Central Pacific Financial Corp. (NYSE: CPF) (the "Company"), parent company of Central Pacific Bank (the "Bank" or "CPB"), today reported net income of $20.8 million, or $0.80 diluted earnings per share ("EPS"), for the second quarter of 2026. This compares to net income of $20.7 million, or EPS of $0.78, in the prior quarter and $18.3 million, or EPS of $0.67, in the same period last year.
“We delivered another strong quarter of performance, backed by our team’s dedication and commitment," said Arnold Martines, Chairman, President and CEO. "Our robust capital position supports future organic growth, while returning value to shareholders through our increased dividend and continued share repurchases. We are also honored to be the highest-ranked company in Hawaii on America’s Best Companies 2026 list, published by TIME magazine, and recognized by Forbes as the Best Bank in Hawaii for the third consecutive year. We are grateful for the support of our customers and the communities we serve.”
Earnings Highlights
Net interest income for the second quarter of 2026 totaled $62.8 million, which increased by $1.5 million, or 2.4% from the prior quarter, and increased by $3.0 million, or 5.1%, compared to the same quarter last year. Net interest margin ("NIM") for the second quarter of 2026 was 3.57%, an increase of 4 basis points ("bp" or "bps") from the prior quarter, and an increase of 13 bps from the same quarter last year. The sequential quarter increase in net interest income and NIM was primarily driven by higher average balances and yields earned on loans and investment securities, combined with a decline in average rates paid on interest-bearing deposits.
The Company recorded a provision for credit losses of $4.4 million in the second quarter of 2026, compared to a provision of $2.4 million in the prior quarter, and a provision of $5.0 million in the same quarter last year. The current quarter provision included a provision for credit loss on loans of $3.3 million and a $1.1 million reserve for off-balance sheet credit exposures. The increase from the prior quarter was primarily driven by changes in the economic forecast used in our current expected credit losses model, combined with higher unfunded loan commitments.
Other operating income for the second quarter of 2026 totaled $14.6 million, compared to $11.6 million in the prior quarter, and $13.0 million in the same quarter last year. The sequential quarter increase was primarily due to a $2.6 million increase in income from bank-owned life insurance ("BOLI") due to favorable equity market performance.
Other operating expense for the second quarter of 2026 totaled $46.2 million, compared to $43.7 million in the prior quarter, and $43.9 million in the same quarter last year. The increase from the prior quarter was primarily attributable to higher salaries and employee benefits of $2.3 million due to higher deferred compensation expense and incentive accruals. The increase in deferred compensation expense was related to equity market performance.
The efficiency ratio was 59.62% in the second quarter of 2026, compared to 59.87% in the prior quarter and 60.36% in the same quarter last year.
The effective tax rate for the second quarter of 2026 was 22.6%, compared to 23.0% in the prior quarter, and 23.5% in the same quarter last year. The decrease in the Company's effective tax rate was primarily attributable to an increase in tax-exempt income.
Balance Sheet Highlights
As of June 30, 2026, total assets were $7.50 billion, generally consistent with $7.50 billion at March 31, 2026, and increased $131.5 million, or 1.8% from $7.37 billion at June 30, 2025.
Total loans, net of deferred fees and costs, were $5.31 billion at June 30, 2026, and remained relatively stable compared to $5.32 billion at March 31, 2026, and $5.29 billion at June 30, 2025. The average yield earned on loans during the second quarter of 2026 was 4.96%, compared to 4.93% in the prior quarter and 4.96% in the same quarter last year.
Total deposits were $6.70 billion at June 30, 2026, relatively unchanged from $6.70 billion at March 31, 2026, and increased by $150.8 million, or 2.3% from $6.54 billion at June 30, 2025. Core deposits, which include demand deposits, savings and money market deposits and time deposits up to $250,000, totaled $6.12 billion at June 30, 2026, generally consistent with $6.13 billion at March 31, 2026, and increased by $167.1 million, or 2.8% from $5.96 billion at June 30, 2025. The average rate paid on total deposits during the second quarter of 2026 was 0.90%, consistent with 0.90% in the prior quarter, and decreased from 1.02% in the same quarter last year.
Asset Quality
Nonperforming assets totaled $16.5 million, or 0.22% of total assets at June 30, 2026, compared to $14.5 million, or 0.19% of total assets at March 31, 2026 and $14.9 million, or 0.20% of total assets at June 30, 2025.
Net charge-offs in the second quarter of 2026 totaled $2.7 million, compared to net charge-offs of $2.4 million in the prior quarter, and net charge-offs of $4.7 million in the same quarter last year. On an annualized basis, net charge-offs as a percentage of average loans was 0.20% in the second quarter of 2026, compared to 0.18% in the prior quarter, and 0.35% in the same quarter last year.
The allowance for credit losses on loans was 1.14% of total loans as of June 30, 2026, compared to 1.13% at March 31, 2026 and June 30, 2025.
Capital
Total shareholders' equity at June 30, 2026 was $596.3 million, compared to $593.9 million at March 31, 2026 and $568.9 million at June 30, 2025.
