Share-based compensation (Tables)

6 Months Ended

Jun. 30, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of share-based compensation expense and related income tax benefit

Share-based compensation expense and the related income tax benefit were as follows:

	Three months ended June 30				Six months ended June 30
(in millions)	2019		2018		2019		2018
HEI consolidated
Share-based compensation expense 1	$	3.7	$	2.8	$	5.9	$	4.4
Income tax benefit	0.7		0.5		0.9		0.7
Hawaiian Electric consolidated
Share-based compensation expense 1	1.1		0.9		1.8		1.5
Income tax benefit	0.2		0.2		0.3		0.3

¹ 

For the three and six months ended June 30, 2019 and 2018, the Company has not capitalized any share-based compensation.

Schedule of common stock granted to a nonemployee director under the 2011 Director Plan

HEI granted HEI common stock to nonemployee directors under the 2011 Director Plan as follows:

	Three months ended June 30				Six months ended June 30
(dollars in millions)	2019		2018		2019		2018
Shares granted	35,580		37,747		35,580		38,821
Fair value	$	1.5	$	1.3	$	1.5	$	1.3
Income tax benefit	0.4		0.3		0.4		0.3

Schedule of restricted stock units

Information about HEI’s grants of restricted stock units was as follows:

	Three months ended June 30										Six months ended June 30
	2019					2018					2019					2018
	Shares			(1)		Shares			(1)		Shares			(1)		Shares			(1)
Outstanding, beginning of period	211,225			$	35.28	208,088			$	32.97	200,358			$	33.05	197,047			$	31.53
Granted	—			—		3,159			33.78		94,559			37.68		92,064			34.09
Vested	—			—		(448		)	31.94		(76,712		)	32.61		(75,683		)	30.56
Forfeited	(2,600		)	35.56		(9,943		)	32.05		(9,580		)	33.82		(12,572		)	32.27
Outstanding, end of period	208,625			$	35.28	200,856			$	33.03	208,625			$	35.28	200,856			$	33.03
Total weighted-average grant-date fair value of shares granted (in millions)	$	—				$	0.1				$	3.6				$	3.1

(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.

Schedule of Long-Term Incentive Plan (LTIP) linked to total return to shareholders

Information about HEI’s LTIP grants linked to TSR was as follows:

	Three months ended June 30									Six months ended June 30
	2019				2018					2019					2018
	Shares		(1)		Shares			(1)		Shares			(1)		Shares			(1)
Outstanding, beginning of period	98,311		$	39.61	66,791			$	38.84	65,578			$	38.81	32,904			$	39.51
Granted	—		—		1,315			38.20		34,647			41.07		36,941			38.21
Vested (issued or unissued and cancelled)	—		—		—			—		—			—		—			—
Forfeited	—		—		(1,929		)	38.85		(1,914		)	38.62		(3,668		)	38.84
Outstanding, end of period	98,311		$	39.61	66,177			$	38.82	98,311			$	39.61	66,177			$	38.82
Total weighted-average grant-date fair value of shares granted (in millions)	$	—			$	0.1				$	1.4				$	1.4

(1)

Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model.

Schedule of Long-Term Incentive Program fair value awards granted

Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:

(dollars in thousands)	June 30, 2019			December 31, 2018
Unpaid principal balance	$	1,200,017		$	1,188,514
Weighted average note rate	4.01		%	3.98		%
Weighted average discount rate	9.3		%	10.0		%
Weighted average prepayment speed	10.3		%	6.5		%

The following table summarizes the assumptions used to determine the fair value of the LTIP awards linked to TSR and the resulting fair value of LTIP awards granted:

	2019		2018
Risk-free interest rate	2.48	%	2.29	%
Expected life in years	3		3
Expected volatility	15.8	%	17.0	%
Range of expected volatility for Peer Group	15.0% to 73.2%		15.1% to 26.2%
Grant date fair value (per share)	$41.07		$38.20

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis:

					Significant unobservable  input value (1)
($ in thousands)	Fair value		Valuation technique	Significant unobservable input	Range	Weighted Average
June 30, 2019
Home equity line of credit	$	199	Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Residential land	25		Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Total loans	$	224
December 31, 2018
Home equity line of credit	$	77	Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)
Total loans	$	77
Real estate acquired in settlement of loans	$	186	Fair value of property or collateral	Appraised value less 7% selling cost		N/A (2)

(1) Represent percent of outstanding principal balance.

(2) N/A - Not applicable. There is one asset in each fair value measurement type.

Schedule of Long-Term Incentive Plan (LTIP) linked to other performance conditions

Information about HEI’s LTIP awards payable in shares linked to other performance conditions was as follows:

	Three months ended June 30									Six months ended June 30
	2019				2018					2019					2018
	Shares		(1)		Shares			(1)		Shares			(1)		Shares			(1)
Outstanding, beginning of period	407,090		$	35.12	267,167			$	33.80	276,169			$	33.80	131,616			$	33.47
Granted	—		—		5,257			33.52		138,580			37.68		147,766			34.08
Vested	—		—		—			—		—			—		—			—
Forfeited	—		—		(7,717		)	33.80		(7,659		)	33.91		(14,675		)	33.80
Outstanding, end of period	407,090		$	35.12	264,707			$	33.79	407,090			$	35.12	264,707			$	33.79
Total weighted-average grant-date fair value of shares granted (at target performance levels) (in millions)	$	—			$	0.2				$	5.2				$	5.0

(1)

Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.