FIRST HAWAIIAN, INC. 10-Q

ITEM 1. FINANCIAL STATEMENTS ​ FIRST HAWAIIAN, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF INCOME (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (dollars in thousands, except per share amounts) 2022 2021 Interest income ​ ​ ​ ​ ​ ​ Loans and lease financing ​ $ 103,732 ​ $ 110,939 Available-for-sale securities ​ ​ 32,107 ​ ​ 23,146 Other ​ ​ 782 ​ ​ 491 Total interest income ​ ​ 136,621 ​ ​ 134,576 Interest expense ​ ​ ​ ​ ​ ​ Deposits ​ ​ 2,749 ​ ​ 4,056 Short-term and long-term borrowings ​ ​ — ​ ​ 1,362 Total interest expense ​ ​ 2,749 ​ ​ 5,418 Net interest income ​ ​ 133,872 ​ ​ 129,158 Provision for credit losses ​ ​ ( 5,747 ) ​ ​ — Net interest income after provision for credit losses ​ ​ 139,619 ​ ​ 129,158 Noninterest income ​ ​ ​ ​ ​ ​ Service charges on deposit accounts ​ ​ 7,501 ​ ​ 6,718 Credit and debit card fees ​ ​ 14,850 ​ ​ 14,551 Other service charges and fees ​ ​ 9,654 ​ ​ 8,846 Trust and investment services income ​ ​ 8,883 ​ ​ 8,492 Bank-owned life insurance ​ ​ ( 417 ) ​ ​ 2,389 Other ​ ​ 909 ​ ​ 2,872 Total noninterest income ​ ​ 41,380 ​ ​ 43,868 Noninterest expense ​ ​ ​ ​ ​ ​ Salaries and employee benefits ​ ​ 48,226 ​ ​ 43,936 Contracted services and professional fees ​ ​ 17,147 ​ ​ 17,188 Occupancy ​ ​ 7,410 ​ ​ 7,170 Equipment ​ ​ 5,977 ​ ​ 5,491 Regulatory assessment and fees ​ ​ 2,224 ​ ​ 2,034 Advertising and marketing ​ ​ 2,028 ​ ​ 1,591 Card rewards program ​ ​ 6,883 ​ ​ 4,835 Other ​ ​ 14,147 ​ ​ 14,061 Total noninterest expense ​ ​ 104,042 ​ ​ 96,306 Income before provision for income taxes ​ ​ 76,957 ​ ​ 76,720 Provision for income taxes ​ ​ 19,238 ​ ​ 19,027 Net income ​ $ 57,719 ​ $ 57,693 Basic earnings per share ​ $ 0.45 ​ $ 0.44 Diluted earnings per share ​ $ 0.45 ​ $ 0.44 Basic weighted-average outstanding shares ​ ​ 127,556,242 ​ ​ 129,933,104 Diluted weighted-average outstanding shares ​ ​ 128,121,126 ​ ​ 130,589,878 ​ The accompanying notes are an integral part of these unaudited interim consolidated financial statements. ​ ​ 2 Table of Contents FIRST HAWAIIAN, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ ​ March 31, ​ (dollars in thousands) 2022 2021 Net income ​ $ 57,719 $ 57,693 ​ Other comprehensive loss, net of tax: ​ ​ ​ ​ ​ ​ ​ Net change in investment securities ​ ​ ( 394,551 ) ​ ​ ( 75,039 ) ​ Net change in cash flow derivative hedges ​ ​ ( 1,258 ) ​ ​ — ​ Other comprehensive loss ​ ​ ( 395,809 ) ​ ​ ( 75,039 ) ​ Total comprehensive loss ​ $ ( 338,090 ) ​ $ ( 17,346 ) ​ ​ The accompanying notes are an integral part of these unaudited interim consolidated financial statements. ​ 3 Table of Contents FIRST HAWAIIAN, INC. AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, (dollars in thousands, except share amount) 2022 2021 Assets ​ ​ ​ ​ ​ ​ Cash and due from banks ​ $ 274,022 ​ $ 246,716 Interest-bearing deposits in other banks ​ ​ 1,352,138 ​ ​ 1,011,753 Investment securities, at fair value (amortized cost: $ 8,733,170 as of March 31, 2022 and $ 8,560,733 as of December 31, 2021) ​ ​ 8,062,384 ​ ​ 8,428,032 Loans held for sale ​ ​ — ​ ​ 538 Loans and leases ​ ​ 12,891,743 ​ ​ 12,961,999 Less: allowance for credit losses ​ ​ 150,280 ​ ​ 157,262 Net loans and leases ​ ​ 12,741,463 ​ ​ 12,804,737 ​ ​ ​ ​ ​ ​ ​ Premises and equipment, net ​ ​ 315,766 ​ ​ 318,448 Other real