Exact Name of Registrant as Specified in Its Charter | Commission File Number | I.R.S. Employer Identification No. | ||||||||||||
and Principal Subsidiary | ||||||||||||||
Registrant | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||
Hawaiian Electric Industries, Inc. |
Hawaiian Electric Industries, Inc. | ☒ | No | ☐ | Hawaiian Electric Company, Inc. | ☒ | No | ☐ |
Hawaiian Electric Industries, Inc. | ☒ | No | ☐ | Hawaiian Electric Company, Inc. | ☒ | No | ☐ |
Hawaiian Electric Industries, Inc.: | Hawaiian Electric Company, Inc.: | ||||||||||||||||||||||
☒ | Smaller reporting company | Large accelerated filer | ☐ | Smaller reporting company | |||||||||||||||||||
Accelerated filer | ☐ | Emerging growth company | Accelerated filer | ☐ | Emerging growth company | ||||||||||||||||||
Non-accelerated filer | ☐ | ☒ |
Hawaiian Electric Industries, Inc. | ☐ | Hawaiian Electric Company, Inc. | ☐ |
Hawaiian Electric Industries, Inc. | Yes | ☐ | No | Hawaiian Electric Company, Inc. | Yes | ☐ | No |
Class of Common Stock | Outstanding April 25, 2022 | ||||||||||
Hawaiian Electric Industries, Inc. (Without Par Value) | Shares | ||||||||||
Hawaiian Electric Company, Inc. ($6-2/3 Par Value) | Shares (not publicly traded) |
Page No. | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
three months ended March 31, 2022 and 2021 | |||||||||||
Terms | Definitions | |||||||
ACL | Allowance for credit losses, which is the current credit loss standard, requires recording the allowance based on the expected loss model | |||||||
AES Hawaii | AES Hawaii, Inc. | |||||||
AOCI | Accumulated other comprehensive income/(loss) | |||||||
ARA | Annual revenue adjustment | |||||||
ASB | American Savings Bank, F.S.B., a wholly owned subsidiary of ASB Hawaii, Inc. | |||||||
ASB Hawaii | ASB Hawaii, Inc., a wholly owned subsidiary of Hawaiian Electric Industries, Inc. and the parent company of American Savings Bank, F.S.B. | |||||||
ASU | Accounting Standards Update | |||||||
CARES Act | The Coronavirus Aid, Relief, and Economic Security Act enacted March 27, 2020 | |||||||
CBRE | Community-based renewable energy | |||||||
Company | Hawaiian Electric Industries, Inc. and its direct and indirect subsidiaries, including, without limitation, Hawaiian Electric Company, Inc. and its subsidiaries (listed under Hawaiian Electric); ASB Hawaii, Inc. and its subsidiary, American Savings Bank, F.S.B. and Pacific Current, LLC and its subsidiaries (listed under Pacific Current). The Old Oahu Tug Service, Inc. was dissolved in March 2022. | |||||||
Consumer Advocate | Division of Consumer Advocacy, Department of Commerce and Consumer Affairs of the State of Hawaii | |||||||
D&O | Decision and order from the PUC | |||||||
Dodd-Frank Act | Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 | |||||||
DOH | Department of Health of the State of Hawaii | |||||||
DRIP | HEI Dividend Reinvestment and Stock Purchase Plan | |||||||
ECRC | Energy cost recovery clause | |||||||
EIP | 2010 Equity and Incentive Plan, as amended and restated | |||||||
EPA | Environmental Protection Agency — federal | |||||||
EPRM | Exceptional Project Recovery Mechanism | |||||||
EPS | Earnings per share | |||||||
ERP/EAM | Enterprise Resource Planning/Enterprise Asset Management | |||||||
ESG | Environmental, Social & Governance | |||||||
ESM | Earnings Sharing Mechanism | |||||||
EVE | Economic value of equity | |||||||
Exchange Act | Securities Exchange Act of 1934 | |||||||
FASB | Financial Accounting Standards Board | |||||||
FDIC | Federal Deposit Insurance Corporation | |||||||
federal | U.S. Government | |||||||
FHLB | Federal Home Loan Bank | |||||||
FHLMC | Federal Home Loan Mortgage Corporation | |||||||
Fitch | Fitch Ratings, Inc. | |||||||
FNMA | Federal National Mortgage Association | |||||||
FRB | Federal Reserve Board | |||||||
GAAP | Accounting principles generally accepted in the United States of America | |||||||
GHG | Greenhouse gas | |||||||
GNMA | Government National Mortgage Association | |||||||
GSPA | Grid Services Purchase Agreement | |||||||
Hamakua Energy | Hamakua Energy, LLC, an indirect subsidiary of Pacific Current | |||||||
Hawaii Electric Light | Hawaii Electric Light Company, Inc., an electric utility subsidiary of Hawaiian Electric Company, Inc. |
Terms | Definitions | |||||||
Hawaiian Electric | Hawaiian Electric Company, Inc., an electric utility subsidiary of Hawaiian Electric Industries, Inc. and parent company of Hawaii Electric Light Company, Inc., Maui Electric Company, Limited and Renewable Hawaii, Inc. | |||||||
HEI | Hawaiian Electric Industries, Inc., direct parent company of Hawaiian Electric Company, Inc., ASB Hawaii, Inc. and Pacific Current, LLC. The Old Oahu Tug Service, Inc. was dissolved in March 2022. | |||||||
HEIRSP | Hawaiian Electric Industries Retirement Savings Plan | |||||||
HELOC | Home equity line of credit | |||||||
HPOWER | City and County of Honolulu with respect to a power purchase agreement for a refuse-fired plant | |||||||
IPP | Independent power producer | |||||||
IRLCs | Interest rate lock commitments | |||||||
Kalaeloa | Kalaeloa Partners, L.P. | |||||||
kWh | Kilowatthour/s (as applicable) | |||||||
LMI | Low-to-moderate income | |||||||
LTIP | Long-term incentive plan | |||||||
Maui Electric | Maui Electric Company, Limited, an electric utility subsidiary of Hawaiian Electric Company, Inc. | |||||||
Mauo | Mauo, LLC, a subsidiary of Pacific Current | |||||||
Moody’s | Moody’s Investors Service’s | |||||||
MPIR | Major Project Interim Recovery | |||||||
MSRs | Mortgage servicing rights | |||||||
MW | Megawatt/s (as applicable) | |||||||
MRP | Multi-year rate period | |||||||
NII | Net interest income | |||||||
NPBC | Net periodic benefit costs | |||||||
NPPC | Net periodic pension costs | |||||||
O&M | Other operation and maintenance | |||||||
OCC | Office of the Comptroller of the Currency | |||||||
OPEB | Postretirement benefits other than pensions | |||||||
Pacific Current | Pacific Current, LLC, a wholly owned subsidiary of HEI and parent company of Hamakua Holdings, LLC, Mauo, LLC, Alenuihaha Developments, LLC, Kaʻieʻie Waho Company, LLC, Kaʻaipuaʻa, LLC, Upena, LLC and Mahipapa, LLC | |||||||
PBR | Performance-based regulation | |||||||
PGV | Puna Geothermal Venture | |||||||
PIMs | Performance incentive mechanisms | |||||||
PPA | Power purchase agreement | |||||||
PPAC | Purchased power adjustment clause | |||||||
PUC | Public Utilities Commission of the State of Hawaii | |||||||
PV | Photovoltaic | |||||||
RAM | Revenue adjustment mechanism | |||||||
RBA | Revenue balancing account | |||||||
REIP | Renewable Energy Infrastructure Program | |||||||
RFP | Request for proposals | |||||||
ROACE | Return on average common equity | |||||||
RORB | Return on rate base | |||||||
RPS | Renewable portfolio standards | |||||||
S&P | S&P Global Ratings | |||||||
SBA | Small Business Administration | |||||||
SEC | Securities and Exchange Commission | |||||||
See | Means the referenced material is incorporated by reference | |||||||
Tax Act | 2017 Tax Cuts and Jobs Act (H.R. 1, An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018) | |||||||
TDR | Troubled debt restructuring | |||||||
Utilities | Hawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited | |||||||
VIEs | Variable interest entities |
Three months ended March 31 | ||||||||||||||
(in thousands, except per share amounts) | 2022 | 2021 | ||||||||||||
Revenues | ||||||||||||||
Electric utility | $ | $ | ||||||||||||
Bank | ||||||||||||||
Other | ||||||||||||||
Total revenues | ||||||||||||||
Expenses | ||||||||||||||
Electric utility | ||||||||||||||
Bank | ||||||||||||||
Other | ||||||||||||||
Total expenses | ||||||||||||||
Operating income (loss) | ||||||||||||||
Electric utility | ||||||||||||||
Bank | ||||||||||||||
Other | ( | ( | ||||||||||||
Total operating income | ||||||||||||||
Retirement defined benefits credit—other than service costs | ||||||||||||||
Interest expense, net—other than on deposit liabilities and other bank borrowings | ( | ( | ||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||
Gain on sales of investment securities, net and equity-method investment | ||||||||||||||
Income before income taxes | ||||||||||||||
Income taxes | ||||||||||||||
Net income | ||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||
Net income for common stock | $ | $ | ||||||||||||
Basic earnings per common share | $ | $ | ||||||||||||
Diluted earnings per common share | $ | $ | ||||||||||||
Weighted-average number of common shares outstanding | ||||||||||||||
Net effect of potentially dilutive shares | ||||||||||||||
Weighted-average shares assuming dilution |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Net income for common stock | $ | $ | ||||||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||
Net unrealized gains (losses) on available-for-sale investment securities: | ||||||||||||||
Net unrealized losses on available-for-sale investment securities arising during the period, net of taxes of $( | ( | ( | ||||||||||||
Reclassification adjustment for net realized gains included in net income, net of taxes of $ | ( | |||||||||||||
Derivatives qualifying as cash flow hedges: | ||||||||||||||
Unrealized interest rate hedging gains arising during the period, net of taxes of $ | ||||||||||||||
Reclassification adjustment for net realized losses included in net income, net of taxes of $ | ||||||||||||||
Retirement benefit plans: | ||||||||||||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes of $ | ||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $( | ( | ( | ||||||||||||
Other comprehensive loss, net of tax benefits | ( | ( | ||||||||||||
Comprehensive income (loss) attributable to Hawaiian Electric Industries, Inc. | $ | ( | $ |
(dollars in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||
Assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash | ||||||||||||||
Accounts receivable and unbilled revenues, net | ||||||||||||||
Available-for-sale investment securities, at fair value | ||||||||||||||
Held-to-maturity investment securities, at amortized cost | ||||||||||||||
Stock in Federal Home Loan Bank, at cost | ||||||||||||||
Loans held for investment, net | ||||||||||||||
Loans held for sale, at lower of cost or fair value | ||||||||||||||
Property, plant and equipment, net of accumulated depreciation of $ | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Regulatory assets | ||||||||||||||
Other | ||||||||||||||
Goodwill | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Liabilities and shareholders’ equity | ||||||||||||||
Liabilities | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Interest and dividends payable | ||||||||||||||
Deposit liabilities | ||||||||||||||
Short-term borrowings—other than bank | ||||||||||||||
Other bank borrowings | ||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||
Deferred income taxes | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ||||||||||||||
Other | ||||||||||||||
Total liabilities | ||||||||||||||
Preferred stock of subsidiaries - not subject to mandatory redemption | ||||||||||||||
Commitments and contingencies (Notes 3 and 4) | ||||||||||||||
Shareholders’ equity | ||||||||||||||
Preferred stock, | ||||||||||||||
Common stock, | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive loss, net of tax benefits | ( | ( | ||||||||||||
Total shareholders’ equity | ||||||||||||||
Total liabilities and shareholders’ equity | $ | $ |
Common stock | Retained | Accumulated other comprehensive | ||||||||||||||||||||||||||||||
(in thousands) | Shares | Amount | Earnings | income (loss) | Total | |||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income for common stock | — | — | — | |||||||||||||||||||||||||||||
Other comprehensive loss, net of tax benefits | — | — | — | ( | ( | |||||||||||||||||||||||||||
Share-based expenses and other, net | ( | — | — | ( | ||||||||||||||||||||||||||||
Common stock dividends ( | — | — | ( | — | ( | |||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Balance, December 31, 2020 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income for common stock | — | — | — | |||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | ( | ( | |||||||||||||||||||||||||||
Share-based expenses and other, net | — | — | ||||||||||||||||||||||||||||||
Common stock dividends ( | — | — | ( | — | ( | |||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Cash flows from operating activities | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities | ||||||||||||||
Depreciation of property, plant and equipment | ||||||||||||||
Other amortization | ||||||||||||||
Provision for credit losses | ( | ( | ||||||||||||
Loans originated, held for sale | ( | ( | ||||||||||||
Proceeds from sale of loans, held for sale | ||||||||||||||
Gain on sales of investment securities, net and equity-method investment | ( | ( | ||||||||||||
Gain on sale of loans, net | ( | ( | ||||||||||||
Deferred income taxes | ( | ( | ||||||||||||
Share-based compensation expense | ||||||||||||||
Allowance for equity funds used during construction | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Changes in assets and liabilities | ||||||||||||||
Decrease in accounts receivable and unbilled revenues, net | ||||||||||||||
Increase in fuel oil stock | ( | ( | ||||||||||||
Increase in regulatory assets | ( | ( | ||||||||||||
Increase (decrease) in regulatory liabilities | ( | |||||||||||||
Increase in accounts, interest and dividends payable | ||||||||||||||
Change in prepaid and accrued income taxes, tax credits and utility revenue taxes | ( | ( | ||||||||||||
Decrease in defined benefit pension and other postretirement benefit plans liability | ( | ( | ||||||||||||
Change in other assets and liabilities | ( | ( | ||||||||||||
Net cash provided by operating activities | ||||||||||||||
Cash flows from investing activities | ||||||||||||||
Available-for-sale investment securities purchased | ( | ( | ||||||||||||
Principal repayments on available-for-sale investment securities | ||||||||||||||
Proceeds from sale of available-for-sale investment securities | ||||||||||||||
Purchases of held-to-maturity investment securities | ( | |||||||||||||
Proceeds from repayments or maturities of held-to-maturity investment securities | ||||||||||||||
Purchase of stock from Federal Home Loan Bank | ( | |||||||||||||
Redemption of stock from Federal Home Loan Bank | ||||||||||||||
Net decrease in loans held for investment | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Contributions to low income housing investments | ( | |||||||||||||
Other | ||||||||||||||
Net cash used in investing activities | ( | ( |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Cash flows from financing activities | ||||||||||||||
Net increase in deposit liabilities | ||||||||||||||
Net increase in short-term borrowings with original maturities of three months or less | ||||||||||||||
Net increase in other bank borrowings with original maturities of three months or less | ||||||||||||||
Repayment of short-term debt | ( | |||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||
Repayment of long-term debt | ( | ( | ||||||||||||
Withheld shares for employee taxes on vested share-based compensation | ( | ( | ||||||||||||
Common stock dividends | ( | ( | ||||||||||||
Preferred stock dividends of subsidiaries | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Net cash provided by financing activities | ||||||||||||||
Net decrease in cash, cash equivalents and restricted cash | ( | ( | ||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||
Cash and cash equivalents, end of period | $ | $ |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Revenues | $ | $ | ||||||||||||
Expenses | ||||||||||||||
Fuel oil | ||||||||||||||
Purchased power | ||||||||||||||
Other operation and maintenance | ||||||||||||||
Depreciation | ||||||||||||||
Taxes, other than income taxes | ||||||||||||||
Total expenses | ||||||||||||||
Operating income | ||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||
Retirement defined benefits credit —other than service costs | ||||||||||||||
Interest expense and other charges, net | ( | ( | ||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||
Income before income taxes | ||||||||||||||
Income taxes | ||||||||||||||
Net income | ||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||
Net income attributable to Hawaiian Electric | ||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||
Net income for common stock | $ | $ |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Net income for common stock | $ | $ | ||||||||||||
Other comprehensive income, net of taxes: | ||||||||||||||
Retirement benefit plans: | ||||||||||||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes of $ | ||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $( | ( | ( | ||||||||||||
Other comprehensive income, net of taxes | ||||||||||||||
Comprehensive income attributable to Hawaiian Electric Company, Inc. | $ | $ |
(dollars in thousands, except par value) | March 31, 2022 | December 31, 2021 | ||||||||||||
Assets | ||||||||||||||
Property, plant and equipment | ||||||||||||||
Utility property, plant and equipment | ||||||||||||||
Land | $ | $ | ||||||||||||
Plant and equipment | ||||||||||||||
Less accumulated depreciation | ( | ( | ||||||||||||
Construction in progress | ||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation of $ | ||||||||||||||
Total property, plant and equipment, net | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Customer accounts receivable, net | ||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||
Other accounts receivable, net | ||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||
Materials and supplies, at average cost | ||||||||||||||
Prepayments and other | ||||||||||||||
Regulatory assets | ||||||||||||||
Total current assets | ||||||||||||||
Other long-term assets | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Regulatory assets | ||||||||||||||
Other | ||||||||||||||
Total other long-term assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Capitalization and liabilities | ||||||||||||||
Capitalization | ||||||||||||||
Common stock ($6 2/3 par value, authorized March 31, 2022 and December 31, 2021) | $ | $ | ||||||||||||
Premium on capital stock | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive loss, net of tax benefits-retirement benefit plans | ( | ( | ||||||||||||
Common stock equity | ||||||||||||||
Cumulative preferred stock — not subject to mandatory redemption | ||||||||||||||
Long-term debt, net | ||||||||||||||
Total capitalization | ||||||||||||||
Commitments and contingencies (Note 3) | ||||||||||||||
Current liabilities | ||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||
Current portion of long-term debt, net | ||||||||||||||
Short-term borrowings from non-affiliates | ||||||||||||||
Accounts payable | ||||||||||||||
Interest and preferred dividends payable | ||||||||||||||
Taxes accrued, including revenue taxes | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Other | ||||||||||||||
Total current liabilities | ||||||||||||||
Deferred credits and other liabilities | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Deferred income taxes | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Unamortized tax credits | ||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ||||||||||||||
Other | ||||||||||||||
Total deferred credits and other liabilities | ||||||||||||||
Total capitalization and liabilities | $ | $ |
Common stock | Premium on capital | Retained | Accumulated other comprehensive | |||||||||||||||||||||||||||||||||||
(in thousands) | Shares | Amount | stock | earnings | income (loss) | Total | ||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | — | ||||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Balance, December 31, 2020 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | — | ||||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Cash flows from operating activities | ||||||||||||||
Net income | $ | $ | ||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities | ||||||||||||||
Depreciation of property, plant and equipment | ||||||||||||||
Other amortization | ||||||||||||||
Deferred income taxes | ( | ( | ||||||||||||
State refundable credit | ( | ( | ||||||||||||
Bad debt expense | ||||||||||||||
Allowance for equity funds used during construction | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Changes in assets and liabilities | ||||||||||||||
Decrease in accounts receivable | ||||||||||||||
Increase in accrued unbilled revenues | ( | ( | ||||||||||||
Increase in fuel oil stock | ( | ( | ||||||||||||
Increase in materials and supplies | ( | ( | ||||||||||||
Increase in regulatory assets | ( | ( | ||||||||||||
Increase (decrease) in regulatory liabilities | ( | |||||||||||||
Increase in accounts payable | ||||||||||||||
Change in prepaid and accrued income taxes, tax credits and revenue taxes | ( | ( | ||||||||||||
Decrease in defined benefit pension and other postretirement benefit plans liability | ( | ( | ||||||||||||
Change in other assets and liabilities | ( | ( | ||||||||||||
Net cash provided by operating activities | ||||||||||||||
Cash flows from investing activities | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Other | ||||||||||||||
Net cash used in investing activities | ( | ( | ||||||||||||
Cash flows from financing activities | ||||||||||||||
Common stock dividends | ( | ( | ||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ||||||||||||
Repayment of short-term debt | ( | |||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||
Net increase in short-term borrowings from non-affiliates and affiliates with original maturities of three months or less | ||||||||||||||
Other | ( | |||||||||||||
Net cash provided by (used in) financing activities | ( | |||||||||||||
Net decrease in cash, cash equivalents and restricted cash | ( | ( | ||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||
Cash and cash equivalents, end of period | $ | $ |
(in thousands) | Electric utility | Bank | Other | Total | ||||||||||||||||||||||
Three months ended March 31, 2022 | ||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | ||||||||||||||||||||||
Intersegment revenues (eliminations) | ( | |||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | $ | ( | $ | |||||||||||||||||||||
Income taxes (benefit) | ( | |||||||||||||||||||||||||
Net income (loss) | ( | |||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | $ | $ | ( | $ | |||||||||||||||||||||
Total assets (at March 31, 2022) | $ | $ | $ | $ | ||||||||||||||||||||||
Three months ended March 31, 2021 | ||||||||||||||||||||||||||
Revenues from external customers | $ | $ | $ | $ | ||||||||||||||||||||||
Intersegment revenues (eliminations) | ( | |||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | $ | ( | $ | |||||||||||||||||||||
Income taxes (benefit) | ( | |||||||||||||||||||||||||
Net income (loss) | ( | |||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | $ | $ | ( | $ | |||||||||||||||||||||
Total assets (at December 31, 2021) | $ | $ | $ | $ |
Three months ended March 31 | ||||||||||||||
(in millions) | 2022 | 2021 | ||||||||||||
Kalaeloa | $ | $ | ||||||||||||
AES Hawaii | ||||||||||||||
HPOWER | ||||||||||||||
Hamakua Energy | ||||||||||||||
Puna Geothermal Venture | ||||||||||||||
Wind IPPs | ||||||||||||||
Solar IPPs | ||||||||||||||
Other IPPs 1 | ||||||||||||||
Total IPPs | $ | $ |
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Total | ||||||||||||||||||||||
Incremental accrued RBA balance through September 30, 2021 (and associated revenue taxes) | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
Incremental Performance Incentive Mechanisms (net) | ||||||||||||||||||||||||||
Incremental MPIR/EPRM Revenue Adjustment | ||||||||||||||||||||||||||
Other | ( | $ | ( | |||||||||||||||||||||||
Net incremental amount to be collected under the RBA rate tariffs | $ | ( | $ | $ | ( | $ | ( | |||||||||||||||||||
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating income | ( | |||||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Income before income taxes | ( | |||||||||||||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||||||||||||||
Net income | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net income attributable to Hawaiian Electric | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | ||||||||||||||||||||||||||||||||||||||
Comprehensive income attributable to common shareholder | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating income | ( | |||||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Income before income taxes | ( | |||||||||||||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||||||||||||||
Net income | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net income attributable to Hawaiian Electric | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits | ( | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Comprehensive income attributable to common shareholder | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi- diaries | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Land | $ | $ | ||||||||||||||||||||||||||||||||||||
