# Bank of Hawaii Corp: Form 10-K for the period ended Dec 31, 2024

- Company: [Bank of Hawaii Corp](/companies/boh.md) (CIK 46195)
- Form: 10-K
- Filed: 2025-03-04
- Accepted by EDGAR: Mar 3, 2025, 19:10 ET
- Period: 2024-12-31
- Accession: 0000950170-25-031193
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/46195/000095017025031193/boh-20241231.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/46195/000095017025031193/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-12-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 12 months, 2024-01-01 to 2024-12-31 | $122.1m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Income tax | 12 months, 2024-01-01 to 2024-12-31 | $47.9m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 12 months, 2024-01-01 to 2024-12-31 | $150.0m | us-gaap:NetIncomeLoss |
| Diluted EPS | 12 months, 2024-01-01 to 2024-12-31 | $3.46 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 12 months, 2024-01-01 to 2024-12-31 | $3.48 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 12 months, 2024-01-01 to 2024-12-31 | 39,700,388 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 12 months, 2024-01-01 to 2024-12-31 | $178.4m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 12 months, 2024-01-01 to 2024-12-31 | $9.7m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 12 months, 2024-01-01 to 2024-12-31 | $112.3m | us-gaap:PaymentsOfDividendsCommonStock |
| Share repurchases | 12 months, 2024-01-01 to 2024-12-31 | $5.3m | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2024-12-31 | $763.6m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Total assets | at 2024-12-31 | $23.60bn | us-gaap:Assets |
| Total liabilities | at 2024-12-31 | $21.93bn | us-gaap:Liabilities |
| Long-term debt | at 2024-12-31 | $550.0m | us-gaap:LongTermDebt |
| Shareholders' equity | at 2024-12-31 | $1.67bn | us-gaap:StockholdersEquity |

## Business

As filed, 36,233 characters.

### General

Bank of Hawaii Corporation (“Bank of Hawai‘i Corporation” or the “Parent”) is a Delaware corporation and a bank holding company (“BHC”) headquartered in Honolulu, Hawai‘i. The Parent’s principal operating wholly-owned subsidiary, Bank of Hawai‘i (“Bank of Hawaiʻi” or the “Bank”), was organized on December 17, 1897, and is chartered by the State of Hawai‘i. The Bank’s deposits are insured by the Federal Deposit Insurance Corporation (the “FDIC”) and the Bank is a member of the Federal Reserve System. The Bank, directly and through its subsidiaries, provides a broad range of financial products and services primarily to customers in Hawaiʻi, Guam, and other Pacific Islands. References to “we,” “our,” “us,” or “the Company” refer to the Parent and its subsidiaries and are consolidated for financial reporting purposes. The Bank’s subsidiaries are identified in Exhibit 21.1 to this Form 10-K and include, among others, Bankoh Investment Services, Inc. and Pacific Century Life Insurance Corporation. The Bank’s subsidiaries are engaged in securities brokerage, investment advisory services, and providing credit insurance. We are organized into three business segments for management reporting purposes: Consumer Banking, Commercial Banking, and Treasury and Other. See Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (“MD&A”) and Note 13 in Item 8. “Notes to Consolidated Financial Statements” for more information.

Our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports can be found free of charge on our website at www.boh.com as soon as reasonably practicable after such material is electronically filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”). The SEC maintains a website, www.sec.gov, which contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Our Corporate Governance Guidelines; charters of the Audit Committee, the Human Resources and Compensation Committee, and the Nominating and Corporate Governance Committee; and our Code of Business Conduct and Ethics are available on our website at www.boh.com. Printed copies of this information may be obtained, without charge, by written request to the Corporate Secretary at 130 Merchant Street, Honolulu, Hawaiʻi, 96813.

We use our website at https://ir.boh.com as a routine channel of distribution of Company information, including press releases, presentations, financial and other supplemental information, as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the investor relations portion of our website in addition to following our social media channels, press releases, SEC filings, and public conference calls and webcasts. None of the information provided on our website, in our press releases, public conference calls and webcasts, or through social media channels is incorporated into, or deemed to be a part of, this Annual Report on Form 10-K or in any other report or document we file with the SEC.

### Competition

The Company operates in a highly competitive environment subject to intense competition from traditional financial service providers including banks, savings associations, credit unions, mortgage companies, finance companies, mutual funds, brokerage firms, insurance companies, and other non-traditional providers of financial services including financial service subsidiaries of commercial and manufacturing companies. Some of our competitors are not subject to the same level of regulation and oversight that is required of banks and BHCs, and receive favorable tax treatment. As a result, some of our competitors may have lower cost structures. Also, some of our competitors, through delivery channels such as the Internet, may be based outside of the markets that we serve. By emphasizing our extensive branch network, exceptional service levels, and knowledge of local trends and conditions, the Company believes it has developed a competitive advantage in its market.

### Supervision and Regulation

Our operations are subject to extensive regulation by federal and state governmental authorities. The regulations are primarily intended to protect depositors, customers, and the integrity of the U.S. banking system and capital markets. The following information describes some of the more significant laws and regulations applicable to us. The descriptions below are qualified in their entirety by reference to the applicable laws and regulations. Proposals to change the laws and regulations governing the banking industry are frequently raised in Congress, in state legislatures, and with the various bank regulatory agencies. Changes in applicable laws or regulations, or a change in the way such laws or regulations are interpreted by regulatory agencies or courts, may have a material impact on our business, operations, and earnings.

The federal banking regulators regularly issue new guidance and standards, and update existing guidance and standards, regarding cybersecurity intended to enhance cyber risk management among financial institutions. Financial institutions are expected to comply with such guidance and standards and to accordingly develop appropriate security controls and risk management process.

In November 2021, the United States federal bank regulatory agencies adopted a rule regarding notification requirements for banking organizations related to significant computer security incidents. Under this rule, a bank holding company, such as Parent, and a national bank, such as the Bank, are required to notify the Federal Reserve of OCC, respectively, within 36 hours of incidents that have materially disrupted or degraded, or are reasonably likely to materially disrupt or degrade, the banking organization's ability to deliver services to a material portion of its customer base, jeopardize the viability of key operations of the banking organization, or pose a threat to the financial stability of the United States.

#### The Parent

The Parent is registered as a BHC under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and is subject to the supervision of and to examination by the Board of Governors of the Federal Reserve (the “FRB”). The Parent is also registered as a financial institution holding company under the Hawaiʻi Code of Financial Institutions (the “Code”) and is subject to the registration, reporting, and examination requirements of the Code.

The BHC Act prohibits, with certain exceptions, a BHC from acquiring direct or indirect beneficial ownership or control of either a company that is not a bank, or more than 5% of the voting shares of any bank, without the FRB’s prior approval. A BHC is generally prohibited from engaging in any activity other than banking, managing or controlling banks or other subsidiaries authorized under the BHC Act, or an activity that the FRB has determined to be so closely related to those activities as to be a proper incident to one of them.

Under FRB policy, a BHC is expected to serve as a source of financial and management strength to its subsidiary bank(s). A BHC is also expected to commit resources to support its subsidiary bank(s) in circumstances where it might not do so absent such a policy. Under this policy, a BHC is expected to maintain reliable funding and contingency plans to stand ready to provide adequate capital funds to its subsidiary bank(s) during periods of financial adversity and to maintain the financial flexibility and capital-raising capacity to obtain additional resources for assisting its subsidiary bank(s).

Under the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the “Riegle-Neal Act”), banks and BHCs from any state are permitted to acquire banks located in any other state, subject to certain conditions, including certain nationwide and state-imposed deposit concentration limits. Banks also have the ability, subject to certain restrictions, to acquire branches outside their home states by acquisition or merger under the Riegle-Neal Act. The establishment of new interstate branches is also possible in those states with laws that expressly permit de novo branching. Because the Code permits de novo branching by out-of-state banks, those banks may establish new branches in Hawaiʻi.

#### Bank of Hawaiʻi

The Bank is subject to extensive federal, state, territorial and foreign regulations that significantly affect its business and activities. The Bank is subject to supervision of the FRB and examination by the Federal Reserve Bank of San Francisco, the Consumer Financial Protection Bureau (the “CFPB”), and the State of Hawaiʻi Department of Commerce and Consumer Affairs’ (“DCCA”) Division of Financial Institutions. These regulatory bodies have broad authority to implement standards and to initiate proceedings designed to prohibit depository institutions from engaging in activities that may represent “unsafe” or “unsound” banking practices or constitute violations of applicable laws, rules, regulations, administrative orders, or written agreements with regulators. The standards relate to, among other compliance matters, operations and management, asset quality, interest rate exposure, capital, executive compensation, and consumer protection. The regulatory bodies are authorized to take informal (non-public) or formal (public) supervisory actions against regulated entities, including BHCs and banks, that fail to meet such standards, including, without limitation, the issuance of written agreements, cease-and-desist orders, and consent orders, which may, among other things, result in restrictions on a bank’s ability to pay dividends, requirements to increase capital, restrictions on activities, the imposition of civil monetary penalties, and revocation of a bank’s charter for the most severe infractions, or putting such a bank into receivership if it is not financially viable.

Bankoh Investment Services, Inc., the broker-dealer and investment adviser subsidiary of the Bank, is incorporated in Hawaiʻi and is regulated by the SEC, the Financial Industry Regulatory Authority, and the DCCA’s Insurance Division. Pacific Century Life Insurance Corporation is a subsidiary of the Bank and is incorporated in Arizona and is primarily regulated by the State of Arizona Department of Insurance.

#### The Dodd Frank Act

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) and its regulations, among other things, mandated capital and liquidity requirements, established standards for mortgage lenders, regulated executive and incentive-based compensation, imposed various consumer protections and numerous other provisions. Provisions also limit or place significant burdens and costs on activities traditionally conducted by banking organizations, such as arranging and participating in swap and derivative transactions, proprietary trading and investing in private equity and other funds.

Several provisions of the Dodd-Frank Act were significantly changed by enactment of the Economic Growth, Regulatory Relief, and Consumer Protection Act in May 2018, notably by eliminating the requirement for institutions like the Company to perform and publicly disclose periodic stress tests. The Company continues to monitor and implement rules, regulations, and interpretations of the Dodd-Frank Act as they are adopted and modified, and to evaluate their application to our current and future operations.

#### Capital Requirements

In July 2013, the FRB, the Office of the Comptroller of the Currency (the “OCC”) and the FDIC adopted new capital rules (the “Rules”). These Rules were designed to help ensure that banks maintain strong capital positions by increasing both the quantity and quality of capital held by U.S. banking organizations. The Rules reflect, in part, certain standards initially adopted by the Basel Committee on Banking Supervision in December 2010 (which are commonly called “Basel III” standards) as well as requirements by the Dodd-Frank Act.

The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) identifies five capital categories for insured depository institutions: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and “critically undercapitalized.”

The federal banking agencies are authorized by FDICIA to impose progressively more restrictive constraints on operations, management and capital distributions, depending on the capital category in which an institution is classified. These “prompt corrective actions” can include: requiring an insured depository institution to adopt a capital restoration plan guaranteed by the institution’s parent company; placing limits on asset growth and restrictions on activities, including restrictions on transactions with affiliates; restricting the interest rates the institution may pay on deposits; prohibiting the payment of principal or interest on subordinated debt; prohibiting the holding company from making capital distribution without prior regulatory approval; and ultimately appointing a receiver for the institution.

A “well capitalized” institution must have a Common Equity Tier 1 Capital Ratio of at least 6.5%, a Tier 1 Capital Ratio of at least 8%, a Total Capital Ratio of at least 10%, a Tier 1 Leverage Ratio of at least 5%, and not be subject to a capital directive order. As of December 31, 2024, the Bank was classified as “well capitalized.” The classification of a depository institution under one of the categories set out above is primarily for the purpose of applying the prompt corrective actions, and is not intended to be, nor should it be interpreted as, a representation of the overall financial condition or the prospects of that financial institution. See Note 11 in Item 8. “Notes to Consolidated Financial Statements” for more information.

#### Dividend Restrictions

The Parent is a legal entity separate and distinct from the Bank. The Parent’s principal source of funds to pay dividends on its common stock and preferred stock and to service its liabilities is dividends from the Bank. Various federal and state laws and regulations limit the amount of dividends the Bank may pay to the Parent without regulatory approval. The FRB is authorized to determine the circumstances when the payment of dividends would be an unsafe or unsound practice and to prohibit such payments. The right of the Parent, its shareholders, and creditors to participate in any distribution of the assets or earnings of its subsidiaries is also subject to the prior claims of creditors of those subsidiaries. For information regarding the limitations on the Bank’s ability to pay dividends to the Parent, see Note 11 in Item 8. “Notes to Consolidated Financial Statements.”

#### Transactions with Affiliates and Insiders

Transactions between the Bank and any affiliate are governed by Sections 23A and 23B of the Federal Reserve Act. An affiliate of the Bank is any company or entity which controls, is controlled by or is under common control with the Bank which is not a subsidiary of the Bank. Under federal law, the Bank is subject to restrictions that limit the transfer of funds or other items of value to the Parent, and any other non-bank affiliates in “covered transactions.” In general, covered transactions include making loans to an affiliate, the purchase of or investment in the securities issued by an affiliate, the purchase of assets from an affiliate, the acceptance of securities issued by an affiliate as collateral security for a loan or extensions of credit to any person or company, the issuance of a guarantee, acceptance or letter of credit on behalf of an affiliate, or certain transactions with an affiliate that involve the borrowing or lending of securities and certain derivative transactions with an affiliate.

Unless an exemption applies, covered transactions by the Bank with a single affiliate are limited to 10% of the Bank’s capital and surplus, and with respect to all covered transactions with affiliates in the aggregate, they are limited to 20% of the Bank’s capital and surplus. Section 23B of the Federal Reserve Act and Federal Reserve Regulation W also require that certain transactions between the Bank and its affiliates be on terms substantially the same, or at least as favorable to the Bank, as those prevailing at the time for comparable transactions with or involving other non-affiliated persons.

The Federal Reserve Act and Federal Reserve Regulation O place restrictions and certain reporting requirements on any extension of credit made by a member bank to (a) an executive officer, director, or principal shareholder of the bank, or any company of which the bank is a subsidiary, and of any other subsidiary of that company, and (b) a company controlled by such a person, or to a political or campaign committee that benefits or is controlled by such a person (collectively referred to as “insiders”). These restrictions include limits on loans to one borrower and conditions that must be met before such loans can be made. There is also an aggregate limitation on all loans to insiders and their related interests. Certain restrictions also apply to extensions of credit made to an executive officer, directors, or principal shareholder of a bank (or to a related interest of such person) by a correspondent bank.

#### The Volcker Rule

In December 2013, the Federal Reserve, the OCC, the FDIC, the SEC, and the Commodities Futures Trading Commission issued final rules to implement certain provisions of the Dodd-Frank Act commonly known as the “Volcker Rule.” The Volcker Rule, as amended on August 20, 2019, generally prohibits U.S. banks from engaging in proprietary trading and restricts those banking entities from sponsoring, investing in, or having certain relationships with hedge funds and private equity funds. The prohibitions under the Volcker Rule are subject to a number of statutory exemptions, restrictions, and definitions. The Volcker Rule has not had a material impact on the Company’s financial condition and results of operation.

#### FDIC Insurance

The FDIC provides insurance coverage for certain deposits held by the Bank through the Deposit Insurance Fund, which the FDIC maintains by assessing depository institutions an insurance premium. The Bank is assessed deposit insurance premiums by the FDIC using a risk-based assessment rate and adjusted average total assets. The Bank’s FDIC insurance assessment was $17.9 million in 2024, $28.3 million in 2023 and $6.5 million in 2022. The increase in the FDIC insurance during 2023 was primarily related to a special assessment, discussed below.

In November 2023, the FDIC implemented a special assessment to recover the loss to the Deposit Insurance Fund following the closures of Silicon Valley Bank, Signature Bank and First Republic Bank. The assessment was based on reported uninsured deposits as of December 31, 2022. The FDIC could cease collection early or extend the special assessment period as they deem necessary depending on whether the amount the FDIC collects from the special assessment is higher or lower than the actual or estimated FDIC losses. The initial FDIC special assessment of $14.7 million was accrued during the year ended December 31, 2023. Subsequent adjustments increased the special assessment by $1.9 million to $16.6 million. These adjustments were accrued during the year ended December 31, 2024. The special assessment is being paid in eight quarterly installments, which began in June 2024.

A depository institution’s deposit insurance may be terminated by the FDIC upon a finding that the institution’s financial condition is unsafe or unsound, or that the institution has engaged in unsafe or unsound practices, or has violated any applicable rule, regulation, or order or condition enacted or imposed by a regulatory agency. Termination of the Bank’s deposit insurance would end its ability to function as a commercial bank in Hawaiʻi.

#### Depositor Preference

In the event of the “liquidation or other resolution” of an insured depository institution, claims of insured and uninsured depositors for deposits payable in the United States (including the claims of the FDIC as subrogee of insured depositors), plus certain claims for administrative expenses of the FDIC as a receiver will have priority in payment ahead of unsecured creditors including, in the case of the Bank, the Parent.

#### Other Safety and Soundness Regulations

The federal banking agencies also have adopted guidelines prescribing safety and soundness standards. These guidelines establish general standards for internal controls, information systems, internal audit systems, loan documentation, credit underwriting, interest rate risk exposure, asset growth, asset quality, earnings standards, compensation, fees and benefits. In general, the guidelines require appropriate systems and practices to identify and manage the risks and exposures specified in the guidelines before capital becomes impaired.

#### Community Reinvestment and Consumer Protection Laws

- *Community Reinvestment.* The Community Reinvestment Act of 1977 (“CRA”) requires the appropriate federal banking agency, in connection with its examination of a bank, to assess the bank’s record in meeting the credit needs of the communities served by the bank, including low and moderate income neighborhoods. Under the CRA, institutions are assigned a rating of “outstanding,” “satisfactory,” “needs to improve,” or “substantial non-compliance.” The regulatory assessment of the bank’s record is made available to the public. Further, these assessments are considered by regulators when evaluating mergers, acquisitions and applications to open, close, or relocate a branch or facility. The Bank’s current CRA rating is “outstanding.”

In October 2023, the U.S. banking agencies issued a final rule to amend their regulations implementing the CRA. The rule materially revises the current CRA framework, including the assessment areas in which a bank is evaluated to include activities associated with online and mobile banking, the tests used to evaluate the Bank in its assessment areas, new methods of calculating credit for lending, investment, and service activities, and additional data collection and reporting requirements. Most of the rule's provisions will become applicable on January 1, 2026. Reporting of the collected data will not be required until 2027.

- *Consumer Protection Laws.* In addition to the CRA, the Bank is subject to a number of federal laws designed to protect borrowers and promote lending to various sectors of the economy and population in connection with its lending activities. These include the Equal Credit Opportunity Act, the Truth-in-Lending Act, the Home Mortgage Disclosure Act and the Real Estate Settlement Procedures Act.

Federal banking regulators, pursuant to the Gramm-Leach-Bliley Act, have enacted regulations limiting the ability of banks and other financial institutions to disclose nonpublic consumer information to non-affiliated third parties. The regulations require disclosure of privacy policies and allow consumers to prevent certain personal information from being shared with non-affiliated third parties. The Fair and Accurate Credit Transaction Act (“FACT Act”) requires financial institutions to develop and implement an identity theft prevention program to detect, prevent and mitigate identity theft “red flags” to reduce the risk that customer information will be misused to conduct fraudulent financial transactions.

A number of other federal and state consumer protection laws extensively govern the Bank’s relationship with its customers. These laws include the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Truth in Lending Act, the Truth in Savings Act, the Electronic Fund Transfer Act, the Expedited Funds Availability Act, the Home Mortgage Disclosure Act, the Fair Housing Act, the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, Telephone Consumer Protection Act, the Service Members Civil Relief Act and these laws’ respective state-law counterparts, as well as state and territorial usury laws and laws regarding unfair and deceptive acts and practices. These and other laws subject the Bank to substantial regulatory oversight and, among other things, require disclosures of the cost of credit and terms of deposit accounts, provide substantive consumer rights, prohibit discrimination in credit transactions, regulate the use of credit report information, provide financial privacy protections, prohibit unfair, deceptive and abusive practices, and restrict the Bank’s ability to raise interest rates.

The CFPB was created under the Dodd-Frank Act as an agency responsible for promulgating and enforcing regulations designed to protect consumers including adding prohibitions on unfair, deceptive and abusive acts and practices. The CFPB, along with other prudential regulators and the Department of Justice, have also expanded the focus of their regulatory examinations and investigations to include “fair and responsible banking.” Fair and responsible banking strives to provide equal credit opportunities to all applicants of a community, to prohibit discrimination by lenders on the basis of certain borrower characteristics, and to ensure that a bank’s practices are not deceptive, unfair, or take unreasonable advantage of consumers or businesses. The enhanced focus encompasses the entire loan life cycle, including post-closing activities such as collections and servicing, and pre-application activities such as marketing and loan solicitation and origination.

Violations of applicable consumer protection laws and regulations can result in significant potential liability from litigation brought by customers, including actual damages, restitution and attorneys’ fees. Federal bank regulators, state attorneys general and state and local consumer protection agencies may also seek to enforce consumer protection requirements and obtain these and other remedies, including regulatory sanctions, customer rescission rights, and civil money penalties. Failure to comply with consumer protection requirements may also result in our failure to obtain required bank regulatory approvals for transactions the Bank may wish to pursue, or prohibit us from engaging in such transactions even if approval is not required.

#### Bank Secrecy Act / Anti-Money Laundering Laws

The Bank is subject to the Bank Secrecy Act and other anti-money laundering laws and regulations, including the USA PATRIOT Act of 2001. The USA PATRIOT Act created new laws, regulations, and penalties, imposed significant new compliance and due diligence obligations, and expanded the application of those laws outside the U.S. Additionally, like all U.S. companies and individuals, the Company is prohibited from transacting business with certain individuals and entities named on the Office of Foreign Asset Control’s list of Specially Designated Nationals and Blocked Persons.

The Bank has been required to implement policies, procedures, and controls to detect, prevent, and report potential money laundering and terrorist financing and to verify the identity of its customers. The Company maintains procedures and systems to identify its customers, and to monitor and block transactions related to prohibited persons and entities. Violations of these requirements can result in substantial civil and criminal sanctions. In addition, the federal financial institution regulatory agencies consider the effectiveness of a financial institution’s anti-money laundering activities when reviewing bank mergers and BHC acquisitions. These agencies are focusing their examinations on anti-money laundering compliance, and we will continue to monitor and augment, where necessary, the Company's anti-money laundering compliance programs.