estate owned and repossessed personal property ​ ​ — ​ ​ 175 Accrued interest receivable ​ ​ 61,561 ​ ​ 63,158 Bank-owned life insurance ​ ​ 471,401 ​ ​ 471,819 Goodwill ​ ​ 995,492 ​ ​ 995,492 Mortgage servicing rights ​ ​ 7,650 ​ ​ 8,302 Other assets ​ ​ 760,843 ​ ​ 643,240 Total assets ​ $ 25,042,720 ​ $ 24,992,410 Liabilities and Stockholders' Equity ​ ​ ​ ​ ​ ​ Deposits: ​ ​ ​ ​ ​ ​ Interest-bearing ​ $ 12,504,821 ​ $ 12,422,283 Noninterest-bearing ​ ​ 9,765,609 ​ ​ 9,393,863 Total deposits ​ ​ 22,270,430 ​ ​ 21,816,146 Retirement benefits payable ​ ​ 134,323 ​ ​ 134,491 Other liabilities ​ ​ 352,818 ​ ​ 384,861 Total liabilities ​ ​ 22,757,571 ​ ​ 22,335,498 ​ ​ ​ ​ ​ ​ ​ Commitments and contingent liabilities (Note 11) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stockholders' equity ​ ​ ​ ​ ​ ​ Common stock ($ 0.01 par value; authorized 300,000,000 shares; issued/outstanding: 140,875,595 / 127,686,307 as of March 31, 2022; issued/outstanding: 140,581,715 / 127,502,472 as of December 31, 2021) ​ ​ 1,409 ​ ​ 1,406 Additional paid-in capital ​ ​ 2,530,795 ​ ​ 2,527,663 Retained earnings ​ ​ 628,642 ​ ​ 604,534 Accumulated other comprehensive loss, net ​ ​ ( 517,502 ) ​ ​ ( 121,693 ) Treasury stock ( 13,189,288 shares as of March 31, 2022 and 13,079,243 shares as of December 31, 2021) ​ ​ ( 358,195 ) ​ ​ ( 354,998 ) Total stockholders' equity ​ ​ 2,285,149 ​ ​ 2,656,912 Total liabilities and stockholders' equity ​ $ 25,042,720 ​ $ 24,992,410 ​ The accompanying notes are an integral part of these unaudited interim consolidated financial statements. ​ ​ ​ 4 Table of Contents FIRST HAWAIIAN, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Paid-In ​ Retained ​ Comprehensive ​ Treasury ​ ​ ​ (dollars in thousands, except share amounts) Shares Amount Capital Earnings Loss Stock Total Balance as of December 31, 2021 127,502,472 ​ $ 1,406 $ 2,527,663 $ 604,534 $ ( 121,693 ) $ ( 354,998 ) $ 2,656,912 Net income ​ — ​ ​ — ​ ​ — ​ ​ 57,719 ​ ​ — ​ ​ — ​ ​ 57,719 Cash dividends declared ( $ 0.26 per share) ​ — ​ ​ — ​ ​ — ​ ​ ( 33,151 ) ​ ​ — ​ ​ — ​ ​ ( 33,151 ) Equity-based awards ​ 183,835 ​ ​ 3 ​ ​ 3,132 ​ ​ ( 460 ) ​ ​ — ​ ​ ( 3,197 ) ​ ​ ( 522 ) Other comprehensive loss, net of tax ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 395,809 ) ​ ​ — ​ ​ ( 395,809 ) Balance as of March 31, 2022 ​ 127,686,307 ​ $ 1,409 ​ $ 2,530,795 ​ $ 628,642 ​ $ ( 517,502 ) ​ $ ( 358,195 ) ​ $ 2,285,149 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Paid-In ​ Retained ​ Comprehensive ​ Treasury ​ ​ ​ (dollars in thousands, except share amounts) Shares Amount Capital Earnings Income (Loss) Stock Total Balance as of December 31, 2020 ​ 129,912,272 ​ $ 1,402 ​ $ 2,514,014 ​ $ 473,974 ​ $ 31,604 ​ $ ( 276,890 ) ​ $ 2,744,104 Net income ​ — ​ ​ — ​ ​ — ​ ​ 57,693 ​ ​ — ​ ​ — ​ ​ 57,693 Cash dividends declared ($ 0.26 per share) ​ — ​ ​ — ​ ​ — ​ ​ ( 33,812 ) ​ ​ — ​ ​ — ​ ​ ( 33,812 ) Equity-based awards ​ 170,082 ​ ​ 3 ​ ​ 3,034 ​ ​ ( 437 ) ​ ​ — ​ ​ ( 2,373 ) ​ ​ 227 Common stock repurchased ​ ( 332,464 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 9,543 ) ​ ​ ( 9,543 ) Other comprehensive loss, net of tax ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 75,039 ) ​ ​ — ​ ​ ( 75,039 ) Balance as of March 31, 2021 ​ 129,749,890 ​ $ 1,405 ​ $ 2,517,048 ​ $ 497,418 ​ $ ( 43,435 ) ​ $ ( 288,806 ) ​ $ 2,683,630 ​ ​ ​ The accompanying notes are an integral part of these unaudited interim consolidated financial statements. ​ ​ 5 Table of Contents FIRST HAWAIIAN, INC. AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ ​ March 31, (dollars in thousands) 2022 2021 Cash flows from operating activities ​ ​ ​ ​ ​ ​ Net income ​ $ 57,719 ​ $ 57,693 Adjustments to reconcile net income to net cash provided by operating activities: ​ ​ ​ ​ ​ ​ Provision for credit losses ​ ​ ( 5,747 ) ​ ​ — Depreciation, amortization and accretion, net ​ ​ 15,581 ​ ​ 13,643 Deferred income tax provision ​ ​ 15,059 ​ ​ 355 Stock-based compensation ​ ​ 3,135 ​ ​ 3,037 Other losses ​ ​ 1,566 ​ ​ 1,090 Originations of loans held for sale ​ ​ ( 6,566 ) ​ ​ ( 61,552 ) Proceeds from sales of loans held for sale ​ ​ 6,194 ​ ​ 67,067 Net gains on sales of loans originated for investment and held for sale ​ ​ — ​ ​ ( 1,486 ) Change in assets and liabilities: ​ ​ ​ ​ ​ ​ Net (increase) decrease in other assets ​ ​ ( 33,509 ) ​ ​ 27,030 Net increase in other liabilities ​ ​ 12,830 ​ ​ 47,323 Net cash provided by operating activities ​ ​ 66,262 ​ ​ 154,200 Cash flows from investing activities ​ ​ ​ ​ ​ ​ Available-for-sale securities: ​ ​ ​ ​ ​ ​ Proceeds from maturities and principal repayments ​ ​ 383,290 ​ ​ 448,655 Proceeds from calls and sales ​ ​ 970 ​ ​ 145 Purchases ​ ​ ( 563,925 ) ​ ​ ( 1,178,760 ) Other investments: ​ ​ ​ ​ ​ ​ Proceeds from sales ​ ​ 2,690 ​ ​ 2,404 Purchases ​ ​ ( 2,841 ) ​ ​ ( 14,515 ) Loans: ​ ​ ​ ​ ​ ​ Net decrease (increase) in loans and leases resulting from originations and principal repayments ​ ​ 180,505 ​ ​ ( 45,193 ) Proceeds from sales of loans originated for investment ​ ​ — ​ ​ 220 Purchases of loans ​ ​ ( 114,677 ) ​ ​ ( 558 ) Purchases of premises, equipment and software ​ ​ ( 2,695 ) ​ ​ ( 3,791 ) Proceeds from sales of other real estate owned ​ ​ 176 ​ ​ — Other ​ ​ — ​ ​ ( 1,171 ) Net cash used in investing activities ​ ​ ( 116,507 ) ​ ​ ( 792,564 ) Cash flows from financing activities ​ ​ ​ ​ ​ ​ Net increase in deposits ​ ​ 454,284 ​ ​ 905,958 Dividends paid ​ ​ ( 33,151 ) ​ ​ ( 33,812 ) Stock tendered for payment of withholding taxes ​ ​ ( 3,197 ) ​ ​ ( 2,373 ) Common stock repurchased ​ ​ — ​ ​ ( 9,543 ) Net cash provided by financing activities ​ ​ 417,936 ​ ​ 860,230 Net increase in cash and cash equivalents ​ ​ 367,691 ​ ​ 221,866 Cash and cash equivalents at beginning of period ​ ​ 1,258,469 ​ ​ 1,040,944 Cash and cash equivalents at end of period ​ $ 1,626,160 ​ $ 1,262,810 ​ ​ ​ ​ ​ ​ ​ Supplemental disclosures ​ ​ ​ ​ ​ ​ Interest paid ​ $ 3,545 ​ $ 8,894 Income taxes paid, net of income tax refunds ​ ​ 2,124 ​ ​ 981 Noncash investing and financing activities: ​ ​ ​ ​ ​ ​ Operating lease right-of-use assets obtained in exchange for new lease obligations ​ ​ 761 ​ ​ 6,864 Transfers (to) from loans and leases (from) to loans held for sale ​ ​ ( 834 ) ​ ​ 1,840 ​ The accompanying notes are an integral part of these unaudited interim consolidated financial statements. ​ 6 Table of Contents FIRST HAWAIIAN, INC. AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ​ 1. Organization and Basis of Presentation ​ First Hawaiian, Inc. (“FHI” or the “Parent”), a bank holding company, owns 100 % of the outstanding common stock of First Hawaiian Bank (“FHB” or the “Bank”), its only direct, wholly owned subsidiary. FHB offers a comprehensive suite of banking services, including loans, deposit products, wealth management, insurance, trust, retirement planning, credit card and merchant processing services, to consumer and commercial customers. ​ The accompanying unaudited interim consolidated financial statements of First Hawaiian, Inc. and Subsidiary (the “Company”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. ​ The accompanying unaudited interim consolidated financial statements and notes thereto should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. ​ In the opinion of management, all adjustments, which consist of normal recurring adjustments necessary for a fair presentation of the interim period consolidated financial information, have been made. Results of operations for interim periods are not necessarily indicative of results to be expected for the entire year. Intercompany account balances and transactions have been eliminated in consolidation. ​ Use of Estimates in the Preparation of Financial Statements ​ The preparation of consolidated financial statements in conformity with GAAP requires management 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 financial statements and the reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and various other assumptions believed to be reasonable. Although these estimates are based on management’s best knowledge of current events, actual results may differ from these estimates. ​ Accounting Standards Adopted in 2022 ​ In July 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2021-05, Leases (Topic 842), Lessors – Certain Leases with Variable Lease Payments. This guidance amends the Topic 842 lease classification requirements for lessors to align them with practice under Topic 840. Lessors should classify and account for a lease with variable lease payments that do not depend on a reference index or a rate as an operating lease if both of the following criteria are met: 1) the lease would have been classified as a sales-type lease or a direct financing lease in accordance with the Topic 842 lease classification criteria, and 2) the lessor would have otherwise recognized a day-one loss. The Company adopted the provisions of ASU No. 2021-05 on January 1, 2022 and it did not have a material impact on the Company’s consolidated financial statements. ​ Recent Accounting Pronouncements ​ The following ASUs have been issued by the FASB and are applicable to the Company in future reporting periods. ​ In March 2022, the FASB issued ASU No. 2022-01, Derivatives and Hedging (Topic 815), Fair Value Hedging – Portfolio Layer Method. This update clarifies the guidance in Topic 815 on fair value hedge accounting of interest rate risk for portfolios of financial assets. Under current hedge accounting guidance, the “last-of-layer” method enables an entity to apply fair value hedging to a stated amount of a closed portfolio of prepayable financial assets without having to consider prepayment risk or credit risk when measuring those assets. The hedged item represents a single layer within that closed portfolio. This update expands the scope of this guidance to allow entities to apply the “portfolio layer” method to portfolios of all financial assets, including both prepayable and