Plant and equipment | ||||||||||||||||||||||||||||||||||||||
Less accumulated depreciation | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Construction in progress | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation | ||||||||||||||||||||||||||||||||||||||
Total property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Investment in wholly owned subsidiaries, at equity | ( | |||||||||||||||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||||||||||||||
Restricted cash | ||||||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Customer accounts receivable, net | ||||||||||||||||||||||||||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||||||||||||||||||||||||||
Other accounts receivable, net | ( | |||||||||||||||||||||||||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||||||||||||||||||||||||||
Materials and supplies, at average cost | ||||||||||||||||||||||||||||||||||||||
Prepayments and other | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Total current assets | ( | |||||||||||||||||||||||||||||||||||||
Other long-term assets | ||||||||||||||||||||||||||||||||||||||
Operating lease right-of-use assets | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total other long-term assets | ( | |||||||||||||||||||||||||||||||||||||
Total assets | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Capitalization and liabilities | ||||||||||||||||||||||||||||||||||||||
Capitalization | ||||||||||||||||||||||||||||||||||||||
Common stock equity | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cumulative preferred stock—not subject to mandatory redemption | ||||||||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||||||||
Total capitalization | ( | |||||||||||||||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of long-term debt | ||||||||||||||||||||||||||||||||||||||
Short-term borrowings from non-affiliates | ||||||||||||||||||||||||||||||||||||||
Short-term borrowings from affiliate | ( | |||||||||||||||||||||||||||||||||||||
Accounts payable | ||||||||||||||||||||||||||||||||||||||
Interest and preferred dividends payable | ( | |||||||||||||||||||||||||||||||||||||
Taxes accrued, including revenue taxes | ||||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total current liabilities | ( | |||||||||||||||||||||||||||||||||||||
Deferred credits and other liabilities | ||||||||||||||||||||||||||||||||||||||
Operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Deferred income taxes | ||||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Unamortized tax credits | ||||||||||||||||||||||||||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ( | |||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Total deferred credits and other liabilities | ( | |||||||||||||||||||||||||||||||||||||
Total capitalization and liabilities | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi-diaries | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Land | $ | $ | ||||||||||||||||||||||||||||||||||||
Plant and equipment | ||||||||||||||||||||||||||||||||||||||
Less accumulated depreciation | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Construction in progress | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation | ||||||||||||||||||||||||||||||||||||||
Total property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Investment in wholly owned subsidiaries, at equity | ( | |||||||||||||||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||||||||||||||
Restricted cash | ||||||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Customer accounts receivable, net | ||||||||||||||||||||||||||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||||||||||||||||||||||||||
Other accounts receivable, net | ( | |||||||||||||||||||||||||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||||||||||||||||||||||||||
Materials and supplies, at average cost | ||||||||||||||||||||||||||||||||||||||
Prepayments and other | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Total current assets | ( | |||||||||||||||||||||||||||||||||||||
Other long-term assets | ||||||||||||||||||||||||||||||||||||||
Operating lease right-of-use assets | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total other long-term assets | ( | |||||||||||||||||||||||||||||||||||||
Total assets | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Capitalization and liabilities | ||||||||||||||||||||||||||||||||||||||
Capitalization | ||||||||||||||||||||||||||||||||||||||
Common stock equity | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cumulative preferred stock—not subject to mandatory redemption | ||||||||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||||||||
Total capitalization | ( | |||||||||||||||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of long-term debt | ||||||||||||||||||||||||||||||||||||||
Short-term borrowings-affiliate | ( | |||||||||||||||||||||||||||||||||||||
Accounts payable | ||||||||||||||||||||||||||||||||||||||
Interest and preferred dividends payable | ( | |||||||||||||||||||||||||||||||||||||
Taxes accrued, including revenue taxes | ||||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total current liabilities | ( | |||||||||||||||||||||||||||||||||||||
Deferred credits and other liabilities | ||||||||||||||||||||||||||||||||||||||
Operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Deferred income taxes | ||||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Unamortized tax credits | ||||||||||||||||||||||||||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ( | |||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total deferred credits and other liabilities | ( | |||||||||||||||||||||||||||||||||||||
Total capitalization and liabilities | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Net income for common stock | — | ( | ||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | — | ||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Balance, December 31, 2020 | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Net income for common stock | — | ( | ||||||||||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | ( | |||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cash flows from investing activities | ||||||||||||||||||||||||||||||||||||||
Capital expenditures | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | ( | ||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Cash flows from financing activities | ||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net increase in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less | ( | |||||||||||||||||||||||||||||||||||||
Net cash used in financing activities | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
Net increase (decrease) in cash and cash equivalents | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||||||||||||||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||||||||||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cash flows from investing activities | ||||||||||||||||||||||||||||||||||||||
Capital expenditures | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Advances from affiliates | ( | |||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
Cash flows from financing activities | ||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Repayment of short-term debt | ( | ( | ||||||||||||||||||||||||||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||||||||||||||||||||||||||
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less | ( | ( | ||||||||||||||||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net cash provided by (used in) financing activities | ( | |||||||||||||||||||||||||||||||||||||
Net increase (decrease) in cash and cash equivalents | ( | ( | ||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||||||||||||||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||||||||||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Interest and dividend income | ||||||||||||||
Interest and fees on loans | $ | $ | ||||||||||||
Interest and dividends on investment securities | ||||||||||||||
Total interest and dividend income | ||||||||||||||
Interest expense | ||||||||||||||
Interest on deposit liabilities | ||||||||||||||
Interest on other borrowings | ||||||||||||||
Total interest expense | ||||||||||||||
Net interest income | ||||||||||||||
Provision for credit losses | ( | ( | ||||||||||||
Net interest income after provision for credit losses | ||||||||||||||
Noninterest income | ||||||||||||||
Fees from other financial services | ||||||||||||||
Fee income on deposit liabilities | ||||||||||||||
Fee income on other financial products | ||||||||||||||
Bank-owned life insurance | ||||||||||||||
Mortgage banking income | ||||||||||||||
Gain on sale of real estate | ||||||||||||||
Gain on sale of investment securities, net | ||||||||||||||
Other income, net | ||||||||||||||
Total noninterest income | ||||||||||||||
Noninterest expense | ||||||||||||||
Compensation and employee benefits | ||||||||||||||
Occupancy | ||||||||||||||
Data processing | ||||||||||||||
Services | ||||||||||||||
Equipment | ||||||||||||||
Office supplies, printing and postage | ||||||||||||||
Marketing | ||||||||||||||
FDIC insurance | ||||||||||||||
Other expense | ||||||||||||||
Total noninterest expense | ||||||||||||||
Income before income taxes | ||||||||||||||
Income taxes | ||||||||||||||
Net income | ||||||||||||||
Other comprehensive loss, net of tax benefits | ( | ( | ||||||||||||
Comprehensive income (loss) | $ | ( | $ | ( |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Interest and dividend income | $ | $ | ||||||||||||
Noninterest income | ||||||||||||||
Less: Gain on sale of real estate | ||||||||||||||
Less: Gain on sale of investment securities, net | ||||||||||||||
*Revenues-Bank | ||||||||||||||
Total interest expense | ||||||||||||||
Provision for credit losses | ( | ( | ||||||||||||
Noninterest expense | ||||||||||||||
Less: Gain on sale of real estate | ||||||||||||||
Less: Retirement defined benefits credit—other than service costs | ( | ( | ||||||||||||
*Expenses-Bank | ||||||||||||||
*Operating income-Bank | ||||||||||||||
Add back: Retirement defined benefits credit—other than service costs | ( | ( | ||||||||||||
Add back: Gain on sale of investment securities, net | ||||||||||||||
Income before income taxes | $ | $ |
(in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||
Cash and due from banks | $ | $ | ||||||||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||
Investment securities | ||||||||||||||||||||||||||
Available-for-sale, at fair value | ||||||||||||||||||||||||||
Held-to-maturity, at amortized cost (fair value of $ | ||||||||||||||||||||||||||
Stock in Federal Home Loan Bank, at cost | ||||||||||||||||||||||||||
Loans held for investment | ||||||||||||||||||||||||||
Allowance for credit losses | ( | ( | ||||||||||||||||||||||||
Net loans | ||||||||||||||||||||||||||
Loans held for sale, at lower of cost or fair value | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||||
Total assets | $ | $ | ||||||||||||||||||||||||
Liabilities and shareholder’s equity | ||||||||||||||||||||||||||
Deposit liabilities—noninterest-bearing | $ | $ | ||||||||||||||||||||||||
Deposit liabilities—interest-bearing | ||||||||||||||||||||||||||
Other borrowings | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total liabilities | ||||||||||||||||||||||||||
Common stock | ||||||||||||||||||||||||||
Additional paid-in capital | ||||||||||||||||||||||||||
Retained earnings | ||||||||||||||||||||||||||
Accumulated other comprehensive loss, net of tax benefits | ||||||||||||||||||||||||||
Net unrealized losses on securities | $ | ( | $ | ( | ||||||||||||||||||||||
Retirement benefit plans | ( | ( | ( | ( | ||||||||||||||||||||||
Total shareholder’s equity | ||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | $ | ||||||||||||||||||||||||
Other assets | ||||||||||||||||||||||||||
Bank-owned life insurance | $ | $ | ||||||||||||||||||||||||
Premises and equipment, net | ||||||||||||||||||||||||||
Accrued interest receivable | ||||||||||||||||||||||||||
Mortgage-servicing rights | ||||||||||||||||||||||||||
Low-income housing investments | ||||||||||||||||||||||||||
Deferred tax asset | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
$ | $ | |||||||||||||||||||||||||
Other liabilities | ||||||||||||||||||||||||||
Accrued expenses | $ | $ | ||||||||||||||||||||||||
Federal and state income taxes payable | ||||||||||||||||||||||||||
Cashier’s checks | ||||||||||||||||||||||||||
Advance payments by borrowers | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
$ | $ |
Amortized cost | Gross unrealized gains | Gross unrealized losses | Estimated fair value | Gross unrealized losses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less than 12 months | 12 months or longer | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Number of issues | Fair value | Amount | Number of issues | Fair value | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Held-to-maturity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and Federal agency obligations | $ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Held-to-maturity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and Federal agency obligations | $ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( |
March 31, 2022 | Amortized cost | Fair value | ||||||||||||
(in thousands) | ||||||||||||||
Available-for-sale | ||||||||||||||
Due in one year or less | $ | $ | ||||||||||||
Due after one year through five years | ||||||||||||||
Due after five years through ten years | ||||||||||||||
Due after ten years | ||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | ||||||||||||||
Total available-for-sale securities | $ | $ | ||||||||||||
Held-to-maturity | ||||||||||||||
Due in one year or less | $ | $ | ||||||||||||
Due after one year through five years | ||||||||||||||
Due after five years through ten years | ||||||||||||||
Due after ten years | ||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | ||||||||||||||
Total held-to-maturity securities | $ | $ |
Three months ended March 31 | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Proceeds | $ | $ | ||||||||||||
Gross gains | ||||||||||||||
Gross losses | ||||||||||||||
Tax expense on realized gains |
March 31, 2022 | December 31, 2021 | ||||||||||
(in thousands) | |||||||||||
Real estate: | |||||||||||
Residential 1-4 family | $ | $ | |||||||||
Commercial real estate | |||||||||||
Home equity line of credit | |||||||||||
Residential land | |||||||||||
Commercial construction | |||||||||||
Residential construction | |||||||||||
Total real estate | |||||||||||
Commercial | |||||||||||
Consumer | |||||||||||
Total loans | |||||||||||
Less: Deferred fees and discounts | ( | ( | |||||||||
Allowance for credit losses | ( | ( | |||||||||
Total loans, net | $ | $ |
(in thousands) | Residential 1-4 family | Commercial real estate | Home equity line of credit | Residential land | Commercial construction | Residential construction | Commercial loans | Consumer loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
Three months ended March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Three months ended March 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | Home equity line of credit | Commercial construction | Commercial loans | Total | ||||||||||||||||||||||
Three months ended March 31, 2022 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ( | |||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
Three months ended March 31, 2021 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ( | ( | ||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ |
Term Loans by Origination Year | Revolving Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | 2022 | 2021 | 2020 | 2019 | 2018 | Prior | Revolving | Converted to term loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ |
Term Loans by Origination Year | Revolving Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | 2021 | 2020 | 2019 | 2018 | 2017 | Prior | Revolving | Converted to term loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | 30-59 days past due | 60-89 days past due | Greater than 90 days | Total past due | Current | Total financing receivables | Amortized cost> 90 days and accruing | |||||||||||||||||||||||||||||||||||||
March 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||||||||||||||
With a Related ACL | Without a Related ACL | Total | With a Related ACL | Without a Related ACL | Total | |||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||
Real estate: | ||||||||||||||
Residential 1-4 family | $ | $ | ||||||||||||
Commercial real estate | ||||||||||||||
Home equity line of credit | ||||||||||||||
Residential land | ||||||||||||||
Commercial construction | ||||||||||||||
Residential construction | ||||||||||||||
Commercial | ||||||||||||||
Consumer | ||||||||||||||
Total troubled debt restructured loans accruing interest | $ | $ |
Three months ended March 31, 2021 | ||||||||||||||||||||
(dollars in thousands) | Number of contracts | Outstanding recorded investment (as of period end)1 | Related allowance (as of period end) | |||||||||||||||||
Troubled debt restructurings | ||||||||||||||||||||
Real estate: | ||||||||||||||||||||
Residential 1-4 family | $ | $ | ||||||||||||||||||
Commercial real estate | ||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||
Residential land | ||||||||||||||||||||
Commercial construction | ||||||||||||||||||||
Residential construction | ||||||||||||||||||||
Commercial | ||||||||||||||||||||
Consumer | ||||||||||||||||||||
$ | $ |
Amortized cost | ||||||||||||||||||||
(in thousands) | March 31, 2022 | December 31, 2021 | Collateral type | |||||||||||||||||
Real estate: | ||||||||||||||||||||
Residential 1-4 family | $ | $ | Residential real estate property | |||||||||||||||||
Commercial real estate | Commercial real estate property | |||||||||||||||||||
Home equity line of credit | Residential real estate property | |||||||||||||||||||
Residential land | Residential real estate property | |||||||||||||||||||
Total real estate | ||||||||||||||||||||
Commercial | Business assets | |||||||||||||||||||
Total | $ | $ |
(in thousands) | Gross carrying amount | Accumulated amortization | Valuation allowance | Net carrying amount | ||||||||||||||||||||||
March 31, 2022 | $ | $ | ( | $ | $ | |||||||||||||||||||||
December 31, 2021 | ( |
Three months ended March 31 | ||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||
Mortgage servicing rights | ||||||||||||||
Beginning balance | $ | $ | ||||||||||||
Amount capitalized | ||||||||||||||
Amortization | ( | ( | ||||||||||||
Other-than-temporary impairment | ||||||||||||||
Carrying amount before valuation allowance | ||||||||||||||
Valuation allowance for mortgage servicing rights | ||||||||||||||
Beginning balance | ||||||||||||||
Provision | ( | |||||||||||||
Other-than-temporary impairment | ||||||||||||||
Ending balance | ||||||||||||||
Net carrying value of mortgage servicing rights | $ | $ |
(dollars in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||
Unpaid principal balance | $ | $ | ||||||||||||
Weighted average note rate | % | % | ||||||||||||
Weighted average discount rate | % | % | ||||||||||||
Weighted average prepayment speed | % | % |
(dollars in thousands) | March 31, 2022 | December 31, 2021 | ||||||||||||
Prepayment rate: | ||||||||||||||
25 basis points adverse rate change | $ | ( | $ | ( | ||||||||||
50 basis points adverse rate change | ( | ( | ||||||||||||
Discount rate: | ||||||||||||||
25 basis points adverse rate change | ( | ( | ||||||||||||
50 basis points adverse rate change | ( | ( |
(in millions) | Gross amount of recognized liabilities | Gross amount offset in the Balance Sheets | Net amount of liabilities presented in the Balance Sheets | |||||||||||||||||
Repurchase agreements | ||||||||||||||||||||
March 31, 2022 | $ | $ | $ | |||||||||||||||||
December 31, 2021 |
Gross amount not offset in the Balance Sheets | ||||||||||||||||||||
(in millions) | Net amount of liabilities presented in the Balance Sheets | Financial instruments | Cash collateral pledged | |||||||||||||||||
Commercial account holders | ||||||||||||||||||||
March 31, 2022 | $ | $ | $ | |||||||||||||||||
December 31, 2021 | ||||||||||||||||||||
March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||
(in thousands) | Notional amount | Fair value | Notional amount | Fair value | ||||||||||||||||||||||
Interest rate lock commitments | $ | $ | ( | $ | $ | |||||||||||||||||||||
Forward commitments | ( |
Derivative Financial Instruments Not Designated as Hedging Instruments 1 | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||
(in thousands) | Asset derivatives | Liability derivatives | Asset derivatives | Liability derivatives | ||||||||||||||||||||||
Interest rate lock commitments | $ | $ | $ | $ | ||||||||||||||||||||||
Forward commitments | ||||||||||||||||||||||||||
$ | $ | $ | $ |
Derivative Financial Instruments Not Designated as Hedging Instruments | Location of net gains (losses) recognized in the Statements of Income | Three months ended March 31 | ||||||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||||||||
Interest rate lock commitments | Mortgage banking income | $ | ( | $ | ( | |||||||||||||||
Forward commitments | Mortgage banking income | |||||||||||||||||||
$ | ( | $ | ( |
HEI Consolidated | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||
(in thousands) | Net unrealized gains (losses) on securities | Unrealized gains (losses) on derivatives | Retirement benefit plans | AOCI | AOCI-Retirement benefit plans | ||||||||||||||||||||||||
Balance, December 31, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
Current period other comprehensive income (loss) | ( | ( | |||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||||||
Balance, December 31, 2020 | $ | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||
Current period other comprehensive income (loss) | ( | ( | |||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | $ | ( |
Amount reclassified from AOCI | Affected line item in the Statements of Income / Balance Sheets | |||||||||||||||||||
Three months ended March 31 | ||||||||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||||||||
HEI consolidated | ||||||||||||||||||||
Net realized gains on securities included in net income | $ | $ | ( | Gain on sale of investment securities, net | ||||||||||||||||
Net realized losses on derivatives qualifying as cash flow hedges | Interest expense | |||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost | See Note 8 for additional details | |||||||||||||||||||
Impact of D&Os of the PUC included in regulatory assets | ( | ( | See Note 8 for additional details | |||||||||||||||||
Total reclassifications | $ | $ | ( | |||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost | $ | $ | See Note 8 for additional details | |||||||||||||||||
Impact of D&Os of the PUC included in regulatory assets | ( | ( | See Note 8 for additional details | |||||||||||||||||
Total reclassifications | $ | $ |
Three months ended March 31, 2022 | ||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other | Total | ||||||||||||||||||||||
Revenues from contracts with customers | ||||||||||||||||||||||||||
Electric energy sales - residential | $ | $ | $ | $ | ||||||||||||||||||||||
Electric energy sales - commercial | ||||||||||||||||||||||||||
Electric energy sales - large light and power | ||||||||||||||||||||||||||
Electric energy sales - other | ||||||||||||||||||||||||||
Bank fees | ||||||||||||||||||||||||||
Other sales | ||||||||||||||||||||||||||
Total revenues from contracts with customers | ||||||||||||||||||||||||||
Revenues from other sources | ||||||||||||||||||||||||||
Regulatory revenue | $ | $ | $ | $ | ||||||||||||||||||||||
Bank interest and dividend income | ||||||||||||||||||||||||||
Other bank noninterest income | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total revenues from other sources | ||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Timing of revenue recognition | ||||||||||||||||||||||||||
Services/goods transferred at a point in time | $ | $ | $ | $ | ||||||||||||||||||||||
Services/goods transferred over time | ||||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ |
Three months ended March 31, 2021 | ||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other | Total | ||||||||||||||||||||||
Revenues from contracts with customers | ||||||||||||||||||||||||||
Electric energy sales - residential | $ | $ | $ | $ | ||||||||||||||||||||||
Electric energy sales - commercial | ||||||||||||||||||||||||||
Electric energy sales - large light and power | ||||||||||||||||||||||||||
Electric energy sales - other | ||||||||||||||||||||||||||
Bank fees | ||||||||||||||||||||||||||
Other sales | ||||||||||||||||||||||||||
Total revenues from contracts with customers | ||||||||||||||||||||||||||
Revenues from other sources | ||||||||||||||||||||||||||
Regulatory revenue | ||||||||||||||||||||||||||
Bank interest and dividend income | ||||||||||||||||||||||||||
Other bank noninterest income | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total revenues from other sources | ||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Timing of revenue recognition | ||||||||||||||||||||||||||