In January 2021, the Anti-Money Laundering Act of 2020 (“AMLA”), which amends the Bank Secrecy Act, was enacted. Among other things, the AMLA codifies a risk-based approach to anti-money laundering compliance for financial institutions; requires the U.S. Department of the Treasury to promulgate priorities for anti-money laundering and countering the financing of terrorism policy' requires the development of standards by the U.S. Department of the Treasury for testing technology and internal processes for Bank Secrecy Act compliance; expands enforcement and investigation-related authority, including a significant expansion in the available sanctions for certain Bank Secrecy Act violations; and expands Bank Secrecy Act whistleblower incentives and protections. Many of the statutory provisions in the AMLA will require additional rulemaking, reports and other measures, and the impact of the AMLA will depend on, among other measures, the impact of the AMLA will depend on, among other things, rulemaking and implementation guidance.

### Human Capital Management

As of December 31, 2024, we employed 1,865 full-time equivalent employees, of which 1,732 are located in the State of Hawaiʻi, with the remainder located in Guam, other Pacific Islands, and other U.S. states. None of our employees are subject to a collective bargaining agreement.

People are our heart and soul, and we value the contributions of all of our teammates. We are committed to building an engaged and connected employee community. We introduced a role dedicated to Culture and Employee Experience. A driving focus is creating a human-centric, inclusive and innovative environment that nurtures a strong sense of belonging, fuels continuous learning and develops effective leaders, who drive exceptional employee experiences and continued organizational success. Key areas of focus for us include:

We believe in a work environment where teammates feel they belong and be their authentic selves leading them to thrive, contribute and succeed. As of December 31, 2024, approximately 88% of our workforce identifies as minorities (non-Caucasian) and approximately 61% of our employees are female. Among our senior leaders and managers, 82% are minorities and 59% are female. We conduct regular external pay equity studies to evaluate compensation practices and confirm that gender pay gaps do not exist. Our commitment is to create a workplace where every individual feels valued, known, empowered and inspired.

Leadership and Employee Development: We are committed to the success of our teammates and have focused on their growth and development both personally and professionally. We nurture a collaborative, digitally connected workplace aligned to the changing needs of the work environment. Skills and professional development training is provided to employees at all levels, with additional development sessions specifically targeted to managers and leaders. Making Leadership Excellence a Priority is a key component of the Employee Experience, and we need our leaders to deliver exceptional employee experiences and develop the successful workforce of tomorrow. Key initiatives include the continued support of executive coaching to elevate leadership capabilities, a new senior leader development series called the Leadership Excellence Forum, a competitive Leadership Development Program, a hybrid Pathways to Professional Excellence cohort with 36 employees from Oahu, the neighbor islands and the West Pacific and an enhanced online performance management process that empowers the employee to own the first step of the performance review process.

To help maintain Hawaiʻi’s special culture of ‘*ohana* and working together toward common goals, continued attention was paid to engaging teammates in a hybrid environment. Based on employee feedback from surveys, online and in-person sessions were continued in 2024 to connect with employees and encourage collaboration. “Recruit Connect” continued in 2024 to help teammates identify job opportunities within the Company and find out more about them. In some cases, sessions led to referred candidates joining the Bank, and to current employees finding a new career path. “Manager Excellence Forums” continued in

2024 as a platform connecting managers so that they can learn from and support one another when facing real management issues and discuss practical solutions. Manager engagement has been key to navigating the ever-changing business environment, and these forums help managers stay connected and improve their management skills while moving forward with their teams. Topics have included: Evaluating Employees and Meaningful Conversations to prepare our managers for the 2024 Performance, Merit & Bonus season, Rising Team, and how our leaders can continue to build stronger team dynamics. “Rising Team” continued to be a priority in 2024. This new and modern technology platform provides a way for us to strengthen our connection with our teammates. “Rising Team” enables managers to confidently facilitate sessions with their team and offers everyone the opportunity to share thoughts and feedback in real time on a variety of leadership themed topics, such as Psychological safety, Appreciation, Natural talents and Career horizons.

Employee Benefits: We believe in enabling a healthy workforce and providing a benefits program that is designed to attract, retain, and engage employees. In addition to competitive insurance, healthcare, and retirement offerings, examples of more innovative and workforce-specific benefits offerings include: mortgage discount program, student loan assistance program, well-being sessions, and personal finance education. We continue to incorporate mental health, financial well-being, social health, community, and a positive employee experience in their well-being strategies, in addition to physical health. In 2024, we expanded resources to support employees and actively sought new ways to foster an environment where employees feel empowered to bring their whole selves to work.

Health and Safety: The health and safety of our employees is a priority. We continue our commitment to workplace safety and workforce health to maintain business and operational continuity without diminishing our focus on both employee and customer safety.

### Information about our Executive Officers

Listed below are executive officers of the Parent.

Peter S. Ho, 59

Chairman and Chief Executive Officer since July 2010; President from April 2008 to July 2024.

James C. Polk, 58

President since July 2024; Chief Banking Officer since January 2022; Chief Commercial Officer from January 2020 to December 2021; Vice Chair since June 2016.

Dean Y. Shigemura, 61

Vice Chair since December 2017; Chief Financial Officer since March 2017.

Marco A. Abbruzzese, 59

Vice Chair, Senior Executive Director of Wealth Management since January 2022; Regional Managing Director - Washington, Oregon and Alaska of Wells Fargo from June 2009 to December 2021.

Matthew K.M. Emerson, 47

Chief Retail Banking Officer since July 2024; Chief Strategy Officer since November 2023; Vice Chair since November 2022; Senior Executive Director of Mortgage Banking and Loans from February 2020 to November 2023; Senior Executive Vice President and Senior Executive Director of eCommerce from September 2018 to February 2020.

Patrick M. McGuirk, 55

Vice Chair and Chief Administrative Officer since September 2023; Senior Executive Vice President and Chief General Counsel from November 2020 to September 2023; Executive Vice President and General Counsel at Flagstar Bank from December 2014 to October 2020.

Taryn L. Salmon, 54

Vice Chair and Chief Information and Operations Officer since April 2024.

S. Bradley Shairson, 55

Vice Chair and Chief Risk Officer since March 2024; Deputy Chief Risk Officer from May 2023 to March 2024; Chief Operating Officer and Chief Risk Officer of Regions Bank Capital Markets from March 2017 to April 2023.

## Risk factors

As filed, 55,042 characters.

There are a number of risks and uncertainties, including those material risk factors described below, that could negatively affect our business, financial condition, results of operations, liquidity and the trading price of our common stock.

To the extent that any of the information in this Form 10-K constitutes forward-looking statements, the risk factors below are cautionary statements identifying important factors that could cause actual results to differ materially from those expressed in any forward-looking statements made by us or on our behalf. See Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations - Forward-Looking Statements.”

### Risks Related to Macroeconomic and Political Conditions

*Our business is sensitive to regional business and economic conditions, in particular those of Hawaiʻi, Guam and other Pacific Islands.*

Our business and operations are primarily concentrated in Hawaiʻi and the Pacific Islands. The local economic conditions in these market areas have a significant impact on the Company's ability to originate loans, the ability of the borrowers to repay these loans, and the value of the collateral securing these loans. A significant decline in the general business and economic conditions caused by declines in one or more key industries, inflation, recession, unemployment, U.S. tariffs on imported goods or retaliatory tariffs on U.S. goods, or other factors beyond the Company's control can affect, and has in the past affected, these local economic conditions.

These local economies rely heavily on tourism, the U.S. military, real estate, construction, government, and other service-based industries. Lower visitor arrivals or spending, unemployment rates, occupancy rates, real or threatened acts of war or terrorism, public unrest, increases in energy costs, inflation, tariffs, the availability of affordable air transportation, climate change, natural disasters and adverse weather, public health issues, and federal, State of Hawaiʻi and local government budget issues may impact consumer and corporate spending. The level of domestic and international visitor arrivals and spending, housing prices, real estate values, and unemployment rates are some of the metrics that we regularly monitor. We are also continuing to monitor Maui's recovery from the August 2023 wildfire. Additionally, financial markets may be adversely affected by the current or anticipated impact of military conflict, terrorism or other geopolitical events.

Deterioration of business and economic conditions, particularly in Hawaiʻi and the West Pacific, has in the past adversely affected, and in the future could adversely affect the quality of our assets, credit losses, and the demand for our products and services, which could lead to lower revenues, higher expenses, and lower earnings.

*Our loan portfolio is largely secured by real estate, and a downturn in the real estate market may adversely affect our results of operations.*

Our loan portfolio is largely secured by real estate, with a particular concentration of real estate located in Hawaiʻi and the West Pacific. As of December 31, 2024, our residential mortgage loans represented $4.6 billion, or 32.9%, of our total loan and lease portfolio and our commercial mortgage loans represented approximately $4.0 billion, or 28.6%, of our total loan and lease portfolio.

Payments on loans secured by commercial real estate often depend upon the successful operation and management of the properties and the businesses which operate from within them. Payments on loans secured by residential real estate often depends on the employment of the homeowner. Repayment of loans may be affected by factors such as adverse conditions in the real estate market, changes in business and economic conditions, changes in government regulation, or the impact of trends toward hybrid work. Decreases in tenant occupancy, rental rates and home sales in Hawaiʻi and the West Pacific can have, and in the past have had, a negative effect on the ability of borrowers to make timely repayments of their loans and the value of the collateral, held as security for these loans, thereby increasing the credit risk associated with the loan portfolio. Declines in real estate value and sales volumes and higher unemployment in Hawaiʻi and the West Pacific may also result in higher than expected loan delinquencies and a decline in demand for our products and services. These negative events may cause us to incur losses and may adversely affect our capital, liquidity and financial condition.

*A sustained period of high inflation or other high cost economic environment could pose a risk to local economies and the financial performance of the Bank.*

A prolonged period of inflation or other period of high cost of goods such as a result of tariffs given that Hawaiʻi imports certain goods from Mexico, Canada and other countries that may become subject to tariffs, may impact our profitability by negatively impacting our costs and expenses. Economic and inflationary pressure on consumers and uncertainty regarding the economic environment could result in changes in consumer and commercial spending, borrowing and savings habits. Such conditions could have a material adverse effect on the credit quality of our loans and our business, financial condition and results of operations.

*Climate change and the governmental responses to it could have a material adverse impact on the Bank and its customers.*

The impacts of climate change, such as extreme weather conditions, natural disasters and rising sea levels, could impact the Bank’s operations as well as those of its customers and third party vendors upon which it relies. Such events could also result in market volatility or negatively impact our customers’ ability to pay outstanding loans, or result in the deterioration of the value of our collateral causing a material adverse effect on the Bank’s financial condition and results of operation. Furthermore, increasing regulation related to climate change could have an adverse effect on the business and financial condition of the Bank and its customers, including our credit portfolio. Further legislation and regulatory requirements could increase the operating expenses of, or otherwise adversely impact, the Bank or its customers. To the extent that the Bank or its customers experience increases in costs, reductions in the value of assets, constraints on operations or similar concerns driven by changes in regulation relating to climate change, the Bank’s business and results of operations may be adversely affected.

*Disruptions, instability and failures in the banking industry may negatively impact us.*

Events impacting the financial services industry, such as the 2023 failures of Silicon Valley Bank, Signature Bank and First Republic Bank, have resulted in decreased confidence in banks among uninsured consumer and commercial depositors, other counterparties and investors, as well as significant disruption, volatility and reduced valuations of equity and other securities of banks in the capital markets. These events occurred during a period of rapidly rising interest rates which, among other things, resulted in unrealized losses in longer duration securities and loans held by banks, and more competition for bank deposits. These events have, and could continue to, adversely impact the market price and volatility of the Company’s common stock. These events may also result in potentially adverse changes to laws or regulations governing banks and bank holding companies or result in the impositions of restrictions through supervisory or enforcement activities, including higher capital requirements, which could have a material impact on our business. Inability to access wholesale funding, loss of client deposits or changes in our credit ratings could negatively impact our overall liquidity or capitalization, including by increasing the cost of capital or limiting our ability to access capital markets. We may be impacted by concerns regarding the soundness or creditworthiness of other financial institutions, which can cause substantial and cascading disruption within the financial markets and increased expenses.

*Any reduction in defense spending by the federal government in the State of Hawai*ʻ*i could adversely impact the economy in Hawaiʻi and the West Pacific.*

The U.S. military has a major presence in Hawaiʻi and the West Pacific. As a result, the U.S. military is an important aspect of the economies in which we operate. The funding of the U.S. military is subject to the overall U.S. Government budget and appropriation decisions and processes which are driven by numerous factors, including geo-political events, macroeconomic conditions, and the ability and willingness of the U.S. Government to enact legislation. U.S. Government appropriations have been and likely will continue to be affected by larger U.S. Government budgetary issues and related legislation. Cuts in defense and other security spending in the State of Hawaiʻi could have an adverse impact on the economies in which we operate, which could adversely affect our business, financial condition, and results of operations.

*Changes in interest rates could adversely impact our results of operations and capital.*

Our earnings are highly dependent on the spread between the interest earned on loans, leases, and investment securities and the interest paid on deposits and borrowings. We primarily rely on customer deposits as a sizable source of relatively stable and low-cost funds. Changes in market interest rates impact the rates earned on loans, leases, and investment securities and the rates paid on deposits and borrowings. In addition, changes to market interest rates could impact the level of loans, leases, investment securities, deposits, and borrowings, and the credit profile of our current borrowers. Interest rates are affected by many factors beyond our control, and fluctuate in response to general economic conditions, currency fluctuations, and the monetary and fiscal policies of various governmental and regulatory authorities.

Changes in monetary policy, including changes in interest rates, will influence the origination of loans and leases, the purchase of investments, the generation of deposits, and the rates received on loans and investment securities and paid on deposits. Any substantial prolonged change in market interest rates may negatively impact our ability to attract deposits, originate loans and leases, and achieve satisfactory interest rate spreads. If we are unable to continue to fund loans and other assets through customer deposits or access capital markets on favorable terms or if we otherwise fail to manage our liquidity effectively, our liquidity, net interest margin, financial results and condition may be adversely affected.

Fixed rate loans increase our exposure to interest rate risk in a rising rate environment because interest-bearing liabilities would be subject to repricing before assets become subject to repricing. Adjustable rate loans decrease the risks to a lender associated with changes in interest rates but involve other risks. As interest rates rise, the payment by the borrower rises to the extent permitted by the terms of the loan, and the increased payment increases the potential for default. At the same time, for secured loans, the marketability of the underlying collateral may be adversely affected by higher interest rates. In a declining interest rate environment, there is likely to be an increase in prepayment activity on loans as the borrowers refinance their loans at lower interest rates. Under these circumstances, our results of operations could be negatively impacted.

Changes in interest rates also can affect the value of loans, investments and other interest-rate sensitive assets including mortgage servicing rights, and our ability to realize gains on the sale or resolution of assets. This type of income can vary significantly from quarter-to-quarter and year-to-year based on a number of different factors, including the interest rate environment. An increase in interest rates that adversely affects the ability of borrowers to pay the principal or interest on loans may lead to an increase in non-performing assets and increased credit loss reserve requirements that could have a material adverse effect on our results of operations

Increased credit losses for the Bank could result if economic conditions stagnate or deteriorate. The risk of nonpayment on loans and leases is inherent in all lending activities. We maintain a reserve for credit losses to absorb estimated expected credit losses over the life of the loan and lease portfolio as of the balance sheet date. Management makes various assumptions and judgments about the loan and lease portfolios in determining the level of the reserve for credit losses. Many of these assumptions are based on current economic conditions. Should economic conditions stagnate or deteriorate nationally or in Hawaiʻi, we may be required to take increased reserves and/or experience higher credit losses in future periods. Inability of our borrowers to make timely repayments on their loans, or decreases in real estate collateral values may result in increased delinquencies, foreclosures, and customer bankruptcies, any of which could have a material adverse effect on our financial condition or results of operations.

*Our allowance for credit losses may prove to be insufficient to absorb losses or appropriately reflect, at any given time, the inherent risk of loss in our loan portfolio.*

Our non-performing assets were at $19.3 million, or 0.14%, of total loans and leases and foreclosed real estate at December 31, 2024. Our criticized loans were $296.2 million, or 2.10%, of total loans and leases at December 31, 2024. The risk of nonpayment on loans and leases is inherent in all lending activities and, like all financial institutions, we maintain an allowance for credit losses to provide for loans in our portfolio that may not be repaid in their entirety.

In determining the level of the reserve for credit losses, we consider numerous factors and our management makes various assumptions and judgments about the loan and lease portfolios, some of which are difficult, subjective, and involve complex judgments. Many of these assumptions are based on current economic conditions, particularly in Hawaiʻi and the West Pacific. If economic conditions stagnate or deteriorate, particularly in Hawaiʻi and the West Pacific, our borrowers may not be able to make timely repayments on their loans or real estate collateral values may decline, resulting in increased delinquencies, foreclosures, and customer bankruptcies, resulting in corresponding increases in credit losses. Our estimates of the risk of loss and amount of loss on any loan are complicated by the significant uncertainties surrounding our borrowers responses to changing business and economic conditions, interest rate environments, inflation and other factors. Because of the degree of uncertainty and susceptibility of these factors to change, our actual losses and estimates of risk of loss inherent in our loan portfolio have varied and are likely to continue to vary from our current estimates. Such variances may materially and adversely affect our financial condition and results of operations.

*Consumer protection initiatives and court decisions related to the foreclosure process affect our remedies as a creditor.*

Proposed consumer protection initiatives related to the foreclosure process, including voluntary and/or mandatory programs intended to permit or require lenders to consider loan modifications or other alternatives to foreclosure, could increase our credit losses or increase our expense in pursuing our remedies as a creditor.

In addition, Hawaiʻi’s appellate courts have made rulings that increase the complexity and risk of nonjudicial, or out-of-court, foreclosures. At the same time, a chronic backlog of cases in the Hawaiʻi courts has slowed the judicial foreclosure process, which delays the Bank’s ability to take over, preserve and sell the mortgaged property. Delays in the foreclosure process also could increase the amount of servicing advances that we are required to make, lengthen the time it takes for us to be reimbursed for such advances, and increase the costs incurred during the foreclosure process, which in turn could affect our financial condition or results of operations.

*Changes in the capital markets could materially affect the level of assets under management and the demand for our other fee-based services.*

Changes in the capital markets could affect the volume of income from and demand for our fee-based services. Our investment management revenues depend in large part on the level of assets under management. Market volatility that leads customers to liquidate investments or move investments to other institutions or asset classes, as well as lower asset values can reduce our level of assets under management, thereby decreasing our investment management revenues.

### Risks Related to Common Stock

#### The Parent’s liquidity is dependent on dividends from the Bank.

The Parent is a separate and distinct legal entity from the Bank. The Parent receives substantially all of its cash in the form of dividends from the Bank. These dividends are the principal source of funds to pay dividends on the Parent’s common and preferred stock or to repurchase common stock under the Parent’s share repurchase program. Various federal and state laws and regulations impose limitations on the payment of dividends, such as requiring regulatory approval under certain circumstances. Limitations on the Parent’s ability to receive dividends from the Bank could have a material adverse effect on the Parent’s ability to meet its obligations or pay dividends to shareholders.

*There can be no assurance that the Parent will continue to declare cash dividends.*

The Parent paid cash dividends of $112.3 million on common shares during 2024. In January 2025, the Parent’s Board of Directors declared a quarterly cash dividend of $0.70 per share on the Parent’s outstanding common shares.

Our dividend payments may change from time-to-time, and we cannot provide assurance that we will continue to declare dividends in any particular amounts or at all. Dividends on our common stock are subject to capital availability and periodic determinations by our Board of Directors. Additionally, so long as any share of Series A Preferred Stock or Series B Preferred Stock remains outstanding, unless the full dividends for the immediately preceding dividend period on all outstanding shares of Series A Preferred Stock and Series B Preferred Stock have been paid in full or declared and a sum sufficient for the payment has been set aside, we would not be permitted to declare or pay a dividend on our common stock. We continue to evaluate the potential impact that regulatory proposals may have on our liquidity and capital management strategies, including those required under the Dodd-Frank Act. The actual amount and timing of future dividends, if any, will depend on market and economic conditions, applicable SEC rules, federal and state regulatory and supervisory restrictions, and various other factors. A reduction in or elimination of our dividend payments could have a negative effect on our stock price.

### Risks Related to Regulatory Changes

*Fiscal and monetary policy changes may significantly impact our profitability and liquidity.*

The Company’s business and earnings are significantly affected by the fiscal and monetary policies of the Federal Government and its agencies. The Bank is particularly affected by the policies of the Federal Reserve, which regulates the supply of money and credit in the United States. Among the instruments of monetary policy available to the Federal Reserve are (a) conducting open market operations in U.S. government securities, (b) changing the discount rates of borrowings of depository institutions, (c) imposing or changing reserve requirements against depository institutions’ deposits, and (d) imposing or changing reserve requirements against certain borrowings by banks and their affiliates. These methods are used in varying degrees and combinations to directly affect the availability of bank loans and deposits, as well as the interest rates charged on loans and paid on deposits. Changes to these policies of the Federal Reserve may have a material effect on our business, results of operations and financial condition.

*Legislation and regulatory initiatives affecting the financial services industry, including new interpretations, restrictions and requirements, could detrimentally affect the Company’s business.*

We are and will continue to be subject to extensive examination, supervision and comprehensive regulation by federal bank regulatory agencies. Banking regulations are primarily intended to protect depositors’ funds, federal deposit insurance funds, and the banking system and the financial system as a whole, and not holders of our common stock. These regulations affect our lending practices, capital structure, investment practices, dividend policy, and growth, among other things. See Item 1. “Business – Supervision and Regulation” of this Annual Report on Form 10-K for information regarding regulation affecting the Company.

The Dodd-Frank Act, other consumer protection laws, and their implementing rules and regulations are likely to continue to result in increased compliance costs, along with possible restrictions on our products, services and manner of operations, any of which may have a material adverse effect on our results of operations and financial condition.

The CFPB has exercised its broad rule-making, supervisory, and examination authority of consumer financial products, as well as expanded data collection and enforcement powers, over depository institutions with more than $10.0 billion in assets. Regulation of overall safety and soundness, the CRA, federal housing and flood insurance, as they pertain to consumer financial products and services, remains with the FRB. As a result of greater regulatory scrutiny of consumer financial products as a whole, the Company has become subject to more and expanded regulatory examinations, which also could result in increased costs as well as harm to our reputation in the event of a finding that we have not complied with the increased regulatory requirements.

