Central Pacific Financial Q2 net interest income rises on higher loan yield

Overview

• Hawaii bank holding company reported Q2 net income and EPS up both sequentially and yr/yr

• Net interest income and margin rose, driven by higher loan yields and lower deposit costs

• Company raised quarterly dividend and repurchased $11.3 mln in shares during the quarter

Outlook

• Company did not provide specific guidance for future quarters or the full year in the press release

Result Drivers

• LOAN AND INVESTMENT YIELDS - Co said higher average balances and yields on loans and investment securities, along with lower deposit costs, drove increases in net interest income and margin

• BOLI INCOME - Increase in income from bank-owned life insurance due to favorable equity market performance boosted other operating income

• OPERATING EXPENSES - Higher salaries and employee benefits, mainly from increased deferred compensation expense tied to equity market performance, raised operating expenses

Company press release: ID:nBwbCDrDa

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "hold."

• Wall Street's median 12-month price target for Central Pacific Financial Corp is $41.00, about 6% above its July 23 closing price of $38.68

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 10 three months ago

Reuters Recommended Reads

• July 23 - Business First Bancshares Q2 profit rises on higher loan yields

• July 23 - Glacier Bancorp Q2 profit jumps on higher net interest income, wider margin

• July 23 - Puerto Rico's Popular Q2 profit rises on higher interest income; lifts dividend

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)