Services/goods transferred at a point in time | $ | $ | $ | $ | ||||||||||||||||||||||
Services/goods transferred over time | ||||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ |
Three months ended March 31 | ||||||||||||||||||||||||||
Pension benefits | Other benefits | |||||||||||||||||||||||||
(in thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | ||||||||||||||||||||||
Interest cost | ||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | ||||||||||||||||||||||
Amortization of net prior period gain | ( | ( | ||||||||||||||||||||||||
Amortization of net actuarial (gain)/losses1 | ( | |||||||||||||||||||||||||
Net periodic pension/benefit cost (return) | ( | ( | ||||||||||||||||||||||||
Impact of PUC D&Os | ||||||||||||||||||||||||||
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os) | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | ||||||||||||||||||||||
Interest cost | ||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | ||||||||||||||||||||||
Amortization of net prior period gain | ( | ( | ||||||||||||||||||||||||
Amortization of net actuarial losses1 | ||||||||||||||||||||||||||
Net periodic pension/benefit cost (return) | ( | ( | ||||||||||||||||||||||||
Impact of PUC D&Os | ||||||||||||||||||||||||||
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os) | $ | $ | $ | ( | $ | ( |
Three months ended March 31 | ||||||||||||||
(in millions) | 2022 | 2021 | ||||||||||||
HEI consolidated | ||||||||||||||
Share-based compensation expense 1 | $ | $ | ||||||||||||
Income tax benefit | ||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||
Share-based compensation expense 1 | ||||||||||||||
Income tax benefit |
Three months ended March 31 | ||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||
Shares | (1) | Shares | (1) | |||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | ||||||||||||||||||||||||
Granted | ||||||||||||||||||||||||||
Vested | ( | ( | ||||||||||||||||||||||||
Forfeited | ( | ( | ||||||||||||||||||||||||
Outstanding, end of period | $ | $ | ||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (in millions) | $ | $ |
Three months ended March 31 | ||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||
Shares | (1) | Shares | (1) | |||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | ||||||||||||||||||||||||
Granted | ||||||||||||||||||||||||||
Vested (issued or unissued and cancelled) | ( | ( | ||||||||||||||||||||||||
Forfeited | ( | ( | ||||||||||||||||||||||||
Outstanding, end of period | $ | $ | ||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (in millions) | $ | $ |
2022 | 2021 | |||||||||||||
Risk-free interest rate | % | % | ||||||||||||
Expected life in years | ||||||||||||||
Expected volatility | % | % | ||||||||||||
Range of expected volatility for Peer Group | ||||||||||||||
Grant date fair value (per share) | $ | $ |
Three months ended March 31 | ||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||
Shares | (1) | Shares | (1) | |||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | ||||||||||||||||||||||||
Granted | ||||||||||||||||||||||||||
Vested | ( | ( | ||||||||||||||||||||||||
Increase above target (cancelled) | ( | |||||||||||||||||||||||||
Forfeited | ( | ( | ||||||||||||||||||||||||
Outstanding, end of period | $ | $ | ||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (at target performance levels) (in millions) | $ | $ |
Three months ended March 31 | 2022 | 2021 | ||||||||||||
(in millions) | ||||||||||||||
Supplemental disclosures of cash flow information | ||||||||||||||
HEI consolidated | ||||||||||||||
Interest paid to non-affiliates, net of amounts capitalized | $ | $ | ||||||||||||
Hawaiian Electric consolidated | ||||||||||||||
Interest paid to non-affiliates | ||||||||||||||
Supplemental disclosures of noncash activities | ||||||||||||||
HEI consolidated | ||||||||||||||
Property, plant and equipment | ||||||||||||||
Unpaid invoices and accruals for capital expenditures, balance, end of period (investing) | ||||||||||||||
Increase related to an acquisition (investing) | ||||||||||||||
Right-of-use assets obtained in exchange for operating lease obligations (investing) | ||||||||||||||
Common stock issued (gross) for director and executive/management compensation (financing)1 | ||||||||||||||
Unsettled trades to purchase investment securities (investing) | ||||||||||||||
Other receivable related to pending sales proceeds from the sale of an equity-method investment (investing) | ||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||
Electric utility property, plant and equipment | ||||||||||||||
Unpaid invoices and accruals for capital expenditures, balance, end of period (investing) | ||||||||||||||
Increase related to an acquisition (investing) | ||||||||||||||
Right-of-use assets obtained in exchange for operating lease obligations (investing) |
Estimated fair value | ||||||||||||||||||||||||||||||||
(in thousands) | Carrying or notional amount | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | Total | |||||||||||||||||||||||||||
March 31, 2022 | ||||||||||||||||||||||||||||||||
Financial assets | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Held-to-maturity investment securities | ||||||||||||||||||||||||||||||||
Loans, net | ||||||||||||||||||||||||||||||||
Mortgage servicing rights | ||||||||||||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Deposit liabilities | ||||||||||||||||||||||||||||||||
Short-term borrowings—other than bank | ||||||||||||||||||||||||||||||||
Other bank borrowings | ||||||||||||||||||||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||||||||||||||||||||
Derivative liabilities | ||||||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||
Short-term borrowings | ||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||
December 31, 2021 | ||||||||||||||||||||||||||||||||
Financial assets | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Held-to-maturity investment securities | ||||||||||||||||||||||||||||||||
Loans, net | ||||||||||||||||||||||||||||||||
Mortgage servicing rights | ||||||||||||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Deposit liabilities | ||||||||||||||||||||||||||||||||
Short-term borrowings—other than bank | ||||||||||||||||||||||||||||||||
Other bank borrowings | ||||||||||||||||||||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||||||||||||||||||||
Derivative liabilities | ||||||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||
March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||
Fair value measurements using | Fair value measurements using | |||||||||||||||||||||||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities (bank segment) | ||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | ||||||||||||||||||||||||||||||||||||||
Corporate bonds | ||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||||||||||||||
Interest rate lock commitments (bank segment)1 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Forward commitments (bank segment)1 | ||||||||||||||||||||||||||||||||||||||
Interest rate swap (Other segment)2 | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Derivative liabilities | ||||||||||||||||||||||||||||||||||||||
Interest rate lock commitments (bank segment)1 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Forward commitments (bank segment)1 | ||||||||||||||||||||||||||||||||||||||
Interest rate swap (Other segment)2 | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
Three months ended March 31 | ||||||||||||||
Mortgage revenue bonds | 2022 | 2021 | ||||||||||||
(in thousands) | ||||||||||||||
Beginning balance | $ | $ | ||||||||||||
Principal payments received | ( | ( | ||||||||||||
Purchases | ||||||||||||||
Unrealized gain (loss) included in other comprehensive income | ||||||||||||||
Ending balance | $ | $ |
Three months ended March 31 | % | |||||||||||||||||||||||||
(in thousands) | 2022 | 2021 | change | Primary reason(s)* | ||||||||||||||||||||||
Revenues | $ | 785,068 | $ | 642,946 | 22 | Primarily increase for the electric utility segment | ||||||||||||||||||||
Operating income | 99,276 | 98,031 | 1 | Increase for the electric utility segment and lower losses for the “other” segment, partly offset by decrease for bank segment | ||||||||||||||||||||||
Net income for common stock | 69,167 | 64,358 | 7 | Higher net income at the electric utility segment and lower net loss for the “other” segment, partly offset by lower net income at the bank segment. See below for effective tax rate explanation. | ||||||||||||||||||||||
Three months ended March 31 | ||||||||||||||||||||
(in thousands) | 2022 | 2021 | Primary reason(s) | |||||||||||||||||
Revenues | $ | 1,161 | $ | 951 | Increase in other sales at Pacific Current subsidiaries. | |||||||||||||||
Operating loss | (4,349) | (6,379) | The first three months of 2022 and 2021 include $0.8 million and $0.7 million, respectively, of operating income from Pacific Current1. Corporate expenses for the first three months of 2022 was $1.9 million lower than the same period in 2021, primarily due to lower charitable donations, due to timing of contributions. | |||||||||||||||||
Gain on sale of equity-method investment | 8,123 | — | Gain on sale of an equity-method investment at Pacific Current. | |||||||||||||||||
Net loss | (1,112) | (8,556) | The net loss for the first three months of 2022 was lower than the net loss for the first three months of 2021 due to the gain on sale of an equity-method investment by Pacific Current and the same factors cited for the change in operating loss. |
(dollars in millions) | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||
Short-term borrowings—other than bank | $ | 71 | 1 | % | $ | 54 | 1 | % | ||||||||||||||||||
Long-term debt, net—other than bank | 2,316 | 49 | 2,322 | 48 | ||||||||||||||||||||||
Preferred stock of subsidiaries | 34 | 1 | 34 | 1 | ||||||||||||||||||||||
Common stock equity | 2,304 | 49 | 2,391 | 50 | ||||||||||||||||||||||
$ | 4,725 | 100 | % | $ | 4,801 | 100 | % |
Average balance | Balance | |||||||||||||||||||
(in millions) | Three months ended March 31, 2022 | March 31, 2022 | December 31, 2021 | |||||||||||||||||
Commercial paper | $ | 51 | $ | 66 | $ | 54 | ||||||||||||||
Line of credit draws on revolving credit facility | — | — | — | |||||||||||||||||
Three months ended March 31 | Increase | |||||||||||||||||||||||||
2022 | 2021 | (decrease) | (dollars in millions, except per barrel amounts) | |||||||||||||||||||||||
$ | 709 | $ | 565 | $ | 144 | Revenues. Net increase largely due to: | ||||||||||||||||||||
$ | 105 | higher fuel oil prices and higher kWh generated1 | ||||||||||||||||||||||||
25 | higher purchased power energy prices offset by lower kWh purchased2 | |||||||||||||||||||||||||
10 | higher revenue from ARA adjustments, which included an offset of management audit savings delivered to customers | |||||||||||||||||||||||||
2 | revenue in 2022 related to ownership of and responsibility for the U.S. Army’s electrical distribution system on Oahu starting March 1, 2022, offset by an equal amount of operating expense | |||||||||||||||||||||||||
1 | increase related solely to a change in the timing for revenue recognition within the year, which eliminates seasonality in recognizing target revenues and results in recognizing revenues evenly throughout the year with target revenues recognized on an annual basis remaining unchanged | |||||||||||||||||||||||||
1 | higher MPIR and PIMs revenue | |||||||||||||||||||||||||
221 | 127 | 94 | Fuel oil expense1. Net increase largely due to higher fuel oil prices and higher kWh generated partially offset by lower penalties for fuel efficiency due to reset of heat rate | |||||||||||||||||||||||
164 | 142 | 22 | Purchased power expense1, 2. Net increase largely due to higher purchased power energy prices partially offset by lower kWh purchased and lower capacity charges | |||||||||||||||||||||||
125 | 115 | 10 | Operation and maintenance expenses. Net increase largely due to: | |||||||||||||||||||||||
2 | more generating facility overhauls and maintenance work performed | |||||||||||||||||||||||||
2 | expense in 2022 related to ownership of and responsibility for the U.S. Army’s electrical distribution system on Oahu starting March, 1, 2022, offset by an equal amount of revenue | |||||||||||||||||||||||||
2 | higher transmission and distribution preventive and corrective maintenance expense | |||||||||||||||||||||||||
1 | higher outside services for Information Technology and Services support, Demand Response Management System, and Battery Bonus program | |||||||||||||||||||||||||
1 | higher property damage and legal reserve for pending claims | |||||||||||||||||||||||||
1 | higher bad debt expense | |||||||||||||||||||||||||
125 | 111 | 14 | Other expenses. Increase due to higher revenue taxes, coupled with higher depreciation expense in 2022 for plant investments in 2021 | |||||||||||||||||||||||
74 | 69 | 5 | Operating income. Increase largely due to higher ARA revenue, MPIR and PIMs revenue and lower penalties for fuel efficiency, partially offset by higher operation and maintenance expenses and higher depreciation expense | |||||||||||||||||||||||
59 | 55 | 4 | Income before income taxes. Increase largely due to higher operating income | |||||||||||||||||||||||
46 | 43 | 3 | Net income for common stock. Increase largely due to higher operating income. See below for effective tax rate explanation | |||||||||||||||||||||||
1,957 | 1,909 | 48 | Kilowatthour sales (millions)3 | |||||||||||||||||||||||
$ | 103.40 | $ | 63.87 | $ | 39.53 | Average fuel oil cost per barrel | ||||||||||||||||||||
470,851 | 468,745 | 2,106 | Customer accounts (end of period) |
% | Rate-making Return on rate base (RORB)* | ROACE** | Rate-making ROACE*** | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Twelve months ended March 31, 2022 | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Hawaiian Electric | Hawaii Electric Light | Maui Electric | |||||||||||||||||||||||||||||||||||||||||||||||
Utility returns | 7.30 | 6.01 | 6.68 | 8.60 | 6.66 | 7.50 | 9.61 | 7.41 | 8.58 | |||||||||||||||||||||||||||||||||||||||||||||||
PUC-allowed returns | 7.37 | 7.52 | 7.43 | 9.50 | 9.50 | 9.50 | 9.50 | 9.50 | 9.50 | |||||||||||||||||||||||||||||||||||||||||||||||
Difference | (0.07) | (1.51) | (0.75) | (0.90) | (2.84) | (2.00) | 0.11 | (2.09) | (0.92) |
Utilities | Number of contracts | Total photovoltaic size (MW) | BESS Size (MW/MWh) | Guaranteed commercial operation dates | Contract term (years) | Total projected annual payment (in millions) | ||||||||||||||||||||||||||||||||
Hawaiian Electric | 4 | 139.5 | 139.5/558 | 7/31/22, 9/30/22, 1/20/23 &8/31/23 | 20 & 25 | $ | 32.2 | |||||||||||||||||||||||||||||||
Hawaii Electric Light | 2 | 60 | 60/240 | 11/3/22 & 12/2/22 | 25 | 14.1 | ||||||||||||||||||||||||||||||||
Maui Electric | 2 | 75 | 75/300 | 4/28/23 & 10/27/23 | 25 | 17.6 | ||||||||||||||||||||||||||||||||
Total | 8 | 274.5 | 274.5/1,098 | $ | 63.9 |
Utilities | Number of contracts | Total photovoltaic size (MW) | BESS Size (MW/MWh) | Guaranteed commercial operation dates | Contract term (years) | Total projected annual payment (in millions) | ||||||||||||||||||||||||||||||||||||||
Hawaiian Electric | 4 | 94 | 94 | / | 503 | 5/17/23, 10/30/23, 12/29/23 & 4/9/2024 | 20 & 25 | $ | 32.9 | |||||||||||||||||||||||||||||||||||
Hawaiian Electric | 1 | * | N/A | 185 | / | 565 | 12/30/22 | 20 | 24.0 | |||||||||||||||||||||||||||||||||||
Maui Electric | 2 | 60 | 60 | / | 240 | 7/25/23 & 12/29/23 | 25 | 18.2 | ||||||||||||||||||||||||||||||||||||
Total | 7 | 154 | 339 | / | 1,308 | $ | 75.1 |
Utilities | Fast Frequency Response - 1 (MW) | Fast Frequency Response - 2 (MW) | Capacity - Load Build (MW) | Capacity - Load Reduction (MW) | ||||||||||||||||||||||
Hawaiian Electric | — | 26.7 | 14.5 | 19.4 | ||||||||||||||||||||||
Hawaii Electric Light | 6.0 | — | 3.2 | 4.0 | ||||||||||||||||||||||
Maui Electric | 6.1 | — | 1.9 | 4.7 | ||||||||||||||||||||||
Total | 12.1 | 26.7 | 19.6 | 28.1 |
Utilities | Number of contracts | BESS Size (MW/MWh) | Guaranteed commercial operation dates | |||||||||||||||||
Hawaii Electric Light | 1 | 12/12 | 12/30/22 | |||||||||||||||||
Maui Electric | 1 | 40/160 | 4/28/23 | |||||||||||||||||
Total | 2 | 52/172 |
(dollars in millions) | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||||
Short-term borrowings | $ | 6 | — | % | $ | — | — | % | ||||||||||||||||||
Long-term debt, net | 1,677 | 42 | 1,676 | 42 | ||||||||||||||||||||||
Preferred stock | 34 | 1 | 34 | 1 | ||||||||||||||||||||||
Common stock equity | 2,277 | 57 | 2,262 | 57 | ||||||||||||||||||||||
$ | 3,994 | 100 | % | $ | 3,972 | 100 | % |
Average balance | Balance | |||||||||||||||||||
(in millions) | Three months ended March 31, 2022 | March 31, 2022 | December 31, 2021 | |||||||||||||||||
Short-term borrowings1 | ||||||||||||||||||||
Commercial paper | $ | 13 | $ | 6 | $ | — | ||||||||||||||
Borrowings from HEI | — | — | — | |||||||||||||||||
Line of credit draws on revolving credit facility | — | — | — |
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | ||||||||
Total “up to” amounts of taxable debt authorized through 2022 | $ | 410 | $ | 150 | $ | 130 | |||||
Less: | |||||||||||
Taxable debt authorized and issued in 2018 under April 2018 Approval | 75 | 15 | 10 | ||||||||
Taxable debt issuance to refinance the 2004 QUIDS in 2019 | 30 | 10 | 10 | ||||||||
Taxable debt issuance in May 2020 | 110 | 10 | 40 | ||||||||
Taxable debt executed in October 2020, but issued on January 14, 2021 | 60 | 30 | 25 | ||||||||
Remaining authorized amounts | $ | 135 | $ | 85 | $ | 45 |
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | ||||||||
Total “up to” amounts of common stock authorized to issue and sell through 2021 | $ | 150.0 | $ | 10.0 | $ | 10.0 | |||||
Supplemental increase authorized | 280.0 | 100.0 | 100.0 | ||||||||
Total “up to” amounts of common stock authorized to issue and sell through 2022 | 430.0 | 110.0 | 110.0 | ||||||||
Less: Common stock authorized and issued in 2017, 2018, 2019, 2020 and 2021 | 208.6 | 16.3 | 46.8 | ||||||||
Remaining authorized amounts | $ | 221.4 | $ | 93.7 | $ | 63.2 |
Three months ended March 31 | |||||||||||||||||
(in thousands) | 2022 | 2021 | Change | ||||||||||||||
Net cash provided by operating activities | $ | 76,775 | $ | 31,961 | $ | 44,814 | |||||||||||
Net cash used in investing activities | (74,864) | (68,498) | (6,366) | ||||||||||||||
Net cash provided by (used in) financing activities | (25,974) | 36,460 | (62,434) |
Three months ended March 31 | Increase | |||||||||||||||||||||||||
(in millions) | 2022 | 2021 | (decrease) | Primary reason(s) | ||||||||||||||||||||||
Interest and dividend income | $ | 60 | $ | 59 | $ | 1 | ||||||||||||||||||||
Average loan portfolio yields were 19 basis points lower—impacted by the continued low interest rate environment as adjustable rate loans have repriced lower during the past year and new loan production yields continue to originate below their portfolio yields. Lower loan yields were also due to lower PPP loan fees recognized in 2022 compared to 2021 as the PPP loan portfolio has paid down significantly over the past year. | ||||||||||||||||||||||||||
Average loan portfolio balances decreased $156 million - home equity lines of credit average balance decreased $97 million due to increased paydowns in the portfolio; consumer loan average balance decreased $45 million due to ASB’s strategic decision to reduce production of this loan type during the period of weakened economic activity caused by the COVID-19 pandemic. Commercial loan average balance decreased $201 million due to repayments in the PPP loan portfolio. Residential average balance increased $154 million due to the Bank’s decision to portfolio a larger portion of the production. Commercial real estate average balance increased $28 million due to demand for this loan type. | ||||||||||||||||||||||||||
Average investment securities portfolio balance increased $801 million—excess liquidity from strong deposit growth invested in agency securities. | ||||||||||||||||||||||||||
Average investment securities yields 30 basis points higher—benefited from lower amortization of premiums in the investment portfolio. | ||||||||||||||||||||||||||
Noninterest income | 16 | 19 | (3) | |||||||||||||||||||||||
Lower mortgage banking income - lower residential loan sale volume due to lower production volume, ASB’s decision to portfolio a larger portion of the residential loan production and lower residential loan sale profit margin in 2022 compared to 2021. | ||||||||||||||||||||||||||
Lower bank owned life insurance income - lower return from insurance policies and lower insurance policy claim proceeds in 2022 compared to 2021. | ||||||||||||||||||||||||||
Gain on sale of real estate - due to the sale of a branch property owned by ASB. The branch was closed in January 2022. | ||||||||||||||||||||||||||
Less: gain on sale of real estate | (1) | — | (1) | Gain on sale of real estate, which is included in Noninterest income above and in the Bank’s statements of income and comprehensive income in Note 4, is classified as gain on sale of real estate in the condensed consolidated statements of income, and accordingly, is reflected in operating expenses below as a separate line item and excluded from Revenues. | ||||||||||||||||||||||
Less: gain on sale of investment securities, net | — | (1) | 1 | Gain on sale of investment securities, net, which is included in Noninterest income above and in the Bank’s statements of income and comprehensive income in Note 4, is classified as gain on sale of investment securities, net in the condensed consolidated statements of income, and accordingly, is reflected below following operating income as a separate line item and excluded from Revenues. | ||||||||||||||||||||||
Revenues | 75 | 77 | (2) | The decrease in revenues for the three months ended March 31, 2022 compared to the same period in 2021 was primarily due to lower noninterest income partly offset by higher interest income. | ||||||||||||||||||||||
Interest expense | 1 | 1 | — | |||||||||||||||||||||||
Interest expense on deposits and other borrowings were flat. | ||||||||||||||||||||||||||
Average core deposit balances increased $535 million; average term certificate balances decreased $129 million. | ||||||||||||||||||||||||||
Average deposit yields decreased from 8 basis points to 5 basis points. | ||||||||||||||||||||||||||
Average other borrowings decreased $15 million and average yields decreased 8 basis points. | ||||||||||||||||||||||||||
Provision for credit losses | (3) | (8) | 5 |
Three months ended March 31 | Increase | |||||||||||||||||||||||||
(in millions) | 2022 | 2021 | (decrease) | Primary reason(s) | ||||||||||||||||||||||
2022 negative provision for credit losses reflects a stable economic outlook, good credit trends including lower net charge-offs and improved credit loss rates which included credit upgrades in the commercial real estate loan portfolio. | ||||||||||||||||||||||||||
2022 negative provision for credit losses also due to the release of loss reserves for a commercial real estate credit. | ||||||||||||||||||||||||||
2021 negative provision for credit losses reflected improvement in economic outlook, strong credit results including lower net charge-offs and improved credit loss rates which included credit upgrades in the commercial real estate and commercial loan portfolios. | ||||||||||||||||||||||||||
2021 negative provision for credit losses was also due to lower personal unsecured loan portfolio balances which had higher credit loss rates. | ||||||||||||||||||||||||||
Delinquency rates have decreased—from 0.43% at March 31, 2021 to 0.27% at March 31, 2022 due to lower residential 1-4 family, commercial real estate, consumer and home equity line of credit loan delinquencies. | ||||||||||||||||||||||||||
Net charge-off to average loans have decreased—from 0.18% at March 31, 2021 to 0.01% at March 31, 2022 primarily due to lower personal unsecured loan portfolio net charge-offs. | ||||||||||||||||||||||||||
Noninterest expense | 48 | 48 | — | |||||||||||||||||||||||
Lower compensation and benefits expenses offset by higher occupancy expenses. | ||||||||||||||||||||||||||
2021 noninterest expense benefited from a one-time credit adjustment for a change in accounting for the ASB retirement plan. | ||||||||||||||||||||||||||
Gain on sale of real estate | (1) | — | (1) | |||||||||||||||||||||||
Expenses | 45 | 41 | 4 | The increase in expenses for the three months ended March 31, 2022 compared to the same period in 2021 was due to higher negative provision for credit losses in 2021, partly offset by higher gain on sale of real estate. | ||||||||||||||||||||||
Operating income | 30 | 36 | (6) | The decrease in operating income for the three months ended March 31, 2022 compared to the same period in 2021 was primarily due to higher negative provision for credit losses in 2021 and lower noninterest income, partly offset by higher interest income. | ||||||||||||||||||||||
Gain on sale of investment securities, net | — | 1 | (1) | The decrease in gain on sale of investment securities - primarily due to the sale of investment securities in 2021 with no similar sales in 2022. | ||||||||||||||||||||||