New laws, regulations, and changes, and the uncertainty surrounding whether such laws, regulations and changes will be implemented, interpreted, repealed or reinstated, in the current regulatory and political climate, may continue to increase our costs of regulatory compliance. For example, federal, state, and local governments have enacted numerous data privacy and security laws, including data breach notification laws, personal data privacy laws, financial privacy laws, consumer protection laws, and other similar laws. Additionally, laws such as the USA PATRIOT Act and the Bank Secrecy Act require financial institutions to develop programs to prevent financial institutions from being used for money laundering and terrorist activities and require financial institutions to establish procedures for identifying and verifying the identity of clients seeking to open new financial accounts.

Because of these new laws, regulations, and changes, the bank regulatory framework is quickly changing and becoming increasingly stringent. Additionally, certain laws and regulations may be subject to differing applications and interpretations, which may be inconsistent or conflict among jurisdictions. Preparing for and complying with these obligations requires us to devote significant resources. These laws and regulations may significantly affect the markets in which we do business, the markets for and value of our assets and investments, and our ongoing operations, costs, and profitability.

In addition, there may be increased regulatory scrutiny in the course of routine examinations and otherwise, and new regulations designed to respond to recent negative developments in the banking industry, all of which may increase our costs of doing business and reduce our profitability. Among other things, there may be increased focus by both regulators and investors on deposit composition, the level of uninsured deposits, brokered deposits, unrealized losses in securities portfolios, liquidity, commercial real estate composition and concentration, and capital and general oversight and control of the foregoing. Financial institutions, such as ourselves, could face increased scrutiny or be viewed as higher risk by regulators and/or the investor community, which could negatively affect our results of operations and financial condition or the market for our common stock.

Further, leadership and staff changes in regulatory agencies such as the CFPB, CFTC, SEC, and the Treasury Department could lead to changes in the rulemaking, supervision, examination and enforcement priorities and policies of the agencies. The potential impact of any changes within these agencies cannot be predicted at this time.

*Changes in the capital, leverage, liquidity requirements for financial institutions could materially affect future requirements of the Company.*

We are subject to regulatory requirements relating to capital, which are subject to change from time to time. If we fail to meet applicable requirements, we may be restricted in the types of activities we may conduct, and we may be prohibited from taking certain capital actions, such as paying dividends and share repurchases. See “Regulatory Initiatives Affecting the Banking Industry” section in Item 7. “MD&A” for more information.

While we expect to continue to meet the capital requirements set forth by federal bank regulators, we may fail to do so. In addition, these requirements could have a negative impact on our ability to lend, grow deposit balances, make acquisitions or make capital distributions in the form of dividends and share repurchases. Higher capital levels could also lower our return on equity.

*Changes in income tax laws and interpretations, or in accounting standards, could materially affect our financial condition or results of operations.*

Further changes in income tax laws could be enacted, or interpretations of existing income tax laws could change, causing an adverse effect on our financial condition or results of operations. For example, the Inflation Reduction Act was enacted on August 16, 2022, and introduced, among provisions, a new corporate minimum income tax on certain large corporations, an excise tax of 1% on certain share repurchases by corporations, and increased funding for the Internal Revenue Service. Although we do not anticipate the new corporate minimum income tax will currently apply to us, changes in our business and any future regulations or other guidance on the interpretation and application of the new corporate minimum tax, as well as the potential application of the share repurchase excise tax, may result in additional taxes payable by us, which could materially and adversely affect our financial results and operations. Similarly, our accounting policies and methods are fundamental to how we report our financial condition and results of operations. Some of these policies require use of estimates and assumptions that may affect the value of our assets, liabilities, and financial results. Periodically, new accounting standards are issued or existing standards are revised, changing the methods for preparing our financial statements. These changes are not within our control and may significantly impact our financial condition and results of operations.

### Risks Related to Business Operations

*A failure in or breach of our operational systems, information systems, or infrastructure, or those of our third party vendors and other service providers, may result in financial losses, loss of customers, or damage to our reputation.*

We rely heavily on communications and information systems to conduct our business. In addition, we rely on third parties to provide key components of our infrastructure, including loan, deposit and general ledger processing, internet connections, and network access. These types of information and related systems are critical to the operation of our business and essential to our ability to perform day-to-day operations, and, in some cases, are critical to the operations of certain of our customers. These third parties with which we do business or that facilitate our business activities, including exchanges, clearing firms, financial intermediaries or vendors that provide services or security solutions for our operations, could also be sources of operational and information security risk to us, including breakdowns or failures of their own systems or capacity constraints. In addition, our communications and information systems and operations (including those of third parties that facilitate our business activities) could be damaged or interrupted due to events such as natural or human-caused disasters (including public health crises) or extreme weather (including as a result of climate change), geopolitical events and security issues, computer viruses, physical or electronic break-ins, operational failures, and similar events or disruptions.

Although we have safeguards and business continuity plans in place, our business operations may be adversely affected by significant and widespread disruption to our physical infrastructure or operating systems that support our business and our customers, resulting in financial losses, loss of customers, or damage to our reputation.

*An interruption or breach in security of our information systems or those related to merchants and third party vendors, including as a result of cyber attacks, could disrupt our business, result in the disclosure or misuse of confidential or proprietary information, damage our reputation, or result in financial losses.*

Our business requires the collection and retention of large volumes of customer data, including payment card numbers and other personally identifiable information in various information systems that we maintain and in those maintained by third parties with whom we contract to provide data services. We also maintain important internal company data such as personally identifiable information about our employees and information relating to our operations. The integrity and protection of that customer and company data is important to us. As customer, public, legislative and regulatory expectations and requirements regarding operational and information security have increased, our operating systems and infrastructure must continue to be safeguarded and monitored for potential failures, disruptions and breakdowns.

Our technologies, systems, networks and software, and those of other financial institutions have been, and are likely to continue to be, the target of cybersecurity threats and attacks, which may range from uncoordinated individual attempts to sophisticated and targeted measures directed at us. These cybersecurity threats and attacks may include, but are not limited to, attempts to access information, including customer and company information, malicious code, computer viruses and denial of service attacks that could result in unauthorized access, misuse, loss or destruction of data (including confidential customer information), account takeovers, unavailability of service or other events. These types of threats may result from human error, fraud or malice on the part of external or internal parties, intelligence-gathering by foreign governments, or from accidental technological failure internally or by our vendors. Further, to access our products and services our customers may use computers and mobile devices that are beyond our security control systems. The risk of a security breach or disruption, particularly through cyber-attack or cyber intrusion, including by computer hackers, has increased as the number, intensity and sophistication of attempted attacks and intrusions around the world have increased.

Our customers and employees have been, and will continue to be, targeted by parties using fraudulent emails and other communications in attempts to misappropriate passwords, payment card numbers, bank account information or other personal information or to introduce viruses or other malware through “trojan horse” programs to our customers’ devices. These communications may appear to be legitimate messages sent by the Bank or other businesses, but direct recipients to fake websites operated by the sender of the email or request that the recipient send a password or other confidential information via email or download a program. Despite our efforts to mitigate these threats through product improvements, use of encryption and authentication technology to secure online transmission of confidential consumer information, and customer and employee education, such attempted frauds against us or our merchants and our third party service providers remain a serious issue. The pervasiveness of cyber security incidents in general and the risks of cyber-crime are complex and continue to evolve. In light of several recent high-profile data breaches involving other companies’ losses of customer personal and financial information, a material cybersecurity incident could cause customer and/or Bank losses, damage to our brand, and increase our costs through the ongoing cost of technology investments to improve security, as well as the potential financial and reputational impact of a cyber security incident involving the Company.

Although we make significant efforts to maintain the security and integrity of our information systems and have implemented various measures to manage the risk of a security breach or disruption, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches or disruptions would not be successful or damaging. Even the most well-protected information, networks, systems and facilities remain potentially vulnerable because attempted security breaches, particularly cyber-attacks and intrusions, or disruptions will occur in the future, and because the techniques used in such attempts are constantly evolving and generally are not recognized until launched against a target, in some cases are designed not to be detected and, in fact, may not be detected. Accordingly, we may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus making it virtually impossible for us to entirely mitigate this risk. A security breach or other significant disruption could: 1) disrupt the proper functioning of our networks and systems and therefore our operations and/or those of certain of our customers; 2) result in the unauthorized access to, and destruction, loss, theft, misappropriation or release of confidential, sensitive or otherwise valuable information of ours or our customers, including account numbers and other financial and personal information; 3) result in a violation of applicable privacy, data breach and other laws, subjecting the Bank to additional regulatory scrutiny and exposing the Bank to civil litigation, governmental fines and possible financial liability; 4) require significant management attention and resources to remedy the damages that result; or 5) harm our reputation or cause a decrease in the number of customers that choose to do business with us or reduce the level of business that our customers do with us. The occurrence of any such failures, disruptions or security breaches could have a negative impact on our results of operations, financial condition, and cash flows as well as damage our brand and reputation.

#### Our mortgage banking income may experience significant volatility.

Our mortgage banking income is highly influenced by the level and direction of mortgage interest rates, real estate activity, and refinancing activity. Interest rates can affect the amount of mortgage banking activity and impact fee income and the fair value of our derivative financial instruments and mortgage servicing rights. Changes in the fair value of mortgage servicing rights are recorded in mortgage banking income in the Company’s consolidated statements of income. If loan delinquencies or prepayment speeds are higher than anticipated or other factors perform worse than modeled, the recorded value of certain of our mortgage servicing rights may decrease, which could adversely affect our business, financial condition and results of operations. Mortgage banking income may also be impacted by changes in our strategy to manage our residential mortgage portfolio. For example, we may occasionally decide to add more conforming saleable loans to our portfolio (as opposed to selling the loans in the secondary market) which would reduce our gains on sales of residential mortgage loans. These variables could adversely affect mortgage banking income.

*Our mortgage loan servicing business may be impacted if we do not meet our obligations, or if servicing standards change.*

We act as servicer for mortgage loans sold into the secondary market, primarily to government sponsored enterprises (“GSEs”) such as Fannie Mae. As a seller and servicer for those loans, we make warranties about their origination and are required to perform servicing according to complex contractual and handbook requirements. We maintain systems and procedures intended to ensure that we comply with these requirements. We may be penalized and, in limited instances required to repurchase certain mortgages, due to alleged failures to adhere to these requirements. Should GSEs change the requirements in their servicing handbooks, we may sustain higher compliance costs.

*Risks related to representation and warranty provisions may impact our mortgage loan servicing business.*

The Company sells residential mortgage loans in the secondary market primarily to Fannie Mae. The Company also pools Federal Housing Administration (“FHA”) insured and U.S. Department of Veterans Affairs (“VA”) guaranteed residential mortgage loans for sale to Ginnie Mae. These pools of FHA-insured and VA-guaranteed residential mortgage loans are securitized by Ginnie Mae. The agreements under which the Company sells residential mortgage loans to Fannie Mae or Ginnie Mae and the insurance or guaranty agreements with FHA and VA contain provisions that include various representations and warranties regarding the origination and characteristics of the residential mortgage loans. Although the specific representations and warranties vary among investors, insurance or guarantee agreements, they typically cover ownership of the loan, validity of the lien securing the loan, the absence of delinquent taxes or liens against the property securing the loan, compliance with loan criteria set forth in the applicable agreement, compliance with applicable federal, state, and local laws, and other matters. As of December 31, 2024, the unpaid principal balance of residential mortgage loans sold and serviced by the Company was $2.0 billion. The agreements under which the Company sells residential mortgage loans require delivery of various documents to the investor or its document custodian. Although these loans are primarily sold on a non-recourse basis, the Company may be obligated to repurchase residential mortgage loans or reimburse investors for losses incurred if a loan review reveals that underwriting and documentation standards were potentially not met. Some agreements may require the Company to repurchase delinquent loans. Upon receipt of a repurchase request, the Company works with investors or insurers to arrive at a mutually agreeable resolution. Repurchase demands are typically reviewed on an individual loan by loan basis to validate the claims made by the investor or insurer and to determine if a contractually required repurchase event has occurred. The Company manages the risk associated with potential repurchases or other forms of settlement through its underwriting and quality assurance practices and by servicing mortgage loans to meet investor and secondary market standards. For the year ended December 31, 2024, the Company repurchased three residential mortgage loans with an aggregate unpaid principal balance totaling $1.1 million as a result of the representation and warranty provisions contained in these contracts. The loans were delinquent as to principal and interest at the time of repurchase, however, no material losses were incurred related to these repurchases.

*Risks relating to residential mortgage loan servicing activities may adversely affect our results.*

In addition to servicing loans in the Company’s portfolio, substantially all of the loans the Company sells to investors are sold with servicing rights retained. The Company also services loans originated by other mortgage loan originators. As servicer, the Company’s primary duties are to: (1) collect payments due from borrowers; (2) advance certain delinquent payments of principal and interest; (3) maintain and administer any hazard, title, or primary mortgage insurance policies relating to the mortgage loans; (4) maintain any required escrow accounts for payment of taxes and insurance and administer escrow payments; and (5) foreclose on defaulted mortgage loans or, to the extent consistent with the documents governing a securitization, consider alternatives to foreclosure, such as loan modifications or short sales. As of December 31, 2024, we serviced an aggregate unpaid principal balance of approximately $2.5 billion.

During any period in which our borrowers are not making payments on loans we service, including during defaults, delinquencies, forbearances, and in certain circumstances where a borrower prepays a loan, we generally are required under our servicing agreements to advance our own funds to pay principal and interest, property taxes and insurance premiums, legal expenses, and other expenses. In addition, in the event a loan serviced by us defaults or becomes delinquent, or to the extent a mortgagee under such loan is allowed to enter into a forbearance by applicable law or regulation, the repayment to us of any advance related to such events may be delayed until the loan is repaid or refinanced or liquidation occurs. Any delay or impairment in our ability to collect an advance may affect our liquidity, and delays in reimbursements of us, or our inability to be reimbursed, for advances could be detrimental to our business. In addition, any regulatory actions that lengthen the foreclosure process could increase the amount of servicing advances that we are required to make, lengthen the time it takes for us to be reimbursed for such advances, and increase the costs incurred during the foreclosure process.

Additionally, each agreement under which the Company acts as servicer generally specifies a standard of responsibility for actions taken by the Company in such capacity and provides protection against expenses and liabilities incurred by the Company when acting in compliance with the respective servicing agreements. However, if the Company commits a material breach of obligations as servicer, the Company may be subject to termination if the breach is not cured within a specified period following notice. The standards governing servicing and the possible remedies for violations of such standards vary by investor. These standards and remedies are determined by servicing guides issued by the investors as well as the contract provisions established between the investors and the Company. Remedies could include repurchase of an affected loan.

*The requirement to record certain assets and liabilities at fair value may adversely affect our financial results.*

We report certain assets, including available-for-sale investment securities, at fair value. Generally, for assets that are reported at fair value we use quoted market prices or valuation models that utilize market data inputs to estimate fair value. Because we record these assets at their estimated fair value, mark-to-market gains or losses may impact equity or income. The level of interest rates can impact the estimated fair value of investment securities. Mark-to-market values of non-hedged available-for-sale investment securities are recorded in shareholders’ equity as a component of other comprehensive income. Disruptions in the capital markets may require us to reserve for credit losses in future periods with respect to investment securities in our portfolio. The amount and timing of any credit allowance recognized will be measured as the difference between the security’s amortized cost basis and the amount expected to be collected over the security’s lifetime.

*Natural disasters and adverse weather in Hawaiʻi and the West Pacific may negatively affect real estate property values and our operations.*

Real estate and real estate property values play an important role for the Bank in several ways. The Bank owns or leases many real estate properties in connection with its operations, primarily located in Hawaiʻi with its unique weather and geology. Our business operations could suffer to the extent the Bank cannot utilize its branch network due to damage from weather or other natural disasters.

Real estate is also utilized as collateral for many of our loans. A natural disaster in Hawaiʻi or the West Pacific could cause property values in the affected areas to fall, might limit our customers' access to adequate property insurance, or otherwise impact borrowers’ ability to pay their financial obligations, any of which would increase our exposure to loan defaults and could require the Bank to record an impairment on our financial statements.

In August 2023, wildfires broke out in West Maui destroying the historic town of Lahaina as well as structures and farmland in Upcountry Maui and North Kihei. Roughly 2,200 structures were lost in the fire, 85% of which were homes. Though the economic recovery has been faster than anticipated, Maui's visitor industry remains depressed as the Maui economy continues its gradual post-wildfire recovery. While loans to our customers impacted by the Maui wildfires were not material to our total loan portfolio, real estate property values in the wildfire area were negatively affected and continue to be negatively affected during the wild-fire recovery period.

### General Risk Factors

#### Competition may adversely affect our business.

Our future depends on our ability to compete effectively. We compete for deposits, loans, leases, and other financial services with a variety of competitors, including banks, thrifts, savings associations, credit unions, mortgage companies, finance companies, mutual funds, brokerage firms, insurance companies, and other non-traditional providers of financial services, including financial technology companies and financial service subsidiaries of commercial and manufacturing companies. Some of our competitors are not subject to the same level of regulation and oversight that is required of banks and BHCs, and may benefit from tax exemptions or lower tax rates. As a result, some of these competitors may have lower cost structures. We expect competitive conditions to intensify as consolidation in the financial services industry continues.

Both federal and local laws provide mechanisms for out-of-state banks and their holding companies to acquire or open branches in our service territories. Failure to effectively address this competitive risk by competing, innovating and making effective use of new and existing channels to deliver our products and services could adversely affect our financial condition or results of operations.

*Our future performance will depend on our ability to respond timely to technological change.*

The financial services industry is likely to become more competitive as further technological advances enable more companies, including non-depository institutions, to provide financial services. Also, some of our competitors, through delivery channels such as the Internet, may be based outside of the markets that we serve.

*Negative public opinion could damage our reputation and adversely impact our earnings and liquidity.*

Our bank's reputation is critical to establishing and retaining our customer relationships. Reputational risk, or the risk to our business, earnings, liquidity, and capital from negative public opinion, could result from our actual or alleged conduct in a variety of areas, including legal and regulatory compliance, lending practices, corporate governance, litigation, ethical issues, or inadequate protection of customer information. Because of the concentration of our business in Hawaiʻi and the West Pacific, we are particularly sensitive to the opinion of the public in those areas, which reflects the values and culture of our communities such as the Hawaiʻi's culture of ‘*ohana*. We expend significant resources to comply with regulatory requirements. Failure to comply could result in reputational harm or significant legal and/or remedial costs. Damage to our reputation could adversely affect our ability to retain and attract new customers, and adversely impact our earnings and liquidity.

*We are subject to certain litigation, and our expenses related to this litigation may adversely affect our results.*

We are, from time-to-time, involved in various legal proceedings arising from our normal business activities. These claims and legal actions, including supervisory actions by our regulators, could involve large monetary claims and significant defense costs. The outcome of these cases is uncertain. Substantial legal liability or significant regulatory action against us could have material financial effects or cause significant reputational harm to us, which in turn could seriously harm our business prospects. In recent years, regulatory enforcement and fines have increased across the banking and financial services sector. There is no assurance that those actions will not result in regulatory settlements or other enforcement actions against the Company or the Bank. Furthermore, a single event involving a potential violation of law or regulation may give rise to numerous and overlapping investigations and proceedings by multiple federal and state agencies and officials. In addition, if one or more financial institutions are found to have violated a law or regulation relating to certain business activities, this could lead to investigations by regulators or other governmental agencies of the same or similar activities by other financial institutions, including the Company, and large fines and remedial measures that may have been imposed in resolving earlier investigations for the same or similar activities at other financial institutions may be used as the basis for future settlements.

We may be exposed to substantial uninsured liabilities, which could materially affect our results of operations and financial condition. Based on information currently available, we believe that the eventual outcome of known actions against us will not be materially in excess of such amounts accrued by us. However, in the event of unexpected future developments, it is possible that the ultimate resolution of those matters may be material to our financial results for any particular period. See Note 20 in Item 8. “Notes to the Consolidated Financial Statements” under the discussion related to Contingencies for more information.

*Our performance depends on attracting and retaining key employees and skilled personnel to operate our business effectively.*

Our success is dependent on our ability to recruit qualified and skilled personnel to operate our business effectively. Competition for these qualified and skilled people is intense. There are a limited number of qualified personnel in the markets we serve, so our success depends in part on the continued services of many of our current management and other key employees. Failure to retain our key employees and maintain adequate staffing of qualified personnel could adversely impact our operations and our ability to compete.

*The soundness of other financial institutions may adversely impact our financial condition or results of operations.*

Our ability to engage in routine funding transactions could be adversely affected by the actions and commercial soundness of other financial institutions. Financial services institutions are interrelated as a result of trading, clearing, lending, counterparty, or other relationships. As a result, defaults by, or even rumors or questions about, one or more financial services institutions or the financial services industry in general have led to market-wide liquidity problems and could lead to losses or defaults by us or by other institutions. We have exposure to many different industries and counterparties, and we routinely execute transactions with brokers and dealers, commercial banks, investment banks, mutual funds, and other institutional clients. Many of these transactions expose us to credit risk in the event of default of our counterparty or client. In addition, our credit risk may be exacerbated when the collateral held by us cannot be realized upon or is liquidated at prices not sufficient to recover the full amount of the loan or derivative exposure due us. Such losses could materially affect our financial condition or results of operations.

#### We have experienced increases in FDIC insurance assessments.

The Deposit Insurance Fund is supported mainly through quarterly assessments on insured banks, like the Bank. The Bank is subject to both base and special assessments. The Bank's base assessment is determined by the FDIC using a risk-based assessment rate and average total assets minus our average tangible equity. Special assessments are made by the FDIC based on reported uninsured deposits and often times in response to particular events. In November 2023, the FDIC implemented a special assessment to recover the loss to the Deposit Insurance Fund following the failures of Silicon Valley Bank, Signature Bank, and First Republic Bank. The assessment was based on reported uninsured deposits as of December 31, 2022. The Company's share of the FDIC special assessment was approximately $16.6 million. We may also experience increases in our base assessments depending on increases in our assessment base or assessment rate. Further increases in our assessment fees may have an adverse effect on our results of operations and financial condition.

## Cybersecurity

As filed, 6,248 characters.

As a company that collects and retains large volumes of customer and employee data, including payment card numbers and other personally identifiable information, we face significant and persistent cybersecurity risks. The protection and integrity of that data is important to us, which is demonstrated by the significant efforts and investments made to implement various measures to manage the risk of a security breach or disruption.

