HONOLULU (HawaiiNewsNow) - Hawaiian Electric Industries Inc. (NYSE: HE) reports a $48 million quarterly profit, up about 50 percent from a year ago, on higher earnings in both its electric and banking divisions.
The company owns Hawaiian Electric Co., Maui Electric, and the Big Island's HELCO, and also owns American Savings Bank, the third largest banking institution in Hawaii.
The combined electric operations produced third quarter net income of $38 million, up from $22 million in the summer quarter of 2010, the company said Thursday.
HEI President Connie Lau said interim rate relief granted by the Hawaii Public Utilities Commission was the main reason electric company earnings improved by $16 million.
"Continued regulatory support to recover our investments in a timely manner is essential to our success in attracting the significant capital needed to fund out utilities' reliability and clean energy plans," Lau said.
She also cited $2 million in fuel efficiency savings on Maui and the Big Island, partly offset by $1 million lower kilowatthour sales on those islands.
Bank profit increases slightly
American Savings Bank reported a $15.5 million profit, up slightly from $15.3 million in the same quarter last year.
Loans grew $40 million - mostly home equity loans (second mortgages) and commercial loans, while residential mortgages declined in value. Net interest margin was 4.11 percent, down from 4.31 percent a year earlier.
"This marks the fourth consecutive quarter of loan growth," Lau said.
Provision for loan losses was $3.8 million, down more than a third from $6 million a year earlier. Net write-off ratio was 0.54 percent, compared to 0.53 percent a year earlier, which the bank described as "low compared to our peers." As the third quarter ended, ASB had a tier 1 leverage ratio of 9.1 percent and a total risk-based capital ratio of 13 percent.