i pacific Health
Robert w. wo*
owner and Director
C.S. Wo & Sons ltd.
*Bank of Hawaii Corporation Board of Directors
SH A R E H O L D E R I N F O R M A T I O N
CorporaTe HeadquarTerS
Bank of Hawaii Corporation
130 Merchant Street
Honolulu, Hawaii 96813
annuaL meeTing
The annual meeting of
shareholders will be held on Friday, April 27,
2018, at 8:30 a.m. at the
Bank of Hawaii Main Office, 5th Floor, 111 South
King Street, Honolulu, Hawaii.
TranSFer agenT and regiSTrar
Computershare Investor Services, LLC
250 Royall Street, Canton, MA 02021
Common SToCk LiSTing nYSe: BoH
The common stock of Bank of Hawaii
Corporation is traded on the New York Stock
Exchange under the ticker symbol BOH and is
quoted daily in leading financial publications as
“Bank of Hawaii.”
dividend reinveSTmenT
& stoCk puRCHAse plAn (dRp)
Bank of Hawaii Corporation’s DRP allows
existing shareholders to purchase common
shares of the company’s stock by either
reinvesting their stock dividends or by optional
cash payments.
- Individuals must possess at least one share of
the company’s stock to participate in the DRP.
- Shares are purchased on the 10th business day
of each month based on the average of five
trading days ending on the day of purchase.
- Minimum payment for purchase of shares is
$25 and the maximum is $5,000 per calendar
quarter.
- There are no fees for purchasing shares or for
the safekeeping of stock certificates. Fees are
assessed on the sale of shares in the DRP.
Detailed information about Bank of Hawaii
Corporation’s DRP can be found online at www.
boh.com or by calling Computershare Investor
Services LLC at 1-888-660-5443
inquirieS
Shareholders with questions about stock
transfer services, share holdings or dividend
reinvestment may contact Computershare
Investor Services LLC at 1-888-660-5443
between 7:00 a.m. and 5:00 p.m. Central
Standard Time.
inveSTorS and anaLYSTS Seeking
FinanCiaL inFormaTion
Cindy Wyrick
Executive Vice President
Investor Relations
Phone: 1-808-694-8430
For generaL inquirieS
Phone: 1-888-643-3888
www.boh.com
Forward-Looking STaTemenTS
This report contains forward-looking statements concerning, among other things, the economic
and business environment in our service area and elsewhere, credit quality and other financial and
business matters in future periods. 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) general economic conditions either nationally, internationally or locally may be different than
expected, and particularly, any event that negatively impacts the tourism industry in Hawaii;
2) unanticipated changes in the securities markets, public debt markets, and other capital markets
in the U.S. and internationally; 3) competitive pressures in the markets for financial services and
products; 4) the impact of legislative and regulatory initiatives, particularly the Dodd-Frank Wall
Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”); and the new
administration's review of potential changes to such initiatives; 5) changes in fiscal and monetary
policies of the markets in which we operate; 6) the increased cost of maintaining or the
Company’s ability to maintain adequate liquidity and capital, based on the requirements adopted
by the Basel Committee on Banking Supervision and U.S. regulators; 7) actual or alleged conduct
which could harm our reputation; 8) changes in accounting standards; 9) changes in tax laws or
regulations or the interpretation of such laws and regulations, including the Tax Cuts and Jobs Act
of 2017; 10) changes in our credit quality or risk profile that may increase or decrease the required
level of our reserve for credit losses; 11) changes in market interest rates that may affect credit
markets and our ability to maintain our net interest margin; 12) the impact of litigation and
regulatory investigations of the Company, including costs, expenses, settlements, and judgments;
13) any failure in or breach of our operational systems, information systems or infrastructure, or
those of our merchants, third party vendors and other service providers; 14) any interruption or
breach of security of our information systems resulting in failures or disruptions in customer
account management, general ledger processing, and loan or deposit systems; 15) changes to the
amount and timing of proposed common stock repurchases; and 16) natural disasters, public
unrest or adverse weather, public health, and other conditions impacting us and our customers’
operations. given these risks and uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results. For a detailed discussion of these
and other risks and uncertainties that could cause actual results and events to differ materially
from such forward-looking statements please refer to the risk factors discussed in our Annual
Report on Form 10-K for the fiscal year ended December 31, 2017, and any subsequently filed
reports with the U.S. Securities and Exchange Commission. Words such as “believes,”
“anticipates,” “expects,” “intends,” “targeted” and similar expressions are intended to identify
forward-looking statements, but are not the exclusive means of identifying such statements.
We undertake no obligation to update forward-looking statements to reflect later events or
circumstances, except as may be required by law.
Bank of Hawaii Corporation is an independent regional financial services
company serving businesses, consumers and governments in Hawaii, American
Samoa and the West Pacific. The Company’s principal subsidiary, Bank of
Hawaii, was founded in 1897. For more information about Bank of Hawaii
Corporation, see the Company’s website, www.boh.com.
*Bank of Hawaii Corporation Board of Directors
BaNK oF HaWaii CorporatioN
P.O. Box 2900 • Honolulu, Hawaii 96846