Regulatory Capital Requirements

3 Months Ended

Mar. 31, 2025

Regulatory Capital Requirements

Regulatory Capital Requirements

10. Regulatory Capital Requirements

Federal and state laws and regulations limit the amount of dividends the Company may declare or pay. The Company depends primarily on dividends from FHB as the source of funds for the Company’s payment of dividends.

The Company and the Bank are subject to various regulatory capital requirements imposed by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s operating activities and financial condition. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of its assets and certain off-balance sheet items. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios of Common Equity Tier 1 (“CET1”) capital, Tier 1 capital and total capital to risk-weighted assets, as well as a minimum leverage ratio.

The table below sets forth those ratios at March 31, 2025 and December 31, 2024:

					First Hawaiian				Minimum		Well-
	First Hawaiian, Inc.				Bank				Capital		Capitalized
(dollars in thousands)	Amount		Ratio		Amount		Ratio		Ratio(1)		Ratio(1)
March 31, 2025:
Common equity tier 1 capital to risk-weighted assets	$	2,083,979	12.93	%	$	2,074,202	12.87	%	4.50	%	6.50	%
Tier 1 capital to risk-weighted assets		2,083,979	12.93	%		2,074,202	12.87	%	6.00	%	8.00	%
Total capital to risk-weighted assets		2,283,938	14.17	%		2,274,161	14.11	%	8.00	%	10.00	%
Tier 1 capital to average assets (leverage ratio)		2,083,979	9.01	%		2,074,202	8.96	%	4.00	%	5.00	%
December 31, 2024:
Common equity tier 1 capital to risk-weighted assets	$	2,083,938	12.80	%	$	2,070,403	12.71	%	4.50	%	6.50	%
Tier 1 capital to risk-weighted assets		2,083,938	12.80	%		2,070,403	12.71	%	6.00	%	8.00	%
Total capital to risk-weighted assets		2,277,178	13.99	%		2,263,643	13.90	%	8.00	%	10.00	%
Tier 1 capital to average assets (leverage ratio)		2,083,938	9.14	%		2,070,403	9.08	%	4.00	%	5.00	%

(1) As defined by the regulations issued by the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation (“FDIC”).

Federal regulations require a 2.5% capital conservation buffer designed to absorb losses during periods of economic stress. The capital conservation buffer is composed entirely of CET1, on top of these minimum risk weighted asset ratios, effectively resulting in minimum ratios of (i) 7% CET1 to risk-weighted assets, (ii) 8.5% Tier 1 capital to risk-weighted assets, and (iii) 10.5% total capital to risk-weighted assets. As of March 31, 2025, under the bank regulatory capital guidelines, the Company and Bank were both classified as well-capitalized. Management is not aware of any conditions or events that have occurred since March 31, 2025, to change the capital adequacy category of the Company or the Bank.

In January 2025, the Company announced a stock repurchase program for up to $100.0 million of its outstanding common stock during 2025. Under this plan, the Company repurchased 974,345 shares at a total cost of approximately $25.0 million during the three months ended March 31, 2025. The timing and exact amount of stock repurchases, if any, will be subject to management’s discretion and various factors, including the Company’s capital position and financial performance, as well as market conditions. The stock repurchase program may be suspended, terminated or modified at any time for any reason.

In April 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share on our outstanding shares. The dividend is to be paid on May 30, 2025 to shareholders of record at the close of business on May 19, 2025.