During the second quarter of 2026, the Company repurchased 321,858 shares of common stock at a total cost of $11.3 million, or an average price of $35.01 per share. As of June 30, 2026, $33.2 million remained available under the Company's share repurchase authorization.
The Company's regulatory capital ratios remained strong, with a leverage ratio of 9.7%, a Common Equity Tier 1 ratio of 12.7%, a Tier 1 risk-based capital ratio of 13.6%, and a total risk-based capital ratio of 14.8% at June 30, 2026.
On July 23, 2026, the Board of Directors increased its quarterly cash dividend by 3.4% to $0.30 per share. The dividend will be payable on September 15, 2026, to shareholders of record as of August 31, 2026.
Conference Call
The Company's management will host a conference call today at 2:00 p.m. Eastern Time (8:00 a.m. Hawaii Time) to discuss its second quarter of 2026 financial results. Interested parties may listen to the conference by calling 1-833-461-5787 and entering the meeting ID: 719 331 929 or by registering for the webcast at the following link: . The Company’s investor relations website, , will also include a link to the webcast and a slide presentation.
A replay of the call will be available on the Company's investor relations website until July 24, 2027.
About Central Pacific Financial Corp.
Central Pacific Financial Corp. is a Hawaii-based bank holding company with approximately $7.50 billion in assets as of June 30, 2026. Its primary subsidiary, Central Pacific Bank, operates 27 branches and 56 ATMs in the State of Hawaii. Central Pacific Financial Corp. is listed on the New York Stock Exchange under the symbol "CPF." For additional information, please visit: cpb.bank.
Member FDIC
Equal Housing Lender
NYSE Listed: CPF
Forward-Looking Statements
This document may contain forward-looking statements ("FLS") concerning, among other things: projections of revenues, expenses, income or loss, earnings or loss per share, capital expenditures, payment or nonpayment of dividends, net interest income, capital position, credit losses, net interest margin, or other financial items. These statements may also include the plans, objectives, and expectations of Central Pacific Financial Corp. (the "Company") or its management or Board of Directors, including those relating to business plans, use of capital resources, products or services, and regulatory developments or actions. In addition, such statements may address anticipated economic performance, the expected impact of business initiatives, and the assumptions underlying any of the foregoing.
Words such as "believe," "plan," "anticipate," "aim," "seek," "expect," "intend," "forecast," "hope," "target," "continue," "remain," "estimate," "will," "should," "may," and other similar expressions are intended to identify FLS, although such terminology is not the exclusive means of doing so.
While we believe that our FLS and their underlying assumptions are reasonably based, such statements are inherently subject to risks and uncertainties that may cause actual results to differ materially from expectations. Factors that may lead to such differences, include, but are not limited to: the persistence or resurgence of inflationary pressures in the United States and our market areas, and their effect on market interest rates, economic conditions, and credit quality; the impact of the current U.S. administration’s economic policies, including potential international tariffs, geopolitical instability, trade tensions, and other cost-cutting or fiscal initiatives; the adverse effects of bank failures on customer confidence, deposit behavior, liquidity, and regulatory responses; the effects of pandemics, epidemics, and other public health emergencies, including their impact on Hawaii's tourism and construction sectors and on our borrowers, customers, vendors and employees; supply chain disruptions, labor contract disputes, strikes; adverse trends in the real estate or construction industries, including rising inventory levels or declining property values; deterioration in borrowers' financial performance leading to increased loan delinquencies, asset quality issues, or loan losses; the impact of local, national, and international economic conditions and natural disasters (such as wildfires, volcanic eruptions, hurricanes, tsunamis, storms, floods, or earthquakes) on our markets and major industries within Hawaii; weakness in domestic economic conditions, including instability in the financial industry, deterioration in real estate markets, and declines in consumer or business confidence; revisions to estimates of reserve requirements under applicable regulatory and accounting standards; the impact of legislative and regulatory developments, changing capital and consumer protection rules, and new regulations affecting our operations and competitiveness; the costs and effects of legal and regulatory proceedings, including actual or threatened litigation and the results of governmental and regulatory exams and orders, as well as the costs of ongoing or potential compliance efforts; the effect of accounting standard changes adopted by regulatory agencies, the PCAOB, or the FASB, and the cost and resources associated with implementation; changes in trade, monetary, or fiscal policy, including actions by the Federal Reserve; market volatility and monetary fluctuations, including the transition away from the LIBOR Index; declines in our market capitalization or the price of our common stock; the effects and cost of acquisitions, dispositions, or strategic transactions we may make or evaluate; political instability, acts of war or terrorism, or other geopolitical conflicts; shifts in consumer spending, borrowing, and savings behaviors; technological changes and developments; cybersecurity incidents, data privacy breaches, or fraud involving us or third-party vendors; deficiencies in internal control over financial reporting or disclosure controls and procedures, and our ability to remediate them; increased competition among financial institutions and other financial service providers; our ability to achieve efficiency ratio improvement goals; our ability to attract and retain key personnel; changes in our personnel, organization, compensation and benefit plans; and related reputational or regulatory exposures; and risks related to the United States fiscal debt, deficit, and budget uncertainties.