#### Risk Management and Strategy

Assessing, identifying, and managing cybersecurity related risks are integrated into our overall Enterprise Risk framework, of which one of the objectives is to ensure the confidentiality, integrity, and availability of our information sets through the maintenance of a comprehensive information security program. The program ensures regulatory compliance in alignment with Federal Financial Institutions Examination Council, the Sarbanes-Oxley Act of 2002, and the Gramm-Leach-Bliley Act. One of the key aspects of this program is a risk assessment that is used to identify industry and company-specific risks, measure control effectiveness, identify any gaps that need to be addressed, and linking our controls with applicable policies, standards and guidelines to ensure that responsible parties are aware of their obligations with respect to this program.

*Governanc*e

The Board of Directors holds ultimate responsibility for overseeing cybersecurity and information security risks. They dedicate substantial time and attention to this critical area, leveraging the technical expertise of their members. The Board regularly reviews an Enterprise-Wide Risk Report, which includes key cybersecurity risk measures and trends across the Company. Additionally, the Board annually reviews and approves the Information Security Policy and frequently receives presentations from the Chief Information Security Officer (“CISO”) on cybersecurity risks, industry trends, and best practices.

The Risk Management Committee, which is charged with assisting the Board of Directors in fulfilling its oversight responsibilities related to the Company’s enterprise-wide risk management framework, receives an operational risk update at least quarterly that includes a review of cybersecurity and information security risk.

The Board of Directors is also responsible for the approval and oversight of the Information Security (“IS”) Program. Our CISO, who is designated as the IS Program Coordinator, has over 15 years of relevant information technology, security and program management experience. Under the direction of the CISO, the IS Program focuses on preventing, detecting, and responding to cybersecurity incidents by ensuring the confidentiality, integrity and availability of company information. Central to incident management is the Information Security Incident Response Team, which is responsible for responding expeditiously and effectively to security incidents to minimize risks to the business, customers and consumers. In the event of an incident, we follow the detailed incident response plan, which outlines the steps to be followed from incident identification to mitigation, recovery and notification, including notifying functional areas, regulators, as well as senior leadership and the Board, as appropriate.

All of our employees also have a responsibility to protect the privacy of bank confidential and proprietary information. They are required to undergo periodic information security awareness training to ensure a clear understanding of their roles in protecting information assets and to create a security-minded culture.

We continue to strengthen the management and oversight of cybersecurity risks through new security system enhancements, policies, testing, identification and reporting. We also engage a third-party to perform penetration testing and ongoing analysis to identify potential vulnerabilities and areas for additional enhancements.

We depend on third-party service providers to support our business and operational activities and to help us achieve our strategic goals. However, these third parties can introduce various risks to us and our customers. To mitigate these risks, we have established a Third Party Risk Management framework. This framework equips us with the necessary tools and practices for effective oversight of third-party service providers, ensuring compliance with legal and regulatory obligations, contractual requirements, performance expectations, and our own principles and values.

Our vendor risk management practices are robust and include comprehensive risk assessments of suppliers, with a strong emphasis on cybersecurity. We use commercially available services to monitor our vendors, providing security scores for supplier technology services, threat intelligence, financial intelligence, and other cybersecurity-related considerations. Regular reviews are conducted to track changes in our vendors' cybersecurity risk posture, and continuous threat intelligence monitoring helps identify potential cybersecurity incidents involving third parties. We also strive to negotiate appropriate cybersecurity provisions in our vendor contracts.

For the 2024 period, we reported no material cybersecurity incidents affecting the confidentiality, integrity, or availability of data or systems. We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. We face certain ongoing risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. For further information, see Item 1A. “Risk Factors,” including the risk factor titled “An interruption or breach in security of our information systems or those related to merchants and third-party vendors, including as a result of cyber attacks, could disrupt our business, result in the disclosure or misuse of confidential or proprietary information, damage our reputation, or result in financial losses.”

## Properties

As filed, 421 characters.

Our principal offices are located in the Financial Plaza of the Pacific in Honolulu, Hawaiʻi. We own and lease other branch offices and operating facilities located throughout Hawaiʻi and the West Pacific. We believe our current facilities are adequate to meet our needs. Additional information with respect to premises and equipment is presented in Notes 6 and 23 in Item 8. “Notes to Consolidated Financial Statements.”

## Legal proceedings

As filed, 451 characters.

We are from time to time subject to lawsuits, investigations and claims arising out of the conduct of our business. There are no pending legal proceedings against or involving the Company for which the outcome is likely to have a material adverse effect upon its financial position or results of operations. For additional information, see Note 20 in Item 8. “Notes to Consolidated Financial Statements,” under the discussion related to Contingencies.

## Management's discussion and analysis

As filed, 120,829 characters.

The following MD&A is intended to help the reader understand the Company and its operations and is focused on our fiscal 2024 and 2023 financial results, including comparisons of year-to-year performance between these years. Discussion and analysis of our 2022 fiscal year, as well as the year-to-year comparison between fiscal 2023 and 2022, are included in Part II, Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 29, 2024.

### Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to historical or current facts and may include statements concerning, among other things, the anticipated economic and business environment in our service area and elsewhere, credit quality and other financial and business matters in future periods, our future results of operations and financial position, our business strategy and plans and our objectives and future operations. 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 also may make forward-looking statements in our other documents filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”). In addition, our senior management may provide forward-looking statements orally to analysts, investors, representatives of the media and others. Given these risks and uncertainties, you should not place undue reliance on any forward-looking statement as a prediction of our actual results.

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) Our business is sensitive to regional business and economic conditions, in particular those of Hawaiʻi, Guam and other Pacific Islands; (2) Our loan portfolio is largely secured by real estate, and a downturn in the real estate market may adversely affect our results of operations; (3) A sustained period of high inflation could pose a risk to local economies and the financial performance of the Bank; (4) Climate change and the governmental responses to it could have a material adverse impact on the Bank and its customers; (5) Disruptions, instability and failures in the banking industry may negatively impact us; (6) Any reduction in defense spending by the federal government in the state of Hawaiʻi could adversely impact the economy in Hawaiʻi and the Pacific Islands; (7) Changes in interest rates could adversely impact our results of operations and capital; (8) Our allowance for credit losses may prove to be insufficient to absorb losses or appropriately reflect, at any given time, the inherent risk of loss in our loan portfolio; (9) Consumer protection initiatives and court decisions related to the foreclosure process affect our remedies as a creditor; (10) Changes in the capital markets could materially affect the level of assets under management and the demand for our other fee-based services; (11) The Parent’s liquidity is dependent on dividends from the Bank; (12) There can be no assurance that the Parent will continue to declare cash dividends; (13) Fiscal and monetary policy changes may significantly impact our profitability and liquidity; (14) Legislation and regulatory initiatives affecting the financial services industry, including new interpretations, restrictions and requirements, could detrimentally affect the Company’s business; (15) Changes in income tax laws and interpretations, or in accounting standards, could materially affect our financial condition or results of operations; (16) A failure in or breach of our operational systems, information systems, or infrastructure, or those of our third party vendors and other service providers, may result in financial losses, loss of customers, or damage to our reputation; (17) An interruption or breach in security of our information systems or those related to merchants and third party vendors, including as a result of cyber-attacks, could disrupt our business, result in the disclosure or misuse of confidential or proprietary information, damage our reputation, or result in financial losses; (18) Our mortgage banking income may experience significant volatility; (19) Our mortgage loan servicing business may be impacted if we do not meet our obligations, or if servicing standards change; (20) Risks related to representation and warranty provisions may impact our mortgage loan servicing business; (21) Risks relating to residential mortgage loan servicing activities may adversely affect our results; (22) The requirement to record certain assets and liabilities at fair value may adversely affect our financial results (23) Natural disasters and adverse weather in Hawaiʻi and the Pacific Islands may negatively affect real estate property values and our operations (24) Competition may adversely affect our business; (25) Our future performance will depend on our ability to respond timely to technological change; (26) Negative public opinion could damage our reputation and adversely impact our earnings and liquidity (27) We are subject to certain litigation, and our expenses related to this litigation may adversely affect our results; (28) Our performance depends on attracting and retaining key employees and skilled personnel to operate our business effectively; (29) The soundness of other financial institutions may adversely impact our financial condition or results of operations; and (30) We have experienced increases in FDIC insurance assessments.

The risks and uncertainties that could cause actual results to differ materially from our historical experience and our expectations and projections include but are not limited to those described in Item 1A. “Risk Factors,” Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in our most recent Annual Report on Form 10-K and in subsequent SEC filings. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by the federal securities laws.

### Critical Accounting Estimates

Our Consolidated Financial Statements were prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and follow general practices within the industries in which we operate. The most significant accounting policies we follow are presented in Note 2 in Item 8. “Notes to Consolidated Financial Statements.” Application of GAAP requires us to make estimates that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Most accounting estimates are not considered by management to be critical accounting estimates. Critical accounting estimates are those estimates made in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. In determining which accounting estimates are critical accounting estimates we consider, among other things, whether the application of GAAP requires management to make difficult, subjective, and complex judgments about matters that are inherently uncertain and whether it is likely that materially different amounts would be reported under different conditions or using different assumptions. The accounting estimates that we believe to be most critical in preparing our Consolidated Financial Statements are those that are related to the determination of the reserve for credit losses, fair value estimates, and income taxes. Additional information is presented in Note 2 in Item 8. “Notes to Consolidated Financial Statements.”

#### Reserve for Credit Losses

A consequence of lending activities is that we may incur credit losses. The amount of such losses will vary depending upon the risk characteristics of the loan and lease portfolio as affected by economic conditions.

The reserve for credit losses consists of the allowance for credit losses (the “Allowance”) and the reserve for unfunded commitments (the “Unfunded Reserve”). Accounting estimates related to the reserve for credit losses are considered to be critical as these estimates involve considerable subjective judgment and estimation by management. These estimates are in accordance with Accounting Standards Codification (“ASC”) Topic 326 (“ASC 326”) Financial Instruments - Credit Losses. In the case of loans and leases, the Allowance is a contra-asset valuation account, calculated in accordance with ASC 326, that is deducted from the amortized cost basis of loans and leases to present the net amount expected to be collected. In the case of off-balance-sheet credit exposures, the Unfunded Reserve is a liability account, calculated in accordance with ASC 326, reported as a component of other liabilities in our consolidated statements of condition.

The estimate of expected credit losses is based on relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts. Historical loss experience is generally the starting point for estimating expected credit losses. We then consider whether the historical loss experience should be adjusted for asset-specific risk characteristics or current conditions at the reporting date that did not exist over the period from which historical experience was used. These adjustments can include accounting for new or discontinued products, changes in our portfolio composition, delinquency trends, and with forecasted economic conditions including but not limited to unemployment, real estate market conditions (e.g. prices, sales activity and inventory), visitor arrivals, and the uncertainty of other events (local, national and global). The Unfunded Reserve represents the expected credit losses on off-balance sheet commitments such as unfunded commitments to extend credit and standby letters of credit. The Unfunded Reserve is determined by estimating future draws and applying the expected loss rates on those draws. However, a liability is not recognized for commitments unconditionally cancelable by the Company.

The historical loss experience for the commercial portfolio segment is primarily determined using a Cohort method. This method pools loans and leases into groups (“cohorts”) sharing similar risk characteristics based on product and risk ratings, and tracks each cohort’s historical net charge-offs to calculate a historical loss rate. The historical loss rates for each cohort are then averaged to calculate an overall historical loss rate which is applied to current loan balances to arrive at the quantitative baseline portion of the Allowance for most of the commercial portfolio segment.

The historical loss experience for the consumer portfolio segment is primarily determined using a Vintage method. This method measures historical loss behavior in the form of a historical loss rate for homogenous loan pools that originate in the same period, known as a vintage. The historical loss rates are then applied to origination loan balances by vintage to determine the quantitative baseline portion of the Allowance for most of the consumer portfolio segment. The homogenous loan pools are segmented according to similar risk characteristics (e.g., residential mortgage, home equity) and may be sub-segmented further based on historical loss behavior. For example, we sub-segment residential mortgages by geography and home equity by lien position.

We also consider qualitative adjustments to the quantitative baseline such as the impact of current environmental factors at the reporting date that did not exist over the period from which historical experience was used. Relevant factors include, but are not limited to, concentrations of credit risk, such as geography, industry, real estate property type; and economic trends and conditions, such as Hawaiʻi unemployment, real estate prices and market conditions, and visitor arrivals. We also consider changes in underwriting standards, and levels and trends in delinquencies and criticized loans and leases.

We also incorporate a reasonable and supportable (“R&S”) loss forecast period, which is currently one year, to account for the effect of forecasted economic conditions and other factors on the performance of the loan portfolios, which could differ from historical loss experience. We also perform asset quality reviews which includes a review of forecasted gross charge-offs and recoveries, nonperforming assets, criticized loans and leases, and risk rating migration. The results of the asset quality review are used to consider qualitative adjustments to the quantitative baseline. After the one-year R&S loss forecast period, this adjustment assumes an immediate reversion to historical loss rates for the remaining expected life of the loan.

The company utilizes the University of Hawaiʻi Economic Research Organization (“UHERO”) macroeconomic forecast that is updated quarterly based on economic conditions and events. The forecast includes various economic variables for Hawaiʻi such as gross domestic product (“GDP”), unemployment rate, visitor arrivals, residential real estate market conditions, personal income, and inflation rate. We also utilize other forecast tools for broader U.S. economic variables such as interest rates, as well as to apply any overlays to the forecast.

The reserve for credit losses is generally sensitive to economic conditions and assumptions given the impact for potential losses for the consumer portfolio and risk rating migration for the commercial portfolio. For the consumer portfolio, as an example, an increase in the forecasted Hawaiʻi unemployment rate could lead to an increase in the rate of delinquencies and consequently charge-offs for consumer borrowers. For the Allowance at December 31, 2024, a 25 basis point increase in the forecasted Hawaiʻi unemployment rates would have increased the quantitative component of the Allowance for consumer loans by an estimated $1.4 million. For the commercial portfolio, the impact of adverse changes in economic conditions on borrowers will vary, and generally evaluated on a case-by-case basis to include the borrower’s existing and expected financial capacity. Borrowers that would be most adversely impacted are identified as having the potential for migrating from a Pass to a Classified risk rating. For the Allowance at December 31, 2024, a 50 basis point increase in the percentage of commercial loans risk rated as Classified would increase the quantitative component of the Allowance for commercial loans by an estimated $2.0 million. This sensitivity analysis is hypothetical and provided only to indicate the potential impact changes in economic conditions and assumptions may have on the Allowance estimate. Additionally, changes in factors and inputs may be directionally inconsistent, such that improvement in one factor may offset deterioration in others.

The Unfunded Reserve is determined by estimating future draws and applying the expected loss rates on those draws. Future draws are based on historical averages of utilization rates (i.e., the likelihood of draws taken). To estimate future draws on unfunded balances, current utilization rates are compared to historical utilization rates. If current utilization rates are below historical utilization rates, the rate difference is applied to the committed balance to estimate the future draw. Expected loss rates are estimated using the loss rates calculated for the corresponding loan category in the Allowance. For the commercial portfolio, the historical loss rates were calculated utilizing the Cohort methodology, while the consumer portfolio utilized the Vintage methodology.

#### Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for an asset or liability in an orderly transaction between market participants at the measurement date. The degree of management judgment involved in determining the fair value of a financial instrument is dependent upon the availability of quoted market prices or observable market inputs. For financial instruments that are traded actively and have quoted market prices or observable market inputs, there is minimal subjectivity involved in measuring fair value. However, when quoted market prices or observable market inputs are not fully available, significant management judgment may be necessary to estimate fair value. In developing our fair value measurements, we maximize the use of observable inputs and minimize the use of unobservable inputs.

The fair value hierarchy defines Level 1 valuations as those based on quoted prices, unadjusted, for identical instruments traded in active markets. Level 2 valuations are those based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-based valuation techniques for which all significant assumptions are observable in the market. Level 3 valuations are based on model-based techniques that use at least one significant assumption not observable in the market, or significant management judgment or estimation, some of which may be internally developed.

Financial assets that are recorded at fair value on a recurring basis include available-for-sale investment securities, loans held for sale, mortgage servicing rights, investments related to deferred compensation arrangements, and derivative financial instruments. As of December 31, 2024 and 2023, $2.9 billion or 12% and $2.5 billion or 11%, respectively, of our total assets consisted of financial assets recorded at fair value on a recurring basis and most of these financial assets consisted of available-for-sale investment securities measured using information from a third party pricing service. These investments in debt securities and mortgage-backed securities were all classified in either Levels 1 or 2 of the fair value hierarchy. Financial liabilities that are recorded at fair value on a recurring basis are comprised of derivative financial instruments. As of December 31, 2024, and 2023, $154.1 million and $143.9 million, respectively, or less than 1% of our total liabilities consisted of financial liabilities recorded at fair value on a recurring basis.

As of December 31, 2024 and 2023, Level 3 financial assets recorded at fair value on a recurring basis were $0.7 million and $0.8 million, respectively, or less than 1% of our total assets, and were comprised primarily of mortgage servicing rights and derivative financial instruments. As of December 31, 2024 and 2023, there were no Level 3 financial liabilities recorded at fair value on a recurring basis.

We also use third party pricing services to assist our management in determining the value of securities. Our third party pricing service makes no representations or warranties that the pricing data provided to us is complete or free from errors, omissions, or defects. As a result, we have processes in place to monitor and periodically review the information provided to us by our third party pricing service such as: 1) Our third party pricing service provides us with documentation by asset class of inputs and methodologies used to value securities. We review this documentation to evaluate the inputs and valuation methodologies used to place securities into the appropriate level of the fair value hierarchy. This documentation is periodically updated by our third party pricing service. Accordingly, transfers of securities within the fair value hierarchy are made if deemed necessary. 2) On a quarterly basis, management also selects a sample of securities priced by the Company’s third party pricing service and reviews the significant assumptions and valuation methodologies used by the pricing service with respect to those securities. The information provided is comprised of market reference data, which may include reported trades; bids, offers, or broker-dealer dealer quotes; benchmark yields and spreads; as well as other reference data as appropriate. Periodically, based on these reviews, management determines whether the current placement of the security in the fair value hierarchy is appropriate or whether transfers may be warranted. 3) On a quarterly basis, management reviews the pricing information received from our third party pricing service. This review process includes a comparison to a second source. 4) Our third party pricing service has also established processes for us to submit inquiries regarding quoted prices. Periodically, we will challenge the quoted prices provided by our third party pricing service. Our third party pricing service will review the inputs to the evaluation in light of the new market data presented by us. Our third party pricing service may then affirm the original quoted price or may update the evaluation on a going forward basis. Generally, we do not adjust the price from the third party service provider. 5) On an annual basis, we obtain and review the third party’s most recently issued Service Organization Controls report related to controls placed in operation and tests of operating effectiveness, to update our understanding of the third party pricing service’s control environment.

See Note 21 in Item 8. “Notes to Consolidated Financial Statements” for more information on our fair value measurements.

#### Income Taxes

We determine our liabilities for income taxes based on current tax regulations and interpretations in tax jurisdictions where our income is subject to taxation. Currently, we file tax returns for federal, five state and local domestic jurisdictions, and three foreign jurisdictions. In estimating income taxes payable or receivable, we assess the relative merits and risks of the appropriate tax treatment considering statutory, judicial, and regulatory guidance in the context of each tax position. Accordingly, previously estimated liabilities are regularly reevaluated and adjusted through the provision for income taxes. Changes in the estimate of income taxes payable or receivable occur periodically due to changes in tax rates, interpretations of tax law, the status of examinations being conducted by various taxing authorities, and newly enacted statutory, judicial and regulatory guidance that impact the relative merits and risks of each tax position. These changes, when they occur, may affect the provision for income taxes as well as current and deferred income taxes, and may be significant to our consolidated statements of income and condition.

Management's determination of the realization of net deferred tax assets is based upon management's judgment of various future events and uncertainties, including the timing, character and amount of future income, as well as the implementation of various tax planning strategies to maximize realization of the deferred tax assets. A valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. As of December 31, 2024 and 2023, we carried a valuation allowance of $9.7 million and $6.7 million, respectively, related to our deferred tax assets established in connection with our low-income housing investments.

We are also required to record a liability, referred to as an unrecognized tax benefit (“UTB”), for the entire amount of benefit taken in a prior or future income tax return when we determine that a tax position has a less than 50% likelihood of being accepted by the taxing authority. As of December 31, 2024 and 2023, our liabilities for UTBs were $5.3 million and $3.7 million, respectively.

### Overview

We are a regional financial services company serving businesses, consumers, and governments in Hawaiʻi, Guam, and other Pacific Islands. Our principal operating subsidiary, the Bank, was founded in 1897.

Our business strategy is to use our unique market knowledge, prudent management discipline and brand strength to deliver exceptional value to our stakeholders. Our business plan is balanced between growth and risk management while maintaining flexibility to adjust to economic changes. We will continue to focus on providing customers with best-in-class service and an innovative mix of products and services. We will also remain focused on continuing to deliver strong financial results while maintaining prudent risk and capital management strategies as well as our commitment to support our local communities.

#### Hawaiʻi Economy

Global economic conditions remain broadly favorable for the local economy. The Maui economy continues its gradual post-wildfire recovery while the visitor industry for the rest of the Hawaiʻi is expected to operate at a high level. Due to the weak yen, the Japanese visitor market continues to recover slowly. Considering the ongoing recovery efforts on Maui and weaker Japanese yen, visitor arrivals to Hawaiʻi are expected to have moderate growth in 2025.

The economic environment in Hawaiʻi remained stable with the unemployment rate slightly increasing from 2.9% in December 2023 to 3.0% in December 2024, which was below the U.S. unemployment rate of 4.1%. For the State overall, job growth is expected to expand in 2025 with the main drivers in construction, real estate, and the continued recovery of tourism.

The volume of single-family home sales on Oahu increased 9.1% in 2024 compared to the prior year, while the volume of condominium sales on Oahu decreased 2.5% in 2024 compared to the prior year. The median price of single-family home sales and condominium sales on Oahu increased by 4.8% and 1.3%, respectively, in 2024 compared to the prior year.

#### Earnings Summary

Net income for 2024 was $150.0 million, a decrease of $21.2 million or 12% compared to the prior year. Diluted earnings per common share were $3.46 in 2024, a decrease of $0.68 or 16% compared to the prior year. Our return on average assets was 0.64% in 2024, a decrease of 7 basis points from 2023, and our return on average shareholders’ equity was 9.78% in 2024, compared to 12.63% in the prior year.

