Bank of Hawaii (NYSE:BOH) reported fourth-quarter earnings that surged past analyst forecasts, driven by a significant recovery in its lending margins and a reversal of the high-cost deposit trends that have pressured regional banks over the last two years.
The Honolulu-based lender posted diluted earnings of $1.39 per share for the period ended Dec. 31, 2025, comfortably clearing the $1.25 consensus estimate.
Net income rose to $60.9 million, a 55.6% jump from the same period a year ago and a 14.2% increase from the prior quarter.
The standout metric was the bank’s net interest margin (NIM), which expanded to 2.61%, a 15-basis-point improvement during the quarter.
This expansion was supported by a notable decline in the cost of deposits, which fell to 1.43% from 1.59% in the linked quarter—a sign that the bank is successfully retaining its dominant market share in Hawaii while reducing the premiums paid to savers.
For the full year of 2025, the bank reported net income of $205.9 million, up 37.3% compared to 2024.
The strong capital position allowed the board to resume share repurchases during the fourth quarter, buying back 76,500 shares at a cost of $5 million.
As of year-end, the company retained $121 million in remaining buyback authority.
While loan growth remained modest, the bank's credit quality remained stable.
Total assets ended the year at approximately $24 billion, with the bank maintaining its position as one of the four local institutions controlling over 90% of Hawaii’s market deposits.