Net income | 24 | 30 | (6) | Net income for the three months ended March 31, 2022 was lower than the same period in 2021 due to lower operating income and lower gain on sale of investment securities, partly offset by lower income tax expense. |
Three months ended March 31 | ||||||||||||||
(%) | 2022 | 2021 | ||||||||||||
Return on average assets | 1.04 | 1.40 | ||||||||||||
Return on average equity | 13.70 | 16.04 | ||||||||||||
Net interest margin | 2.79 | 2.95 |
Three months ended March 31 | ||||||||||||||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Average balance | Interest income/ expense | Yield/ rate (%) | Average balance | Interest income/ expense | Yield/ rate (%) | ||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||
Interest-earning deposits | $ | 134,835 | $ | 66 | 0.20 | $ | 47,080 | $ | 12 | 0.10 | ||||||||||||||||||||||||||||
FHLB stock | 10,000 | 74 | 3.00 | 9,929 | 81 | 3.29 | ||||||||||||||||||||||||||||||||
Investment securities | ||||||||||||||||||||||||||||||||||||||
Taxable | 3,131,482 | 13,554 | 1.73 | 2,352,570 | 8,366 | 1.42 | ||||||||||||||||||||||||||||||||
Non-taxable | 69,600 | 367 | 2.11 | 47,599 | 271 | 2.28 | ||||||||||||||||||||||||||||||||
Total investment securities | 3,201,082 | 13,921 | 1.74 | 2,400,169 | 8,637 | 1.44 | ||||||||||||||||||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | 2,303,446 | 20,113 | 3.49 | 2,149,788 | 19,588 | 3.64 | ||||||||||||||||||||||||||||||||
Commercial real estate | 1,137,295 | 9,211 | 3.25 | 1,108,851 | 9,005 | 3.26 | ||||||||||||||||||||||||||||||||
Home equity line of credit | 840,974 | 6,223 | 3.00 | 937,942 | 7,265 | 3.14 | ||||||||||||||||||||||||||||||||
Residential land | 20,822 | 257 | 4.93 | 16,457 | 210 | 5.11 | ||||||||||||||||||||||||||||||||
Commercial | 761,525 | 6,812 | 3.60 | 962,198 | 8,912 | 3.73 | ||||||||||||||||||||||||||||||||
Consumer | 113,826 | 3,459 | 12.33 | 158,930 | 4,987 | 12.72 | ||||||||||||||||||||||||||||||||
Total loans 1,2 | 5,177,888 | 46,075 | 3.58 | 5,334,166 | 49,967 | 3.77 | ||||||||||||||||||||||||||||||||
Total interest-earning assets 3 | 8,523,805 | 60,136 | 2.83 | 7,791,344 | 58,697 | 3.03 | ||||||||||||||||||||||||||||||||
Allowance for credit losses | (71,135) | (101,712) | ||||||||||||||||||||||||||||||||||||
Noninterest-earning assets | 709,010 | 766,844 | ||||||||||||||||||||||||||||||||||||
Total assets | $ | 9,161,680 | $ | 8,456,476 | ||||||||||||||||||||||||||||||||||
Liabilities and shareholder’s equity: | ||||||||||||||||||||||||||||||||||||||
Savings | $ | 3,258,551 | $ | 207 | 0.03 | $ | 2,901,661 | $ | 191 | 0.03 | ||||||||||||||||||||||||||||
Interest-bearing checking | 1,331,008 | 64 | 0.02 | 1,180,049 | 57 | 0.02 | ||||||||||||||||||||||||||||||||
Money market | 205,363 | 33 | 0.07 | 178,275 | 37 | 0.09 | ||||||||||||||||||||||||||||||||
Time certificates | 411,372 | 643 | 0.63 | 540,461 | 1,177 | 0.88 | ||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 5,206,294 | 947 | 0.07 | 4,800,446 | 1,462 | 0.12 | ||||||||||||||||||||||||||||||||
Advances from Federal Home Loan Bank | — | — | — | 30,126 | 23 | 0.30 | ||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase and federal funds purchased | 90,279 | 5 | 0.02 | 75,332 | 4 | 0.02 | ||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 5,296,573 | 952 | 0.07 | 4,905,904 | 1,489 | 0.12 | ||||||||||||||||||||||||||||||||
Noninterest bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
Deposits | 2,973,597 | 2,645,636 | ||||||||||||||||||||||||||||||||||||
Other | 194,449 | 168,067 | ||||||||||||||||||||||||||||||||||||
Shareholder’s equity | 697,061 | 736,869 | ||||||||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 9,161,680 | $ | 8,456,476 | ||||||||||||||||||||||||||||||||||
Net interest income | $ | 59,184 | $ | 57,208 | ||||||||||||||||||||||||||||||||||
Net interest margin (%) 4 | 2.79 | 2.95 |
March 31, 2022 | December 31, 2021 | |||||||||||||||||||||||||
(dollars in thousands) | Balance | % of total | Balance | % of total | ||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | 166,079 | 5 | % | $ | 149,961 | 5 | % | ||||||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | 2,914,027 | 93 | 2,900,322 | 94 | ||||||||||||||||||||||
Corporate bonds | 43,123 | 1 | 31,178 | 1 | ||||||||||||||||||||||
Mortgage revenue bonds | 15,296 | 1 | 15,427 | — | ||||||||||||||||||||||
Total investment securities | $ | 3,138,525 | 100 | % | $ | 3,096,888 | 100 | % |
Three months ended March 31 | Year ended December 31, 2021 | |||||||||||||||||||
(in thousands) | 2022 | 2021 | ||||||||||||||||||
Allowance for credit losses, beginning of period | $ | 71,130 | $ | 101,201 | $ | 101,201 | ||||||||||||||
Provision for credit losses | (3,763) | (7,035) | (26,425) | |||||||||||||||||
Less: net charge-offs | 156 | 2,373 | 3,646 | |||||||||||||||||
Allowance for credit losses, end of period | $ | 67,211 | $ | 91,793 | $ | 71,130 | ||||||||||||||
Ratio of net charge-offs during the period to average loans outstanding (annualized) | 0.01 | % | 0.18 | % | 0.07 | % |
(dollars in millions) | March 31, 2022 | December 31, 2021 | % change | |||||||||||||||||
Total assets | $ | 9,252 | $ | 9,182 | 1 | |||||||||||||||
Investment securities | 3,139 | 3,097 | 1 | |||||||||||||||||
Loans held for investment, net | 5,118 | 5,140 | — | |||||||||||||||||
Deposit liabilities | 8,289 | 8,172 | 1 | |||||||||||||||||
Other bank borrowings | 137 | 88 | 56 |
Change in interest rates | Change in NII (gradual change in interest rates) | Change in EVE (instantaneous change in interest rates) | ||||||||||||||||||||||||
(basis points) | March 31, 2022 | December 31, 2021 | March 31, 2022 | December 31, 2021 | ||||||||||||||||||||||
+300 | 3.6 | % | 5.6 | % | 10.3 | % | 15.5 | % | ||||||||||||||||||
+200 | 2.4 | 4.0 | 7.6 | 11.7 | ||||||||||||||||||||||
+100 | 1.2 | 2.3 | 4.2 | 7.0 | ||||||||||||||||||||||
-100 | (1.5) | (2.5) | (6.0) | (12.6) |
Period* | Total Number of Shares Purchased ** | Average Price Paid per Share ** | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs | ||||||||||||||||||||||
January 1 to 31, 2022 | 12,306 | $41.90 | — | NA | ||||||||||||||||||||||
February 1 to 28, 2022 | 14,171 | $41.35 | — | NA | ||||||||||||||||||||||
March 1 to 31, 2022 | 177,272 | $42.12 | — | NA |
Agreement to provide the SEC with instruments which define the rights of holders of certain long-term debt of HEI and its subsidiaries. | ||||||||
Regulatory Capital Maintenance/Dividend Agreement dated May 26, 1988, between HEI, HEIDI and the Federal Savings and Loan Insurance Corporation (by the Federal Home Loan Bank of Seattle). | ||||||||
OTS letter regarding release from Part II.B. of the Regulatory Capital Maintenance/Dividend Agreement dated May 26, 1988. | ||||||||
Nonemployee Director Retirement Plan, effective as of October 1, 1989. | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Scott W. H. Seu (HEI Chief Executive Officer) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Gregory C. Hazelton (HEI Chief Financial Officer) | ||||||||
HEI Certification Pursuant to 18 U.S.C. Section 1350 | ||||||||
HEI Exhibit 101.INS | XBRL Instance Document - the instance document does not appear on the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
HEI Exhibit 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||
HEI Exhibit 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
HEI Exhibit 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
HEI Exhibit 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
HEI Exhibit 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
HEI Exhibit 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
Supply Contract for Low Sulfur Fuel Oil, High Sulfur Fuel Oil, No. 2 Diesel, and Ultra-Low Sulfur Diesel by and between Hawaiian Electric, Hawaii Electric Light, and Maui Electric and PAR Hawaii Refining, LLC dated February 1, 2022 (certain confidential information has been omitted) | ||||||||
Second Amendment dated February 1, 2022 to Supply Contract for Low Sulfur Fuel Oil, High Sulfur Fuel Oil, No. 2 Diesel, and Ultra-Low Sulfur Diesel by and between Hawaiian Electric, Hawaii Electric Light, and Maui Electric and PAR Hawaii Refining, LLC dated January 21, 2019 (certain confidential information has been omitted) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Shelee M. T. Kimura (Hawaiian Electric Chief Executive Officer) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Tayne S. Y. Sekimura (Hawaiian Electric Chief Financial Officer) | ||||||||
Hawaiian Electric Certification Pursuant to 18 U.S.C. Section 1350 |
HAWAIIAN ELECTRIC INDUSTRIES, INC. | HAWAIIAN ELECTRIC COMPANY, INC. | |||||||||||||
(Registrant) | (Registrant) | |||||||||||||
By | /s/ Scott W. H. Seu | By | /s/ Shelee M. T. Kimura | |||||||||||
Scott W. H. Seu | Shelee M. T. Kimura | |||||||||||||
President and Chief Executive Officer | President and Chief Executive Officer | |||||||||||||
(Principal Executive Officer of HEI) | (Principal Executive Officer of Hawaiian Electric) | |||||||||||||
By | /s/ Gregory C. Hazelton | By | /s/ Tayne S. Y. Sekimura | |||||||||||
Gregory C. Hazelton | Tayne S. Y. Sekimura | |||||||||||||
Executive Vice President | Senior Vice President, | |||||||||||||
and Chief Financial Officer | Chief Financial Officer and Treasurer | |||||||||||||
(Principal Financial Officer of HEI) | (Principal Financial Officer of Hawaiian Electric) | |||||||||||||
Date: May 9, 2022 | Date: May 9, 2022 |
Hawaiian | Name | Position | Phone | Cellular | ||||||||||
Electric | ||||||||||||||
Primary | Guy Xu-Sugahara | Fuels Contract Mgr | 808-543-4043 | 808-384-2337 | ||||||||||
Backup | Chie Reyes | Mgr of Fuels Operations | 808-543-4007 | 808-225-0957 | ||||||||||
SELLER | ||||||||||||||
Primary | Mark Hepburn | VP, Logistics | 808-203-2341 | 808-304-7806 | ||||||||||
Backup | Andre Thomas | Pipeline & Terminal Ops Mgr | 808-547-3842 | 808-479-0591 | ||||||||||
Seller's Address: | |||||
Par Hawaii Refining, LLC | |||||
1132 Bishop Street, Suite 2500 | |||||
Honolulu, HI 96813 | |||||
Attn: Eric Wright | |||||
Email: EWright@parpacific.com | |||||
With a copy to: | |||||
Par Hawaii Refining, LLC | |||||
91-325 Komohana Street | |||||
Kapolei, HI 96707 | |||||
Attn: Eric Wright | |||||
Par Pacific Holdings, Inc. | |||||
825 Town & Country Lane, Suite 1500 | |||||
Houston, TX 77024 | |||||
Attn: Jeff Hollis | |||||
Email: JHollis@parpacific.com | |||||
Companies' Address: | |||||
Hawaiian Electric Company, Inc. | |||||
PO Box 2750 | |||||
Honolulu, Hawai‘i 96840-0001 | |||||
Attention: Manager of Fuels Operations – mailstop CIP3-IF | |||||
Hawai‘i Electric Light Co., Inc. | |||||
P. O. Box 1027 | |||||
Hilo, Hawaiʻi 96721-1027 | |||||
Attn: Production Department | |||||
Maui Electric Company, Ltd. | |||||
P. O. Box 398 | |||||
Kahului, Hawaiʻi 96732 | |||||
Attn: Production Department |
& | Hawaiian Electric Company, Inc. | ||||
1001 Bishop Street, Suite 1100 | |||||
Honolulu, Hawai‘i 96813 | |||||
Attention: Director of Legal Division (AT11-NC) | |||||
By Email: | legalnotices@hawaiianelectric.com | ||||
HAWAIIAN ELECTRIC COMPANY, INC. | |||||
By | /s/ Robert Isler | ||||
Its: | VP, Power Supply | ||||
By | /s/ Shelee Kimura | ||||
Its: | President & CEO | ||||
HAWAII ELECTRIC LIGHT COMPANY, INC. | |||||
By | /s/ Robert Isler | ||||
Its: | Vice President | ||||
By | /s/ Shelee Kimura | ||||
Its: | Chairman & President | ||||
MAUI ELECTRIC CO., LTD. | |||||
By | /s/ Robert Isler | ||||
Its: | Vice President | ||||
By | /s/ Shelee Kimura | ||||
Its: | Chairman & President | ||||
PAR HAWAII REFINING, LLC | |||||
By | /s/ Eric Wright | ||||
Its: | President |
LSFO | Contract Specifications | |||||||||||||
Test Property | Test Method | Unit Of Measure | Min | Max | ||||||||||
API Gravity @ 60° | ASTM D4052 | °API | 12 | [...] | ||||||||||
Viscosity | ASTM D445, D2161 | CST @ 210 °F | [...] | 96 | ||||||||||
Heat Value, Gross | ASTM D240 | MM BTU/BBL | 6.02 | |||||||||||
Flash Point | ASTM D93 | °F | 150 | |||||||||||
Pour Point | ASTM D97, D5949, D5950 | °F | [...] | |||||||||||
Ash | ASTM D482 | Percent, Weight | 0.03 | |||||||||||
Sediment & Water | ASTM D1796 | Percent, Volume | [...]1 | |||||||||||
Sulfur | ASTM D4294 | Percent, Weight | 0.50 | |||||||||||
Nitrogen | ASTM D4629, D5762 | Percent, Weight | 0.50 | |||||||||||
Vanadium | ASTM D5863, D6728 | PPM, Weight | 50.0 | |||||||||||
Carbon Residue | ASTM D4530 | Percent, Weight | [...] |
HSFO | Contract Specifications | |||||||||||||
Test Property | Test Method | Unit Of Measure | Min | Max | ||||||||||
API Gravity @ 60°F | ASTMD1298, D4052 | °API | 6.5 | |||||||||||
Viscosity | ASTM D445, D2161 | CST @ 122 °F | 380 | 480 | ||||||||||
Heat Value, Gross | ASTM D240, D4868 | MM BTU/BBL | 6.0 | |||||||||||
Flash Point | ASTM D93, D6450 | °F | 150 | |||||||||||
Pour Point | ASTM D97, D5950 | °F | 55 | |||||||||||
Sediment & Water | ASTM D1796 | Percent, Volume | 0.5 | |||||||||||
Sulfur | ASTM D1552, D2622, D4294 | Percent, Weight | 2.00 | |||||||||||
Nitrogen | ASTM D4629, D5762 | PPM, Weight | [...] | |||||||||||
Vanadium | ASTM D5863, D6728 | PPM, Weight | [...] |
HSD | Contract Specifications | |||||||||||||
Test Property | Test Method | Unit Of Measure | Min | Max | ||||||||||
API Gravity @ 60°F | ASTMD1298, D4052 | °API | 30 | |||||||||||
Viscosity | ASTM D445, D2161 | CST @ 40°C | 1.9 | 4.1 | ||||||||||
Heat Value, Gross | ASTM D240, D4868 | MM BTU/BBL | [...] | |||||||||||
Flash Point | ASTM D93, D6450 | °F | 150 | |||||||||||
Pour Point | ASTM D97, D5949, D5950 | °F | [...] | |||||||||||
Ash | ASTM D482 | PPM, Weight | 100 | |||||||||||
Cetane Index | ASTM D4737 | Number | 40 | |||||||||||
Carbon Residue | D524, D4530 | Percent, Weight | 0.35 | |||||||||||
Distillation 90% | ASTM D86 | °F | 540 | [...] | ||||||||||
Sediment & Water | ASTM D1796, D2709 | Percent, Volume | 0.05 | |||||||||||
Sulfur | ASTM D129, D2622, D4294 | Percent, Weight | 0.40 | |||||||||||
Nitrogen | ASTM D4629, D5762 | PPM, Weight | 150 | |||||||||||
Sodium + Potassium | ASTM D3605, D6728 | PPM, Weight | 0.5 | |||||||||||
Sodium + Potassium + Lithium | ASTM D3605, D6728 | PPM, Weight | Report | |||||||||||
Vanadium | ASTM D-5863, D6728 | PPM, Weight | [...] |
ULSD | Contract Specifications | |||||||||||||
Test Property | Test Method | Unit Of Measure | Min | Max | ||||||||||
Appearance | ASTM 4176 | Number | 2 | |||||||||||
API Gravity @ 60°F | ASTMD1298, D4052 | °API | Report | |||||||||||
Viscosity | ASTM D445, D2161 | CST @ 40°C | 1.9 | 4.1 | ||||||||||
Heat Value, Gross | ASTM D240, D4868 | MM BTU/BBL | Report | |||||||||||
Flash Point | ASTM D93, D6450 | °F | [...] | |||||||||||
Ash | ASTM D482 | PPM wt | 100 | |||||||||||
Cetane Index | ASTM D4737 | Number | 40 | |||||||||||
Carbon Residue | D524, D4530 | Percent, Weight | 0.35 | |||||||||||
Distillation 90% | ASTM D86 | °C | 282 | 338 | ||||||||||
Sediment & Water | ASTM D1796, D2709 | Percent, Volume | 0.05 | |||||||||||
Sulfur | ASTM D5453, D7039 | PPM, Weight | 15 | |||||||||||
Copper Strip Corrosion: 3HR @ 50°C | ASTM D4629, D5762 | Classification | 3 | |||||||||||
Lubricity, 60 °C, WSD | ASTM D6079 | Microns | 520 | |||||||||||
Conductivity | ASTM D2624, D4308 | pS/m | 25 |
[...] | [...]* | ||||
[...] | [...]* | ||||
[...] | [...]* | ||||
[...] | [...] | ||||
[...] | [...] | ||||
[...] | [...] |
[...] | [...]* | ||||
[...] | [...]* | ||||
[...] | [...] | ||||
[...] | [...] | ||||
[...] | [...] | ||||
[...] | [...] | ||||
[...] | [...] | ||||
[...] | [...] |
If to the Acquiror: | Hawaiian Electric Industries, Inc. | |||||||
HEI Diversified, Inc. | ||||||||
900 Richards Street | ||||||||
Honolulu, Hawaii 96813 | ||||||||
If to the FSLIC: | Principal Supervisory Agent | |||||||
Federal Home Loan Bank | ||||||||
of Seattle | ||||||||
If to the Institution: | American Savings Bank, F.S.B. | |||||||
Financial Plaza of the Pacific | ||||||||
Honolulu, Hawaii 96813 |
HEI Diversified, Inc. | ||||||||
Hawaiian Electric Industries, Inc. | ||||||||
By: /s/ Robert F. Clarke | ||||||||
FEDERAL SAVINGS AND LOAN | ||||||||
INSURANCE CORPORATION | ||||||||
By: /s/ Ronald N. Karr | ||||||||
Supervisory Agent | ||||||||
Federal Home Loan Bank of Seattle |
Sincerely, | |||||
/s/ Duane Thorkildsen | |||||
Duane Thorkildsen | |||||
Assistant Regional Director |
HAWAIIAN ELECTRIC COMPANY, INC. | |||||
By | /s/ Robert Isler | ||||
Its: | VP, Power Supply | ||||
By | /s/ Shelee Kimura | ||||
Its: | President & CEO | ||||
HAWAII ELECTRIC LIGHT COMPANY, INC. | |||||
By | /s/ Robert Isler | ||||
Its: | Vice President | ||||
By | /s/ Shelee Kimura | ||||
Its: | Chairman & President | ||||
MAUI ELECTRIC CO., LTD. | |||||
By | /s/ Robert Isler | ||||
Its: | Vice President | ||||
By | /s/ Shelee Kimura | ||||
Its: | Chairman & President | ||||
PAR HAWAII REFINING, LLC | |||||
By | /s/ Eric Wright | ||||
Its: | President |
Date: May 9, 2022 | |||||
/s/ Scott W. H. Seu | |||||
Scott W. H. Seu | |||||
President and Chief Executive Officer |
Date: May 9, 2022 | |||||
/s/ Gregory C. Hazelton | |||||
Gregory C. Hazelton | |||||
Executive Vice President and Chief Financial Officer |
Date: May 9, 2022 | |||||
/s/ Shelee M. T. Kimura | |||||
Shelee M. T. Kimura | |||||
President and Chief Executive Officer |
Date: May 9, 2022 | |||||
/s/ Tayne S. Y. Sekimura | |||||
Tayne S. Y. Sekimura | |||||
Senior Vice President, Chief Financial Officer and Treasurer |
Date: May 9, 2022 | ||
/s/ Scott W. H. Seu | ||
Scott W. H. Seu | ||
President and Chief Executive Officer | ||
/s/ Gregory C. Hazelton | ||
Gregory C. Hazelton | ||
Executive Vice President and Chief Financial Officer |
Date: May 9, 2022 | ||
/s/ Shelee M. T. Kimura | ||
Shelee M. T. Kimura | ||
President and Chief Executive Officer | ||
/s/ Tayne S. Y. Sekimura | ||
Tayne S. Y. Sekimura | ||
Senior Vice President, Chief Financial Officer and Treasurer |
Condensed Consolidated Statements of Comprehensive Income (unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Net unrealized gains (losses) on available-for-sale investment securities: | ||
Net unrealized gains (losses) on available-for-sale investment securities arising during the period, tax | $ (44,079) | $ (16,616) |
Reclassification adjustment for net realized gains included in net income, tax | 0 | (142) |
Derivatives qualifying as cash flow hedges: | ||
Unrealized interest rate hedging arising during the period, tax | 1,046 | 542 |
Reclassification adjustment for net unrealized losses included in net income, tax | 19 | 0 |
Retirement benefit plans: | ||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, tax | 1,562 | 2,084 |
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, tax | $ (1,500) | $ (2,015) |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Assets | ||
Property, plant and equipment, accumulated depreciation | $ 3,077,453 | $ 3,028,130 |
Shareholders’ equity | ||
Preferred stock, no par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, authorized shares (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued shares (in shares) | 0 | 0 |
Common stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized shares (in shares) | 200,000,000 | 200,000,000 |
Common stock, issued shares (in shares) | 109,431,346 | 109,311,785 |
Common stock, outstanding shares (in shares) | 109,431,346 | 109,311,785 |
Condensed Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Statement of Stockholders' Equity [Abstract] | ||
Common stock dividends (in dollars per share) | $ 0.35 | $ 0.34 |
Condensed Consolidated Statements of Comprehensive Income (unaudited) - HECO (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Retirement benefit plans: | ||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, tax | $ 1,562 | $ 2,084 |
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, tax | (1,500) | (2,015) |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Retirement benefit plans: | ||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, tax | 1,518 | 2,027 |
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, tax | $ (1,500) | $ (2,015) |
Condensed Consolidated Balance Sheets - HECO (Parenthetical) - USD ($) $ in Thousands |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Shareholders’ equity | ||
Common stock, authorized shares (in shares) | 200,000,000 | 200,000,000 |
Common stock, outstanding shares (in shares) | 109,431,346 | 109,311,785 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Utility property, plant and equipment | ||
Nonutility property, plant and equipment, accumulated depreciation | $ 60 | $ 59 |
Shareholders’ equity | ||
Common stock, par value (in dollars per share) | $ 6.67 | $ 6.67 |
Common stock, authorized shares (in shares) | 50,000,000 | 50,000,000 |
Common stock, outstanding shares (in shares) | 17,753,533 | 17,753,533 |
Condensed Consolidated Statements of Changes in Shareholders' Equity (unaudited) - HECO - USD ($) $ in Thousands |
Total |
Hawaiian Electric Company, Inc. and Subsidiaries |
Common stock |
Common stock
Hawaiian Electric Company, Inc. and Subsidiaries
|
Premium on capital stock
Hawaiian Electric Company, Inc. and Subsidiaries
|
Retained earnings |
Retained earnings
Hawaiian Electric Company, Inc. and Subsidiaries
|
Accumulated other comprehensive income (loss) |
Accumulated other comprehensive income (loss)
Hawaiian Electric Company, Inc. and Subsidiaries
|
---|---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2020 | 109,181,000 | 17,324,000 | |||||||
Beginning balance at Dec. 31, 2020 | $ 2,337,502 | $ 2,141,918 | $ 1,678,368 | $ 115,515 | $ 746,987 | $ 660,398 | $ 1,282,335 | $ (1,264) | $ (2,919) |
Increase (decrease) in stockholders' equity | |||||||||
Net income for common stock | 64,358 | 43,358 | 64,358 | 43,358 | |||||
Other comprehensive (loss) income, net of taxes/benefits | (44,016) | 34 | (44,016) | 34 | |||||
Common stock dividends | (37,156) | (27,925) | (37,156) | (27,925) | |||||
Ending balance (in shares) at Mar. 31, 2021 | 109,281,000 | 17,324,000 | |||||||
Ending balance at Mar. 31, 2021 | $ 2,321,293 | 2,157,385 | $ 1,678,973 | $ 115,515 | 746,987 | 687,600 | 1,297,768 | (45,280) | (2,885) |
Beginning balance (in shares) at Dec. 31, 2021 | 109,311,785 | 109,312,000 | 17,753,000 | ||||||
Beginning balance at Dec. 31, 2021 | $ 2,390,884 | 2,261,899 | $ 1,685,496 | $ 118,376 | 798,526 | 757,921 | 1,348,277 | (52,533) | (3,280) |
Increase (decrease) in stockholders' equity | |||||||||
Net income for common stock | 69,167 | 46,409 | 69,167 | 46,409 | |||||
Other comprehensive (loss) income, net of taxes/benefits | (117,159) | 51 | (117,159) | 51 | |||||
Common stock dividends | $ (38,301) | (31,475) | (38,301) | (31,475) | |||||
Ending balance (in shares) at Mar. 31, 2022 | 109,431,346 | 109,431,000 | 17,753,000 | ||||||
Ending balance at Mar. 31, 2022 | $ 2,303,642 | $ 2,276,884 | $ 1,684,547 | $ 118,376 | $ 798,526 | $ 788,787 | $ 1,363,211 | $ (169,692) | $ (3,229) |
Basis of presentation |
3 Months Ended |
---|---|
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentationThe accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, the instructions to SEC Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In preparing the unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates. The accompanying unaudited condensed consolidated financial statements and the following notes should be read in conjunction with the audited consolidated financial statements and the notes thereto in HEI’s and Hawaiian Electric’s Form 10-K for the year ended December 31, 2021.In the opinion of HEI’s and Hawaiian Electric’s management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments required by GAAP to fairly state consolidated HEI’s and Hawaiian Electric’s financial positions as of March 31, 2022 and December 31, 2021 and the results of their operations and cash flows for the three months ended March 31, 2022 and 2021. All such adjustments are of a normal recurring nature, unless otherwise disclosed below or in other referenced material. Results of operations for interim periods are not necessarily indicative of results for the full year. Recent accounting pronouncements. Credit Losses. In March 2022, Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures,” which eliminates the accounting guidance for Troubled Debt Restructurings (TDRs) by creditors in Subtopic 310-40, Receivables-Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. Specifically, rather than applying the recognition and measurement guidance for TDRs, an entity must apply the loan refinancing and restructuring guidance in paragraphs 310-20-35-9 through 35-11 to determine whether a modification results in a new loan or a continuation of an existing loan. The amendments in this update also require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, “Financial Instruments-Credit Losses-Measured at Amortized Cost.” Gross write-off information must be included in the vintage disclosures required for public business entities in accordance with paragraph 325-20-50-6, which requires that an entity disclose the amortized cost basis of financing receivables by credit-quality indicator and class of financing receivable by year of origination. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. ASB is assessing the requirements of the ASU.