- The return on average common equity for 2024 was 10.85% compared to 13.89% for the prior year.
- Net interest income was $466.6 million in 2024, a decrease of $30.4 million compared to the prior year. The decrease was primarily due to higher funding costs, partially offset by higher earning asset yields. The net interest margin was 2.16% in 2024, a decrease of 8 basis points from the prior year.
- Noninterest income was $172.5 million in 2024, a decrease of 2% from the prior year.
- Noninterest expense was $430.1 million in 2024, a decrease of 1.7% compared to the prior year.
- The effective tax rate for 2024 was 24.19% compared with 24.62% for the prior year.
- Total non-performing assets were $19.3 million as of December 31, 2024, an increase of $7.6 million from the prior year. The ratio of non-performing assets to total loans and leases and foreclosed real estate was 0.14% at December 31, 2024, an increase of 6 basis points from the prior year.
- Net loan and lease charge-offs in 2024 were $12.9 million or 9 basis points of total average loans and leases outstanding. Net loan and lease charge-offs in 2024 were comprised of charge-offs of $15.0 million partially offset by recoveries of $7.2 million. Compared to 2023, net loan and lease charge-offs increased by $2.7 million or 2 basis points on total average loans and leases outstanding.
- The allowance for credit losses on loans and leases was $148.5 million as of December 31, 2024, an increase of $2.1 million from the prior year. The ratio of the allowance for credit losses to total loans and leases outstanding was 1.06% at December 31, 2024, up 1 basis point from the prior year.
- Total assets were $23.6 billion as of December 31, 2024, a decrease of 0.6% from the prior year.
- The investment securities portfolio was $7.3 billion as of December 31, 2024, a decrease of $0.1 billion or 1% from the prior year. The portfolio remains largely comprised of securities issued by U.S. government agencies and U.S. government-sponsored enterprises. In 2024, we purchased $470.8 million of investment securities, the majority of which were floating rate securities.
- Total loans and leases were $14.1 billion as of December 31, 2024, an increase of 1% from the prior year.
- Total deposits were $20.6 billion as of December 31, 2024, a decrease of 2% from the prior year.
- Total shareholders’ equity was $1.7 billion as of December 31, 2024, an increase of 18% from the prior year due to the issuance of Series B Preferred Stock in the second quarter of 2024.
- No shares of common stock were repurchased under the share repurchase program in 2024. Total remaining buyback authority under the share repurchase program was $126.0 million as of December 31, 2024.
- The Company’s Board of Directors declared a quarterly cash dividend of $0.70 per share on the Company’s outstanding common shares. The dividend will be payable on March 14, 2025 to shareholders of record at the close of business on February 28, 2025.

### Analysis of Consolidated Statements of Income

Average balances, related income and expenses, and resulting yields and rates, on a taxable-equivalent basis, are presented in Table 1. An analysis of the change in net interest income, on a taxable-equivalent basis, is presented in Table 2.

*(dollars in millions)*

| Average Balances and Interest Rates – Taxable-Equivalent Basis 1 Earning Assets | 2024 Average Balance | Income/ Expense 2 | Yield/ Rate | 2023 Average Balance | Income/ Expense | Table 1 Yield/ Rate |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Cash and Cash Equivalents | $594.1 | $30.7 | 5.17% | $543.9 | $28.4 | 5.22% |
| Investment Securities |  |  |  |  |  |  |
| Available-for-Sale |  |  |  |  |  |  |
| Taxable | 2,433.8 | 89.3 | 3.67 | 2,631.0 | 93.4 | 3.55 |
| Non-Taxable | 9.2 | 0.6 | 6.05 | 6.1 | 0.2 | 4.06 |
| Held-to-Maturity |  |  |  |  |  |  |
| Taxable | 4,783.5 | 84.9 | 1.78 | 5,173.9 | 92.2 | 1.78 |
| Non-Taxable | 34.5 | 0.7 | 2.10 | 35.1 | 0.7 | 2.10 |
| Total Investment Securities | 7,261.0 | 175.5 | 2.42 | 7,846.1 | 186.5 | 2.38 |
| Loans Held for Sale | 2.9 | 0.2 | 6.05 | 3.0 | 0.2 | 6.16 |
| Loans and Leases 3 |  |  |  |  |  |  |
| Commercial Mortgage | 3,763.6 | 205.9 | 5.47 | 3,776.2 | 197.0 | 5.22 |
| Commercial and Industrial | 1,679.8 | 89.2 | 5.31 | 1,511.2 | 74.2 | 4.91 |
| Construction | 333.4 | 25.6 | 7.66 | 262.1 | 16.0 | 6.09 |
| Commercial Lease Financing | 65.1 | 1.7 | 2.68 | 63.7 | 0.8 | 1.30 |
| Residential Mortgage | 4,614.8 | 182.4 | 3.95 | 4,690.5 | 168.9 | 3.60 |
| Home Equity | 2,217.5 | 87.8 | 3.96 | 2,268.0 | 78.2 | 3.45 |
| Automobile | 803.6 | 37.0 | 4.61 | 866.1 | 31.8 | 3.67 |
| Other | 391.1 | 27.4 | 7.01 | 413.8 | 25.3 | 6.12 |
| Total Loans and Leases | 13,868.9 | 657.0 | 4.74 | 13,851.6 | 592.2 | 4.28 |
| Other | 63.2 | 4.2 | 6.66 | 78.3 | 5.1 | 6.51 |
| **Total Earning Assets 2** | 21,790.1 | 867.6 | 3.98 | 22,322.9 | 812.4 | 3.64 |
| Non-Earning Assets | 1,572.6 |  |  | 1,631.3 |  |  |
| **Total Assets** | $23,362.7 |  |  | $23,954.2 |  |  |
| **Interest-Bearing Liabilities** |  |  |  |  |  |  |
| Interest-Bearing Deposits |  |  |  |  |  |  |
| Demand | 3,745.9 | 33.2 | 0.89 | 3,978.7 | 27.0 | 0.68 |
| Savings | 8,362.3 | 209.7 | 2.51 | 8,018.4 | 137.4 | 1.71 |
| Time | 3,042.3 | 125.9 | 4.14 | 2,424.8 | 86.4 | 3.56 |
| Total Interest-Bearing Deposits | 15,150.5 | 368.8 | 2.43 | 14,421.9 | 250.8 | 1.74 |
| Funds Purchased | 0.8 | 0.0 | 5.46 | 18.5 | 0.9 | 4.79 |
| Short-Term Borrowings | 0.0 | 0.0 | 5.25 | 114.0 | 5.7 | 5.01 |
| Securities Sold Under Agreements to Repurchase | 118.2 | 4.6 | 3.90 | 530.9 | 16.3 | 3.07 |
| Other Debt | 559.6 | 23.8 | 4.24 | 921.8 | 39.7 | 4.30 |
| **Total Interest-Bearing Liabilities** | 15,829.1 | 397.2 | 2.51 | 16,007.1 | 313.4 | 1.96 |
| **Net Interest Income** |  | $470.4 |  |  | $499.0 |  |
| Interest Rate Spread |  |  | 1.47% |  |  | 1.68% |
| Net Interest Margin |  |  | 2.16% |  |  | 2.24% |
| Noninterest-Bearing Demand Deposits | 5,385.8 |  |  | 5,990.5 |  |  |
| Other Liabilities | 614.6 |  |  | 601.1 |  |  |
| Shareholders’ Equity | 1,533.2 |  |  | 1,355.5 |  |  |
| **Total Liabilities and Shareholders’ Equity** | $23,362.7 |  |  | $23,954.2 |  |  |

1\. Due to rounding, the amounts presented in this schedule may not tie to other amounts presented elsewhere in this report.

2\. Interest income includes taxable-equivalent basis adjustments, based upon a federal statutory tax rate of 21% of $3.8 million and $2.0 million for the years ended December 31, 2024, and 2023, respectively.

3\. Non-performing loans and leases are included in the respective average loan and lease balances.

*(dollars in millions)*

| Analysis of Change in Net Interest Income – Taxable-Equivalent Basis Change in Interest Income: | Year Ended December 31, 2024 Compared to 2023 Volume 1 | Rate 1 | Table 2 Total |
| --- | ---: | ---: | ---: |
| Cash and Cash Equivalents | $2.6 | $(0.3) | $2.3 |
| Investment Securities |  |  |  |
| Available-for-Sale |  |  |  |
| Taxable | (7.2) | 3.1 | (4.1) |
| Non-Taxable | 0.2 | 0.2 | 0.4 |
| Held-to-Maturity |  |  |  |
| Taxable | (6.9) | (0.4) | (7.3) |
| Non-Taxable | (0.0) | — | (0.0) |
| Total Investment Securities | (13.9) | 2.9 | (11.0) |
| Loans Held for Sale | (0.0) | (0.0) | (0.0) |
| Loans and Leases |  |  |  |
| Commercial Mortgage | (0.6) | 9.5 | 8.9 |
| Commercial and Industrial | 8.9 | 6.1 | 15.0 |
| Construction | 4.9 | 4.7 | 9.6 |
| Commercial Lease Financing | 0.2 | 0.7 | 0.9 |
| Residential Mortgage | (2.7) | 16.2 | 13.5 |
| Home Equity | (1.8) | 11.4 | 9.6 |
| Automobile | (2.5) | 7.7 | 5.2 |
| Other | (1.4) | 3.5 | 2.1 |
| Total Loans and Leases | 5.0 | 59.8 | 64.8 |
| Other | (1.0) | 0.1 | (0.9) |
| **Total Change in Interest Income** | (7.3) | 62.5 | 55.2 |
| **Change in Interest Expense:** |  |  |  |
| Interest-Bearing Deposits |  |  |  |
| Demand | (1.7) | 7.9 | 6.2 |
| Savings | 6.2 | 66.1 | 72.3 |
| Time | 24.2 | 15.3 | 39.5 |
| Total Interest-Bearing Deposits | 28.7 | 89.3 | 118.0 |
| Funds Purchased | (1.0) | 0.1 | (0.9) |
| Short-Term Borrowings | (6.0) | 0.3 | (5.7) |
| Securities Sold Under Agreements to Repurchase | (15.2) | 3.5 | (11.7) |
| Other Debt | (15.4) | (0.5) | (15.9) |
| **Total Change in Interest Expense** | (8.9) | 92.7 | 83.8 |
| **Change in Net Interest Income** | $1.6 | $(30.2) | $(28.6) |

1\. The change in interest income or expense due to both rate and volume has been allocated between the factors in proportion to the relationship of the absolute dollar amounts of the change in each.

#### Net Interest Income

Net interest income is affected by the size and mix of our balance sheet components as well as the spread between interest earned on assets and interest paid on liabilities. Net interest margin is defined as net interest income, on a taxable-equivalent basis, as a percentage of average earning assets.

The average balances of our earning assets decreased by $532.8 million or 2% in 2024 compared to the prior year, primarily due to cashflows from the portfolio being used to reduce our interest-bearing liabilities. Yields on our investment securities portfolio increased by 4 basis points, primarily due to income earned from interest rate swaps that hedge a portion of our AFS securities portfolio partially offset by the impact of a portion of our corporate bonds portfolio converting from fixed-rate securities to lower floating-rate securities in the fourth quarter of 2023. Yields on our loan and lease portfolio increased by 46 basis points due to yield increases on our floating rate loan portfolio, higher rates on loans originated during the period, and income earned from interest rate swaps that hedge a portion of our residential mortgage portfolio.

The average balances of our interest-bearing liabilities decreased by $178.0 million or 1% in 2024 compared to the prior year due to the termination of $1.2 billion in FHLB advances during the third quarter of 2023 and the termination of $625.0 million in repurchase agreements ($575.0 million in the third quarter of 2023 and $50.0 million in the second quarter of 2024). This decrease was partially offset by an increase in our interest-bearing deposits. The cost of our interest-bearing liabilities in 2024 increased by 55 basis points compared to the prior year, primarily driven by customer migration from non-interest bearing and low yield deposit accounts to higher rate deposit products. The cost of our interest-bearing deposits increased by 69 basis points in 2024 compared to the prior year.

#### Noninterest Income

Table 3 presents the major components of noninterest income for 2024 and 2023.

*(dollars in thousands)*

| Noninterest Income | Table 3 Year Ended December 31, 2024 | 2023 | Dollar Change | Percent Change |
| --- | ---: | ---: | ---: | ---: |
| Fees, Exchange, and Other Service Charges | $57,236 | $55,556 | $1,680 | 3% |
| Trust and Asset Management | 47,485 | 43,597 | 3,888 | 9 |
| Service Charges on Deposit Accounts | 32,430 | 31,116 | 1,314 | 4 |
| Bank-Owned Life Insurance | 13,568 | 11,643 | 1,925 | 17 |
| Annuity and Insurance | 5,436 | 4,736 | 700 | 15 |
| Mortgage Banking | 4,109 | 4,255 | (146) | (3) |
| Investment Securities Losses, Net | (7,507) | (11,455) | 3,948 | (34) |
| Other | 19,772 | 37,161 | (17,389) | (47) |
| **Total Noninterest Income** | $172,529 | $176,609 | $(4,080) | (2)% |

Bank-owned life insurance increased by $1.9 million or 17% in 2024 compared to the prior year primarily due to an increase in the yield on the underlying assets in 2024.

Investment securities losses, net, decreased by $3.9 million in 2024 compared to the prior year primarily due to $4.6 million net losses on sales of investment securities in 2023, partially offset by higher fees paid to counterparties for Visa Class B share conversion rate expense during 2024.

Other noninterest income decreased by $17.4 million or 47% in 2024 compared to the prior year primarily due to a $14.7 million gain on the extinguishments of repurchase agreements during 2023 coupled with a decrease in customer derivative fees earned during 2024 as compared to the prior year.

#### Noninterest Expense

Table 4 presents the major components of noninterest expense for 2024 and 2023.

*(dollars in thousands)*

| Noninterest Expense Salaries and Benefits: | Table 4 Year Ended December 31, 2024 | 2023 | Dollar Change | Percent Change |
| --- | ---: | ---: | ---: | ---: |
| Salaries | $154,538 | $154,497 | $41 | 0% |
| Incentive Compensation | 15,708 | 13,339 | 2,369 | 18 |
| Retirement and Other Benefits | 15,408 | 15,707 | (299) | (2) |
| Medical, Dental, and Life Insurance | 14,900 | 12,767 | 2,133 | 17 |
| Share-Based Compensation | 13,667 | 14,770 | (1,103) | (7) |
| Payroll Taxes | 13,232 | 14,677 | (1,445) | (10) |
| Commission Expense | 3,575 | 2,798 | 777 | 28 |
| Separation Expense | 1,536 | 5,524 | (3,988) | (72) |
| Total Salaries and Benefits | 232,564 | 234,079 | (1,515) | (1) |
| Net Occupancy | 42,084 | 39,924 | 2,160 | 5 |
| Net Equipment | 40,886 | 40,251 | 635 | 2 |
| Data Processing | 19,540 | 18,836 | 704 | 4 |
| Professional Fees | 19,319 | 17,459 | 1,860 | 11 |
| FDIC Insurance | 17,850 | 28,313 | (10,463) | (37) |
| Other Expense: |  |  |  |  |
| Advertising | 7,842 | 8,171 | (329) | (4) |
| Delivery and Postage Services | 6,865 | 6,656 | 209 | 3 |
| Merchant Transaction and Card Processing Fees | 6,772 | 6,509 | 263 | 4 |
| Mileage Program Travel | 4,268 | 4,381 | (113) | (3) |
| Broker's Charges | 2,002 | 3,508 | (1,506) | (43) |
| Other | 30,116 | 29,431 | 685 | 2 |
| Total Other Expense | 57,865 | 58,656 | (791) | (1) |
| **Total Noninterest Expense** | $430,108 | $437,518 | $(7,410) | (2)% |

Total salaries and benefits decreased by $1.5 million or 1% in 2024 compared to the prior year primarily due to a decrease in separation expense coupled with a decrease in payroll taxes and share-based compensation, partially offset by an increase in incentive compensation expense and medical, dental, and life insurance expense.

Professional fees expense increased by $1.9 million or 11% in 2024 compared to the prior year primarily due to an increase in consulting fees and various outsourced support functions related to enhancing our risk management efforts.

FDIC insurance expense decreased by $10.5 million or 37% in 2024 compared to the prior year, primarily due to a decrease in the industry-wide FDIC special assessment. We recorded a charge of $1.9 million in 2024 compared to a $14.7 million charge in 2023 in connection with the special assessment. This special assessment was designed to recover the losses to the Deposit Insurance Fund arising from the protection of uninsured depositors following the closures of Silicon Valley Bank, Signature Bank and First Republic Bank. The collection of the special assessment started in the second quarter of 2024 and will be paid in eight quarterly installments.

Total other expense decreased by $0.8 million or 1% in 2024 compared to the prior year primarily due to lower broker's charges as a result of fewer customer swaps in 2024 as compared to 2023.

#### Income Taxes

Table 5 presents our provision for income taxes and effective tax rates for 2024 and 2023:

*(dollars in thousands)*

| Provision for Income Taxes and Effective Tax Rates | Table 5 Provision for Income Taxes | Effective Tax Rates |
| --- | ---: | ---: |
| 2024 | $47,857 | 24.19% |
| 2023 | $55,914 | 24.62% |

31

The provision for income taxes was $47.9 million in 2024, a decrease of $8.1 million compared to the prior year. The effective tax rate for 2024 was 24.19%, a decrease from 24.62% for the prior year. The lower effective tax rate in 2024 compared to the prior year was primarily due to return to provision adjustments and discrete items partially offset by changes to uncertain tax positions.

### Analysis of Business Segments

Our business segments are Consumer Banking, Commercial Banking, and Treasury and Other. Table 6 summarizes net income from our business segments for 2024 and 2023. Additional information about segment performance is presented in Note 13 in Item 8. “Notes to Consolidated Financial Statements.”

*(dollars in thousands)*

| Business Segment Net Income | Year Ended December 31, 2024 | Table 6 2023 1 |
| --- | ---: | ---: |
| Consumer Banking | $129,502 | $127,433 |
| Commercial Banking | 119,423 | 123,813 |
| **Total** | 248,925 | 251,246 |
| Treasury and Other | (98,931) | (80,044) |
| **Consolidated Total** | $149,994 | $171,202 |

1\. Certain prior period information has been reclassified to conform to current presentation.

#### Consumer Banking

Net income increased by $2.1 million or 2% in 2024 compared to the prior year, primarily due an increase in noninterest income, partially offset by an increase in the provision for credit losses. Noninterest income increased by $8.2 million or 6% in 2024 compared to the prior year, primarily due to higher trust and asset management fees, overdraft fees, shareholder servicing fees, annuity and insurance fees, and debit card fees. The provision for credit losses increased by $4.2 million or 54% in 2024 compared to the prior year, primarily due to higher net charge-offs in the installment, home equity, auto and residential loan portfolios.

#### Commercial Banking

Net income decreased by $4.4 million or 4% in 2024 compared to the prior year, primarily due to a decrease in net interest income and noninterest income, partially offset by a decrease in noninterest expense. Net interest income decreased by $3.0 million or 1% in 2024 compared to the prior year, primarily due to lower allocated interest income as a result of a decline in the average balance of commercial deposits, including noninterest bearing balances, partially offset by growth in the commercial and industrial and construction loan portfolios. Noninterest income decreased by $4.2 million or 13% in 2024 compared to the prior year, primarily due to a decrease in customer derivative fees, letter of credit fees, and certificate of deposit breakage fees. This decrease was partially offset by increases in account analysis fees, loan fees, and fees earned on money market sweep balances. Noninterest expense decreased by $3.1 million or 4% in 2024 compared to the prior year, primarily due to a decrease in allocated administrative and support unit expenses, salaries and benefits, and broker charges related to the customer derivative program. This decrease was partially offset by an increase in operational losses, merchant processing fees, allocated rent, and software licensing fees.

#### Treasury and Other

Net income decreased by $18.9 million or 24% in 2024 compared to the prior year, primarily due to lower net interest income and noninterest income, partially offset by lower noninterest expense. Net interest income decreased by $25.3 million or 24% in 2024 compared to the prior year as a result of higher interest-bearing deposit rates, partially offset by higher earning asset yields. Noninterest income decreased by $8.0 million or 47% in 2024 compared to the prior year, primarily due to a $14.7 million gain on the extinguishment of repurchase agreements reported above, which was partially offset by a $4.7 million net loss related to investment securities sales in the prior year. Noninterest expense decreased by $3.9 million or 20% in 2024 compared to the prior year, primarily due to a decrease in the industry-wide FDIC special assessment. The provision for income taxes in this business segment represents the residual amount to arrive at the total tax expense for the Company.

### Analysis of Consolidated Statements of Condition

#### Investment Securities

Table 7 presents the maturity distribution at amortized cost, weighted-average yield to maturity, and fair value of our investment securities.

