Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report: July 28, 2023


Exact Name of Registrant	Commission	I.R.S. Employer
as Specified in Its Charter	File Number	Identification No.
Hawaiian Electric Industries, Inc.	1-8503	99-0208097

State of Hawaii

(State or other jurisdiction of incorporation)

1001 Bishop Street, Suite 2900, Honolulu, Hawaii 96813

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code:

(808) 543-5662

Not applicable

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to 12(b) of the Act:


Registrant	Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Hawaiian Electric Industries, Inc.	Common Stock, Without Par Value	HE	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule12b-2 of the Securities Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the

Exchange Act. ☐

Item 7.01 Regulation FD Disclosure.

On July 28, 2023, HEI issued a news release, “American Savings Bank Reports Second Quarter 2023 Financial Results.” This news release is furnished as Exhibit 99.“

Item 9.01 Financial Statements and Exhibits.


(d) Exhibits
Exhibit 99			News release, dated July 28, 2023, “American Savings Bank Reports Second Quarter 2023 Financial Results”
104			Cover Page Interactive Data File (embedded within the Inline XBRL document)

The information furnished in connection with this current report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


HAWAIIAN ELECTRIC INDUSTRIES, INC.
(Registrant)
/s/ Paul K. Ito
Paul K. Ito
Executive Vice President,
Chief Financial Officer and Treasurer
(Principal Financial Officer)

Date: July 28, 2023

Exhibit 99


		NEWS RELEASE
July 28, 2023
Contact:	Mateo Garcia	Telephone: (808) 543-7300
	Director, Investor Relations	E-mail: ir@hei.com

AMERICAN SAVINGS BANK REPORTS SECOND QUARTER 2023 FINANCIAL RESULTS

2Q 2023 Net Income of $20.2 million

Credit Quality Remains Solid

Strong Capital Position with Ample Liquidity

HONOLULU - American Savings Bank, F.S.B. (ASB), a wholly owned subsidiary of Hawaiian Electric Industries, Inc. (NYSE - HE), today reported second quarter 2023 net income of $20.2 million, compared to $18.6 million in the first quarter of 2023 and $17.5 million in the second quarter of 2022.

“Our team delivered solid results in the second quarter, growing net income to $20.2 million,” said Ann Teranishi, president and chief executive officer of ASB. “Credit quality remains strong, indicative of the continued strength and resilience of Hawaii’s economy, consumers, and businesses. ASB’s capital position remains healthy, with liquidity of approximately three times uninsured or uncollateralized deposits. Our loyal and long-tenured deposit base demonstrates the value of our customer relationships,” said Teranishi.

Financial Highlights

Second quarter 2023 net interest income was $63.2 million compared to $64.9 million in the first, or linked quarter of 2023 and $61.8 million in the second quarter of 2022. The lower net interest income compared to the linked quarter was primarily due to higher interest expense from increased wholesale borrowings and certificates of deposit, and lower interest and dividends on investment securities, partially offset by higher interest and fees on loans. The higher net interest income compared to the prior year quarter was primarily due to higher interest and fees on loans, partially offset by higher interest expense. Net interest margin for the second quarter of 2023 was 2.75%, compared to 2.85% in both the linked and prior year quarters.

The second quarter 2023 provision for credit losses was $0.04 million, compared to $1.2 million in the linked quarter and $2.8 million in the second quarter of 2022. As of June 30, 2023, ASB’s allowance for credit losses to outstanding loans was 1.13% compared to 1.18% as of March 31, 2023 and 1.28% as of June 30, 2022.

The net charge-off ratio for the second quarter of 2023 was 0.14%, unchanged from the linked quarter and up from nil in the second quarter of 2022. Nonaccrual loans as a percentage of total loans receivable held for investment were 0.22%, compared to 0.24% in the linked quarter and 0.40% in the prior year quarter.

Noninterest income was $15.6 million in the second quarter of 2023 compared to $14.4 million in the linked quarter and $12.5 million in the second quarter of 2022. The increase compared to the linked and prior year quarters was primarily due to higher bank-owned life insurance income, a gain on sale of real estate and higher fees from other financial services.

Noninterest expense was $53.8 million compared to $54.4 million in the linked quarter and $49.4 million in the second quarter of 2022. The decrease compared to the linked quarter was primarily due to lower deposit account expenses and lower compensation and benefits expenses. The increase compared to the prior year quarter was primarily due to higher compensation and benefits expenses and F.D.I.C. premiums.

Total loans were $6.1 billion as of June 30, 2023, up 2.7% from December 31, 2022, reflecting growth across most of the portfolio.

Total deposits were $8.2 billion as of June 30, 2023, a decrease of 0.08% from December 31, 2022. Core deposits declined 2.8%, while certificates of deposits increased 33.3%. As of June 30, 2023, 86% of deposits were F.D.I.C. insured or fully collateralized, up slightly from 85% as of March 31, 2023, with approximately 79% of deposits F.D.I.C. insured. For the second quarter of 2023, the average cost of funds was 0.83%, up 17 basis points versus the linked quarter and up 78 basis points versus the prior year quarter.

