Central Pacific Financial in Honolulu reported lower quarterly profit that reflected margin pressure, a higher loan-loss provision and a securities loss.
The $7.6 billion-asset company said in a press release that its fourth-quarter earnings fell by 26% from a year earlier, to $14.9 million. Net interest income fell by 9.1% to $51.1 million – the margin narrowed by 33 basis points to 2.84%.
The company had a $4.7 million provision, a notable increase from $571,000 a year earlier. Net chargeoffs more than tripled those of a year earlier, at $5.5 million.
Central Pacific sold $30 million of available-for-sale debt securities at a $1.9 million loss. Proceeds were used to buy $28.3 million of higher-yielding debt securities; it should take less than three years to earn back the loss.
The company also recorded a $5.1 million pretax gain after selling a real estate property.
Central Pacific said the securities sales, the property sale and a branch lease termination should add $2 million to annual pretax income.