For further information on factors that could cause actual results to differ materially from the expectations or projections expressed in our FLS, please refer to the Company's filings with the U.S. Securities and Exchange Commission, including the Company's most recent Form 10-K, particularly, the discussion of "Risk Factors" set forth therein.
We urge investors to consider all of these factors carefully in evaluating the FLS contained in this document. FLS speak only as of the date on which such statements are made. We undertake no obligation to update any FLS to reflect events or circumstances occurring after the date on which such statements are made, or to reflect the occurrence of unanticipated events, except as required by law.
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Financial Highlights | (Unaudited) TABLE 1 |
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Three Months Ended Six Months Ended | (Dollars in thousands, except for per share amounts) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Jun 30, |
2026 2026 2025 2025 2025 2026 2025 | CONDENSED INCOME STATEMENT | Net interest income $ 62,834 $ 61,358 $ 62,087 $ 61,301 $ 59,796 $ 124,192 $ 117,495 | Provision for credit losses 4,382 2,353 2,396 4,157 4,987 6,735 9,159 | Total other operating income 14,620 11,574 14,201 13,507 13,013 26,194 24,109 | Total other operating expense 46,180 43,666 45,680 47,009 43,946 89,846 86,018 | Income tax expense 6,070 6,188 5,337 5,068 5,605 12,258 10,396 | Net income 20,822 20,725 22,875 18,574 18,271 41,547 36,031 | Basic earnings per share $ 0.80 $ 0.79 $ 0.86 $ 0.69 $ 0.68 $ 1.59 $ 1.33 | Diluted earnings per share 0.80 0.78 0.85 0.69 0.67 1.58 1.33 | Dividends declared per share 0.29 0.29 0.28 0.27 0.27 0.58 0.54 | PERFORMANCE RATIOS | Return on average assets (ROA) [1] 1.12 % 1.12 % 1.25 % 1.01 % 1.00 % 1.12 % 0.98 % | Return on average equity (ROE) [1] 13.94 13.90 15.41 12.89 13.04 13.92 13.04 | Average equity to average assets 8.03 8.07 8.12 7.85 7.66 8.05 7.52 | Efficiency ratio [2] 59.62 59.87 59.88 62.84 60.36 59.74 60.75 | Net interest margin (NIM) [1] 3.57 3.53 3.56 3.49 3.44 3.55 3.37 | Dividend payout ratio [3] 36.25 37.18 32.94 39.13 40.30 36.71 40.60 | SELECTED AVERAGE BALANCES | Average loans, including loans held for sale $ 5,300,949 $ 5,268,482 $ 5,328,499 $ 5,332,656 $ 5,307,946 $ 5,284,805 $ 5,309,768 | Average interest-earning assets 7,076,331 7,022,759 6,964,796 7,011,753 6,985,097 7,049,694 7,019,602 | Average assets 7,433,822 7,396,084 7,310,098 7,341,281 7,314,144 7,415,057 7,351,257 | Average deposits 6,630,910 6,592,361 6,499,119 6,509,692 6,503,463 6,611,742 6,532,122 | Average interest-bearing liabilities 4,876,776 4,846,057 4,757,686 4,807,225 4,807,669 4,861,501 4,860,738 | Average equity 597,299 596,524 593,750 576,531 560,248 596,913 552,610 | [1] ROA and ROE are annualized based on a 30/360 day convention. Annualized net interest income and expense in the NIM calculation are based on the day count interest payment conventions at the interest-earning asset or interest-bearing liability level (i.e. 30/360, actual/actual). | [2] Efficiency ratio is defined as total other operating expense divided by total revenue (net interest income and total other operating income). | [3] Dividend payout ratio is defined as dividends declared per share divided by diluted earnings per share. |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Financial Highlights | (Unaudited) TABLE 1 (CONTINUED) |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, |
2026 2026 2025 2025 2025 | REGULATORY CAPITAL RATIOS | Central Pacific Financial Corp. | Leverage ratio 9.7 % 9.7 % 9.8 % 9.7 % 9.6 % | Common equity tier 1 capital ratio 12.7 12.6 12.7 12.6 12.6 | Tier 1 risk-based capital ratio 13.6 13.5 13.6 13.5 13.5 | Total risk-based capital ratio 14.8 14.7 14.8 15.7 15.8 | Central Pacific Bank | Leverage ratio 9.6 9.6 9.7 10.2 10.1 | Common equity tier 1 capital ratio 13.4 13.4 13.5 14.1 14.1 | Tier 1 risk-based capital ratio 13.4 13.4 13.5 14.1 14.1 | Total risk-based capital ratio 14.7 14.6 14.7 15.3 15.3 |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, | (dollars in thousands, except for per share amounts) 2026 2026 2025 2025 2025 | BALANCE SHEET | Total loans, net of deferred fees and costs $ 5,308,322 $ 5,320,349 $ 5,289,096 $ 5,367,202 $ 5,289,809 | Total assets 7,501,060 7,495,363 7,409,241 