|
Segment financial information |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment financial information | Segment financial information
Intercompany electricity sales of the Utilities to ASB and “other” segments are not eliminated because those segments would need to purchase electricity from another source if it were not provided by the Utilities and the profit on such sales is nominal. Hamakua Energy, LLC’s (Hamakua Energy’s) sales to Hawaii Electric Light (a regulated affiliate) are eliminated in consolidation.
|
Electric utility segment |
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Electric Utility Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Electric utility segment | Electric utility segment Unconsolidated variable interest entities. Power purchase agreements. As of March 31, 2022, the Utilities had five PPAs for firm capacity (including the Puna Geothermal Venture (PGV) PPA that went offline in May 2018 due to lava flow on Hawaii Island, but returned to service with firm capacity of 13.0 MW in the first quarter of 2021, ramped up to 23.9 MW in the second quarter of 2021, and continued to provide capacity at the same level to date) and other PPAs with independent power producers (IPPs) and Schedule Q providers (i.e., customers with cogeneration and/or power production facilities who buy power from or sell power to the Utilities), none of which are currently required to be consolidated as VIEs. Pursuant to the current accounting standards for VIEs, the Utilities are deemed to have a variable interest in Kalaeloa Partners, L.P. (Kalaeloa), AES Hawaii, Inc. (AES Hawaii) and Hamakua Energy by reason of the provisions of the PPA that the Utilities have with the three IPPs. However, management has concluded that the Utilities are not the primary beneficiary of Kalaeloa, AES Hawaii and Hamakua Energy because the Utilities do not have the power to direct the activities that most significantly impact the three IPPs’ economic performance nor the obligation to absorb their expected losses, if any, that could potentially be significant to the IPPs. Thus, the Utilities have not consolidated Kalaeloa, AES Hawaii and Hamakua Energy in its condensed consolidated financial statements. However, Hamakua Energy is an indirect subsidiary of Pacific Current and is consolidated in HEI’s condensed consolidated financial statements. For the other PPAs with IPPs, the Utilities have concluded that the consolidation of the IPPs was not required because either the Utilities do not have variable interests in the IPPs due to the absence of an obligation in the PPAs for the Utilities to absorb any variability of the IPPs, or the IPP was considered a “governmental organization,” and thus excluded from the scope of accounting standards for VIEs. The consolidation of any significant IPP could have a material effect on the unaudited condensed consolidated financial statements, including the recognition of a significant amount of assets and liabilities and, if such a consolidated IPP were operating at a loss and had insufficient equity, the potential recognition of such losses. If the Utilities determine they are required to consolidate the financial statements of such an IPP and the consolidation has a material effect, the Utilities would retrospectively apply accounting standards for VIEs to the IPP.Commitments and contingencies. Contingencies. The Utilities are subject in the normal course of business to pending and threatened legal proceedings. Management does not anticipate that the aggregate ultimate liability arising out of these pending or threatened legal proceedings will be material to its financial position. However, the Utilities cannot rule out the possibility that such outcomes could have a material effect on the results of operations or liquidity for a particular reporting period in the future. Power purchase agreements. Purchases from all IPPs were as follows:
1Includes hydro power and other PPAs Kalaeloa Partners, L.P. Under a 1988 PPA, as amended, Hawaiian Electric is committed to purchase 208 MW of firm capacity from Kalaeloa. In October 2021, Hawaiian Electric and Kalaeloa signed the Amended and Restated Power Purchase Agreement for Firm Dispatchable Capacity and Energy (Amended and Restated PPA) to extend the PPA for an additional term of 10 years. In November 2021, Hawaiian Electric submitted an application for approval of the Amended and Restated PPA to the PUC, which is pending approval before the PUC. The price of purchases from Kalaeloa in the first quarter of 2022 have increased 62% over the first quarter of 2021, primarily due to increased fuel oil cost. AES Hawaii, Inc. Under a PPA entered into in March 1988, as amended (through Amended and Restated Amendment No. 4) for a period of 30 years ending September 2022, Hawaiian Electric agreed to purchase 180 MW of firm capacity from AES Hawaii. Hawaiian Electric does not intend to extend the term of the PPA which will expire on September 1, 2022. Hu Honua Bioenergy, LLC (Hu Honua). In May 2012, Hawaii Electric Light signed a PPA, which the PUC approved in December 2013, with Hu Honua for 21.5 MW of renewable, dispatchable firm capacity fueled by locally grown biomass from a facility on the island of Hawaii. Under the terms of the PPA, the Hu Honua plant was scheduled to be in service in 2016. However, Hu Honua encountered construction and litigation delays, which resulted in an amended and restated PPA between Hawaii Electric Light and Hu Honua dated May 9, 2017. In July 2017, the PUC approved the amended and restated PPA, which becomes effective once the PUC’s order is final and non-appealable. In August 2017, the PUC’s approval was appealed by a third party. On May 10, 2019, the Hawaii Supreme Court issued a decision remanding the matter to the PUC for further proceedings consistent with the court’s decision, which must include express consideration of greenhouse gas (GHG) emissions that would result from approving the PPA, whether the cost of energy under the PPA is reasonable in light of the potential for GHG emissions, and whether the terms of the PPA are prudent and in the public interest, in light of its potential hidden and long-term consequences. As a result, the PUC reopened the docket for further proceedings, including re-examining all of the issues in the proceedings. On July 9, 2020, the PUC issued an order denying Hawaii Electric Light’s request to waive the amended and restated PPA from the PUC’s competitive bidding requirements and therefore, dismissed the request for approval of the amended and restated PPA without prejudice to possible participation in any future competitive bidding process. On September 9, 2020, the PUC denied Hu Honua’s motion for reconsideration of the PUC’s order. Hu Honua filed its notice of appeal to the Hawaii Supreme Court of the PUC’s order denying Hu Honua’s motion for reconsideration. On May 24, 2021, the Hawaii Supreme Court vacated the PUC’s decision and remanded the matter back to the PUC for further proceedings. On June 30, 2021, the PUC issued an order reopening the docket consistent with the Hawaii Supreme Court’s order. A contested case hearing was held in March 2022. The matter is currently with the PUC for decision making. Molokai New Energy Partners (MNEP). In July 2018, the PUC approved Maui Electric’s PPA with MNEP to purchase solar energy from a photovoltaic (PV) plus battery storage project. The 4.88 MW PV and 3 MW Battery Energy Storage System project was to deliver no more than 2.64 MW at any time to the Molokai system. On March 25, 2020, MNEP filed a complaint in the United Stated District Court for the District of Hawaii against Maui Electric claiming breach of contract. On June 3, 2020, Maui Electric provided Notice of Default and Termination of the PPA to MNEP terminating the PPA with an effective date of July 10, 2020. Thereafter, MNEP filed an amended Complaint to include claims relating to the termination and Hawaiian Electric filed its Answer to the Amended Complaint on September 11, 2020, disputing the facts presented by MNEP and all claims within the original and amended complaint. Currently, the discovery phase is ongoing. Fuels barging contract. On August 23, 2021, the Utilities entered into a five-year inter-island fuel transportation contract with Sause Bros., Inc. On December 23, 2021, the PUC issued an interim D&O approving the inter-island fuels transportation contract and recovery of associated costs on an interim basis. The interim decision is effective until the PUC issues its final D&O in the proceeding. The Utility recorded a lease liability of $32 million in connection with the contract, which commenced in January 2022 with an estimated annual base rent of $6.2 million. Utility projects. Many public utility projects require PUC approval and various permits from other governmental agencies. Difficulties in obtaining, or the inability to obtain, the necessary approvals or permits or community support can result in significantly increased project costs or even cancellation of projects. In the event a project does not proceed, or if it becomes probable the PUC will disallow cost recovery for all or part of a project, or if PUC-imposed caps on project costs are expected to be exceeded, project costs may need to be written off in amounts that could result in significant reductions in Hawaiian Electric’s consolidated net income. Enterprise Resource Planning/Enterprise Asset Management (ERP/EAM) implementation project. The ERP/EAM Implementation Project went live in October 2018. Hawaii Electric Light and Hawaiian Electric began to incorporate their portion of the deferred project costs in rate base and started the amortization over a 12-year period in January 2020 and November 2020, respectively. The PUC required a minimum of $246 million ERP/EAM project-related benefit to be delivered to customers over the system’s 12-year service life. In February 2019, the PUC approved a methodology for passing the future cost saving benefits of the new ERP/EAM system to customers developed by the Utilities in collaboration with the Consumer Advocate. The Utilities filed a benefits clarification document on June 10, 2019, reflecting $150 million in future net O&M expense reductions and cost avoidance, and $96 million in capital cost reductions and tax savings over the 12-year service life. To the extent the reduction in O&M expense relates to amounts reflected in electric rates, the Utilities would reduce future rates for such amounts. In October 2019, the PUC approved the Utilities and the Consumer Advocate’s Stipulated Performance Metrics and Tracking Mechanism. As of March 31, 2022, the Utilities’ regulatory liability was $9.1 million ($5.1 million for Hawaiian Electric, $1.6 million for Hawaii Electric Light and $2.4 million for Maui Electric) for the O&M expense savings that are being amortized or to be included in future rates. As part of the settlement agreement approved in the Hawaiian Electric 2020 test year rate case, the regulatory liability for Hawaiian Electric will be amortized over five years, beginning in November 2020, and the O&M benefits for Hawaiian Electric was considered flowed through to customers. On July 7, 2021, the PUC issued an order modifying the reporting frequency of the Semi-Annual Enterprise System Benefits (SAESB) reports to an Annual Enterprise System Benefits (AESB) report on the achieved benefits savings. The most recent SAESB report was filed on February 14, 2022 for the period January 1 through December 31, 2021. Environmental regulation. The Utilities are subject to environmental laws and regulations that regulate the operation of existing facilities, the construction and operation of new facilities and the proper cleanup and disposal of hazardous waste and toxic substances. Hawaiian Electric, Hawaii Electric Light and Maui Electric, like other utilities, periodically encounter petroleum or other chemical releases associated with current or previous operations. The Utilities report and take action on these releases when and as required by applicable law and regulations. The Utilities believe the costs of responding to such releases identified to date will not have a material effect, individually or in the aggregate, on Hawaiian Electric’s consolidated results of operations, financial condition or liquidity. Former Molokai Electric Company generation site. In 1989, Maui Electric acquired Molokai Electric Company. Molokai Electric Company had sold its former generation site (Site) in 1983, but continued to operate at the Site under a lease until 1985 and left the property in 1987. The federal Environmental Protection Agency (EPA) has since identified environmental impacts in the subsurface soil at the Site. In cooperation with the Department of Health of State of Hawaii (DOH) and EPA, Maui Electric further investigated the Site and the adjacent parcel to determine the extent of impacts of polychlorinated biphenyls (PCBs), residual fuel oils and other subsurface contaminants. Maui Electric has a reserve balance of $2.7 million as of March 31, 2022, representing the probable and reasonably estimable undiscounted cost for remediation of the Site and the adjacent parcel based on presently available information; however, final costs of remediation will depend on the cleanup approach implemented. Additionally, on November 24, 2021, the current landowners of the Site, Misaki’s, Inc., filed a lawsuit against Hawaiian Electric (as alleged successor in interest to Molokai Electric, the prior owner of the Site) in the Circuit Court of the Second Circuit of the State of Hawaii (removed to the U.S. District Court for the District of Hawaii). The complaint which was subsequently amended to include Maui Electric, alleges that Hawaiian Electric is responsible for remediation of the Site based on the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), and the Hawaii Environmental Response Law under Hawaii Revised Statutes Chapter 128D, as well as being liable on contractual claims related to a short leaseback period during the transition of ownership from Molokai Electric. At this time, the Utilities are unable to determine the ultimate outcome of the lawsuit or the amount of any possible loss. The Utilities intend to vigorously defend the action. Pearl Harbor sediment study. In July 2014, the U.S. Navy notified Hawaiian Electric of the Navy’s determination that Hawaiian Electric is a Potentially Responsible Party under CERCLA responsible for the costs of investigation and cleanup of PCB contamination in sediment in the area offshore of the Waiau Power Plant as part of the Pearl Harbor Superfund Site. Hawaiian Electric was also required by the EPA to assess potential sources and extent of PCB contamination onshore at Waiau Power Plant. As of March 31, 2022, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $10.1 million. The reserve balance represents the probable and reasonably estimable undiscounted cost for the onshore and offshore investigation and remediation. The final remediation costs will depend on the actual onshore and offshore cleanup costs. Regulatory proceedings Decoupling. Decoupling is a regulatory model that is intended to provide the Utilities with financial stability and facilitate meeting the State of Hawaii’s goals to transition to a clean energy economy and achieve an aggressive renewable portfolio standard. Decoupling delinks the utility’s revenues from the utility’s sales, removing the disincentive to promote energy efficiency and accept more renewable energy. Decoupling continues under the PBR Framework. Performance-based regulation framework. On December 23, 2020, the PUC issued a D&O (PBR D&O) establishing a new PBR Framework to govern the Utilities. The PBR Framework incorporates an annual revenue adjustment (ARA) and a suite of new regulatory mechanisms in addition to previously established regulatory mechanisms. Under the PBR Framework, the decoupling mechanism (i.e., the Revenue Balancing Account (RBA)) established by the previous regulatory framework will continue. The existing cost recovery mechanisms will continue as currently implemented (i.e., the Energy Cost Recovery Clause (ECRC), Purchased Power Adjustment Clause (PPAC), Demand Side Management surcharge (DSM), Renewable Energy Infrastructure Program (REIP), Demand Response Adjustment Clause (DRAC), Pension and Other Post-Employment Benefits (OPEB) tracking mechanisms). In addition to annual revenues provided by the ARA, the Utilities may seek relief for extraordinary projects or programs through the Exceptional Project Recovery Mechanism (EPRM) (formerly known as the Major Project Interim Recovery adjustment mechanism) and earn financial rewards for exemplary performance as provided through a portfolio of Performance Incentive Mechanisms (PIMs) and Shared Savings Mechanisms (SSMs). The PBR Framework incorporates a variety of additional performance mechanisms, including Scorecards, Reported Metrics, and an expedited Pilot Process. The PBR Framework also contains a number of safeguards, including a symmetric Earnings Sharing Mechanism (ESM) which protects the Utilities and customers from excessive earnings or losses, as measured by the Utilities’ achieved rate-making ROACE and a Re-Opener mechanism, under which the PUC will open an examination, at its discretion, to determine if adjustments or modifications to specific PBR mechanisms are appropriate. The new PBR Framework became fully effective on June 1, 2021. On September 17, 2021, the PUC issued an order introducing the PUC staff’s proposal for the development of new PIMs to address the following areas of concern: •Grid reliability, •Timely retirement of fossil fuel generation units, •Interconnection of large-scale renewable energy projects, •Cost control for fossil fuel, purchased power, and other non-ARA costs, and •Expedient utilization of grid services from demand-side resources The order also established a procedural schedule, including technical conferences, statements of position, and a PUC hearing, to govern the PBR Working Group’s review and development of the new PIMs. On March 10, 2022, the PUC issued an order modifying the procedural schedule. In accordance with the modified procedural schedule, the PBR Parties filed final statements of position on April 8, 2022. The PUC hearing was held on April 26 to 27, 2022. Revenue adjustment mechanism. Prior to the implementation of the PBR Framework, the RAM was a major component of the previously established regulatory framework. The RAM was based on the lesser of: a) an inflationary adjustment for certain O&M expenses and return on investment for certain rate base changes, or b) cumulative annual compounded increase in Gross Domestic Product Price Index applied to annualized target revenues (the RAM Cap). All Utilities were limited to the RAM Cap in 2020. Under the PBR Framework, the ARA mechanism replaced the RAM, and became effective on June 1, 2021. RAM revenue adjustments approved by the PUC in 2020 will continue to be included in the RBA provision’s target revenue and RBA rate adjustment unless modified with PUC approval. Annual revenue adjustment mechanism. The PBR Framework established a five-year multi-year rate period during which there will be no general rate cases. Target revenues will be adjusted according to an index-driven ARA based on (i) an inflation factor, (ii) a predetermined X-factor to encompass productivity, which is set at zero, (iii) a Z-factor to account for exceptional circumstances not in the Utilities’ control and (iv) a customer dividend consisting of a negative adjustment of 0.22% of adjusted revenue requirements compounded annually and a flow through of the “pre-PBR” savings commitment from the management audit recommendations developed in a prior docket at a rate of $6.6 million per year from 2021 to 2025. The implementation of the ARA occurred on June 1, 2021. Earnings sharing mechanism. A symmetrical ESM for achieved rate-making ROACE outside of a 300 basis points dead band above or below the current authorized ROACE of 9.5% for each of the Utilities. There is a 50/50 sharing between customers and Utilities for the achieved rate-making ROACE falling within 150 basis points outside of the dead band in either direction, and a 90/10 sharing for any further difference. A reopening or review of the PBR terms will be triggered if the Utilities credit rating outlook indicates a potential credit downgrade below investment grade status, or if its achieved rate-making ROACE enters the outer most tier of the ESM. Exceptional project recovery mechanism. Prior to the implementation of the PBR Framework, the PUC established the Major Project Interim Recovery (MPIR) adjustment mechanism and MPIR Guidelines. The MPIR mechanism provides the opportunity to recover revenues for net costs of approved eligible projects placed in service between general rate cases. In establishing the PBR Framework, the MPIR Guidelines were terminated and replaced with the EPRM Guidelines. Although the MPIR Guidelines were terminated and replaced by the EPRM Guidelines, the MPIR mechanism will continue within the PBR Framework to provide recovery of project costs previously approved for recovery under the MPIR. The newly established EPRM Guidelines permit the Utilities to include the full amount of approved costs in the EPRM for recovery in the first year the project goes into service, pro-rated for the portion of the year the project is in service. Deferred and O&M expense projects are also eligible for EPRM recovery under the EPRM Guidelines. EPRM recoverable costs will be limited to the lesser of actual incurred project costs or PUC‑approved amounts, net of savings. As of March 31, 2022, the Utilities submitted 2022 MPIR amounts totaling $25.9 million, including revenue taxes, for the Schofield Generating Station ($16.5 million), West Loch PV Project ($3.3 million), and Grid Modernization Strategy (GMS) Phase 1 project ($6.1 million for all three utilities) for the accrual of revenues effective January 1, 2022, that included the 2022 return on project amount (based on approved amounts) in rate base, depreciation and incremental O&M expenses. Subject to PUC approval, the Utilities will begin recovery of the annualized 2022 MPIR amounts effective June 1, 2022 through the RBA rate adjustment. As of March 31, 2022, the PUC approved two EPRM projects totaling $41 million to the extent that the project costs are not included in rates. Currently, the Utilities are seeking EPRM recovery of five projects with total project costs of $264 million, subject to PUC approval. Pilot process. The PBR D&O approved a Pilot Process to foster innovation by establishing an expedited implementation process for pilots that test new technologies, programs, business models, and other arrangements. This is intended to support initiatives by the Utilities to test new programs and ideas quickly and elevate any successful pilots for consideration of full-scale implementation. The proposed pilots would be subject to PUC approval with a total annual cap of $10 million. The Pilot Process will feature the two primary activities: an initial “Workplan Development” phase, during which the Utilities identify and scope areas of interests, so as to inform the subsequent “Implementation” phase, during which the Utilities submit specific pilot proposals for expedited review by the PUC and implement the pilot upon approval. The PUC will issue an order, approving, denying, or modifying a proposed Pilot within 45 days of receiving notice of a specific pilot project. On July 9, 2021, the PUC issued an order approving the Utilities’ proposed Pilot Process submitted in April 2021 with modifications, including a cost recovery process that generally allows the Utilities to defer and recover total annual expenditures of approved pilot projects in full over twelve months beginning June 1 of the year following implementation through the RBA rate adjustment, although the Utilities may determine on a case-by-case basis that a particular project’s deferred costs should be amortized over a period greater than twelve months. On July 28, 2021, the Utilities submitted the finalized Pilot Process to govern the review of the pilot project proposals in accordance with the July 9, 2021 order. On November 12, 2021, the Utilities requested PUC approval of their proposed Pilot Process Workplan to guide the development of pilot projects over the next three years. A PUC order on the Workplan is pending. On February 28, 2022, the Utilities filed their first annual Pilot Update report covering pilot projects approved through the Pilot Process framework. The Pilot Update reported on approximately $0.1 million of 2021 deferred costs to be reviewed by the PUC in their review of the Utilities’ proposed adjustments to target revenue in the 2022 spring revenue report. Performance incentive mechanisms. The PUC has established the following PIMs: (1) Service Quality performance incentives, (2) Phase 1 Request for proposal (RFP) PIM for procurement of low-cost renewable energy, (3) Phase 2 RFP PIMs for generation and generation plus