nonprepayable financial assets. The current model is expanded to 1) explicitly allow entities to designate multiple layers in a single portfolio as individual hedged items and 2) also allow entities 7 Table of Contents the flexibility to use any type of derivative (or combination of derivatives) by applying the multiple-layer model that aligns with its risk management strategy. Although no assets may be added to a closed portfolio once it is designated in a portfolio layer method hedge, at any time after the initial hedge designation, new hedging relationships associated with the portfolio may be designated and existing hedging relationships associated with the portfolio may be dedesignated to align with an entity’s evolving strategy for managing interest rate risk on a timely basis. Under the portfolio layer method, the basis of the portfolio assets is generally adjusted at the portfolio level rather than being allocated to individual assets within the portfolio, except when the allocation of basis adjustments is required by other areas of GAAP. The intent of this update is consistent with the FASB’s efforts to better align an entity’s financial reporting with the results of its risk management strategy and to further simplify the hedge accounting model. This update is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of evaluating the impact that this new guidance may have on the Company’s consolidated financial statements. ​ In March 2022, the FASB issued ASU No. 2022-02, Financial Instruments – Credit Losses (Topic 326), Troubled Debt Restructurings and Vintage Disclosures . This update eliminates the accounting guidance on troubled debt restructurings (TDRs) for creditors in Subtopic 310-40 and amends the guidance on vintage disclosures to require disclosure of current-period gross write-offs by year of origination. This ASU also updates the requirements related to accounting for credit losses under Topic 326 and adds enhanced disclosures for creditors with respect to loan refinancings and restructurings for borrowers experiencing financial difficulty. This update is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of evaluating the impact that this new guidance may have on the Company’s consolidated financial statements. ​ 2. Investment Securities ​ As of March 31, 2022 and December 31, 2021, investment securities consisted predominantly of the following investment categories: ​ U.S. Treasury and debt securities – includes U.S. Treasury notes and debt securities issued by government agencies. ​ Mortgage-backed securities – includes securities backed by notes or receivables secured by mortgage assets with cash flows based on actual or scheduled payments. ​ Collateralized mortgage obligations – includes securities backed by a pool of mortgages with cash flows distributed based on certain rules rather than pass through payments. ​ Collateralized loan obligations – includes structured debt securities backed by a pool of loans, consisting of primarily non-investment grade broadly syndicated corporate loans with additional credit enhancement. These are floating rate securities that have an investment grade rating of AA or better. ​ Debt securities issued by states and political subdivisions – includes general obligation bonds issued by state and local governments. ​ 8 Table of