7,421,478 7,369,567 | Total deposits 6,695,754 6,699,354 6,609,764 6,577,684 6,544,989 | Long-term debt 76,547 76,547 76,547 131,527 131,466 | Total equity 596,331 593,879 592,581 588,066 568,874 | Tangible common equity to tangible assets [4] 7.95 % 7.92 % 8.00 % 7.92 % 7.72 % | ASSET QUALITY | Allowance for credit losses (ACL) $ 60,581 $ 59,933 $ 59,621 $ 60,393 $ 59,611 | Nonaccrual loans 15,622 14,524 14,386 14,319 14,895 | Non-performing assets (NPA) 16,546 14,524 14,386 14,319 14,895 | Ratio of ACL to total loans 1.14 % 1.13 % 1.13 % 1.13 % 1.13 % | Ratio of NPA to total assets 0.22 % 0.19 % 0.19 % 0.19 % 0.20 % | PER SHARE OF COMMON STOCK OUTSTANDING | Book value per common share $ 23.11 $ 22.74 $ 22.47 $ 21.86 $ 21.08 | Closing market price per common share 38.20 31.96 31.16 30.34 28.03 | [4] The tangible common equity ratio is a non-GAAP measure which should be read in conjunction with the Company’s GAAP financial information. Comparison of our ratio with those of other companies may not be possible because other companies may calculate the ratio differently. See Reconciliation of Non-GAAP Financial Measures in Table 10. |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Consolidated Balance Sheets | (Unaudited) TABLE 2 |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, | (Dollars in thousands, except share data) 2026 2026 2025 2025 2025 | ASSETS | Cash and due from financial institutions $ 96,678 $ 88,880 $ 88,200 $ 102,859 $ 110,935 | Interest-bearing deposits in other financial institutions 286,593 317,716 290,453 207,034 206,035 | Investment securities: | Debt securities available-for-sale, at fair value 835,378 779,156 748,212 758,683 765,213 | Debt securities held-to-maturity, at amortized cost; fair value of: $474,928 at June 30, 2026, $486,018 at March 31, 2026, $495,845 at December 31, 2025, $500,859 at September 30, 2025, and $499,833 at June 30, 2025 545,215 554,548 562,391 570,886 580,476 | Total investment securities 1,380,593 1,333,704 1,310,603 1,329,569 1,345,689 | Loans held for sale 2,364 2,536 1,084 1,557 — | Loans, net of deferred fees and costs 5,308,322 5,320,349 5,289,096 5,367,202 5,289,809 | Less: allowance for credit losses (60,581 ) (59,933 ) (59,621 ) (60,393 ) (59,611 ) | Loans, net of allowance for credit losses 5,247,741 5,260,416 5,229,475 5,306,809 5,230,198 | Premises and equipment, net 100,231 99,942 100,620 100,992 103,657 | Accrued interest receivable 23,419 24,320 23,559 25,232 23,518 | Investment in unconsolidated entities 57,738 59,548 61,349 52,987 49,370 | Other real estate owned 924 — — — — | Mortgage servicing rights 8,364 8,520 8,672 8,459 8,436 | Bank-owned life insurance 185,134 181,298 180,717 179,743 177,639 | Federal Home Loan Bank of Des Moines ("FHLB") and Federal Reserve Bank ("FRB") stock 24,744 24,682 25,836 25,215 24,816 | Right-of-use lease assets 23,311 24,320 24,822 25,570 30,693 | Other assets 63,226 69,481 63,851 55,452 58,581 | Total assets $ 7,501,060 $ 7,495,363 $ 7,409,241 $ 7,421,478 $ 7,369,567 | LIABILITIES | Deposits: | Noninterest-bearing demand $ 1,917,502 $ 1,897,593 $ 1,891,198 $ 1,903,614 $ 1,938,226 | Interest-bearing demand 1,407,574 1,428,323 1,388,107 1,340,725 1,336,620 | Savings and money market 2,376,831 2,378,834 2,346,522 2,292,881 2,242,122 | Time 993,847 994,604 983,937 1,040,464 1,028,021 | Total deposits 6,695,754 6,699,354 6,609,764 6,577,684 6,544,989 | Long-term debt, net of unamortized debt issuance costs 76,547 76,547 76,547 131,527 131,466 | Lease liabilities 24,063 25,073 25,549 26,288 31,981 | Accrued interest payable 6,044 6,433 7,068 8,604 8,755 | Other liabilities 102,321 94,077 97,732 89,309 83,502 | Total liabilities 6,904,729 6,901,484 6,816,660 6,833,412 6,800,693 | EQUITY | Shareholders' equity: | Preferred stock, no par value, authorized 1,000,000 shares; issued and outstanding: none at June 30, 2026, March 31, 2026, December 31, 2025, September 30, 2025, and June 30, 2025 — — — — — | Common stock, no par value, authorized 185,000,000 shares; issued and outstanding: 25,806,418 at June 30, 2026, 26,115,229 at March 31, 2026, 26,374,967 at December 31, 2025, 26,903,512 at September 30, 2025, and 26,981,436 at June 30, 2025 359,364 370,633 381,158 397,479 399,823 | Additional paid-in capital 107,534 106,501 107,308 106,675 106,033 | Retained earnings 217,789 204,494 191,383 175,968 164,676 | Accumulated other comprehensive loss (88,356 ) (87,749 ) (87,268 ) (92,056 ) (101,658 ) | Total equity 596,331 593,879 592,581 588,066 568,874 | Total liabilities and equity $ 7,501,060 $ 7,495,363 $ 7,409,241 $ 7,421,478 $ 7,369,567 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Consolidated Statements of Income | (Unaudited) TABLE 3 |