Wholesale funding totaled $750 million as of June 30, 2023, up from $681 million as of March 31, 2023.

For the second quarter of 2023, return on average equity was 16.2%, compared to 15.5% in the linked quarter and 12.2% in the second quarter of 2022. Return on average assets was 0.84% for the second quarter of 2023, compared to 0.78% in the linked quarter and 0.76% in the prior year quarter.

In the second quarter of 2023, ASB paid dividends of $11.0 million to HEI. ASB had a Tier 1 leverage ratio of 7.8% as of June 30, 2023.

HEI EARNINGS RELEASE, HEI WEBCAST AND CONFERENCE CALL TO DISCUSS EARNINGS AND 2023 GUIDANCE

Concurrent with ASB’s regulatory filing 30 days after the end of the quarter, ASB announced its second quarter 2023 financial results today. Please note that these reported results relate only to ASB and are not necessarily indicative of HEI’s consolidated financial results for the second quarter 2023.

HEI plans to announce its second quarter 2023 consolidated financial results on Monday, August 7, 2023 and will also conduct a webcast and conference call at 10:15 a.m. Hawaii time (4:15 p.m. Eastern time) that same day to discuss its consolidated earnings, including ASB’s earnings, and 2023 guidance.

To listen to the conference call, dial 1-833-470-1428 (U.S.) or +1-929-526-1599 (international) and enter passcode 910697. Parties may also access presentation materials and/or listen to the conference call by visiting the conference call link on HEI’s website at www.hei.com under “Investor Relations,” sub-heading “News and Events — Events and Presentations.”

A replay will be available online and via phone. The online replay will be available on HEI’s website about two hours after the event. An audio replay will also be available about two hours after the event through August 21, 2023. To access the audio replay, dial 1-929-458-6194 (U.S.) or +(44)-204-525-0658 (international) and enter passcode 380478.

HEI and Hawaiian Electric Company, Inc. (Hawaiian Electric) intend to continue to use HEI’s website, www.hei.com, as a means of disclosing additional information; such disclosures will be included in the Investor Relations section of the website. Accordingly, investors should routinely monitor the Investor Relations section of HEI’s website, in addition to following HEI’s, Hawaiian Electric’s and ASB’s press releases, HEI’s and Hawaiian Electric’s Securities and Exchange Commission (SEC) filings and HEI’s public conference calls and webcasts. Investors may sign up to receive e-mail alerts via the Investor Relations section of the website. The information on HEI’s website is not incorporated by reference into this document or into HEI’s and Hawaiian Electric’s SEC filings unless, and except to the extent, specifically incorporated by reference.

Investors may also wish to refer to the Public Utilities Commission of the State of Hawaii (PUC) website at dms.puc.hawaii.gov/dms to review documents filed with, and issued by, the PUC. No information on the PUC website is incorporated by reference into this document or into HEI’s and Hawaiian Electric’s SEC filings.

The HEI family of companies provides the energy and financial services that empower much of the economic and community activity of Hawaii. HEI’s electric utility, Hawaiian Electric, supplies power to approximately 95% of Hawaii’s population and is undertaking an ambitious effort to decarbonize its operations and the broader state economy. Its banking subsidiary, ASB, is one of Hawaii’s largest financial institutions, providing a wide array of banking and other financial services and working to advance economic growth, affordability and financial fitness. HEI also helps advance Hawaii’s sustainability goals through investments by its non-regulated subsidiary, Pacific Current. For more information, visit www.hei.com.

FORWARD-LOOKING STATEMENTS

This release may contain “forward-looking statements,” which include statements that are predictive in nature, depend upon or refer to future events or conditions, and usually include words such as “will,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “predicts,” “estimates” or similar expressions. In addition, any statements concerning future financial performance, ongoing business strategies or prospects or possible future actions are also forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and are subject to risks, uncertainties and the accuracy of assumptions concerning HEI and its subsidiaries, the performance of the industries in which they do business and economic, political and market factors, among other things. These forward-looking statements are not guarantees of future performance.

Forward-looking statements in this release should be read in conjunction with the “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” discussions (which are incorporated by reference herein) set forth in HEI’s Annual Report on Form 10-K for the year ended December 31, 2022 and HEI’s other periodic reports that discuss important factors that could cause HEI’s results to differ materially from those anticipated in such statements. These forward-looking statements speak only as of the date of the report, presentation or filing in which they are made. Except to the extent required by the federal securities laws, HEI, Hawaiian Electric, ASB and their subsidiaries undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. ###

American Savings Bank, F.S.B.