Contents As of March 31, 2022 and December 31, 2021, all of the Company’s investment securities were classified as available-for-sale. Amortized cost and fair value of securities as of March 31, 2022 and December 31, 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ December 31, 2021 ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Fair ​ Amortized ​ Unrealized ​ Unrealized ​ Fair (dollars in thousands) Cost Gains Losses Value Cost Gains Losses Value U.S. Treasury and government agency debt securities ​ $ 213,572 ​ $ — ​ $ ( 14,028 ) ​ $ 199,544 ​ $ 196,662 ​ $ 125 ​ $ ( 4,224 ) ​ $ 192,563 Mortgage-backed securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential - Government agency ​ ​ 128,080 ​ ​ — ​ ​ ( 5,115 ) ​ ​ 122,965 ​ ​ 135,764 ​ ​ 1,791 ​ ​ ( 291 ) ​ ​ 137,264 Residential - Government-sponsored enterprises ​ ​ 1,450,070 ​ ​ 428 ​ ​ ( 88,153 ) ​ ​ 1,362,345 ​ ​ 1,496,605 ​ ​ 6,914 ​ ​ ( 12,419 ) ​ ​ 1,491,100 Commercial - Government agency ​ ​ 358,910 ​ ​ 53 ​ ​ ( 25,874 ) ​ ​ 333,089 ​ ​ 392,443 ​ ​ 1,741 ​ ​ ( 6,521 ) ​ ​ 387,663 Commercial - Government-sponsored enterprises ​ ​ 1,426,831 ​ ​ — ​ ​ ( 176,997 ) ​ ​ 1,249,834 ​ ​ 1,415,511 ​ ​ 2,646 ​ ​ ( 48,714 ) ​ ​ 1,369,443 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government agency ​ ​ 2,153,236 ​ ​ 59 ​ ​ ( 143,514 ) ​ ​ 2,009,781 ​ ​ 2,103,187 ​ ​ 7,768 ​ ​ ( 31,432 ) ​ ​ 2,079,523 Government-sponsored enterprises ​ ​ 2,719,829 ​ ​ 3 ​ ​ ( 210,125 ) ​ ​ 2,509,707 ​ ​ 2,671,131 ​ ​ 3,608 ​ ​ ( 53,695 ) ​ ​ 2,621,044 Collateralized loan obligations ​ ​ 221,607 ​ ​ 25 ​ ​ ( 748 ) ​ ​ 220,884 ​ ​ 105,245 ​ ​ 2 ​ ​ — ​ ​ 105,247 Debt securities issued by states and political subdivisions ​ ​ 61,035 ​ ​ — ​ ​ ( 6,800 ) ​ ​ 54,235 ​ ​ 44,185 ​ ​ — ​ ​ — ​ ​ 44,185 Total available-for-sale securities ​ $ 8,733,170 ​ $ 568 ​ $ ( 671,354 ) ​ $ 8,062,384 ​ $ 8,560,733 ​ $ 24,595 ​ $ ( 157,296 ) ​ $ 8,428,032 ​ Accrued interest receivable related to available-for-sale investment securities was $ 15.0 million and $ 14.1 million as of March 31, 2022 and December 31, 2021, respectively, and is recorded separately from the amortized cost basis of investment securities on the Company’s unaudited interim consolidated balance sheets. ​ Proceeds from calls and sales of investment securities were $ 1.0 million and nil , respectively, for the three months ended March 31, 2022. Proceeds from calls and sales of investment securities were $ 0.1 million and nil , respectively, for the three months ended March 31, 2021. The Company recorded gross realized gains of nil and gross realized losses of nil for the three months ended March 31, 2022 and 2021. The income tax benefit related to the Company’s net realized loss on the sale of investment securities was nil during both the three months ended March 31, 2022 and 2021. Gains and losses realized on sales of securities are determined using the specific identification method. ​ Interest income from taxable investment securities was $ 29.2 million and $ 22.1 million, respectively, for the three months ended March 31, 2022 and 2021. Interest income from non-taxable investment securities was $ 2.9 million and $ 1.0 million, respectively, for the three months ended March 31, 2022 and 2021. ​ The amortized cost and fair value of debt securities issued by the U.S. Treasury, government