*(dollars in millions)*

| Maturities and Average Yield on Securities As of December 31, 2024 Available-for-Sale 1 | 1 Year or Less | Weighted Average Yield | After 1 Year-5 Years | Weighted Average Yield | After 5 Years-10 Years | Weighted Average Yield | Over 10 Years | Weighted Average Yield | Total | Table 7 Weighted Average Yield | Fair Value |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Debt Securities Issued by the U.S. Treasury and Government Agencies | $40.5 | 1.5% | $216.3 | 3.3% | $0.2 | 4.3% | $— | 0.0% | $257.0 | 3.0% | $249.1 |
| Debt Securities Issued by States and Political Subdivisions | 0.9 | 1.5 | 28.8 | 2.1 | 43.5 | 2.0 | — | — | 73.2 | 2.1 | 63.9 |
| Debt Securities Issued by U.S. Government-Sponsored Enterprises | 0.7 | 0.9 | 0.8 | 2.1 | — | — | — | — | 1.5 | 1.5 | 1.5 |
| Debt Securities Issued by Corporations | 1.3 | 2.6 | 562.3 | 4.5 | 140.0 | 2.1 | — | — | 703.6 | 4.0 | 671.6 |
| Collateralized Mortgage Obligations 2: |  |  |  |  |  |  |  |  |  |  |  |
| Residential - U.S. Government- Sponsored Enterprises | 3.4 | 2.4 | 349.2 | 4.5 | 697.7 | 2.5 | — | — | 1,050.3 | 3.2 | 935.2 |
| Commercial - U.S. Government- Sponsored Enterprises | — | — | 286.8 | 3.9 | — | — | 19.9 | 5.0 | 306.7 | 4.0 | 283.5 |
| Total Collateralized Mortgage Obligations | 3.4 | 2.4 | 636.0 | 4.2 | 697.7 | 2.5 | 19.9 | 5.0 | 1,357.0 | 3.4 | 1,218.7 |
| Mortgage-Backed Securities 2 |  |  |  |  |  |  |  |  |  |  |  |
| Residential - U.S. Government- Sponsored Enterprises | 1.8 | 2.1 | 322.2 | 1.3 | 231.1 | 1.9 | — | — | 555.1 | 1.6 | 484.7 |
| Total Mortgage-Backed Securities | 1.8 | 2.1 | 322.2 | 1.3 | 231.1 | 1.9 | — | — | 555.1 | 1.6 | 484.7 |
| Total Available-for-Sale | $48.6 | 1.6% | $1,766.4 | 3.6% | $1,112.5 | 2.3% | $19.9 | 5.0% | $2,947.4 | 3.1% | $2,689.5 |
| **Held-to-Maturity** |  |  |  |  |  |  |  |  |  |  |  |
| Debt Securities Issued by the U.S. Treasury and Government Agencies | $7.5 | 0.3% | $74.8 | 1.3% | $49.6 | 1.5% | $— | 0.0% | $131.9 | 1.3% | $116.9 |
| Debt Securities Issued by Corporations | — | — | — | — | 10.5 | 1.6 | — | — | 10.5 | 1.6 | 8.3 |
| Collateralized Mortgage Obligations 2: |  |  |  |  |  |  |  |  |  |  |  |
| Residential - U.S. Government- Sponsored Enterprises | 3.3 | 2.8 | 84.0 | 2.4 | 2,097.9 | 1.4 | — | — | 2,185.2 | 1.4 | 1,808.1 |
| Commercial - U.S. Government- Sponsored Enterprises | 2.3 | 2.6 | 281.2 | 1.4 | 132.8 | 1.5 | — | — | 416.3 | 1.5 | 324.2 |
| Total Collateralized Mortgage Obligations | 5.6 | 2.8 | 365.2 | 1.7 | 2,230.7 | 1.4 | — | — | 2,601.5 | 1.4 | 2,132.3 |
| Mortgage-Backed Securities 2 |  |  |  |  |  |  |  |  |  |  |  |
| Commercial - U.S. Government- Sponsored Enterprises | 0.6 | 2.7 | 89.2 | 2.7 | 1,763.9 | 2.1 | 10.9 | 2.2 | 1,864.6 | 2.2 | 1,555.5 |
| Residential - U.S. Government- Sponsored Enterprises | — | — | — | — | 10.0 | 1.8 | — | — | 10.0 | 1.8 | 7.9 |
| Total Mortgage-Backed Securities | 0.6 | 2.7 | 89.2 | 2.7 | 1,773.9 | 2.1 | 10.9 | 2.2 | 1,874.6 | 2.2 | 1,563.4 |
| Total Held-to-Maturity | $13.7 | 1.4% | $529.2 | 1.8% | $4,064.7 | 1.7% | $10.9 | 2.2% | $4,618.5 | 1.7% | $3,820.9 |
| **Total Investment Securities** |  |  |  |  |  |  |  |  |  |  |  |
| As of December 31, 2024 | $62.3 |  | $2,295.6 |  | $5,177.2 |  | $30.8 |  | $7,565.9 |  | $6,510.4 |
| As of December 31, 2023 | $14.5 |  | $1,611.5 |  | $5,651.1 |  | $414.2 |  | $7,691.3 |  | $6,662.5 |

1Weighted-average yields on investment securities available-for-sale are based on amortized cost.

2Information for mortgage-backed securities, collateralized mortgage obligations, and small business administration securities reflect weighted average life, including anticipated future prepayments.

As of December 31, 2024, our investment securities portfolio was comprised of securities with an average remaining duration of approximately 4.83 years, which does not consider the impact of the interest rate swaps that hedge a portion of our available-for-sale portfolio.

We continually evaluate our investment securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability, and level of interest rate risk to which we are exposed. These evaluations may cause us to change the level of funds deployed into investment securities, change the composition of our investment securities portfolio, and change the proportion of investments made into the available-for-sale and held-to-maturity investment categories.

Mortgage-backed securities issued by Ginnie Mae, Fannie Mae, and Freddie Mac continue to be the largest concentrations in the portfolio. As of December 31, 2024, these mortgage-backed securities were all AAA-rated, with a low probability of a change in their credit ratings in the near future. As of December 31, 2024, our available-for-sale investment securities portfolio was comprised of securities with an average remaining duration of approximately 3.03 years, which does not consider the impact of the interest rate swaps that hedge a portion of our available-for-sale portfolio.

Gross unrealized gains in our investment securities portfolio were $1.3 million and $0.7 million as of December 31, 2024 and 2023, respectively. Gross unrealized losses in the investment securities portfolio were $1.1 billion and $1.0 billion as of

December 31, 2024 and 2023, respectively. The increase in gross unrealized losses were primarily due to an increase in rates year over year.

The gross unrealized loss positions were primarily related to mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises. These securities carry the explicit and/or implicit guarantee of the U.S. government and have a long history of zero credit loss. Total gross unrealized losses were primarily attributable to changes in interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. At December 31, 2024, we had the intent and ability to hold the investment securities that were in an unrealized loss position and it is not more likely than not that we will be required to sell the investment securities before recovery of their amortized cost basis, which may be at maturity. See Note 3 in Item 8. “Notes to Consolidated Financial Statements” for more information.

The Company’s corporate bond holdings as of December 31, 2024, had a fair value of $680.0 million. Of this total, $1.2 million was fully guaranteed by the Export-Import Bank of the United States, an agency of the U.S. government, and $8.3 million was fully guaranteed by the U.S. government. Of the remaining $670.4 million of corporate bonds, all were credit-rated A- or better by at least one nationally recognized statistical rating organization.

#### Loans and Leases

Table 8 presents the composition of our loan and lease portfolio by major categories.

*(dollars in thousands)*

| Loans and Leases Commercial | December 31, 2024 | 2023 | 2022 | 2021 | Table 8 2020 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Commercial Mortgage | $4,020,622 | $3,749,016 | $3,725,542 | $3,152,130 | $2,854,829 |
| Commercial and Industrial | 1,705,133 | 1,664,068 | 1,408,645 | 1,488,700 | 1,875,293 |
| Construction | 308,898 | 304,463 | 260,825 | 220,254 | 259,798 |
| Lease Financing | 90,756 | 59,939 | 69,491 | 105,108 | 110,766 |
| Total Commercial | 6,125,409 | 5,777,486 | 5,464,503 | 4,966,192 | 5,100,686 |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 4,628,283 | 4,684,171 | 4,653,072 | 4,309,602 | 4,130,513 |
| Home Equity | 2,165,514 | 2,264,827 | 2,225,950 | 1,836,588 | 1,604,538 |
| Automobile | 764,146 | 837,830 | 870,396 | 736,565 | 708,800 |
| Other | 392,628 | 400,712 | 432,499 | 410,129 | 395,483 |
| Total Consumer | 7,950,571 | 8,187,540 | 8,181,917 | 7,292,884 | 6,839,334 |
| **Total Loans and Leases** | $14,075,980 | $13,965,026 | $13,646,420 | $12,259,076 | $11,940,020 |

Total loans and leases were $14.1 billion as of December 31, 2024. This represents a $111.0 million or 1% increase from the prior year, due to growth in the commercial loan and lease portfolio.

The commercial loan and lease portfolio is comprised of commercial and industrial loans, commercial mortgages, construction loans, and lease financing. Commercial and industrial loans are made primarily to corporations, middle market, and small businesses for the purpose of financing equipment acquisitions, expansion, working capital, and other general business purposes. Commercial mortgage and construction loans are offered to real estate investors, developers, and builders primarily domiciled in Hawaiʻi. Commercial mortgage loans are secured by first mortgages on commercial real estate at loan-to-value ratios generally not exceeding 75%. Commercial properties are well diversified among property types, including and primarily multi-family, industrial, retail and lodging. The primary source of repayment for investor property is cash flow from the property and for owner-occupied property is the operating cash flow from the business.

Table 8A presents an additional breakdown of the Company’s commercial mortgage portfolio.

*(dollars in thousands)*

| Commercial Mortgage Breakdown | As of December 31, 2024 Amount | Percent of total | Table 8A % Owner Occupied |
| --- | ---: | ---: | ---: |
| Multi-family | $1,025,247 | 25% | 0% |
| Industrial | 724,645 | 18 | 42 |
| Retail | 704,780 | 18 | 3 |
| Lodging | 676,350 | 17 | 0 |
| Office | 371,474 | 9 | 20 |
| Other1 | 518,126 | 13 | 26 |
| **Total Commercial Mortgage** | $4,020,622 | 100% | 13% |

1\. Amount includes unamortized loan origination fees.

Construction loans are made for the purchase or construction of a property for which repayment will be generated by the property. We classify loans as construction until the completion of the construction phase. Following construction, if a loan is retained, the loan is reclassified to the commercial mortgage category. Lease financing consists of sales-type leases used by commercial customers to finance capital purchases. Although our primary market is Hawaiʻi, the commercial portfolio contains loans to some borrowers based on the U.S. Mainland, including some Shared National Credits, which have a business connection to Hawaiʻi or are associated with a Hawaiʻi customer relationship.

Commercial loans and leases were $6.1 billion as of December 31, 2024, an increase of $347.9 million or 6% from the prior year primarily due to increased loan production within our commercial mortgage portfolio. Commercial mortgage loans increased by $271.6 million or 7% from the prior year due to increased demand for funding.

The consumer loan and lease portfolio is comprised of residential mortgage loans, home equity lines and loans, indirect auto loans, and other consumer loans including direct installment loans and indirect auto leases. These products are generally offered in the geographic markets we serve. Our residential mortgage loan portfolio is primarily comprised of fixed-rate loans concentrated in Hawaiʻi. We also offer a variety of home equity lines and loans, which are primarily secured by first lien mortgages on residential property of the borrower. Automobile lending activities include loans and leases secured by new or used automobiles. We originate automobile loans and leases on an indirect basis through selected dealerships. Direct installment loans are generally unsecured and are primarily used for personal expenses or for debt consolidation.

Consumer loans and leases were $8.0 billion as of December 31, 2024, a decrease of $237.0 million or 3% from the prior year primarily due to declines in our home equity and automobile portfolios. Home equity decreased by $99.3 million or 4% from the prior year as a result of paydowns and fewer new originations. Automobile loans decreased by $73.7 million or 9% from the prior year as a result of slower sales, increased competition and slowdown in production.

See Note 4 in Item 8. “Notes to Consolidated Financial Statements” and the “Corporate Risk Profile – Credit Risk” section of Item 7. MD&A for more information on our loan and lease portfolio.

Table 9 presents the geographic distribution of our loan and lease portfolio.

*(dollars in thousands)*

| Geographic Distribution of Loan and Lease Portfolio Commercial | December 31, 2024 Hawaiʻi | U.S. Mainland 1 | Guam | Other Pacific Islands | Table 9 Total |
| --- | ---: | ---: | ---: | ---: | ---: |
| Commercial Mortgage | $3,534,658 | $297,758 | $187,777 | $429 | $4,020,622 |
| Commercial and Industrial | 1,493,386 | 139,968 | 62,824 | 8,955 | 1,705,133 |
| Construction | 308,898 | — | — | — | 308,898 |
| Lease Financing | 90,260 | — | 496 | — | 90,756 |
| Total Commercial | 5,427,202 | 437,726 | 251,097 | 9,384 | 6,125,409 |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 4,553,553 | 5,469 | 68,932 | 329 | 4,628,283 |
| Home Equity | 2,119,548 | 41 | 45,925 | — | 2,165,514 |
| Automobile | 601,359 | — | 125,331 | 37,456 | 764,146 |
| Other | 336,718 | — | 47,279 | 8,631 | 392,628 |
| Total Consumer | 7,611,178 | 5,510 | 287,467 | 46,416 | 7,950,571 |
| **Total Loans and Leases** | $13,038,380 | $443,236 | $538,564 | $55,800 | $14,075,980 |
| **Percentage of Total Loans and Leases** | 93% | 3% | 4% | 0% | 100% |

1 For secured loans and leases, classification as U.S. Mainland is made based on where the collateral is located. For unsecured loans and leases, classification as U.S. Mainland is made based on the location where the majority of the borrower’s business operations are conducted.

Our commercial and consumer lending activities are concentrated primarily in Hawaiʻi and the West Pacific. Our commercial loan and lease portfolio to borrowers based on the U.S. Mainland includes participation in Shared National Credits.

Table 10 presents a maturity distribution for selected loan categories.

*(dollars in thousands)*

| Maturities for Selected Loan Categories 1 Commercial | December 31, 2024 Due in One Year or Less | Table 10 Due After One to Five Years | Due After Five to Ten Years | Due After Ten to Fifteen Years | Due After Fifteen Years | Total | Variable Rate Loans | Fixed Rate Loans |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Commercial Mortgage | $626,202 | $1,320,590 | $1,880,703 | $153,431 | $39,696 | $4,020,622 | $2,544,058 | $1,476,564 |
| Commercial and Industrial | 509,608 | 399,200 | 422,764 | 168,592 | 204,969 | 1,705,133 | 1,269,532 | 435,601 |
| Construction | 17,610 | 114,627 | 35,624 | — | 141,037 | 308,898 | 242,316 | 66,582 |
| Lease Financing | 2,232 | 49,425 | 14,702 | — | 24,397 | 90,756 | — | 90,756 |
| Total Commercial | 1,155,652 | 1,883,842 | 2,353,793 | 322,023 | 410,099 | 6,125,409 | 4,055,906 | 2,069,503 |
| Consumer |  |  |  |  |  |  |  |  |
| Residential Mortgage | 324 | 29,364 | 84,066 | 268,615 | 4,245,914 | 4,628,283 | 679,533 | 3,948,750 |
| Home Equity | 2,692 | 5,628 | 64,844 | 377,130 | 1,715,220 | 2,165,514 | 1,084,730 | 1,080,784 |
| Automobile | 11,872 | 549,200 | 203,074 | — | — | 764,146 | — | 764,146 |
| Other | 48,289 | 246,412 | 97,927 | — | — | 392,628 | 30,832 | 361,796 |
| Total Consumer | 63,177 | 830,604 | 449,911 | 645,745 | 5,961,134 | 7,950,571 | 1,795,095 | 6,155,476 |
| **Total Loans and Leases** | $1,218,829 | $2,714,446 | $2,803,704 | $967,768 | $6,371,233 | $14,075,980 | $5,851,001 | $8,224,979 |

1\. Based on contractual maturities.

#### Goodwill

Goodwill was $31.5 million as of December 31, 2024, and 2023. As of December 31, 2024, based on our qualitative assessment, there were no reporting units where we concluded that the fair value of a reporting unit was less than its carrying amount, including goodwill. See Note 2 in Item 8. “Notes to Consolidated Financial Statements” for more information on our goodwill impairment policy.

#### Other Assets

Other assets were $737.0 million as of December 31, 2024, an increase of $95.4 million or 15% from the prior year. The increase resulted from various items. Derivative financial instruments increased by $66.4 million due to an increase in the fair value of our interest rate swaps and the strategic repositioning of our fair value hedge portfolio. Low-income housing and other equity investments increased by $24.3 million due to increased funding of existing projects. Deferred tax assets and tax receivable decreased by $11.2 million or 6.1% due to temporary differences between financial reporting and income tax basis of unrealized losses on investment securities and a decrease in federal income tax receivable. See Note 7 in Item 8. “Notes to Consolidated Financial Statements” for more information on the composition of our other assets.

#### Deposits

Table 11 presents the components of our deposits by major customer categories as of December 31, 2024, and 2023.

*(dollars in thousands)*

| Deposits | Table 11 December 31, 2024 | 2023 |
| --- | ---: | ---: |
| Consumer | $10,397,777 | $10,319,809 |
| Commercial | 8,299,590 | 8,601,224 |
| Public and Other | 1,935,670 | 2,134,012 |
| **Total Deposits** | $20,633,037 | $21,055,045 |

Total deposits were $20.6 billion as of December 31, 2024, a $422.0 million or 2% decrease from the prior year. This decrease was primarily due to a decrease in commercial and public and other deposits. Commercial deposits decreased by $301.6 million or 4%, due to decreases of $258.2 million in core deposits, defined as all deposits exclusive of time deposits and a decrease of $43.4 million in time deposits. Public and other deposits decreased by $198.3 million or 9%, due to a decrease of $114.4 million in time deposits and $83.9 million in core deposits. Consumer deposits remained relatively unchanged from the prior year.

Table 12 presents the components of our savings deposits as of December 31, 2024, and 2023.

*(dollars in thousands)*

| Savings Deposits | Table 12 December 31, 2024 | 2023 |
| --- | ---: | ---: |
| Money Market | $3,430,047 | $3,258,631 |
| Regular Savings | 4,934,869 | 4,930,841 |
| **Total Savings Deposits** | $8,364,916 | $8,189,472 |

Table 13 presents the maturity distribution of the estimated uninsured time deposits as of December 31, 2024, and 2023.

*(dollars in thousands)*

| Maturity Distribution of Estimated Uninsured Time Deposits Remaining maturity: | Table 13 December 31, 2024 |
| --- | ---: |
| Three months or less | $635,812 |
| After three through six months | 365,354 |
| After six through twelve months | 524,286 |
| After twelve months | 102,795 |
| **Total** | $1,628,247 |

Uninsured amounts are estimated based on the portion of account balances in excess of FDIC insurance limits.

Estimated uninsured deposits are calculated pursuant to regulatory guidance and reported in our Call Report and include deposits collateralized by government-backed securities and intercompany deposits of wholly-owned subsidiaries. The table below presents a reconciliation of our estimated uninsured deposits reported in our Call Report to our adjusted uninsured deposits. We believe the adjusted uninsured deposits reconciliation provides useful information about our deposits at risk.

*(dollars in thousands)*

| Uninsured Deposits Reconciliation | December 31, 2024 | Table 13a 2023 |
| --- | ---: | ---: |
| Estimated Uninsured Deposits, as Reported in our Call Report | $10,744,116 | $11,012,425 |
| Less: |  |  |
| Deposits Collateralized by Government-Backed Securities | (1,865,286) | (2,038,011) |
| Intercompany Deposits of Wholly-Owned Subsidiaries | (123,069) | (69,399) |
| Other | (108,015) | (34,340) |
| **Adjusted Uninsured Deposits** | $8,647,746 | $8,870,675 |

37

#### Securities Sold Under Agreements to Repurchase

Table 14 presents the composition of our securities sold under agreements to repurchase.

*(dollars in thousands)*

| Securities Sold Under Agreements to Repurchase | December 31, 2024 | Table 14 2023 |
| --- | ---: | ---: |
| Private Institutions | $100,000 | $150,000 |
| Government Entities | — | 490 |
| **Total Securities Sold Under Agreements to Repurchase** | $100,000 | $150,490 |

As of December 31, 2024, securities sold under agreements to repurchase decreased by $50.5 million, or 34%, compared to the previous year. In May 2024, a private institution exercised its right to call on a repurchase agreement with a balance of $50.0 million, resulting in its termination. In November 2024, a repurchase agreement with a government entity with a balance of $0.5 million matured.

Some of our repurchase agreements with private institutions may be terminated at earlier specified dates by either the private institution or the Company. If all such agreements were to terminate at the earliest possible date, the weighted-average maturity of our repurchase agreements with private institutions would be 0.1 years. Each of our repurchase agreements is accounted for as a collateralized financing arrangement (i.e., secured borrowing) and not as a sale and subsequent repurchase of securities. See Note 9 in Item 8. “Notes to Consolidated Statements” for more information.

#### Other Debt

Other debt was $558.3 million as of December 31, 2024, a decrease of $1.9 million from the prior year. In 2023, we added a net $550.0 million of FHLB advances with a weighted-average interest rate of 4.13% and maturity dates ranging from 2026 to 2028. As of December 31, 2024, our available capacity under our line of credit with the FHLB was $1.7 billion. The FHLB borrowing capacity is secured by residential real estate loan collateral.

#### Pension and Postretirement Plan Obligations

Retirement benefits payable were $23.8 million as of December 31, 2024, an increase of $0.1 million from the prior year. Our pension and postretirement benefit obligations and net periodic benefit cost are actuarially determined based on a number of key assumptions, including the discount rate, the expected return on plan assets, and the health-care cost trend rate. The accounting for pension and postretirement benefit plans reflect the long-term nature of the obligations and the investment horizon of the plan assets.

The discount rate is used to determine the present value of future benefit obligations and the net periodic benefit cost. The discount rate used to value the present value of future benefit obligations as of each year-end is the rate used to estimate the net periodic benefit cost for the following year. Table 15 presents a sensitivity analysis of a 25 basis point change in discount rates to the pension and postretirement benefit plan’s net periodic benefit cost and benefit obligations:

*(dollars in thousands)*

| Discount Rate Sensitivity Analysis | Base Discount Rate Pension Benefits | Postretirement Benefits | Impact of Discount Rate 25 Basis Point Increase Pension Benefits | Postretirement Benefits | Discount Rate 25 Basis Point Decrease Pension Benefits | Table 15 Postretirement Benefits |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| 2024 Net Periodic Benefit Cost | 5.44% | 5.51% | $18 | $(52) | $(23) | $52 |
| Benefit Plan Obligations as of December 31, 2024 | 5.67% | 5.74% | (1,412) | (569) | 1,440 | 583 |
| Estimated 2025 Net Periodic Benefit Cost | 5.67% | 5.74% | 16 | (49) | (20) | 49 |

See Note 14 in Item 8. “Notes to the Consolidated Financial Statements” for more information on our pension and postretirement benefit plans.

#### Contractual Obligations

The Company has various contractual obligations that affect its cash flows and liquidity. Our non-cancelable operating leases and finance lease obligations are primarily related to branch premises, equipment, and a portion of the Company’s headquarters’ building with lease terms extending through 2052. Purchase obligations arise from agreements to purchase goods or services that are enforceable and legally binding. Other contracts included in purchase obligations primarily consist of service agreements for various systems and applications supporting bank operations. Pension and postretirement benefit contributions represent the minimum expected contribution to the unfunded non-qualified pension plan and postretirement benefit plan. Actual contributions may differ from these estimates. Additional information regarding material contractual obligations is presented in Notes 9, 14, 18, 20 and 23 in Item 8. “Notes to Consolidated Financial Statements.”

#### Foreign Activities

Cross-border outstandings are defined as loans (including accrued interest), acceptances, interest-bearing deposits with other banks, other interest-bearing investments, and any other monetary assets which are denominated in dollars or other non-local currency. As of December 31, 2024 and 2023, we did not have cross-border outstandings to any foreign country which exceeded 0.75% of our total assets.