storage project, and Grid Services and standalone storage, (4) new PIMs established in the PBR D&O. •Service Quality performance incentives (ongoing). Service Quality performance incentives are measured on a calendar-year basis. The PIM tariff requires the performance targets, deadbands and the amount of maximum financial incentives used to determine the PIM financial incentive levels for each of the PIMs to remain constant in interim periods, unless otherwise amended by order of the PUC. •Service Reliability Performance measured by System Average Interruption Duration and Frequency Indexes (penalties only). Target performance is based on each utility’s historical 10-year average performance with a deadband of one standard deviation. The maximum penalty for each performance index is 20 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties of approximately $6.8 million - for both indices in total for the three utilities). For the 2021 evaluation period, the Utilities earned $0.2 million in penalties. •Call Center Performance measured by the percentage of calls answered within 30 seconds. Target performance is based on the annual average performance for each utility for the most recent 8 quarters with a deadband of 3% above and below the target. The maximum penalty or reward is 8 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties or rewards of approximately $1.4 million - in total for the three utilities). •Phase 1 RFP PIM. Procurement of low-cost variable renewable resources through the RFP process in 2018 is measured by comparison of the procurement price to target prices. Half of the incentive was earned upon PUC approval of the PPAs. Based on the seven PPAs approved in 2019, the Utilities recognized $1.7 million in 2019 with the remaining award to be recognized in the year following the in-service date of the projects, which is estimated to occur from 2023 to 2024. •Phase 2 RFP PIMs. The PUC order issued on October 9, 2019 establishes pricing thresholds, timelines to complete contracting, and other performance criteria for the performance incentive eligibility. The PIMs provide incentives only without penalties. On July 9, 2020, the Utilities filed two Grid Services Purchase Agreements (GSPA) for the Grid Service RFP that potentially qualify for a demand response PIM; however, details of the incentive metrics will be determined by the PUC. On September 15, 2020, the Utilities filed a PPA that qualified for a PIM incentive and on February 16, 2021, the Utilities filed one additional PPA that qualified for a declining PIM incentive. The PUC approved two PPAs in September 2021 and November 2021 and two GSPAs on December 31, 2020. For the 2021 evaluation period, the Utilities earned $0.1 million in rewards related to the two PPAs. •The PUC established the following two new PIMs in its PBR D&O, which were approved in an order issued on March 23, 2021 and became effective on June 1, 2021. •Renewable portfolio standard (RPS)-A PIM that provides a financial reward for accelerating the achievement of RPS goals. The Utilities may earn a reward for the amount of system generation above the interpolated statutory RPS goal at $20/MWh in 2021 and 2022, $15/MWh in 2023, and $10/MWh for the remainder of the multi-year rate period (MRP). Penalties are already prescribed in the RPS as $20/MWh for failing to meet RPS targets in 2030, 2040 and 2045. The evaluation period commenced on January 1, 2021. For the 2021 evaluation period, the Utilities earned $1.0 million in rewards. •Grid Services Procurement PIM that provides financial rewards for grid services acquired in 2021 and 2022. The Utilities can earn a total maximum reward of $1.5 million over 2021 and 2022. The evaluation period commenced on January 1, 2021. •The PUC also established the following three new PIMs in its PBR D&O, which were approved by the PUC on May 17, 2021 and became effective on June 1, 2021. •Interconnection Approval PIM that provides financial rewards and penalties for interconnection times for distributed energy resources systems <100 kW in size. The Utilities can earn a total annual maximum reward of $3.0 million or a total annual maximum penalty of $0.9 million. For the 2021 evaluation period, the Utilities earned $2.8 million in rewards. •Low-to-Moderate Income (LMI) Energy Efficiency PIM that provides financial reward for collaboration between the Utilities and the third-party Public Benefits Fee Administrator to deliver energy savings for low- and moderate-income customers. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years and be subject to an annual review. The evaluation period is based on Hawaii Energy’s program year with the initial evaluation year being the period of July 1, 2021 through June 30, 2022. •Advanced Metering Infrastructure Utilization PIM that provides financial rewards for leveraging grid modernization investments and engaging customers beyond what is already planned in the Phase 1 Grid Modernization program. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years after which it will be re-evaluated. The evaluation period commenced on January 1, 2021. For the 2021 evaluation period, the Utilities accrued $3.7 million ($2.8 million for Hawaiian Electric, $0.4 million for Hawaii Electric Light and $0.5 million for Maui Electric) in rewards net of penalties. The net rewards related to 2021 were reflected in the 2021 fall revenue report and 2022 spring revenue report filings. Annual review cycle. PBR D&O established an annual review cycle for revenue adjustments under the PBR Framework, including the biannual submission of the revenue reports. The Utilities filed the spring revenue report on March 31, 2022, which is subject to PUC approval. The net incremental amounts between the 2021 fall and 2022 spring revenue reports are proposed to be collected (refunded) from June 1, 2022 through May 31, 2023 as follows:
Regulatory assets for COVID-19 related costs. On May 4, 2020, the PUC issued an order, authorizing all utilities, including the Utilities, to establish regulatory assets to record costs resulting from the suspension of disconnections of service during the pendency of the Governor’s Emergency Proclamation and until otherwise ordered by the PUC. In future proceedings, the PUC will consider the reasonableness of the costs, the appropriate period of recovery, any amount of carrying costs thereon, and any savings directly attributable to suspension of disconnects, and other related matters. As part of the order, the PUC prohibits the Utilities from charging late payment fees on past due payments. As the moratorium on customer disconnections ended on May 31, 2021, the Utilities have resumed charging late payment fees in July 2021. Pursuant to PUC orders, the deferral of COVID-19 related costs by the Utilities ended on December 31, 2020. On October 1, 2021, the PUC approved the Utilities’ request to extend the deferral period to December 31, 2021. In December 2021, to keep customers connected and provide some relief to customers experiencing financial difficulty during the pandemic, the Utilities committed to issuing $2 million in bill credits to qualified customers. The Utilities will not seek recovery for the issued bill credits, resulting in a reduction to the cumulative deferred costs. As of March 31, 2022, the Utilities had recorded a total of $27.8 million in regulatory assets pursuant to the orders. Condensed consolidating financial information. Condensed consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the three month periods ended March 31, 2022 and 2021, and as of March 31, 2022 and December 31, 2021. Hawaiian Electric unconditionally guarantees Hawaii Electric Light’s and Maui Electric’s obligations (a) to the State of Hawaii for the repayment of principal and interest on Special Purpose Revenue Bonds issued for the benefit of Hawaii Electric Light and Maui Electric, and (b) under their respective private placement note agreements and the Hawaii Electric Light notes and Maui Electric notes issued thereunder. Hawaiian Electric is also obligated, after the satisfaction of its obligations on its own preferred stock, to make dividend, redemption and liquidation payments on Hawaii Electric Light’s and Maui Electric’s preferred stock if the respective subsidiary is unable to make such payments. Condensed Consolidating Statement of Income Three months ended March 31, 2022
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Three months ended March 31, 2022
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Income Three months ended March 31, 2021
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Three months ended March 31, 2021
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet March 31, 2022
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet December 31, 2021
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Changes in Common Stock Equity Three months ended March 31, 2022
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Changes in Common Stock Equity Three months ended March 31, 2021
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Cash Flows Three months ended March 31, 2022
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Cash Flows Three months ended March 31, 2021
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Bank Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bank segment | Bank segment Selected financial information American Savings Bank, F.S.B. Statements of Income and Comprehensive Income Data Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
American Savings Bank, F.S.B. Balance Sheets Data
Bank-owned life insurance is life insurance purchased by ASB on the lives of certain key employees, with ASB as the beneficiary. The insurance is used to fund employee benefits through tax-free income from increases in the cash value of the policies and insurance proceeds paid to ASB upon an insured’s death. Other borrowings consisted of securities sold under agreements to repurchase of $137.4 million and $88.3 million at March 31, 2022 and December 31, 2021, respectively. Investment securities. The major components of investment securities were as follows:
* Issued or guaranteed by U.S. Government agencies or sponsored agencies ASB does not believe that the investment securities that were in an unrealized loss position at March 31, 2022 and December 31, 2021, represent a credit loss. Total gross unrealized losses were primarily attributable to change in market conditions. On a quarterly basis the investment securities are evaluated for changes in financial condition of the issuer. Based upon ASB’s evaluation, all securities held within the investment portfolio continue to be investment grade by one or more agencies. The contractual cash flows of the U.S. Treasury, federal agency obligations and agency mortgage-backed securities are backed by the full faith and credit guaranty of the United States government or an agency of the government. ASB does not intend to sell the securities before the recovery of its amortized cost basis and there have been no adverse changes in the timing of the contractual cash flows for the securities. ASB’s investment securities portfolio did not require an allowance for credit losses at March 31, 2022 and December 31, 2021. U.S. Treasury, federal agency obligations, corporate bonds, and mortgage revenue bonds have contractual terms to maturity. Mortgage-backed securities have contractual terms to maturity, but require periodic payments to reduce principal. In addition, expected maturities will differ from contractual maturities because borrowers have the right to prepay the underlying mortgages. The contractual maturities of investment securities were as follows:
The proceeds, gross gains and losses from sales of available-for-sale securities were as follows:
The components of loans were summarized as follows:
ASB's policy is to require private mortgage insurance on all real estate loans when the loan-to-value ratio of the property exceeds 80% of the lower of the appraised value or purchase price at origination. For non-owner occupied residential property purchases, the loan-to-value ratio may not exceed 75% of the lower of the appraised value or purchase price at origination. Allowance for credit losses. The allowance for credit losses (balances and changes) by portfolio segment were as follows:
Allowance for loan commitments. The allowance for loan commitments by portfolio segment were as follows:
Credit quality. ASB performs an internal loan review and grading on an ongoing basis. The review provides management with periodic information as to the quality of the loan portfolio and effectiveness of its lending policies and procedures. The objectives of the loan review and grading procedures are to identify, in a timely manner, existing or emerging credit trends so that appropriate steps can be initiated to manage risk and avoid or minimize future losses. Loans subject to grading include commercial, commercial real estate and commercial construction loans. Each commercial and commercial real estate loan is assigned an Asset Quality Rating (AQR) reflecting the likelihood of repayment or orderly liquidation of that loan transaction pursuant to regulatory credit classifications: Pass, Special Mention, Substandard, Doubtful, and Loss. The AQR is a function of the probability of default model rating, the loss given default, and possible non-model factors which impact the ultimate collectability of the loan such as character of the business owner/guarantor, interim period performance, litigation, tax liens and major changes in business and economic conditions. Pass exposures generally are well protected by the current net worth and paying capacity of the obligor or by the value of the asset or underlying collateral. Special Mention loans have potential weaknesses that, if left uncorrected, could jeopardize the liquidation of the debt. Substandard loans have well-defined weaknesses that jeopardize the liquidation of the debt and are characterized by the distinct possibility that ASB may sustain some loss. An asset classified Doubtful has the weaknesses of those classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. An asset classified Loss is considered uncollectible and has such little value that its continuance as a bankable asset is not warranted. The credit risk profile by vintage date based on payment activity or internally assigned grade for loans was as follows:
Revolving loans converted to term loans during the three months ended March 31, 2022 in the commercial, home equity line of credit and consumer portfolios were $0.5 million, $4.4 million and $1.0 million, respectively. Revolving loans converted to term loans during the three months ended March 31, 2021 in the commercial, home equity line of credit and consumer portfolios were $0.5 million, $6.2 million and $0.7 million, respectively. The credit risk profile based on payment activity for loans was as follows:
The credit risk profile based on nonaccrual loans were as follows:
The credit risk profile based on loans whose terms have been modified and accruing interest were as follows:
ASB did not recognize interest on nonaccrual loans for the three months ended March 31, 2022 and 2021. Troubled debt restructurings. A loan modification is deemed to be a TDR when the borrower is determined to be experiencing financial difficulties and ASB grants a concession it would not otherwise consider. The allowance for credit losses on TDR loans that do not share risk characteristics are individually evaluated based on the present value of expected future cash flows discounted at the loan’s effective original contractual rate or based on the fair value of collateral less cost to sell. The financial impact of the estimated loss is an increase to the allowance associated with the modified loan. When available information confirms that specific loans or portions thereof are uncollectible (confirmed losses), these amounts are charged off against the allowance for credit losses. There were no loan modifications that occurred during the three months ended March 31, 2022. Loan modifications that occurred during the three months ended March 31, 2021 were as follows:
1 The period end balances reflect all paydowns and charge-offs since the modification period. TDRs fully paid off, charged-off, or foreclosed upon by period end are not included. There were no loans modified in TDRs that experienced a payment default of 90 days or more during the first three months of 2022 and 2021. If a loan modified in a TDR subsequently defaults, ASB evaluates the loan for further impairment. Based on its evaluation, adjustments may be made in the allocation of the allowance or partial charge-offs may be taken to further write-down the carrying value of the loan. Commitments to lend additional funds to borrowers whose loan terms have been modified in a TDR totaled nil at March 31, 2022 and December 31, 2021. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides that a financial institution may elect to suspend the requirements under GAAP for certain loan modifications that would otherwise be categorized as a TDR and any related impairment for accounting purposes. In response to the COVID-19 pandemic, the Board of Governors of the FRB, the FDIC, the National Credit Union Administration, the OCC, and the Consumer Financial Protection Bureau, in consultation with the state financial regulators (collectively, the “agencies”) issued a joint interagency statement (issued March 22, 2020; revised statement issued April 7, 2020). Some of the provisions applicable to the Company include, but are not limited to accounting for loan modifications, past due reporting and nonaccrual status and charge-offs. Loan modifications that do not meet the conditions of the CARES Act may still qualify as a modification that does not need to be accounted for as a TDR. The agencies confirmed with the FASB staff that short-term modifications made on a good faith basis in response to COVID-19 to borrowers who were current prior to any relief are not TDRs. This includes short-term (e.g., six months) modifications such as payment deferrals, fee waivers, extensions of repayment terms, or insignificant delays in payment. Financial institutions are not expected to designate loans with deferrals granted due to COVID-19 as past due because of the deferral. A loan’s payment date is governed by the due date stipulated in the legal agreement. If a financial institution agrees to a payment deferral, these loans would not be considered past due during the period of the deferral. Lastly, during short-term COVID-19 modifications, these loans generally should not be reported as nonaccrual or as classified. Collateral-dependent loans. A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the operation or sale of the collateral. Loans considered collateral-dependent were as follows:
ASB had $4.0 million and $3.4 million of mortgage loans collateralized by residential real estate property that were in the process of foreclosure at March 31, 2022 and December 31, 2021, respectively. Mortgage servicing rights (MSRs). In its mortgage banking business, ASB sells residential mortgage loans to government-sponsored entities and other parties, who may issue securities backed by pools of such loans. ASB retains no beneficial interests in these loans other than the servicing rights of certain loans sold. ASB received proceeds from the sale of residential mortgages of $75.6 million and $170.9 million for the three months ended March 31, 2022 and 2021, respectively, and recognized gains on such sales of $1.1 million and $4.3 million for the three months ended March 31, 2022 and 2021, respectively. There were no repurchased mortgage loans for the three months ended March 31, 2022 and 2021. Mortgage servicing fees, a component of other income, net, were $0.9 million for both the three months ended March 31, 2022 and 2021. Changes in the carrying value of MSRs were as follows:
Changes related to MSRs were as follows:
ASB capitalizes MSRs acquired upon the sale of mortgage loans with servicing rights retained. On a monthly basis, ASB compares the net carrying value of the MSRs to its fair value to determine if there are any changes to the valuation allowance and/or other-than-temporary impairment for the MSRs. ASB uses a present value cash flow model to estimate the fair value of MSRs. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in “Revenues - bank” in the condensed consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:
The sensitivity analysis of fair value of MSRs to hypothetical adverse changes of 25 and 50 basis points in certain key assumptions was as follows:
The effect of a variation in certain assumptions on fair value is calculated without changing any other assumptions. This analysis typically cannot be extrapolated because the relationship of a change in one key assumption to the changes in the fair value of MSRs typically is not linear. Other borrowings. As of March 31, 2022 and December 31, 2021, ASB had no FHLB advances outstanding or federal funds purchased with the Federal Reserve Bank. ASB was in compliance with all Advances, Pledge and Security Agreement requirements as of March 31, 2022. Securities sold under agreements to repurchase are accounted for as financing transactions and the obligations to repurchase these securities are recorded as liabilities in the condensed consolidated balance sheets. ASB pledges investment securities as collateral for securities sold under agreements to repurchase. All such agreements are subject to master netting arrangements, which provide for a conditional right of set-off in case of default by either party; however, ASB presents securities sold under agreements to repurchase on a gross basis in the balance sheet. The following tables present information about the securities sold under agreements to repurchase, including the related collateral received from or pledged to counterparties:
The securities underlying the agreements to repurchase are book-entry securities and were delivered by appropriate entry into the counterparties’ accounts or into segregated tri-party custodial accounts at the FHLB. The securities underlying the agreements to repurchase continue to be reflected in ASB’s asset accounts. Derivative financial instruments. ASB enters into interest rate lock commitments (IRLCs) with borrowers, and forward commitments to sell loans or to-be-announced mortgage-backed securities to investors to hedge against the inherent interest rate and pricing risks associated with selling loans. ASB enters into IRLCs for residential mortgage loans, which commit ASB to lend funds to a potential borrower at a specific interest rate and within a specified period of time. IRLCs that relate to the origination of mortgage loans that will be held for sale are considered derivative financial instruments under applicable accounting guidance. Outstanding IRLCs expose ASB to the risk that the price of the mortgage loans underlying the commitments may decline due to increases in mortgage interest rates from inception of the rate lock to the funding of the loan. The IRLCs are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income. ASB enters into forward commitments to hedge the interest rate risk for rate locked mortgage applications in process and closed mortgage loans held for sale. These commitments are primarily forward sales of to-be-announced mortgage backed securities. Generally, when mortgage loans are closed, the forward commitment is liquidated and replaced with a mandatory delivery forward sale of the mortgage to a secondary market investor. In some cases, a best-efforts forward sale agreement is utilized as the forward commitment. These commitments are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income. Changes in the fair value of IRLCs and forward commitments subsequent to inception are based on changes in the fair value of the underlying loan resulting from the fulfillment of the commitment and changes in the probability that the loan will fund within the terms of the commitment, which is affected primarily by changes in interest rates and the passage of time. The notional amount and fair value of ASB’s derivative financial instruments were as follows:
ASB’s derivative financial instruments, their fair values and balance sheet location were as follows:
1 Asset derivatives are included in other assets and liability derivatives are included in other liabilities in the balance sheets. The following table presents ASB’s derivative financial instruments and the amount and location of the net gains or losses recognized in ASB’s statements of income:
Low-Income Housing Tax Credit (LIHTC). ASB’s unfunded commitments to fund its LIHTC investment partnerships were $62.8 million at March 31, 2022 and December 31, 2021. These unfunded commitments were unconditional and legally binding and are recorded in other liabilities with a corresponding increase in other assets. As of March 31, 2022, ASB did not have any impairment losses resulting from forfeiture or ineligibility of tax credits or other circumstances related to its LIHTC investment partnerships.