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Three Months Ended Six Months Ended |
Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Jun 30, | (Dollars in thousands, except per share data) 2026 2026 2025 2025 2025 2026 2025 | Interest income: | Interest and fees on loans $ 65,553 $ 64,323 $ 66,897 $ 67,222 $ 65,668 $ 129,876 $ 129,787 | Interest and dividends on investment securities: | Taxable investment securities 9,732 9,210 9,401 9,776 9,871 18,942 19,672 | Tax-exempt investment securities 684 682 696 709 709 1,366 1,417 | Interest on deposits in other financial institutions 2,331 2,500 1,501 1,857 1,484 4,831 3,738 | Dividend income on FHLB and FRB stock 389 381 382 395 388 770 712 | Total interest income 78,689 77,096 78,877 79,959 78,120 155,785 155,326 | Interest expense: | Interest on deposits: | Interest-bearing demand 757 522 441 490 443 1,279 895 | Savings and money market 7,554 7,502 8,004 8,898 8,414 15,056 17,276 | Time 6,488 6,665 6,999 7,410 7,616 13,153 15,723 | Interest on long-term debt 1,056 1,049 1,346 1,860 1,851 2,105 3,937 | Total interest expense 15,855 15,738 16,790 18,658 18,324 31,593 37,831 | Net interest income 62,834 61,358 62,087 61,301 59,796 124,192 117,495 | Provision for credit losses 4,382 2,353 2,396 4,157 4,987 6,735 9,159 | Net interest income after provision for credit losses 58,452 59,005 59,691 57,144 54,809 117,457 108,336 | Other operating income: | Mortgage banking income 693 649 1,186 958 744 1,342 1,341 | Service charges on deposit accounts 2,250 2,299 2,423 2,330 2,124 4,549 4,271 | Other service charges and fees 6,330 5,789 5,570 6,472 5,957 12,119 11,723 | Income from fiduciary activities 1,580 1,423 1,529 1,547 1,501 3,003 3,125 | Income from bank-owned life insurance 2,999 399 2,816 1,879 2,260 3,398 2,757 | Net loss on sales of investment securities — — — (30 ) — — — | Other 768 1,015 677 351 427 1,783 892 | Total other operating income 14,620 11,574 14,201 13,507 13,013 26,194 24,109 | Other operating expense: | Salaries and employee benefits 25,372 23,085 24,490 24,749 22,696 48,457 44,515 | Net occupancy 4,299 4,322 4,432 4,598 4,253 8,621 8,645 | Computer software 4,952 5,045 5,442 5,151 5,320 9,997 10,034 | Legal and professional services 2,607 2,384 2,878 2,669 2,873 4,991 5,671 | Equipment 822 807 825 867 950 1,629 2,032 | Advertising 762 997 943 730 832 1,759 1,719 | Communication 840 823 495 791 901 1,663 1,934 | Other 6,526 6,203 6,175 7,454 6,121 12,729 11,468 | Total other operating expense 46,180 43,666 45,680 47,009 43,946 89,846 86,018 | Income before income taxes 26,892 26,913 28,212 23,642 23,876 53,805 46,427 | Income tax expense 6,070 6,188 5,337 5,068 5,605 12,258 10,396 | Net income $ 20,822 $ 20,725 $ 22,875 $ 18,574 $ 18,271 $ 41,547 $ 36,031 | Per common share data: | Basic earnings per share $ 0.80 $ 0.79 $ 0.86 $ 0.69 $ 0.68 $ 1.59 $ 1.33 | Diluted earnings per share 0.80 0.78 0.85 0.69 0.67 1.58 1.33 | Cash dividends declared 0.29 0.29 0.28 0.27 0.27 0.58 0.54 | Basic weighted average shares outstanding 25,999,122 26,277,749 26,687,551 26,968,163 26,988,169 26,137,665 27,037,388 | Diluted weighted average shares outstanding 26,109,241 26,414,880 26,827,551 27,083,280 27,069,677 26,261,252 27,139,969 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Average Balances, Interest Income & Expense, Yields and Rates (Taxable Equivalent) | (Unaudited) TABLE 4 |
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Three Months Ended Three Months Ended Three Months Ended |
June 30, 2026 March 31, 2026 June 30, 2025 |