### Corporate Risk Profile

Managing risk is an essential part of successfully operating our business. Management believes that the most prominent risk exposures for the Company are credit risk, market risk, liquidity risk management, capital management, and operational risk.

### Credit Risk

Credit risk is the risk that borrowers or counterparties will be unable or unwilling to repay their obligations in accordance with the underlying contractual terms. We manage and control credit risk in the loan and lease portfolio by adhering to well-defined underwriting criteria and account administration standards established by management. Written credit policies document underwriting standards, approval levels, exposure limits, and other guidelines deemed necessary and prudent. Portfolio exposures at the obligor, industry, product, and/or geographic location levels are actively monitored to manage concentration risk. Furthermore, credit risk management includes an independent credit review process that assesses compliance with commercial and consumer credit policies, risk ratings, and other critical credit information. In addition to utilizing risk management practices that are based upon established and sound lending practices, we adhere to Regulatory Safety and Soundness credit standards. This includes understanding and evaluating our customers’ borrowing needs and capacity to repay, in conjunction with specific risks in their line of business, economic factors, character and history.

Commercial and industrial loans are made primarily for the purpose of financing equipment acquisition, expansion, working capital, and other general business purposes. Lease financing primarily consists of sales-type leases to finance capital purchases ranging from computer equipment to equipment and vehicles. The credit decisions for these transactions are based upon an assessment of the overall financial capacity of the applicant. A determination is made as to the applicant’s ability to repay in accordance with the proposed terms as well as an overall assessment of the risks involved. In addition to an evaluation of the applicant’s financial condition, a determination is made of the probable adequacy of the primary and secondary sources of repayment, such as additional collateral or personal guarantees, to be relied upon in the transaction. Credit agency reports of the applicant’s credit history supplement the analysis of the applicant’s and/or guarantor’s creditworthiness.

Commercial mortgages and construction loans are offered to real estate investors, developers, builders, and owner-occupants primarily domiciled in Hawaiʻi. These loans are secured by first mortgages on real estate at loan-to-value (“LTV”) ratios deemed appropriate based on the property type, location, overall quality, and sponsorship. Generally, these LTV ratios do not exceed 75% based on regulatory-compliant appraisals that we obtain for the underlying properties. Commercial properties are well diversified among property types, including and primarily multi-family, industrial, retail and lodging. Commercial mortgage and construction loans are substantially secured by properties located in Hawaiʻi.

Commercial mortgage loans are underwritten based on the economic fundamentals of the property and the creditworthiness of the borrower. In evaluating a proposed commercial mortgage loan, we primarily emphasize the ratio of the property’s projected net cash flows to the loan’s debt servicing requirement. The debt service coverage ratio normally is not less than 125% and it is computed after deducting for a vacancy factor and property expenses as appropriate. In addition, a personal guarantee of the loan or a portion thereof is sometimes required from the principal(s) of the borrower. We typically require title insurance insuring the priority of our lien, fire, and extended coverage casualty insurance, and flood insurance, if appropriate, in order to protect our security interest in the underlying property. In addition, business interruption insurance or other insurance may be required. Owner-occupant commercial mortgage loans are underwritten based upon the cash flow of the business provided that the real estate asset is utilized in the operation of the business. Real estate is evaluated independently as a secondary source of repayment.

Construction loans are underwritten against projected cash flows derived from rental income, business income from an owner-occupant, or the sale of the property to an end-user. We may mitigate the risks associated with these types of loans by requiring fixed-price construction contracts, performance and payment bonding, controlled disbursements, and pre-sale contracts or pre-lease agreements.

We offer a variety of first lien and second lien mortgage loans to consumers within our markets with first lien residential mortgages comprising our largest loan category. Residential mortgage loans are secured by a primary residence, or a secondary residence or investor property and are underwritten to assess the credit risks and financial capacity and repayment ability of the applicant. Decisions are primarily based on LTV ratios, debt-to-income (“DTI”) ratios or debt-service coverage ratios (“DSCR”), liquidity, and credit scores. LTV ratios generally do not exceed 80%, although higher levels are permitted with mortgage insurance. We offer variable rate mortgage loans with interest rates that are subject to change every six months after the third, fifth, seventh, or tenth year, depending on the product and are based on the Secured Overnight Financing Rate (“SOFR”). Variable rate mortgage loans are underwritten at fully-indexed interest rates. We do not offer payment-option facilities, sub-prime or Alt-A loans, or any product with negative amortization. We selectively offer interest-only mortgage loans to private banking clients.

Home equity lines and loans are secured primarily by a first lien mortgage, or a second lien mortgage on a primary residence, secondary residence, or investor property. The underwriting terms for the home equity product generally permits borrowing availability, in the aggregate, up to 80% of the value of the collateral property for primary residence and up to 75% of the value of the collateral property for secondary residence or investor at the time of origination. We offer fixed and variable rate home equity loans, with variable rate loans underwritten at fully-indexed interest rates. Our procedures for underwriting home equity loans include an assessment of an applicant’s overall financial capacity and repayment ability. Decisions are primarily based on LTV ratios, DTI ratios or DSCR, liquidity and credit scores. Maximum line and loan amounts and LTVs are determined by collateral value and customer segment.

Automobile lending activities include loans and leases secured by new or used automobiles, and leases secured by new automobiles. We originate automobile loans on an indirect basis through selected dealerships in Hawaiʻi, Guam and Saipan, and we originate automobile leases on an indirect basis through selected dealerships in Hawaiʻi. Our procedures for underwriting automobile loans and leases include an assessment of an applicant’s overall financial capacity and repayment ability. Although an applicant’s creditworthiness is the primary consideration, the underwriting process also includes a comparison of the value of the automobile collateral to the proposed loan amount. We require borrowers to maintain full coverage automobile insurance on automobile loans and leases, with the Bank listed as either the loss payee or additional insured.

#### Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More

Table 16 presents a five-year history of non-performing assets and accruing loans and leases past due 90 days or more.

*(dollars in thousands)*

| Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More Non-Performing Assets Non-Accrual Loans and Leases Commercial | December 31, 2024 | 2023 | 2022 | Table 16 2021 | 2020 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Commercial and Industrial | $4,627 | $39 | $37 | $243 | $441 |
| Commercial Mortgage | 2,450 | 2,884 | 3,309 | 8,205 | 8,527 |
| Total Commercial | 7,077 | 2,923 | 3,346 | 8,448 | 8,968 |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 5,052 | 2,935 | 4,239 | 3,305 | 3,223 |
| Home Equity | 4,514 | 3,791 | 4,022 | 4,881 | 3,958 |
| Total Consumer | 9,566 | 6,726 | 8,261 | 8,186 | 7,181 |
| Total Non-Accrual Loans and Leases | 16,643 | 9,649 | 11,607 | 16,634 | 16,149 |
| Foreclosed Real Estate | 2,657 | 2,098 | 1,040 | 2,332 | 2,332 |
| **Total Non-Performing Assets** | $19,300 | $11,747 | $12,647 | $18,966 | $18,481 |
| **Accruing Loans and Leases Past Due 90 Days or More** |  |  |  |  |  |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 3,984 | 3,814 | 2,429 | 3,159 | 5,274 |
| Home Equity | 2,845 | 1,734 | 1,673 | 3,456 | 3,187 |
| Automobile | 776 | 399 | 589 | 729 | 925 |
| Other | 677 | 648 | 683 | 426 | 1,160 |
| Total Consumer | 8,282 | 6,595 | 5,374 | 7,770 | 10,546 |
| **Total Accruing Loans and Leases Past Due 90 Days or More** | $8,282 | $6,595 | $5,374 | $7,770 | $10,546 |
| **Restructured Loans on Accrual Status and Not Past Due 90 Days or More** | $36,568 | $28,651 | $43,658 | $60,519 | $68,065 |
| **Total Loans and Leases** | $14,075,980 | $13,965,026 | $13,646,420 | $12,259,076 | $11,940,020 |
| Ratio of Non-Accrual Loans and Leases to Total Loans and Leases | 0.12% | 0.07% | 0.09% | 0.14% | 0.14% |
| Ratio of Non-Performing Assets to Total Loans and Leases and Foreclosed Real Estate | 0.14% | 0.08% | 0.09% | 0.15% | 0.15% |
| Ratio of Non-Performing Assets to Total Assets | 0.08% | 0.05% | 0.05% | 0.08% | 0.09% |
| Ratio of Commercial Non-Performing Assets to Total Commercial Loans and Leases and Commercial Foreclosed Real Estate | 0.12% | 0.05% | 0.06% | 0.17% | 0.18% |
| Ratio of Consumer Non-Performing Assets to Total Consumer Loans and Leases and Consumer Foreclosed Real Estate | 0.15% | 0.11% | 0.11% | 0.14% | 0.14% |
| Ratio of Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More to Total Loans and Leases and Foreclosed Real Estate | 0.20% | 0.13% | 0.13% | 0.22% | 0.24% |

Table 17 presents the activity in Non-Performing Assets (“NPAs”) for 2024:

*(dollars in thousands)*

|  | Table 17 |
| --- | ---: |
| **Balance at Beginning of Year** | $11,747 |
| Additions | 14,664 |
| Reductions |  |
| Payments | (3,207) |
| Return to Accrual Status | (2,192) |
| Charge-offs/Write-downs | (1,712) |
| Total Reductions | (7,111) |
| **Balance at End of Year** | $19,300 |

NPAs consist of non-accrual loans and leases and foreclosed real estate. Changes in the level of non-accrual loans and leases typically are caused by loans and leases that reach a specified past due status, offset by reductions for loans and leases that are charged-off, paid down, sold, transferred to foreclosed real estate, or are no longer classified as non-accrual because they have returned to accrual status.

Commercial and Industrial non-accrual loans increased by $4.6 million from the prior year, primarily due to the addition of three loans during 2024. The three loans added during 2024 were attributed to one primary borrower.

Residential mortgage non-accrual loans increased by $2.1 million or 72% from the prior year. As of December 31, 2024, our residential mortgage non-accrual loans were comprised of 19 loans with a weighted average current loan-to-value of 77%.

Foreclosed real estate represents property acquired as the result of borrower defaults on loans. Foreclosed real estate is recorded at fair value, less estimated selling costs, at the time of foreclosure. On an ongoing basis, properties are appraised as required by market conditions and applicable regulations. Foreclosed real estate was $2.7 million as of December 31, 2024.

If interest due on the balances of all non-accrual loans as of December 31, 2024 had been accrued under the original terms, approximately $1.2 million in total interest income would have been recognized in 2024.

#### Loans and Leases Past Due 90 Days or More and Still Accruing Interest

Loans and leases past due 90 days or more and still accruing interest were $8.3 million as of December 31, 2024, a $1.7 million or 26% increase from the prior year. The increase was primarily in our home equity portfolio. This category includes loans and leases that are well-secured and in the process of collection, as well as loans and leases that have not reached the specified past due status to be placed on non-accrual.

#### Reserve for Credit Losses

The reserve for credit losses consists of the Allowance and the Unfunded Reserve. Table 18 presents the activity in the Company’s reserve for credit losses for the years ended December 31:

*(dollars in thousands)*

| Reserve for Credit Losses | 2024 | 2023 | 2022 | 2021 | Table 18 2020 |
| --- | ---: | ---: | ---: | ---: | ---: |
| **Balance at Beginning of Period** | $152,429 | $151,247 | $164,297 | $221,303 | $116,849 |
| **CECL Adoption (Day 1) Impact** | — | — | — | — | (5,072) |
| Loans and Leases Charged-Off |  |  |  |  |  |
| Commercial |  |  |  |  |  |
| Commercial and Industrial | (2,609) | (987) | (925) | (1,117) | (1,697) |
| Consumer |  |  |  |  |  |
| Residential Mortgage | (385) | (6) | (80) | (316) | (204) |
| Home Equity | (701) | (82) | (100) | (417) | (397) |
| Automobile | (5,342) | (5,247) | (4,652) | (4,939) | (6,496) |
| Other | (10,099) | (8,645) | (7,585) | (10,530) | (12,244) |
| **Total Loans and Leases Charged-Off** | (19,136) | (14,967) | (13,342) | (17,319) | (21,038) |
| Recoveries on Loans and Leases Previously Charged-Off |  |  |  |  |  |
| Commercial |  |  |  |  |  |
| Commercial and Industrial | 832 | 350 | 552 | 506 | 2,288 |
| Commercial Mortgage | — | — | — | — | 40 |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 303 | 489 | 1,193 | 2,467 | 1,292 |
| Home Equity | 792 | 1,073 | 1,500 | 1,666 | 2,892 |
| Automobile | 2,168 | 2,782 | 2,276 | 3,510 | 3,775 |
| Other | 2,111 | 2,455 | 2,702 | 3,205 | 3,613 |
| **Total Recoveries on Loans and Leases Previously Charged-Off** | 6,206 | 7,149 | 8,223 | 11,354 | 13,900 |
| Net Charged-Off - Loans and Leases | (12,930) | (7,818) | (5,119) | (5,965) | (7,138) |
| Net Charged-Off - Accrued Interest Receivable | — | — | (131) | (541) | — |
| Provision for Credit Losses 1 |  |  |  |  |  |
| Loans and Leases | 15,055 | 9,782 | (8,263) | (52,466) | 115,100 |
| Accrued Interest Receivable 2 | — | — | (283) | (1,745) | 2,700 |
| Unfunded Commitments 3 | (3,905) | (782) | 746 | 3,711 | (1,136) |
| Total Provision for Credit Losses | 11,150 | 9,000 | (7,800) | (50,500) | 116,664 |
| **Balance at End of Period** | $150,649 | $152,429 | $151,247 | $164,297 | $221,303 |
| **Components** |  |  |  |  |  |
| Allowance for Credit Losses - Loans and Leases | $148,528 | $146,403 | $144,439 | $157,821 | $216,252 |
| Allowance for Credit Losses - Accrued Interest Receivable 2 | — | — | — | 414 | 2,700 |
| Reserve for Unfunded Commitments 3 | 2,121 | 6,026 | 6,808 | 6,062 | 2,351 |
| **Total Reserve for Credit Losses** | $150,649 | $152,429 | $151,247 | $164,297 | $221,303 |
| **Average Loans and Leases Outstanding** | $13,868,916 | $13,851,551 | $12,896,510 | $12,023,669 | $11,592,093 |
| Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding | 0.09% | 0.06% | 0.04% | 0.05% | 0.06% |
| Ratio of Allowance for Credit Losses to Loans and Leases Outstanding 4 | 1.06% | 1.05% | 1.06% | 1.29% | 1.81% |

1\. Certain prior period information has been reclassified to conform to current presentations.

2\. On December 31, 2020, the Company established a reserve on accrued interest receivable related to loans in which interest payment forbearances were granted. The reserve was recorded as a contra-asset against accrued interest receivable with the offset to provision for credit losses. In 2022, the reserve on accrued interest receivable was fully released.

3\. The reserve for unfunded commitments is separately recorded in other liabilities in the consolidated statements of condition. For the years ended December 31, 2021 through 2024, the offsetting provision was recorded in provision for credit losses in the consolidated statements of income. In previous reporting periods, the offsetting provision was recorded in other noninterest expense.

4\. The numerator comprises the Allowance for Credit Losses - Loans and Leases.

#### Allowance for Credit Losses

Table 19 and 20 presents the allocation of the Allowance by loan and lease category.

*(dollars in thousands)*

| Allocation of Allowance for Credit Losses Commercial | December 31, 2024 | 2023 | 2022 | 2021 | Table 19 2020 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Commercial Mortgage | $43,745 | $32,646 | $32,588 | $29,997 | $31,723 |
| Commercial and Industrial | 32,840 | 34,036 | 24,283 | 27,650 | 43,092 |
| Construction | 5,315 | 5,090 | 4,223 | 4,311 | 5,417 |
| Lease Financing | 2,000 | 2,302 | 2,806 | 2,992 | 4,615 |
| Total Commercial | 83,900 | 74,074 | 63,900 | 64,950 | 84,847 |
| Consumer |  |  |  |  |  |
| Residential Mortgage | 15,685 | 19,452 | 17,079 | 20,721 | 32,643 |
| Home Equity | 12,130 | 14,317 | 16,654 | 18,924 | 37,987 |
| Automobile | 17,116 | 18,799 | 21,566 | 25,018 | 28,822 |
| Other | 19,697 | 19,761 | 25,240 | 28,208 | 31,953 |
| Total Consumer | 64,628 | 72,329 | 80,539 | 92,871 | 131,405 |
| **Total Allocation of Allowance for Credit Losses** | $148,528 | $146,403 | $144,439 | $157,821 | $216,252 |

| Allocation of Allowance as Percent of Loan or Lease Category Commercial | December 31, 2024 Alloc. Allow. as % of Loan or Lease Category | Loan Category as % of Total Loans and Leases | 2023 Alloc. Allow. as % of Loan or Lease Category | Loan Category as % of Total Loans and Leases | 2022 Alloc. Allow. as % of Loan or Lease Category | Loan Category as % of Total Loans and Leases | 2021 Alloc. Allow. as % of Loan or Lease Category | Loan Category as % of Total Loans and Leases | 2020 Alloc. Allow. as % of Loan or Lease Category | Table 20 Loan Category as % of Total Loans and Leases |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Commercial Mortgage | 1.09% | 28.56% | 0.87% | 26.85% | 0.87% | 27.30% | 0.95% | 25.71% | 1.11% | 23.91% |
| Commercial and Industrial | 1.93 | 12.11 | 2.05 | 11.91 | 1.72 | 10.32 | 1.86 | 12.14 | 2.30 | 15.70 |
| Construction | 1.72 | 2.19 | 1.67 | 2.18 | 1.62 | 1.91 | 1.96 | 1.80 | 2.09 | 2.18 |
| Lease Financing | 2.20 | 0.64 | 3.84 | 0.43 | 4.04 | 0.51 | 2.85 | 0.86 | 4.17 | 0.93 |
| Total Commercial | 1.37 | 43.52 | 1.28 | 41.37 | 1.17 | 40.04 | 1.31 | 40.51 | 1.66 | 42.72 |
| Consumer |  |  |  |  |  |  |  |  |  |  |
| Residential Mortgage | 0.34 | 32.88 | 0.42 | 33.55 | 0.37 | 34.10 | 0.48 | 35.15 | 0.79 | 34.59 |
| Home Equity | 0.56 | 15.38 | 0.63 | 16.22 | 0.75 | 16.31 | 1.03 | 14.98 | 2.37 | 13.44 |
| Automobile | 2.24 | 5.43 | 2.24 | 6.00 | 2.48 | 6.38 | 3.40 | 6.01 | 4.07 | 5.94 |
| Other | 5.02 | 2.79 | 4.93 | 2.86 | 5.84 | 3.17 | 6.88 | 3.35 | 8.08 | 3.31 |
| Total Consumer | 0.81 | 56.48 | 0.88 | 58.63 | 0.98 | 59.96 | 1.27 | 59.49 | 1.92 | 57.28 |
| **Total** | 1.06% | 100.00% | 1.05% | 100.00% | 1.06% | 100.00% | 1.29% | 100.00% | 1.81% | 100.00% |

#### Allowance for Credit Losses – Loans and Leases

As of December 31, 2024, the Allowance was $148.5 million or 1.06% of total loans and leases outstanding compared with an Allowance of $146.4 million or 1.05% of total loans and leases outstanding as of December 31, 2023. The Allowance reflects management’s best estimate of losses over the life of loans and leases in our portfolio in accordance with the CECL approach. The Ratio of Allowance for Credit Losses to Loans and Leases Outstanding was stable compared with the prior year.

Net charge-offs of loans and leases were $12.9 million or 0.09% of total average loans and leases in 2024 compared to $7.8 million or 0.06% of total average loans and leases in the prior year. Net charge-offs in our consumer portfolios were $11.2 million in 2024 compared to $7.2 million in the prior year. This increase was primarily reflected in our other and automobile portfolios. Net charge-offs in our commercial portfolios were $1.8 million in 2024 compared to $0.6 million in the prior year. This increase was reflected in our commercial and industrial portfolio.

The allocation of the Allowance to our commercial portfolio segment increased by $9.8 million or 13% from the prior year. This increase was primarily due to a $11.1 million increase in the Allowance allocated to the commercial mortgage portfolio. The increase is primarily due to the impact of an increase in criticized balances and qualitative adjustments made to this portfolio.

The allocation of the Allowance to our consumer portfolio segment decreased by $7.7 million or 11% from the prior year. This reduction was primarily due to a $3.8 million decrease in the Allowance allocated to the residential mortgage portfolio and a $2.2 million decrease in the Allowance allocated to the home equity portfolio. The reductions were primarily due to lower loss forecasts, due to lower production and improved unemployment rate forecast for the State of Hawaiʻi.

See Note 4 in Item 8. “Notes to Consolidated Financial Statements” for more information on the Allowance and credit quality indicators.

#### Reserve for Unfunded Commitments

The Unfunded Reserve was $2.1 million as of December 31, 2024, and $6.0 million as of December 31, 2023, a decrease of $3.9 million, which was primarily due to the impact of slightly lower historical loss rates and lower unfunded commitments.

#### Provision for Credit Losses

The provision for credit losses was $11.2 million for the year ended December 31, 2024 compared to $9.0 million in the prior year. The increase in the provision was due to a higher provision for the Allowance for loans and leases, partially offset by a lower provision for the Unfunded Reserve.

#### Other Credit Risks

In the normal course of business, we serve the needs of state and political subdivisions in multiple capacities, including traditional banking products such as deposit services, and by investing in municipal debt securities. The carrying value of our municipal debt securities was $63.9 million as of December 31, 2024, and $63.8 million as of December 31, 2023. We also maintained investments in corporate bonds with a carrying value of $682.2 million as of December 31, 2024, and $669.2 million as of December 31, 2023. We are exposed to credit risk in these investments should the issuer of a security be unable to meet its financial obligations. This may result in the issuer failing to make scheduled interest payments and/or being unable to repay the principal upon maturity.

Our use of derivative financial instruments exposes the Company to counterparty credit risk. See Note 17 in Item 8. “Notes to Consolidated Financial Statements” for more information.

### Market Risk

Market risk is the potential of loss arising from adverse changes in interest rates and prices. We are exposed to market risk as a consequence of the normal course of conducting our business activities. Our market risk management process involves measuring, monitoring, and mitigating risks that can significantly impact our consolidated statements of income and condition. In this management process, we balance market risks with expected returns to enhance earnings performance while managing volatility to an acceptable level.

Our primary market risk exposure is interest rate risk.