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Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Credit agreements | Credit agreements On May 14, 2021, HEI and Hawaiian Electric each entered into a separate agreement with a syndicate of nine financial institutions (the HEI Facility and Hawaiian Electric Facility, respectively, and together, the Credit Facilities) to amend and restate their respective previously existing revolving unsecured credit agreements. The $175 million HEI Facility and $200 million Hawaiian Electric Facility both terminate on May 14, 2026. On February 18, 2022, the PUC approved Hawaiian Electric’s request to extend the term of the $200 million Hawaiian Electric Facility to May 14, 2026. In addition to extending the term, Hawaiian Electric also received PUC approval to exercise its options of two one-year extensions of the commitment termination date and to increase its aggregate revolving commitment amount from $200 million to $275 million, should there be a need. None of the facilities are collateralized. As of March 31, 2022 and December 31, 2021, no amounts were outstanding under the Credit Facilities. The Credit Facilities will be maintained to support each company’s respective short-term commercial paper program, but may be drawn on to meet each company’s respective working capital needs and general corporate purposes.
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Shareholders' equity |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' equity | Shareholders’ equity Accumulated other comprehensive income/(loss). Changes in the balances of each component of accumulated other comprehensive income/(loss) (AOCI) were as follows:
Reclassifications out of AOCI were as follows:
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Revenues |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | Revenues Revenue from contracts with customers. The following tables disaggregate revenues by major source, timing of revenue recognition, and segment:
There are no material contract assets or liabilities associated with revenues from contracts with customers existing at December 31, 2021 or as of March 31, 2022. Accounts receivable and unbilled revenues related to contracts with customers represent an unconditional right to consideration since all performance obligations have been satisfied. These amounts are disclosed as accounts receivable and unbilled revenues, net on HEI’s condensed consolidated balance sheets and customer accounts receivable, net and accrued unbilled revenues, net on Hawaiian Electric’s condensed consolidated balance sheets. As of March 31, 2022, the Company had no material remaining performance obligations due to the nature of the Company’s contracts with its customers. For the Utilities, performance obligations are fulfilled as electricity is delivered to customers. For ASB, fees are recognized when a transaction is completed.
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Retirement benefits |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement benefits | Retirement benefits Defined benefit pension and other postretirement benefit plans information. For the first three months of 2022, the Company contributed $10 million ($10 million by the Utilities) to its pension and other postretirement benefit plans, compared to $9 million ($9 million by the Utilities) in the first three months of 2021. The Company’s current estimate of total contributions to its pension and other postretirement benefit plans in 2022 is $41 million ($41 million by the Utilities), compared to $52 million ($51 million by the Utilities) in 2021. In addition, the Company expects to pay directly $3 million ($1 million by the Utilities) of benefits in 2022, compared to $1 million ($1 million by the Utilities) paid in 2021. The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:
1 Three months ended March 31, 2021 amounts include the one-time cumulative impact of the change in accounting principle for the plans’ fixed income securities from the calculated market-related value method to the fair value method, which was recorded in the first quarter of 2021. HEI consolidated recorded retirement benefits expense of $12 million ($12 million by the Utilities) in the first three months of 2022 and $11 million ($12 million by the Utilities) in the first three months of 2021 and charged the remaining net periodic benefit cost primarily to electric utility plant. The Utilities have implemented pension and OPEB tracking mechanisms under which all of their retirement benefit expenses (except for executive life and nonqualified pension plan expenses) determined in accordance with GAAP are recovered over time. Under the tracking mechanisms, any actual costs determined in accordance with GAAP that are over/under amounts allowed in rates are charged/credited to a regulatory asset/liability. The regulatory asset/liability for each utility will then be amortized over 5 years beginning with the respective utility’s next rate case. Defined contribution plans information. For the first three months of 2022 and 2021, the Company’s expenses for its defined contribution plans under the Hawaiian Electric Industries Retirement Savings Plan (HEIRSP) and the ASB 401(k) Plan were $2.0 million and $1.7 million, respectively, and cash contributions were $1.9 million and $1.8 million, respectively. For the first three months of 2022 and 2021, the Utilities’ expenses and cash contributions for its defined contribution plan under the HEIRSP were $0.9 million and $0.8 million, respectively. Retirement benefit plan changes. On December 3, 2021, the Utilities’ union members ratified a new collective bargaining agreement, which includes changes to retirement benefits for all new employees commencing employment on or after January 1, 2022. The changes ratified in the collective bargaining agreement will apply to all employees of HEI and the Utilities first hired on or after January 1, 2022 (New Employees). New Employees are not eligible to participate in the HEI Pension Plan. Instead, New Employees will receive a non-elective employer contribution, equal to 10% of their annual compensation, subject to a vesting schedule, to their account under the HEIRSP, the defined contribution plan for HEI and the Utilities. Only New Employees are impacted by the retirement benefit plan changes. There are no retirement benefit plan changes for employees hired on or before December 31, 2021.
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Share-based compensation |
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Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | Share-based compensation Under the 2010 Equity and Incentive Plan, as amended, HEI can issue shares of common stock as incentive compensation to selected employees in the form of stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares and other share-based and cash-based awards. The 2010 Equity and Incentive Plan (original EIP) was amended and restated effective March 1, 2014 (EIP) and an additional 1.5 million shares were added to the shares available for issuance under these programs. As of March 31, 2022, approximately 2.8 million shares remained available for future issuance under the terms of the EIP, assuming recycling of shares withheld to satisfy statutory tax liabilities relating to EIP awards, including an estimated 0.6 million shares that could be issued upon the vesting of outstanding restricted stock units and the achievement of performance goals for awards outstanding under long-term incentive plans (assuming that such performance goals are achieved at maximum levels). Under the 2011 Nonemployee Director Stock Plan (2011 Director Plan), HEI can issue shares of common stock as compensation to nonemployee directors of HEI, Hawaiian Electric and ASB. As of March 31, 2022, there were 244,347 shares remaining available for future issuance under the 2011 Director Plan. Share-based compensation expense and the related income tax benefit were as follows:
1 For the three months ended March 31, 2022 and 2021, the Company has not capitalized any share-based compensation. Stock awards. There were no grants to nonemployee directors for the three months ended March 31, 2022 and 2021. Restricted stock units. Information about HEI’s grants of restricted stock units was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant. For the three months ended March 31, 2022 and 2021, total restricted stock units and related dividends that vested had a fair value of $3.9 million and $3.0 million, respectively, and the related tax benefits were $0.6 million and $0.6 million, respectively. As of March 31, 2022, there was $7.6 million of total unrecognized compensation cost related to the nonvested restricted stock units. The cost is expected to be recognized over a weighted-average period of 2.3 years. Long-term incentive plan payable in stock. The 2020-22, 2021-23 and 2022-24 long-term incentive plans (LTIP) provide for performance awards under the EIP of shares of HEI common stock based on the satisfaction of performance goals, including a market condition goal. The number of shares of HEI common stock that may be awarded is fixed on the date the grants are made, subject to the achievement of specified performance levels and calculated dividend equivalents. The potential payout varies from 0% to 200% of the number of target shares, depending on the achievement of the goals. The market condition goal is based on HEI’s total shareholder return (TSR) compared to the Edison Electric Institute Index over the relevant three-year period. The other performance condition goals relate to EPS growth, return on average common equity (ROACE), renewable portfolio standards, carbon emissions reduction, Hawaiian Electric’s net income growth, ASB’s efficiency ratio and strategic initiatives and Pacific Current’s EBITDA growth and return on average invested capital. LTIP linked to TSR. Information about HEI’s LTIP grants linked to TSR was as follows:
(1) Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model. The grant date fair values of the shares were determined using a Monte Carlo simulation model utilizing actual information for the common shares of HEI and its peers for the period from the beginning of the performance period to the grant date and estimated future stock volatility of HEI and its peers over the remaining three-year performance period. The expected stock volatility assumptions for HEI and its peer group were based on the three-year historic stock volatility. A dividend assumption is not required for the Monte Carlo simulation because the grant payout includes dividend equivalents and projected returns include the value of reinvested dividends. 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:
For the three months ended March 31, 2022 and 2021, total vested LTIP awards linked to TSR and related dividends had a fair value of $0.8 million and $0.8 million, respectively, and the related tax benefits were $0.1 million and $0.2 million, respectively. As of March 31, 2022, there was $2.2 million of total unrecognized compensation cost related to the nonvested performance awards payable in shares linked to TSR. The cost is expected to be recognized over a weighted-average period of 1.8 years. LTIP awards linked to other performance conditions. Information about HEI’s LTIP awards payable in shares linked to other performance conditions was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant. For the three months ended March 31, 2022 and 2021, total vested LTIP awards linked to other performance conditions and related dividends had a fair value of $3.2 million and $1.7 million, respectively, and the related tax benefits were $0.4 million and $0.4 million, respectively. As of March 31, 2022, there was $6.6 million of total unrecognized compensation cost related to the nonvested shares linked to performance conditions other than TSR. The cost is expected to be recognized over a weighted-average period of 1.9 years.
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Income taxes |
3 Months Ended |
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Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxesThe Company’s and the Utilities’ effective tax rates (combined federal and state income tax rates) were 20% and 21%, respectively, for the three months ended March 31, 2022. These rates differed from the combined statutory rates, due primarily to the Utilities’ amortization of excess deferred income taxes related to the provision in the Tax Act that lowered the federal income tax rate from 35% to 21%, the tax benefits derived from the low income housing tax credit investments and the non-taxability of the bank-owned life insurance income. The Company’s and the Utilities’ effective tax rates were 19% and 20%, respectively, for the three months ended March 31, 2021. In August 2020, the Internal Revenue Service notified the Company that its 2017 and 2018 income tax returns would be examined. The Company was previously audited every year through 2011, at which time the IRS changed their internal policies regarding audit frequency. The audit is still in progress and the Company has responded to all information requests received. The Company has not been notified of any material audit adjustments to date. |
Cash flows |
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Cash flows | Cash flows
1 The amounts shown represent the market value of common stock issued for director and executive/management compensation and withheld to satisfy statutory tax liabilities.
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Fair value measurements |
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Fair value measurements | Fair value measurements Fair value measurement and disclosure valuation methodology. The following are descriptions of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial instruments not carried at fair value: Short-term borrowings—other than bank. The carrying amount of short-term borrowings approximated fair value because of the short maturity of these instruments. Investment securities. The fair value of ASB’s investment securities is determined quarterly through pricing obtained from independent third-party pricing services or from brokers not affiliated with the trade. Non-binding broker quotes are infrequent and generally occur for new securities that are settled close to the month-end pricing date. The third-party pricing vendors ASB uses for pricing its securities are reputable firms that provide pricing services on a global basis and have processes in place to ensure quality and control. The third-party pricing services use a variety of methods to determine the fair value of securities that fall under Level 2 of ASB’s fair value measurement hierarchy. Among the considerations are quoted prices for similar securities in an active market, yield spreads for similar trades, adjustments for liquidity, size, collateral characteristics, historic and generic prepayment speeds, and other observable market factors. To enhance the robustness of the pricing process, ASB will on a quarterly basis compare its standard third-party vendor’s price with that of another third-party vendor. If the prices are within an acceptable tolerance range, the price of the standard vendor will be accepted. If the variance is beyond the tolerance range, an evaluation will be conducted by ASB and a challenge to the price may be made. Fair value in such cases will be based on the value that best reflects the data and observable characteristics of the security. In all cases, the fair value used will have been independently determined by a third-party pricing vendor or non-affiliated broker. The fair value of the mortgage revenue bonds is estimated using a discounted cash flow model to calculate the present value of future principal and interest payments and, therefore is classified within Level 3 of the valuation hierarchy. Loans held for sale. Residential and commercial loans are carried at the lower of cost or market and are valued using market observable pricing inputs, which are derived from third party loan sales and, therefore, are classified within Level 2 of the valuation hierarchy. Loans held for investment. Fair value of loans held for investment is derived using a discounted cash flow approach which includes an evaluation of the underlying loan characteristics. The valuation model uses loan characteristics which includes product type, maturity dates and the underlying interest rate of the portfolio. This information is input into the valuation models along with various forecast valuation assumptions including prepayment forecasts, to determine the discount rate. These assumptions are derived from internal and third party sources. Since the valuation is derived from model-based techniques, ASB includes loans held for investment within Level 3 of the valuation hierarchy. Collateral dependent loans. Collateral dependent loans have been adjusted to fair value. When a loan is identified as collateral dependent, the Company measures the impairment using the current fair value of the collateral, less selling costs. Depending on the characteristics of a loan, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases, the value of the collateral may be estimated as having little or no value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. If it is determined that the value of the collateral dependent loan is less than its recorded investment, the Company recognizes this impairment and adjusts the carrying value of the loan to fair value through the allowance for credit losses. Real estate acquired in settlement of loans. Foreclosed assets are carried at fair value (less estimated costs to sell) and are generally based upon appraisals or independent market prices that are periodically updated subsequent to classification as real estate owned. Such adjustments typically result in a Level 3 classification of the inputs for determining fair value. ASB estimates the fair value of collateral-dependent loans and real estate owned using the sales comparison approach. Mortgage servicing rights. MSRs are capitalized at fair value based on market data at the time of sale and accounted for in subsequent periods at the lower of amortized cost or fair value. MSRs are evaluated for impairment at each reporting date. ASB's MSRs are stratified based on predominant risk characteristics of the underlying loans including loan type and note rate. For each stratum, fair value is calculated by discounting expected net income streams using discount rates that reflect industry pricing for similar assets. Expected net income streams are estimated based on industry assumptions regarding prepayment expectations and income and expenses associated with servicing residential mortgage loans for others. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in "Revenues - bank" in the consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. ASB compares the fair value of MSRs to an estimated value calculated by an independent third-party. The third-party relies on both published and unpublished sources of market related assumptions and its own experience and expertise to arrive at a value. ASB uses the third-party value only to assess the reasonableness of its own estimate. ASB includes MSRs within Level 3 of the valuation hierarchy. Time deposits. The fair value of fixed-maturity certificates of deposit was estimated by discounting the future cash flows using the rates currently offered for FHLB advances of similar remaining maturities. Deposit liabilities are classified in Level 2 of the valuation hierarchy. Other borrowings. For advances and repurchase agreements, fair value is estimated using quantitative discounted cash flow models that require the use of interest rate inputs that are currently offered for advances and repurchase agreements of similar remaining maturities. The majority of market inputs are actively quoted and can be validated through external sources, including broker market transactions and third party pricing services. Long-term debt—other than bank. Fair value of fixed-rate long-term debt—other than bank was obtained from third-party financial services providers based on the current rates offered for debt of the same or similar remaining maturities and from discounting the future cash flows using the current rates offered for debt of the same or similar risks, terms, and remaining maturities. The carrying amount of floating rate long-term debt—other than bank approximated fair value because of the short-term interest reset periods. Long-term debt—other than bank is classified in Level 2 of the valuation hierarchy. Interest rate lock commitments (IRLCs). The estimated fair value of commitments to originate residential mortgage loans for sale is based on quoted prices for similar loans in active markets. IRLCs are classified as Level 2 measurements. Forward sales commitments. To be announced (TBA) mortgage-backed securities forward commitments are classified as Level 1, and consist of publicly-traded debt securities for which identical fair values can be obtained through quoted market prices in active exchange markets. The fair values of ASB’s best efforts and mandatory delivery loan sale commitments are determined using quoted prices in the market place that are observable and are classified as Level 2 measurements. The following table presents the carrying or notional amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments.