Average Average Average Average Average Average | (Dollars in thousands) Balance Yield/Rate Interest Balance Yield/Rate Interest Balance Yield/Rate Interest | ASSETS | Interest-earning assets: | Interest-bearing deposits in other financial institutions $ 253,598 3.69 % $ 2,331 $ 274,885 3.69 % $ 2,500 $ 134,270 4.43 % $ 1,484 | Investment securities: | Taxable [1] 1,362,100 2.86 9,732 1,318,722 2.80 9,210 1,379,213 2.86 9,871 | Tax-exempt [1] [3] 134,964 2.56 866 135,519 2.55 863 139,103 2.58 897 | Total investment securities 1,497,064 2.83 10,598 1,454,241 2.77 10,073 1,518,316 2.84 10,768 | Loans, including loans held for sale [2] 5,300,949 4.96 65,553 5,268,482 4.93 64,323 5,307,946 4.96 65,668 | FHLB and FRB stock 24,720 6.28 389 25,151 6.07 381 24,565 6.33 388 | Total interest-earning assets 7,076,331 4.47 78,871 7,022,759 4.44 77,277 6,985,097 4.49 78,308 | Noninterest-earning assets 357,491 373,325 329,047 | Total assets $ 7,433,822 $ 7,396,084 $ 7,314,144 | LIABILITIES AND EQUITY | Interest-bearing liabilities: | Interest-bearing demand deposits $ 1,442,933 0.21 % $ 757 $ 1,407,877 0.15 % $ 522 $ 1,357,049 0.13 % $ 443 | Savings and money market deposits 2,367,169 1.28 7,554 2,371,217 1.28 7,502 2,275,799 1.48 8,414 | Time deposits up to $250,000 428,642 2.14 2,290 432,745 2.18 2,331 439,738 2.32 2,546 | Time deposits over $250,000 561,485 3.00 4,198 557,671 3.15 4,334 603,652 3.37 5,070 | Total interest-bearing deposits 4,800,229 1.24 14,799 4,769,510 1.25 14,689 4,676,238 1.41 16,473 | Long-term debt 76,547 5.53 1,056 76,547 5.56 1,049 131,431 5.65 1,851 | Total interest-bearing liabilities 4,876,776 1.30 15,855 4,846,057 1.32 15,738 4,807,669 1.53 18,324 | Noninterest-bearing deposits 1,830,681 1,822,851 1,827,225 | Other liabilities 129,066 130,652 119,002 | Total liabilities 6,836,523 6,799,560 6,753,896 | Total equity 597,299 596,524 560,248 | Total liabilities and equity $ 7,433,822 $ 7,396,084 $ 7,314,144 | Net interest income (taxable-equivalent) 63,016 61,539 59,984 | Taxable-equivalent adjustment [3] (182 ) (181 ) (188 ) | Net interest income (GAAP) $ 62,834 $ 61,358 $ 59,796 | Interest rate spread 3.17 % 3.12 % 2.96 % | Net interest margin (taxable-equivalent) [4] 3.57 % 3.53 % 3.44 % | [1] At amortized cost. | [2] Includes nonaccrual loans. | [3] Interest income and resultant yield information for tax-exempt investment securities is expressed on a taxable-equivalent basis using a federal statutory tax rate of 21%. | [4] Annualized net interest income and expense in the NIM calculation are based on the day count interest payment conventions at the interest-earning asset or interest-bearing liability level (i.e. 30/360, actual/actual). |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Average Balances, Interest Income & Expense, Yields and Rates (Taxable Equivalent) | (Unaudited) TABLE 5 |
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Six Months Ended Six Months Ended |
June 30, 2026 June 30, 2025 |
Average Average Average Average | (Dollars in thousands) Balance Yield/Rate Interest Balance Yield/Rate Interest | ASSETS | Interest-earning assets: | Interest-bearing deposits in other financial institutions $ 264,183 3.69 % $ 4,831 $ 169,991 4.43 % $ 3,738 | Investment securities: | Taxable [1] 1,340,531 2.83 18,942 1,377,957 2.86 19,672 | Tax-exempt [1] [3] 135,240 2.55 1,729 139,345 2.57 1,794 | Total investment securities 1,475,771 2.80 20,671 1,517,302 2.83 21,466 | Loans, including loans held for sale [2] 5,284,805 4.94 129,876 5,309,768 4.92 129,787 | FHLB and FRB stock 24,935 6.17 770 22,541 6.32 712 | Total interest-earning assets 7,049,694 4.45 156,148 7,019,602 4.46 155,703 | Noninterest-earning assets 365,363 331,655 | Total assets $ 7,415,057 $ 7,351,257 | LIABILITIES AND EQUITY | Interest-bearing liabilities: | Interest-bearing demand deposits $ 1,425,501 0.18 % $ 1,279 $ 1,356,209 0.13 % $ 895 | Savings and money market deposits 2,369,182 1.28 15,056 2,310,429 1.51 17,276 | Time deposits up to $250,000 430,682 2.16 4,621 448,557 2.42 5,377 | Time deposits over $250,000 559,589 3.07 8,532 603,785 3.46 10,346 | Total interest-bearing deposits 4,784,954 1.24 29,488 4,718,980 1.45 33,894 | Long-term debt 76,547 5.55 2,105 141,758 5.60 3,937 | Total interest-bearing liabilities 4,861,501 1.31 31,593 4,860,738 1.57 37,831 | Noninterest-bearing deposits 1,826,788 1,813,142 | Other liabilities 129,855 124,767 | Total liabilities 6,818,144 6,798,647 | Total equity 596,913 552,610 | Total liabilities and equity $ 7,415,057 $ 7,351,257 | Net interest income (taxable-equivalent) 124,555 117,872 | Taxable-equivalent adjustment [3] (363 ) (377 ) | Net interest income (GAAP) $ 124,192 $ 117,495 | Interest rate spread 3.14 % 2.89 % | Net interest margin (taxable-equivalent) [4] 3.55 % 3.37 % | [1] At amortized cost. | [2] Includes nonaccrual loans. | [3] Interest income and resultant yield information for tax-exempt investment