STATEMENTS OF INCOME DATA

(Unaudited)


	Three months ended						Six months ended June 30
(in thousands)	June 30, 2023		March 31, 2023		June 30, 2022		2023		2022
Interest and dividend income
Interest and fees on loans	$	67,966	$	64,842	$	48,129	$	132,808	$	94,134
Interest and dividends on investment securities	13,775		14,637		14,693		28,412		28,677
Total interest and dividend income	81,741		79,479		62,822		161,220		122,811
Interest expense
Interest on deposit liabilities	9,661		6,837		921		16,498		1,868
Interest on other borrowings	8,852		7,721		139		16,573		144
Total interest expense	18,513		14,558		1,060		33,071		2,012
Net interest income	63,228		64,921		61,762		128,149		120,799
Provision for credit losses	43		1,175		2,757		1,218		(506)
Net interest income after provision for credit losses	63,185		63,746		59,005		126,931		121,305
Noninterest income
Fees from other financial services	5,009		4,679		4,716		9,688		10,303
Fee income on deposit liabilities	4,504		4,599		4,552		9,103		9,243
Fee income on other financial products	2,768		2,744		2,529		5,512		5,247
Bank-owned life insurance	1,955		1,425		(142)		3,380		539
Mortgage banking income	230		130		372		360		1,449
Gain on sale of real estate	495		—		—		495		1,002

Other income, net	678		801		475		1,479		847
Total noninterest income	15,639		14,378		12,502		30,017		28,630
Noninterest expense
Compensation and employee benefits	29,394		30,204		27,666		59,598		54,881
Occupancy	5,539		5,588		5,467		11,127		11,419
Data processing	5,095		5,012		4,484		10,107		8,635
Services	2,689		2,595		2,522		5,284		4,961
Equipment	2,957		2,646		2,402		5,603		4,731
Office supplies, printing and postage	1,109		1,165		1,073		2,274		2,133
Marketing	834		1,016		934		1,850		1,952

Other expense	6,152		6,191		4,850		12,343		8,899
Total noninterest expense	53,769		54,417		49,398		108,186		97,611
Income before income taxes	25,055		23,707		22,109		48,762		52,324
Income taxes	4,851		5,145		4,643		9,996		10,988
Net income	$	20,204	$	18,562	$	17,466	$	38,766	$	41,336
Comprehensive income (loss)	$	12,994	$	36,992	$	(71,369)	$	49,986	$	(169,940)
OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets	0.84		0.78		0.76		0.81		0.90
Return on average equity	16.20		15.51		12.17		15.87		13.01
Return on average tangible common equity	19.40		18.73		14.20		19.07		14.95
Net interest margin	2.75		2.85		2.85		2.80		2.82
Efficiency ratio	68.18		68.62		66.52		68.40		65.32
Net charge-offs to average loans outstanding	0.14		0.14		0.00		0.14		0.01
As of period end
Nonaccrual loans to loans receivable held for investment	0.22		0.24		0.40
Allowance for credit losses to loans outstanding	1.13		1.18		1.28
Tangible common equity to tangible assets	4.3		4.3		4.9
Tier-1 leverage ratio	7.8		7.7		7.7
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions)	$	11.0	$	14.0	$	12.0	$	25.0	$	27.0

This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.

American Savings Bank, F.S.B.

BALANCE SHEETS DATA

(Unaudited)


(in thousands)	June 30, 2023				December 31, 2022
Assets
Cash and due from banks			$	158,170			$	153,042
Interest-bearing deposits			9,958				3,107
Cash and cash equivalents			168,128				156,149
Investment securities
Available-for-sale, at fair value			1,368,037				1,429,667
Held-to-maturity, at amortized cost			1,224,917				1,251,747
Stock in Federal Home Loan Bank, at cost			18,000				26,560
Loans held for investment			6,138,182				5,978,906
Allowance for credit losses			(69,068)				(72,216)
Net loans			6,069,114				5,906,690
Loans held for sale, at lower of cost or fair value			6,910				824
Other			683,395				692,143
Goodwill			82,190				82,190
Total assets			$	9,620,691			$	9,545,970
Liabilities and shareholder’s equity
Deposit liabilities–noninterest-bearing			$	2,683,725			$	2,811,077
Deposit liabilities–interest-bearing			5,479,510				5,358,619
Other borrowings			750,000				695,120
Other			212,268				212,269
Total liabilities			9,125,503				9,077,085
Common stock			1				1
Additional paid-in capital			357,123				355,806
Retained earnings			463,459				449,693
Accumulated other comprehensive loss, net of tax benefits
Net unrealized losses on securities	$	(315,917)			$	(328,904)
Retirement benefit plans	(9,478)		(325,395)		(7,711)		(336,615)
Total shareholder’s equity			495,188				468,885
Total liabilities and shareholder’s equity			$	9,620,691			$	9,545,970

This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.

Cover	Jul. 28, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Jul. 28, 2023
Entity Registrant Name	Hawaiian Electric Industries, Inc.
Entity File Number	1-8503
Entity Tax Identification Number	99-0208097
Entity Incorporation, State or Country Code	HI
Entity Address, Address Line One	1001 Bishop Street, Suite 2900
Entity Address, City or Town	Honolulu
Entity Address, State or Province	HI
Entity Address, Postal Zip Code	96813
City Area Code	808
Local Phone Number	543-5662
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of each class	Common Stock, Without Par Value
Trading Symbol	HE
Security Exchange Name	NYSE
Entity Emerging Growth Company	false
Entity Central Index Key	0000354707
Amendment Flag	false