#### Interest Rate Risk

The objective of our interest rate risk management process is to optimize net interest income while operating within acceptable limits. This involves balancing expected returns with potential earnings and price volatility due to changes in interest rates over short-term, medium-term, and long-term time horizons, while maintaining adequate levels of funding and liquidity. The potential cash flows, sales, or replacement value of many of our assets and liabilities, especially those that earn or pay interest, are sensitive to changes in interest rates. This interest rate risk arises primarily from our core business activities of extending loans and accepting deposits. Our investment securities portfolio is also subject to significant interest rate risk.

We utilize two management guidelines to measure our interest rate risk exposure: 1) net interest income (“NII”) sensitivity, and 2) economic value of equity (“EVE”) sensitivity. NII and EVE sensitivities measure the estimated percentage change in forward looking net-interest income and economic value, respectively, under instantaneous parallel shocks of the yield curve ranging from -400 basis points to +400 basis points. We measure NII sensitivity over two successive 12-month periods to evaluate interest rate risk over short-term and medium-term time horizons. EVE sensitivity, which captures the present value of all on and off balance sheet positions, measures interest rate risk over a long-term time horizon. The results are measured relative to established limits and early warning indicators that ensure that fluctuation in income and valuation in both up and down rate shocks remain within levels approved by the Asset and Liability Management Committee (“ALCO”) and the Board of Directors. While we recognize that instantaneous parallel shocks of the entire yield curve are unrealistic, we believe that the application of immediate shocks provides us with a sufficient range of potential outcomes to frame our risk exposures. We pay particular attention to the +/-200 basis point shock sensitivities, as we believe they represent a more realistic range of rate movements that could occur in the near to medium term. For the year ended December 31, 2024, we remained within applicable guidelines for such scenarios.

The ALCO, which is comprised of members of executive management, utilizes several techniques to manage interest rate risk, which include:

- adjusting the balance sheet mix or altering the interest rate characteristics of assets and liabilities;
- changing product pricing strategies;
- modifying characteristics, including mix and duration, of the investment securities portfolio; and
- using derivative financial instruments.

Changes in interest rates may have a material impact on earnings and valuation due to balance sheet cash flow, maturity structure and repricing frequency. The investment portfolio and loan portfolios have significant repricing volumes and cash flows from maturities and paydowns, providing opportunities to redeploy funds in order to respond to changes in the rate environment. These assets are primarily funded by deposit balances, which generally have an indeterminate life. Historically, our deposit base has consisted primarily of core consumer and commercial deposit relationships. While we strive to position our balance sheet to organically reduce volatility in earnings and valuation, primarily through our funding and investment portfolio positioning, as well as product pricing strategies, we have also established a hedging program designed to allow us to adjust the duration of our earning assets synthetically. As of December 31, 2024, our hedging program consisted primarily of pay-fixed interest rate swaps. As interest rates change, we may use different instruments to manage interest rate risk, including caps, floors, swaptions and other commonly utilized derivative instruments. See Note 17 in Item 8. “Notes to Consolidated Financial Statements.”

A key element in our ongoing process to measure and monitor interest rate risk is the utilization of an asset/liability simulation model. This model attempts to capture the dynamic nature of assets and liabilities in various interest rate environments. It estimates and measures our balance sheet sensitivity to changes in interest rates. Given the structure of our balance sheet, model results are particularly sensitive to changes in prepayment rates on mortgage-related assets and the repricing behavior of interest-bearing deposits. We utilize a model to estimate the prepayment behavior of our mortgage-related assets, which considers the characteristics of the underlying mortgage loans, including rate (used to gauge refinance incentive), seasoning or age, and seasonality. The model’s forecasted results are regularly tested against historical prepayment behavior and is, in the ordinary course, recalibrated if the difference between actual and projected prepayments exceed established guidelines. Separate models are utilized to project interest-bearing deposit repricing behavior in various interest rate environments. These models were developed based upon our historical repricing behavior over several interest rate cycles. The models’ forecast results are periodically tested against historical pricing and have been and may continue to be recalibrated.

We utilize net interest income simulations to analyze short-term income sensitivities to changes in interest rates. Table 21A presents, for the twelve months subsequent to December 31, 2024, and 2023, an estimate of the change in net interest income that would result from a gradual and immediate change in interest rates, moving in a parallel fashion over the entire yield curve, relative to the measured base case scenario. The base case scenario assumes the consolidated statements of condition and interest rates are generally unchanged.

*(dollars in thousands)*

| Net Interest Income Sensitivity Profile Immediate Change in Interest Rates (basis points) | Impact on Future Annual Net Interest Income December 31, 2024 |  | Table 21A December 31, 2023 |  |
| ---: | ---: | ---: | ---: | ---: |
| +400 | $31,028 | 5.6% | $109,909 | 21.6% |
| +300 | 25,281 | 4.6 | 85,238 | 16.7 |
| +200 | 18,783 | 3.4 | 59,228 | 11.6 |
| +100 | 10,393 | 1.9 | 31,961 | 6.3 |
| -100 | (13,029) | (2.3) | (33,605) | (6.6) |
| -200 | (27,883) | (5.0) | (64,601) | (12.7) |
| -300 | (43,536) | (7.8) | (95,971) | (18.8) |
| -400 | (65,753) | (11.8) | (129,431) | (25.4) |

46

Based on our net interest income simulation as of December 31, 2024, net interest income is expected to increase as interest rates rise. Rising interest rates would drive higher rates on floating rate loans and investment securities, as well as higher reinvestment rates on loan and investment securities cashflows. However, lower interest rates would likely cause an initial decline in net interest income as lower rates would lead to lower yields on loans and investment securities, as well as drive higher premium amortization on existing investment securities. Based on our net interest income simulation as of December 31, 2024, NII sensitivity to changes in interest rates for the twelve months subsequent to December 31, 2024, was less sensitive in comparison to the sensitivity profile for the twelve months subsequent to December 31, 2023. Year-over-year NII sensitivity decreased primarily due to an increase in assumed deposit repricing sensitivity.

To analyze the impact of changes in interest rates more realistically, we also simulate non-parallel interest rate scenarios. These scenarios help to isolate the sensitivity of earnings to various points on the yield curve. Based upon our interest rate simulations, the Company is exposed to movements in both the short and long-end of the yield curve. A movement higher or lower in the short-end of the yield curve would lead to floating-rate assets immediately repricing, while liability funding would react on a lag. Thus, net interest income may decrease from the base case in the near term if short-term rates were to decrease, although would benefit if short-term rates were to increase and liabilities maintained their ability to lag market rate increases. A movement higher or lower in the long-end of the yield curve would lead to assets repricing over time given ongoing cash flows from maturities and prepayments of investment securities and loans. Net interest income may decrease from the base case should long-term rates decline from their current levels, although would benefit if long-term rates were to increase.

The following table presents an estimate of the change in EVE that would result from an immediate change in interest rates, moving in a parallel fashion over the entire yield curve, relative to the measured base case scenario. Similar to the sensitivity profile above, the base case scenario assumes the consolidated statements of condition and interest rates are generally unchanged.

*(dollars in thousands)*

| Economic Value of Equity Sensitivity Profile Immediate Change in Interest Rates (basis points) | Impact on Economic Value of Equity December 31, 2024 |  | Table 21B December 31, 2023 |  |
| ---: | ---: | ---: | ---: | ---: |
| +400 | $(1,032,211) | (29.1)% | $(852,829) | (30.1)% |
| +300 | (763,479) | (21.5) | (624,395) | (22.1) |
| +200 | (496,443) | (14.0) | (396,259) | (14.0) |
| +100 | (238,689) | (6.7) | (180,902) | (6.4) |
| -100 | 177,198 | 5.0 | 136,083 | 4.8 |
| -200 | 274,546 | 7.7 | 188,466 | 6.7 |
| -300 | 294,363 | 8.3 | 42,697 | 1.5 |
| -400 | (99,219) | (2.8) | (235,282) | (8.3) |

EVE sensitivity year-over-year was largely unchanged.

#### Other Market Risks

In addition to interest rate risk, we are exposed to other forms of market risk in our normal business transactions. Foreign currency and foreign exchange contracts expose us to a small degree of foreign currency risk. These transactions are primarily executed on behalf of customers. Our trust and asset management income is at risk to fluctuations in the market values of underlying assets, particularly debt and equity securities. Also, our share-based compensation expense is dependent on the fair value of our stock options, restricted stock units, and restricted stock at the date of grant. The fair value of stock options, restricted stock units, and restricted stock is impacted by the market price of the Parent’s common stock on the date of grant and is at risk to changes in equity markets, general economic conditions, and other factors.

### Liquidity Risk Management

The objective of our liquidity risk management process is to manage cash flow and liquidity in an effort to provide continuous access to sufficient, reasonably priced funds. Funding requirements are impacted by factors such as loan originations and refinancings, changes in deposit balances, liability issuances and settlements, and off-balance sheet funding commitments. We adhere to various regulatory guidelines regarding required liquidity levels and regularly monitor our liquidity position in light of the changing economic environment and customer activity. Based on periodic liquidity assessments, we may alter our asset, liability, and off-balance sheet positions. The ALCO monitors sources and uses of funds and modifies asset and liability positions as liquidity requirements change. This process, combined with our ability to raise funds in money and capital markets and through private placements, provides flexibility in managing the exposure to liquidity risk.

We maintain access to ample sources of readily available contingent liquidity. As of December 31, 2024, we had pledged loans and investment securities to the Federal Reserve Discount Window and had remaining borrowing capacity of $7.4 billion. We are also a member of the Federal Home Loan Bank (“FHLB”) of Des Moines. As of December 31, 2024, we had pledged loans to the FHLB and had remaining borrowing capacity of $1.7 billion.

In addition, we utilize our investment securities portfolio as collateral to secure deposits of public entities as well as repurchase agreements with private institution counterparties. The high-quality nature of our investment securities portfolio, which consists primarily of government and agency securities, facilitates the use of these assets for pledging purposes.

Other sources of liquidity also include investment securities in our available-for-sale securities portfolio and our ability to sell loans in the secondary market. Our core deposits have historically provided us with a long-term source of stable and relatively low-cost source of funding. Additional funding is also available through the issuance of long-term debt or equity.

General market and economic conditions will impact our ability to borrow funds from external sources, as well as the cost of such borrowing both in terms of rate as well as haircuts on collateral pledged to support such borrowings. Although a significant portion of our investment securities were in an unrealized loss position as of December 31, 2024, we believe we have sufficient access to various forms of liquidity that would alleviate the need to liquidate these investment securities and realize the losses.

We continued our focus on maintaining a strong liquidity position throughout 2024. As of December 31, 2024, cash and cash equivalents were $0.8 billion, the carrying value of our available-for-sale investment securities was $2.7 billion, and total deposits were $20.6 billion. As of December 31, 2024, our available-for-sale investment securities portfolio had an average remaining duration of approximately 3.03 years.

### Capital Management

We actively manage capital, commensurate with our risk profile, to enhance shareholder value. We also seek to maintain capital levels for the Company and the Bank at amounts in excess of the regulatory “well-capitalized” thresholds. Periodically, we may respond to market conditions by implementing changes to our overall balance sheet positioning to manage our capital position.

The Company and the Bank are each subject to regulatory capital requirements administered by the federal banking agencies and the Division of Financial Institutions, an agency of the State of Hawaiʻi Department of Commerce and Consumer Affairs. Failure to meet minimum capital requirements could cause certain mandatory and discretionary actions by regulators that, if undertaken, would likely have a material effect on our financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative and qualitative measures. These measures were established by regulation intended to ensure capital adequacy. Capital ratios are calculated using the regulatory capital rule that allows a five-year transition period related to the adoption of CECL. As of December 31, 2024, the Company’s capital levels remained characterized as “well-capitalized.” There have been no conditions or events since December 31, 2024, that management believes have changed either the Company’s or the Bank’s capital classifications. The Company’s regulatory capital ratios are presented in Table 22 below.

Table 22 presents a five-year history of activities and balances in our capital accounts, along with key capital ratios.

*(dollars in thousands)*

| Shareholders’ Equity and Regulatory Capital Change in Shareholders' Equity | December 31, 2024 | 2023 | 2022 | Table 22 2021 | 2020 |
| --- | ---: | ---: | ---: | ---: | ---: |
| Net Income | $149,994 | $171,202 | $225,804 | $253,372 | $153,804 |
| Cash Dividends Paid on Common Shares | (112,313) | (111,795) | (112,557) | (110,633) | (107,434) |
| Cash Dividends Paid on Preferred Shares | (12,644) | (7,877) | (7,877) | (2,975) | — |
| Dividend Reinvestment Program | 4,246 | 4,535 | 4,680 | 4,835 | 5,012 |
| Preferred Stock Issued, Net | 160,614 | — | — | 175,487 | — |
| Common Stock Repurchased | (5,302) | (14,290) | (55,063) | (31,258) | (18,006) |
| Other 1 | 68,937 | 55,472 | (349,603) | (51,724) | 54,299 |
| **Increase (Decrease) in Shareholders' Equity** | $253,532 | $97,247 | $(294,616) | $237,104 | $87,675 |
| Regulatory Capital |  |  |  |  |  |
| Total Common Shareholders' Equity | $1,322,774 | $1,238,756 | $1,141,508 | $1,436,124 | $1,374,507 |
| Add: CECL Transitional Amount | 2,375 | 4,749 | 7,124 | 9,498 | 23,750 |
| Less: Goodwill, Net of Deferred Tax Liabilities | 28,746 | 28,746 | 28,746 | 28,747 | 28,718 |
| Postretirement Benefit Liability Adjustments | (23,396) | (23,261) | (25,078) | (33,496) | (43,250) |
| Net Unrealized Gains (Losses) on Investment Securities | (319,993) | (373,427) | (409,579) | (32,886) | 51,072 |
| Other | (9,097) | (198) | (198) | (198) | (198) |
| Common Equity Tier 1 Capital | 1,648,889 | 1,611,645 | 1,554,741 | 1,483,455 | 1,361,915 |
| Preferred Stock, Net of Issuance Cost | 336,101 | 175,487 | 175,487 | 175,487 | — |
| Tier 1 Capital | 1,984,990 | 1,787,132 | 1,730,228 | 1,658,942 | 1,361,915 |
| Allowable Reserve for Credit Losses | 148,634 | 148,400 | 145,202 | 153,001 | 141,869 |
| **Total Regulatory Capital** | $2,133,624 | $1,935,532 | $1,875,430 | $1,811,943 | $1,503,784 |
| **Risk-Weighted Assets** | $14,225,908 | $14,226,780 | $14,238,798 | $12,236,805 | $11,295,077 |
| **Key Regulatory Capital Ratios** |  |  |  |  |  |
| Common Equity Tier 1 Capital Ratio | 11.59% | 11.33% | 10.92% | 12.12% | 12.06% |
| Tier 1 Capital Ratio | 13.95 | 12.56 | 12.15 | 13.56 | 12.06 |
| Total Capital Ratio | 15.00 | 13.60 | 13.17 | 14.81 | 13.31 |
| Tier 1 Leverage Ratio | 8.31 | 7.51 | 7.37 | 7.32 | 6.71 |

1\. Includes unrealized gains and losses on investment securities, minimum pension liability adjustments, and common stock issuances under share-based compensation and related tax impact.

As of December 31, 2024, shareholders’ equity was $1.7 billion, an increase of $253.5 million or 18% from the prior year. For 2024, the increase was attributed to net income of $150.0 million, net preferred stock issuance of $160.6 million, other comprehensive income of $53.3 million, share-based compensation of $14.4 million, and common stock issuances of $5.4 million offset by cash dividends of $112.3 million paid on common stock shares, cash dividends of $12.6 million paid on preferred stock shares, and common stock repurchases of $5.3 million related to taxes withheld for share based compensation. Cash dividends on preferred stock increased in 2024 compared to the prior year due to the payment of dividends beginning in June 2024 on the Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B.

No shares of common stock were repurchased under our share repurchase program in 2024. From the beginning of our share repurchase program in July 2001 through December 31, 2024, we repurchased a total of 58.2 million shares of common stock and returned a total of nearly $2.4 billion to our common shareholders at an average cost of $41.24 per share. Remaining buyback authority was $126.0 million as of December 31, 2024. The actual amount and timing of future share repurchases, if any, will depend on market and economic conditions, regulatory rules, applicable SEC rules, and various other factors.

In January 2025, the Parent’s Board of Directors declared the quarterly dividend of its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series A, of $10.94 per share, equivalent to $0.2735 per depositary share and its Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series B, of $20.00 per share, equivalent to $0.5000 per depositary share. The dividend was paid on February 3, 2025, to shareholders of record of the preferred stock at the close of business on January 17, 2025.

In January 2025, the Parent’s Board of Directors declared the quarterly cash dividend of $0.70 per share on the Parent’s outstanding common shares. The dividend will be payable on March 14, 2025, to shareholders of record at the close of business on February 28, 2025.

### Regulatory Initiatives Affecting the Banking Industry

#### Basel III

Under final FRB and FDIC approved rules implementing the Basel Committee on Banking Supervision’s capital guidelines for U.S. banks minimum requirements increased for both the quantity and quality of capital held by the Company. The Basel III capital standards substantially revised the risk-based capital requirements applicable to bank holding companies and their depository institution subsidiaries, including the definitions and the components of Tier 1 capital and Total Capital, the method of evaluating risk-weighted assets, institution of a capital conservation buffer, and other matters affecting regulatory capital ratios. Strict eligibility criteria for regulatory capital instruments were also implemented under the rules.

The phase-in period for the final rules became effective for the Company on January 1, 2015, with full compliance with all of the final rules’ requirements phased in over a multi-year schedule, which were fully implemented on January 1, 2019. As of December 31, 2024, the Company’s capital levels remained characterized as “well-capitalized.”

Management continues to monitor regulatory developments and their potential impact to the Company’s capital and liquidity requirements.

#### Stress Testing

Enactment of the Economic Growth, Regulatory Relief, and Consumer Protection Act in May 2018 significantly altered several provisions of the Dodd-Frank Act, including how stress tests are run. Bank holding companies with total assets of less than $100 billion, such as the Company, are no longer subject to company-run stress testing requirements in section 165(i)(2) of the Dodd-Frank Act, including publishing a summary of results. At this time, the Company continues to run internal stress tests as a component of our comprehensive risk management and capital planning process.

### Operational Risk

Operational risk represents the risk of loss resulting from our operations, including, but not limited to, the risk of fraud by employees or persons outside the Company, errors relating to transaction processing and technology, failure to adhere to compliance requirements, and the risk of cyber attacks. We are also exposed to operational risk through our outsourcing arrangements, and the effect that changes in circumstances or capabilities of our outsourcing vendors can have on our ability to continue to perform operational functions necessary to our business. The risk of loss also includes the potential legal actions that could arise as a result of an operational deficiency or as a result of noncompliance with applicable regulatory standards, adverse business decisions or their implementation, and customer attrition due to potential negative publicity. Operational risk is inherent in all business activities, and management of this risk is important to the achievement of Company goals and objectives.

Our Operational Risk Committee (the “ORC”) provides oversight and assesses the most significant operational risks including cybersecurity risks facing the Company. We have developed a framework that provides for a centralized operating risk management function through the ORC, supplemented by business unit responsibility for managing operational risks specific to their business units. Our internal audit department also validates the system of internal controls through ongoing risk-based audit procedures and reports on the effectiveness of internal controls to executive management and the Audit Committee of the Board of Directors.

We continuously strive to strengthen our system of internal controls to improve the oversight of operational risk. While our internal controls have been designed to minimize operational risks, there is no assurance that business disruption or operational losses will not occur. On an ongoing basis, management reassesses operational risks, implements appropriate process changes, and invests in enhancements to our systems of internal controls.

### Guarantees

We pool FHA insured and VA guaranteed residential mortgage loans for sale to Ginnie Mae. We also sell residential mortgage loans in the secondary market to Fannie Mae. The agreements under which we sell residential mortgage loans to Ginnie Mae or Fannie Mae and the insurance or guaranty agreements with the FHA and VA contain provisions that include various representations and warranties regarding the origination and characteristics of the residential mortgage loans. Although these loans are primarily sold on a non-recourse basis, we may be obligated to repurchase residential mortgage loans or reimburse the respective investor if it is found that required documents were not delivered or were defective.

We also service substantially all of the loans we sell to investors in the secondary market. Each agreement under which we act as servicer generally specifies a standard of responsibility for our actions and provides protection against expenses and liabilities incurred by us when acting in compliance with the respective servicing agreements. However, if we commit a material breach of obligations as servicer, we may be subject to various penalties which may include the repurchase of an affected loan or a reimbursement to the respective investor.

## Market risk

As filed, 150 characters.

See the Market Risk section in Management’s Discussion and Analysis of Financial Condition and Results of Operation included in Item 7 of this report.

## Controls and procedures

As filed, 7,262 characters.

#### Disclosure Controls and Procedures

The Company’s management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of December 31, 2024. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, 2024.

#### Management’s Annual Report on Internal Control over Financial Reporting

Management of the Company is responsible for establishing and maintaining effective internal control over financial reporting. Internal control is designed to provide reasonable assurance to the Company’s management and board of directors regarding the preparation of reliable published financial statements. Internal control over financial reporting includes self-monitoring mechanisms, and actions are taken to correct deficiencies as they are identified.

Because of inherent limitations in any system of internal control, no matter how well designed, misstatements due to error or fraud may occur and not be detected, including the possibility of the circumvention or overriding of controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Further, because of changes in conditions, internal control effectiveness may vary over time.

Management assessed the Company’s internal control over financial reporting as of December 31, 2024. This assessment was based on criteria for effective internal control over financial reporting described in “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this assessment, the Chief Executive Officer and Chief Financial Officer concluded that the Company maintained effective internal control over financial reporting as of December 31, 2024.

The effectiveness of the Company’s internal control over financial reporting as of December 31, 2024, has been audited by Ernst & Young LLP , located in Honolulu, Hawaiʻi, United States, the independent registered public accounting firm who also has audited the Company’s Consolidated Financial Statements included in this Annual Report on Form 10-K. Ernst & Young LLP’s attestation report on the Company’s internal control over financial reporting appears on the following page and is incorporated by reference herein.

#### Changes in Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended December 31, 2024, that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

### Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Bank of Hawaii Corporation

### Opinion on Internal Control Over Financial Reporting

We have audited Bank of Hawaii Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Bank of Hawaii Corporation and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of condition of the Company as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income (loss), shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and our report dated March 3, 2025 expressed an unqualified opinion thereon.

### Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

### Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Honolulu, Hawaiʻi

March 3, 2025

Filed Mar 4, 2025.
Source: SEC EDGAR, the filing index for accession 0000950170-25-031193. Last ingested by Listed: Oct 26, 2026, 17:06 ET. No prices; not investment advice.