Fair value measurements on a recurring basis. Assets and liabilities measured at fair value on a recurring basis were as follows:
1 Derivatives are carried at fair value in other assets or other liabilities in the balance sheets with changes in value included in mortgage banking income. 2 Derivatives are included in other assets and other liabilities in the balance sheets. The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:
Mortgage revenue bonds are issued by the Department of Budget and Finance of the State of Hawaii. The Company estimates the fair value by using a discounted cash flow model to calculate the present value of estimated future principal and interest payments. The unobservable input used in the fair value measurement is the weighted average discount rate. As of March 31, 2022, the weighted average discount rate was 2.27%, which was derived by incorporating a credit spread over the one month LIBOR rate. Significant increases (decreases) in the weighted average discount rate could result in a significantly lower (higher) fair value measurement. Fair value measurements on a nonrecurring basis. Certain assets and liabilities are measured at fair value on a nonrecurring basis and therefore are not included in the tables above. These measurements primarily result from assets carried at the lower of cost or fair value or from impairment of individual assets. As of March 31, 2022 and December 31, 2021, there were no financial instruments measured at fair value on a nonrecurring basis. For the three months ended March 31, 2022 and 2021, there were no adjustments to fair value for ASB’s loans held for sale. Significant increases (decreases) in any of those inputs in isolation would result in significantly higher (lower) fair value measurements.
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Basis of presentation (Policies) |
3 Months Ended |
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Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentationThe accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, the instructions to SEC Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In preparing the unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates. |
Recent accounting pronouncements | Recent accounting pronouncements. Credit Losses. In March 2022, Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2022-02, “Financial Instruments-Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures,” which eliminates the accounting guidance for Troubled Debt Restructurings (TDRs) by creditors in Subtopic 310-40, Receivables-Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. Specifically, rather than applying the recognition and measurement guidance for TDRs, an entity must apply the loan refinancing and restructuring guidance in paragraphs 310-20-35-9 through 35-11 to determine whether a modification results in a new loan or a continuation of an existing loan. The amendments in this update also require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of Subtopic 326-20, “Financial Instruments-Credit Losses-Measured at Amortized Cost.” Gross write-off information must be included in the vintage disclosures required for public business entities in accordance with paragraph 325-20-50-6, which requires that an entity disclose the amortized cost basis of financing receivables by credit-quality indicator and class of financing receivable by year of origination. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. ASB is assessing the requirements of the ASU.
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Troubled debt restructurings | Troubled debt restructurings. A loan modification is deemed to be a TDR when the borrower is determined to be experiencing financial difficulties and ASB grants a concession it would not otherwise consider. The allowance for credit losses on TDR loans that do not share risk characteristics are individually evaluated based on the present value of expected future cash flows discounted at the loan’s effective original contractual rate or based on the fair value of collateral less cost to sell. The financial impact of the estimated loss is an increase to the allowance associated with the modified loan. When available information confirms that specific loans or portions thereof are uncollectible (confirmed losses), these amounts are charged off against the allowance for credit losses.
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Fair value measurements | The following are descriptions of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial instruments not carried at fair value: Short-term borrowings—other than bank. The carrying amount of short-term borrowings approximated fair value because of the short maturity of these instruments. Investment securities. The fair value of ASB’s investment securities is determined quarterly through pricing obtained from independent third-party pricing services or from brokers not affiliated with the trade. Non-binding broker quotes are infrequent and generally occur for new securities that are settled close to the month-end pricing date. The third-party pricing vendors ASB uses for pricing its securities are reputable firms that provide pricing services on a global basis and have processes in place to ensure quality and control. The third-party pricing services use a variety of methods to determine the fair value of securities that fall under Level 2 of ASB’s fair value measurement hierarchy. Among the considerations are quoted prices for similar securities in an active market, yield spreads for similar trades, adjustments for liquidity, size, collateral characteristics, historic and generic prepayment speeds, and other observable market factors. To enhance the robustness of the pricing process, ASB will on a quarterly basis compare its standard third-party vendor’s price with that of another third-party vendor. If the prices are within an acceptable tolerance range, the price of the standard vendor will be accepted. If the variance is beyond the tolerance range, an evaluation will be conducted by ASB and a challenge to the price may be made. Fair value in such cases will be based on the value that best reflects the data and observable characteristics of the security. In all cases, the fair value used will have been independently determined by a third-party pricing vendor or non-affiliated broker. The fair value of the mortgage revenue bonds is estimated using a discounted cash flow model to calculate the present value of future principal and interest payments and, therefore is classified within Level 3 of the valuation hierarchy. Loans held for sale. Residential and commercial loans are carried at the lower of cost or market and are valued using market observable pricing inputs, which are derived from third party loan sales and, therefore, are classified within Level 2 of the valuation hierarchy. Loans held for investment. Fair value of loans held for investment is derived using a discounted cash flow approach which includes an evaluation of the underlying loan characteristics. The valuation model uses loan characteristics which includes product type, maturity dates and the underlying interest rate of the portfolio. This information is input into the valuation models along with various forecast valuation assumptions including prepayment forecasts, to determine the discount rate. These assumptions are derived from internal and third party sources. Since the valuation is derived from model-based techniques, ASB includes loans held for investment within Level 3 of the valuation hierarchy. Collateral dependent loans. Collateral dependent loans have been adjusted to fair value. When a loan is identified as collateral dependent, the Company measures the impairment using the current fair value of the collateral, less selling costs. Depending on the characteristics of a loan, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases, the value of the collateral may be estimated as having little or no value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. If it is determined that the value of the collateral dependent loan is less than its recorded investment, the Company recognizes this impairment and adjusts the carrying value of the loan to fair value through the allowance for credit losses. Real estate acquired in settlement of loans. Foreclosed assets are carried at fair value (less estimated costs to sell) and are generally based upon appraisals or independent market prices that are periodically updated subsequent to classification as real estate owned. Such adjustments typically result in a Level 3 classification of the inputs for determining fair value. ASB estimates the fair value of collateral-dependent loans and real estate owned using the sales comparison approach. Mortgage servicing rights. MSRs are capitalized at fair value based on market data at the time of sale and accounted for in subsequent periods at the lower of amortized cost or fair value. MSRs are evaluated for impairment at each reporting date. ASB's MSRs are stratified based on predominant risk characteristics of the underlying loans including loan type and note rate. For each stratum, fair value is calculated by discounting expected net income streams using discount rates that reflect industry pricing for similar assets. Expected net income streams are estimated based on industry assumptions regarding prepayment expectations and income and expenses associated with servicing residential mortgage loans for others. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in "Revenues - bank" in the consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. ASB compares the fair value of MSRs to an estimated value calculated by an independent third-party. The third-party relies on both published and unpublished sources of market related assumptions and its own experience and expertise to arrive at a value. ASB uses the third-party value only to assess the reasonableness of its own estimate. ASB includes MSRs within Level 3 of the valuation hierarchy. Time deposits. The fair value of fixed-maturity certificates of deposit was estimated by discounting the future cash flows using the rates currently offered for FHLB advances of similar remaining maturities. Deposit liabilities are classified in Level 2 of the valuation hierarchy. Other borrowings. For advances and repurchase agreements, fair value is estimated using quantitative discounted cash flow models that require the use of interest rate inputs that are currently offered for advances and repurchase agreements of similar remaining maturities. The majority of market inputs are actively quoted and can be validated through external sources, including broker market transactions and third party pricing services. Long-term debt—other than bank. Fair value of fixed-rate long-term debt—other than bank was obtained from third-party financial services providers based on the current rates offered for debt of the same or similar remaining maturities and from discounting the future cash flows using the current rates offered for debt of the same or similar risks, terms, and remaining maturities. The carrying amount of floating rate long-term debt—other than bank approximated fair value because of the short-term interest reset periods. Long-term debt—other than bank is classified in Level 2 of the valuation hierarchy. Interest rate lock commitments (IRLCs). The estimated fair value of commitments to originate residential mortgage loans for sale is based on quoted prices for similar loans in active markets. IRLCs are classified as Level 2 measurements. Forward sales commitments. To be announced (TBA) mortgage-backed securities forward commitments are classified as Level 1, and consist of publicly-traded debt securities for which identical fair values can be obtained through quoted market prices in active exchange markets. The fair values of ASB’s best efforts and mandatory delivery loan sale commitments are determined using quoted prices in the market place that are observable and are classified as Level 2 measurements.
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Segment financial information (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment financial information |
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Electric utility segment (Tables) |
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Electric Utility Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of purchases from all IPPs | Purchases from all IPPs were as follows:
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Schedule of net annual incremental amounts proposed to be collected (refunded) | The net incremental amounts between the 2021 fall and 2022 spring revenue reports are proposed to be collected (refunded) from June 1, 2022 through May 31, 2023 as follows:
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Schedule of condensed consolidating statements of income (loss) | Condensed Consolidating Statement of Income Three months ended March 31, 2022
Condensed Consolidating Statement of Income Three months ended March 31, 2021
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Schedule of condensed consolidating statement of comprehensive income | Condensed Consolidating Statement of Comprehensive Income Three months ended March 31, 2022
Condensed Consolidating Statement of Comprehensive Income Three months ended March 31, 2021
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Schedule of condensed consolidating balance sheet | Condensed Consolidating Balance Sheet March 31, 2022
Condensed Consolidating Balance Sheet December 31, 2021 Balance Sheets Data
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Schedule of condensed consolidating statement of changes in common stock equity | Condensed Consolidating Statement of Changes in Common Stock Equity Three months ended March 31, 2022
Condensed Consolidating Statement of Changes in Common Stock Equity Three months ended March 31, 2021
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Schedule of condensed consolidating statement of cash flows | Condensed Consolidating Statement of Cash Flows Three months ended March 31, 2022
Condensed Consolidating Statement of Cash Flows Three months ended March 31, 2021
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Bank segment (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bank Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of statements of income data | Condensed Consolidating Statement of Income Three months ended March 31, 2022
Condensed Consolidating Statement of Income Three months ended March 31, 2021
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Schedule of statements of comprehensive income data | Statements of Income and Comprehensive Income Data
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Schedule of balance sheets data | Condensed Consolidating Balance Sheet March 31, 2022
Condensed Consolidating Balance Sheet December 31, 2021 Balance Sheets Data
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Schedule of the book value and aggregate fair value by major security type | The major components of investment securities were as follows:
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Schedule of contractual maturities of available-for-sale securities | The contractual maturities of investment securities were as follows:
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Schedule of proceeds, gross gains and losses from sales of available-for-sale securities | The proceeds, gross gains and losses from sales of available-for-sale securities were as follows:
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Schedule of components of loans receivable | The components of loans were summarized as follows:
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Schedule of allowance for credit losses | The allowance for credit losses (balances and changes) by portfolio segment were as follows:
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Schedule of allowance for loan commitments | The allowance for loan commitments by portfolio segment were as follows:
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Schedule of credit risk profile by internally assigned grade for loans | The credit risk profile by vintage date based on payment activity or internally assigned grade for loans was as follows:
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Schedule of credit risk profile based on payment activity for loans | The credit risk profile based on payment activity for loans was as follows:
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Schedule of credit risk profile based on nonaccrual loans, accruing loans 90 days or more past due | The credit risk profile based on nonaccrual loans were as follows:
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Schedule of loan modifications | Loan modifications that occurred during the three months ended March 31, 2021 were as follows:
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Schedule of collateral-dependent loans | Loans considered collateral-dependent were as follows:
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Schedule of amortized intangible assets | Changes in the carrying value of MSRs were as follows:
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Schedule of key assumptions used in estimating fair value | Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:
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Schedule of sensitivity analysis of fair value, transferor's interests in transferred financial assets | The sensitivity analysis of fair value of MSRs to hypothetical adverse changes of 25 and 50 basis points in certain key assumptions was as follows:
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Schedule of securities sold under agreements to repurchase | The following tables present information about the securities sold under agreements to repurchase, including the related collateral received from or pledged to counterparties:
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Schedule of notional and fair value of derivatives | The notional amount and fair value of ASB’s derivative financial instruments were as follows:
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Schedule of derivative financial instruments | ASB’s derivative financial instruments, their fair values and balance sheet location were as follows:
1 Asset derivatives are included in other assets and liability derivatives are included in other liabilities in the balance sheets.
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Schedule of derivative financial instruments and net gain or loss | The following table presents ASB’s derivative financial instruments and the amount and location of the net gains or losses recognized in ASB’s statements of income:
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Shareholders' equity (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accumulated other comprehensive income | Changes in the balances of each component of accumulated other comprehensive income/(loss) (AOCI) were as follows:
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Schedule of reclassifications out of accumulated other comprehensive income/(loss) | Reclassifications out of AOCI were as follows:
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Revenues (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of revenue | The following tables disaggregate revenues by major source, timing of revenue recognition, and segment:
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Retirement benefits (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of net periodic benefit cost for consolidated HEI | The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:
1 Three months ended March 31, 2021 amounts include the one-time cumulative impact of the change in accounting principle for the plans’ fixed income securities from the calculated market-related value method to the fair value method, which was recorded in the first quarter of 2021.
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Share-based compensation (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [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:
1 For the three months ended March 31, 2022 and 2021, the Company has not capitalized any share-based compensation.
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Schedule of restricted stock units | Information about HEI’s grants of restricted stock units was as follows:
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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:
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Schedule of Long-Term Incentive Plan assumptions | 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:
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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:
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Cash flows (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of supplemental disclosures of cash and noncash activity |
1 The amounts shown represent the market value of common stock issued for director and executive/management compensation and withheld to satisfy statutory tax liabilities.
|
Fair value measurements (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of estimated fair values of certain of the Company's financial instruments | The following table presents the carrying or notional amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments.
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Schedule of assets measured at fair value on a recurring basis | Assets and liabilities measured at fair value on a recurring basis were as follows:
1 Derivatives are carried at fair value in other assets or other liabilities in the balance sheets with changes in value included in mortgage banking income. 2 Derivatives are included in other assets and other liabilities in the balance sheets.
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Schedule of changes in Level 3 assets and liabilities measured at fair value on a recurring basis | The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:
|
Electric utility segment - Unconsolidated variable interest entities (Details) |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022
entity
agreement
|
Jun. 30, 2021
MW
|
Mar. 31, 2021
MW
|
|
Power purchase agreement | |||
Number of IPPs (in entities) | entity | 3 | ||
Puna Geothermal Venture Power Purchase Agreement | |||
Power purchase agreement | |||
Firm capacity volume (in megawatts) | MW | 23.9 | 13.0 | |
Hawaiian Electric Company | |||
Power purchase agreement | |||
Number of power purchase agreements (PPAs) (in agreements) | agreement | 5 |
Electric utility segment - Most recent rate proceedings (Details) - USD ($) $ in Thousands |
1 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Mar. 31, 2022 |
|
Regulatory Projects and Legal Obligations [Line Items] | ||
Regulatory assets | $ 565,543 | $ 559,161 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Regulatory Projects and Legal Obligations [Line Items] | ||
Regulatory assets | $ 27,800 | |
Hawaiian Electric Company, Inc. and Subsidiaries | COVID-19 | ||
Regulatory Projects and Legal Obligations [Line Items] | ||
Customer bill forgiveness | $ 2,000 |
Bank segment - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Dec. 31, 2021 |
|
Allowance for credit losses | |||
Securities sold under agreements to repurchase | $ 137.0 | $ 88.0 | |
American Savings Bank (ASB) | |||
Allowance for credit losses | |||
Securities sold under agreements to repurchase | $ 137.4 | $ 88.3 | |
Minimum benchmark percentage of loan to appraisal ratio which mortgage insurance is required | 80.00% | ||
Minimum benchmark percentage of loan to appraisal ratio on non-owner occupied residential property | 75.00% | ||
Home equity line of credit | |||
Allowance for credit losses | |||
Conversion of debt | $ 4.4 | $ 6.2 | |
Commercial | |||
Allowance for credit losses | |||
Conversion of debt | 0.5 | 0.5 | |
Consumer | |||
Allowance for credit losses | |||
Conversion of debt | $ 1.0 | $ 0.7 |
Bank segment - Allowance for loan commitments (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Allowance for loan commitments: | ||
Beginning balance | $ 4,900 | $ 4,300 |
Provision | 500 | (1,400) |
Ending balance | 5,400 | 2,900 |
Real estate | Home equity line of credit | ||
Allowance for loan commitments: | ||
Beginning balance | 400 | 300 |
Provision | 0 | 100 |
Ending balance | 400 | 400 |
Real estate | Commercial construction | ||
Allowance for loan commitments: | ||
Beginning balance | 3,700 | 3,000 |
Provision | (100) | (1,700) |
Ending balance | 3,600 | 1,300 |
Commercial | ||
Allowance for loan commitments: | ||
Beginning balance | 800 | 1,000 |
Provision | 600 | 200 |
Ending balance | $ 1,400 | $ 1,200 |
Bank segment - Troubled debt restructuring - narrative (Details) - Troubled debt restructurings real estate loans - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Dec. 31, 2021 |
|
Financing Receivable, Impaired [Line Items] | |||
Financing receivable modifications minimum, period of payment default of loans determined to be TDRs (in days) | 90 days | 90 days | |
Commitments to lend additional funds to borrows with impaired or modified loans | $ 0.0 | $ 0.0 | |
Consumer mortgage loans collateralized by residential real estate property in foreclosure process | $ 4.0 | $ 3.4 |
Bank segment - Other borrowings (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
Offsetting Liabilities [Line Items] | ||
Gross amount of recognized liabilities | $ 137 | $ 88 |
Gross amount offset in the Balance Sheets | 0 | 0 |
Net amount of liabilities presented in the Balance Sheets | 137 | 88 |
Commercial account holders | ||
Offsetting Liabilities [Line Items] | ||
Net amount of liabilities presented in the Balance Sheets | 137 | 88 |
Financial instruments | 161 | 161 |
Cash collateral pledged | $ 0 | $ 0 |
Bank segment - Derivatives (Details) - Derivative Financial Instruments Not Designated as Hedging Instruments - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
Dec. 31, 2021 |
|
Derivative instrument | |||
Asset derivatives | $ 208 | $ 638 | |
Liability derivatives | 58 | 11 | |
Net gains (losses) recognized in the Statement of Income | (477) | $ (3,258) | |
Interest rate lock commitments | |||
Derivative instrument | |||
Notional amount | 12,342 | 39,377 | |
Fair value | (18) | 638 | |
Asset derivatives | 40 | 638 | |
Liability derivatives | 58 | 0 | |
Interest rate lock commitments | Mortgage banking income | |||
Derivative instrument | |||
Net gains (losses) recognized in the Statement of Income | (655) | (4,098) | |
Forward commitments | |||
Derivative instrument | |||
Notional amount | 11,750 | 38,000 | |
Fair value | 168 | (11) | |
Asset derivatives | 168 | 0 | |
Liability derivatives | 0 | $ 11 | |
Forward commitments | Mortgage banking income | |||
Derivative instrument | |||
Net gains (losses) recognized in the Statement of Income | $ 178 | $ 840 |
Bank segment - Contingencies (Details) - USD ($) $ in Millions |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|
American Savings Bank (ASB) | ||
Loss Contingencies [Line Items] | ||
Unfunded commitments to fund the company's LIHTC | $ 62.8 | $ 62.8 |
Credit agreements - Narrative (Details) - Hawaiian Electric Company, Inc. and Subsidiaries |
May 14, 2021
USD ($)
institution
extensionOption
|
Mar. 31, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
---|---|---|---|
Credit Facilities | |||
Credit agreement | |||
Number of financial institutions | institution | 9 | ||
Line of credit outstanding | $ 0 | $ 0 | |
HEI Facility | |||
Credit agreement | |||
Credit agreement | $ 175,000,000 | ||
Hawaiian Electric Facility | |||
Credit agreement | |||
Credit agreement | $ 275,000,000 | ||
Number of extension options | extensionOption | 2 | ||
Extension period | 1 year | ||
Hawaiian Electric Facility | Line of credit facility | |||
Credit agreement | |||
Credit agreement | $ 200,000,000 |
Share-based compensation - Summary of income taxes (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Share-based compensation | ||
Share-based compensation expense | $ 2.1 | $ 2.6 |
Income tax benefit | 0.3 | 0.4 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Share-based compensation | ||
Share-based compensation expense | 0.6 | 1.1 |
Income tax benefit | $ 0.1 | $ 0.3 |
Share-based compensation - Fair value assumptions (Details) - LTIP linked to TRS - $ / shares |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Dec. 31, 2021 |
|
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Risk-free interest rate | 0.19% | |
Expected life in years | 3 years | |
Expected volatility | 29.90% | |
Range of expected volatility for Peer Group, minimum rate | 25.60% | |
Range of expected volatility for Peer Group, maximum rate | 102.90% | |
Grant date fair value (in dollars per share) | $ 41.12 | |
Forecast | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Risk-free interest rate | 1.71% | |
Expected life in years | 3 years | |
Expected volatility | 31.00% | |
Range of expected volatility for Peer Group, minimum rate | 25.40% | |
Range of expected volatility for Peer Group, maximum rate | 76.70% | |
Grant date fair value (in dollars per share) | $ 54.92 |
Income taxes (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Income Tax Contingency [Line Items] | ||
Effective income tax, percent | 20.00% | 19.00% |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Income Tax Contingency [Line Items] | ||
Effective income tax, percent | 21.00% | 20.00% |
Fair value measurements - Changes in level 3 assets and liabilities (Details) - Mortgage revenue bonds - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2022 |
Mar. 31, 2021 |
|
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 15,427 | $ 27,185 |
Principal payments received | (131) | (11,758) |
Purchases | 0 | 0 |
Unrealized gain (loss) included in other comprehensive income | 0 | 0 |
Ending balance | $ 15,296 | $ 15,427 |
Fair value measurements - Narrative (Details) |
3 Months Ended | |
---|---|---|
Mar. 31, 2022
USD ($)
|
Mar. 31, 2021
USD ($)
|
|
Fair value measurements on a nonrecurring basis | American Savings Bank (ASB) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Adjustments to fair value of loans held for sale | $ 0 | $ 0 |
Weighted average discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage revenue bonds, measurement input | 0.0227 |
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