securities is expressed on a taxable-equivalent basis using a federal statutory tax rate of 21%. | [4] Annualized net interest income and expense in the NIM calculation are based on the day count interest payment conventions at the interest-earning asset or interest-bearing liability level (i.e. 30/360, actual/actual). |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Loans | (Unaudited) TABLE 6 |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, | (Dollars in thousands) 2026 2026 2025 2025 2025 | Commercial and industrial $ 590,404 $ 590,810 $ 594,592 $ 608,814 $ 608,130 | Construction 211,007 204,368 213,191 217,610 190,008 | Residential mortgage 1,815,342 1,806,965 1,839,191 1,839,535 1,851,690 | Home equity 577,283 582,380 600,082 610,889 627,834 | Commercial mortgage 1,686,361 1,703,760 1,594,433 1,613,187 1,540,523 | Consumer 427,925 432,066 447,607 477,167 471,624 | Total loans, net of deferred fees and costs 5,308,322 5,320,349 5,289,096 5,367,202 5,289,809 | Less: Allowance for credit losses (60,581 ) (59,933 ) (59,621 ) (60,393 ) (59,611 ) | Loans, net of allowance for credit losses $ 5,247,741 $ 5,260,416 $ 5,229,475 $ 5,306,809 $ 5,230,198 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Deposits | (Unaudited) TABLE 7 |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, | (Dollars in thousands) 2026 2026 2025 2025 2025 | Noninterest-bearing demand $ 1,917,502 $ 1,897,593 $ 1,891,198 $ 1,903,614 $ 1,938,226 | Interest-bearing demand 1,407,574 1,428,323 1,388,107 1,340,725 1,336,620 | Savings and money market 2,376,831 2,378,834 2,346,522 2,292,881 2,242,122 | Time deposits up to $250,000 421,811 429,564 433,629 444,005 439,687 | Core deposits 6,123,718 6,134,314 6,059,456 5,981,225 5,956,655 | Other time deposits greater than $250,000 441,059 431,013 412,188 458,339 459,945 | Government time deposits 130,977 134,027 138,120 138,120 128,389 | Total time deposits greater than $250,000 572,036 565,040 550,308 596,459 588,334 | Total deposits $ 6,695,754 $ 6,699,354 $ 6,609,764 $ 6,577,684 $ 6,544,989 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Nonperforming Assets and Accruing Loans 90+ Days Past Due | (Unaudited) TABLE 8 |
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Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, | (Dollars in thousands) 2026 2026 2025 2025 2025 | Nonaccrual loans: | Commercial and industrial $ 192 $ 490 $ 591 $ 357 $ 110 | Real estate: | Residential mortgage 9,268 10,518 10,572 11,413 12,327 | Home equity 5,619 2,986 2,608 2,119 1,889 | Consumer 543 530 615 430 569 | Total nonaccrual loans 15,622 14,524 14,386 14,319 14,895 | Other real estate owned ("OREO"): | Real estate: | Residential mortgage 924 — — — — | Total OREO 924 — — — — | Total nonperforming assets ("NPAs") 16,546 14,524 14,386 14,319 14,895 | Accruing loans 90+ days past due: | Real estate: | Residential mortgage — — 664 1,159 1,625 | Home equity — — 485 — 21 | Consumer 286 290 403 349 418 | Total accruing loans 90+ days past due 286 290 1,552 1,508 2,064 | Total NPAs and accruing loans 90+ days past due $ 16,832 $ 14,814 $ 15,938 $ 15,827 $ 16,959 | Ratio of total nonaccrual loans to total loans 0.29 % 0.27 % 0.27 % 0.27 % 0.28 % | Ratio of total NPAs to total assets 0.22 0.19 0.19 0.19 0.20 | Ratio of total NPAs to total loans and OREO 0.31 0.27 0.27 0.27 0.28 | Ratio of total NPAs and accruing loans 90+ days past due to total loans and OREO 0.32 0.28 0.30 0.29 0.32 | Quarter-to-quarter changes in NPAs: | Balance at beginning of quarter $ 14,524 $ 14,386 $ 14,319 $ 14,895 $ 11,085 | Additions 4,202 2,094 2,549 838 5,879 | Reductions: | Payments (782 ) (284 ) (397 ) (286 ) (585 ) | Return to accrual status (16 ) (883 ) (1,098 ) (821 ) (861 ) | Charge-offs, valuation adjustments and other reductions (1,382 ) (789 ) (987 ) (307 ) (623 ) | Total reductions (2,180 ) (1,956 ) (2,482 ) (1,414 ) (2,069 ) | Balance at end of quarter $ 16,546 $ 14,524 $ 14,386 $ 14,319 $ 14,895 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Allowance for Credit Losses on Loans | (Unaudited) TABLE 9 |
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Three Months Ended Six Months Ended |
Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Jun 30, | (Dollars in thousands) 2026 2026 2025 2025 2025 2026 2025 | Allowance for credit losses ("ACL") on loans: | Balance at beginning of period $ 59,933 $ 59,621 $ 60,393 $ 59,611 $ 60,469 $ 59,621 $ 59,182 | Provision for credit losses on loans 3,304 2,724 1,685 3,440 3,810 6,028 7,715 | Charge-offs: | Commercial and industrial (1,353 ) (1,056 ) (678 ) (1,071 ) (2,858 ) (2,409 ) (3,438 ) | Real estate: | Residential mortgage (23 ) — — — — (23 ) — | Consumer (2,283 ) (2,301 ) (2,831 ) (2,824 ) (2,864 ) (4,584 ) (5,841 ) | Total charge-offs (3,659 ) (3,357 ) (3,509 ) (3,895 ) (5,722 ) (7,016 ) (9,279 ) | Recoveries: | Commercial and industrial 198 175 266 204 195 373 366 | Real estate: | Construction — 2 1 — 3 2 3 | Residential mortgage 10 8 9 8 7 18 17 | Home equity 6 6 9 9 9 12 12 | Consumer 789 754 767 1,016 840 1,543 1,595 | Total recoveries 1,003 945 1,052 1,237 1,054 1,948 1,993 | Net charge-offs (2,656 ) (2,412 ) (2,457 ) (2,658 ) (4,668 ) (5,068 ) (7,286 ) | Balance at end of period $ 60,581 $ 59,933 $ 59,621 $ 60,393 $ 59,611 $ 60,581 $ 59,611 | Average loans, net of deferred fees and costs $ 5,300,949 $ 5,268,482 $ 5,328,499 $ 5,332,656 $ 5,307,946 $ 5,284,805 $ 5,309,768 | Ratio of annualized net charge-offs to average loans 0.20 % 0.18 % 0.18 % 0.20 % 0.35 % 0.19 % 0.27 % | Ratio of ACL to total loans 1.14 1.13 1.13 1.13 1.13 1.14 1.13 |
CENTRAL PACIFIC FINANCIAL CORP. AND SUBSIDIARIES | Reconciliation of Non-GAAP Financial Measures | (Unaudited) TABLE 10 |
To supplement its consolidated financial information, the Company utilizes certain non-GAAP financial measures. These measures are not intended to be considered in isolation or as a substitute for comparable GAAP results. The Company believes these non-GAAP financial measures provide meaningful insight to investors and other stakeholders in understanding its financial performance and position, by excluding certain transactions that may be non-recurring, non-operational, or not indicative of ongoing results. The Company believes that these non-GAAP measures offer a useful perspective for evaluating performance trends over time and are intended to support period-to-period comparisons. The Company believes they are valuable tools for both investors and management in assessing historical results and forecasting future performance. Non-GAAP financial measures may not be comparable to similarly entitled measures reported by other companies. The results for the three months ended June 30, 2026 were not materially impacted by items outside of the normal course of business.
A key measure of operating efficiency monitored by the Company is the efficiency ratio, which is derived from GAAP-based amounts. It is calculated by dividing total other operating expenses by total pre-provision revenue (defined as net interest income plus total other operating income). The Company believes that the efficiency ratio, a non-GAAP financial measure, provides a useful supplemental metric that enhances understanding of its business performance and operating efficiency. However, this ratio should not be viewed as a substitute for GAAP results and may not be comparable to similarly titled measures reported by other companies. The following table presents the Company's efficiency ratio for the periods indicated:
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Three Months Ended Six Months Ended | (dollars in thousands) Jun 30, 2026 Dec 31, 2025 Jun 30, 2025 Jun 30, 2026 Jun 30, 2025 | Total other operating expense $ 46,180 $ 45,680 $ 43,946 $ 89,846 $ 86,018 | Net interest income $ 62,834 $ 62,087 $ 59,796 $ 124,192 $ 117,495 | Total other operating income 14,620 14,201 13,013 26,194 24,109 | Total revenue $ 77,454 $ 76,288 $ 72,809 $ 150,386 $ 141,604 | Efficiency ratio (non-GAAP) 59.62 % 59.88 % 60.36 % 59.74 % 60.75 % |
The table below presents the Tangible Common Equity ("TCE") ratio, a non-GAAP financial measure, as of the dates indicated. The TCE ratio is calculated by dividing tangible common equity by tangible assets.
(dollars in thousands) Jun 30, 2026 Mar 31, 2026 Dec 31, 2025 Sep 30, 2025 Jun 30, 2025 | Total equity $ 596,331 $ 593,879 $ 592,581 $ 588,066 $ 568,874 | Less: Intangible assets — — — — — | TCE $ 596,331 $ 593,879 $ 592,581 $ 588,066 $ 568,874 | Total assets $ 7,501,060 $ 7,495,363 $ 7,409,241 $ 7,421,478 $ 7,369,567 | Less: Intangible assets — — — — — | Tangible assets $ 7,501,060 $ 7,495,363 $ 7,409,241 $ 7,421,478 $ 7,369,567 | TCE ratio (non-GAAP) 7.95 % 7.92 % 8.00 % 7.92 % 7.72 % |
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