agencies and states and political subdivisions and collateralized loan obligations as of March 31, 2022, by contractual maturity, are shown below. Mortgage-backed securities and collateralized mortgage obligations are disclosed separately in the table below as remaining expected maturities will differ from contractual maturities as borrowers have the right to prepay obligations. ​ 9 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ ​ Amortized ​ Fair (dollars in thousands) Cost Value Due in one year or less ​ $ 30,148 ​ $ 29,944 Due after one year through five years ​ ​ 39,854 ​ ​ 38,512 Due after five years through ten years ​ ​ 178,200 ​ ​ 172,750 Due after ten years ​ ​ 248,012 ​ ​ 233,457 ​ ​ ​ 496,214 ​ ​ 474,663 ​ ​ ​ ​ ​ ​ ​ Mortgage-backed securities: ​ ​ ​ ​ ​ ​ Residential - Government agency ​ ​ 128,080 ​ ​ 122,965 Residential - Government-sponsored enterprises ​ ​ 1,450,070 ​ ​ 1,362,345 Commercial - Government agency ​ ​ 358,910 ​ ​ 333,089 Commercial - Government-sponsored enterprises ​ ​ 1,426,831 ​ ​ 1,249,834 Total mortgage-backed securities ​ ​ 3,363,891 ​ ​ 3,068,233 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ Government agency ​ ​ 2,153,236 ​ ​ 2,009,781 Government-sponsored enterprises ​ ​ 2,719,829 ​ ​ 2,509,707 Total collateralized mortgage obligations ​ ​ 4,873,065 ​ ​ 4,519,488 Total available-for-sale securities ​ $ 8,733,170 ​ $ 8,062,384 ​ At March 31, 2022, pledged securities totaled $ 2.0 billion, of which $ 1.8 billion was pledged to secure public deposits and $ 186.8 million was pledged to secure other financial transactions. At December 31, 2021, pledged securities totaled $ 2.1 billion, of which $ 1.9 billion was pledged to secure public deposits and $ 193.2 million was pledged to secure other financial transactions. ​ The Company held no securities of any single issuer, other than debt securities issued by the U.S. government, government agencies and government-sponsored enterprises, taken in the aggregate, which were in excess of 10% of stockholders’ equity as of March 31, 2022 or December 31, 2021. ​ The following tables present the unrealized gross losses and fair values of securities in the available-for-sale portfolio by length of time that the 499 and 318 individual securities in each category have been in a continuous loss position as of March 31, 2022 and December 31, 2021, respectively. The unrealized losses on investment securities were attributable to changes in interest rates, relative to when the investment securities were purchased, and not due to the credit quality of the investment securities. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Time in Continuous Loss as of March 31, 2022 ​ ​ Less Than 12 Months ​ 12 Months or More ​ Total ​ ​ Unrealized ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized ​ ​ ​ (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury and government agency debt securities ​ $ ( 4,314 ) ​ $ 93,417 ​ $ ( 9,714 ) ​ $ 106,127 ​ $ ( 14,028 ) ​ $ 199,544 Mortgage-backed securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential - Government agency ​ ​ ( 5,115 ) ​ ​ 122,965 ​ ​ — ​ ​ — ​ ​ ( 5,115 ) ​ ​ 122,965 Residential - Government-sponsored enterprises ​ ​ ( 75,047 ) ​ ​ 1,209,850 ​ ​ ( 13,106 ) ​ ​ 106,145 ​ ​ ( 88,153 ) ​ ​ 1,315,995 Commercial - Government agency ​ ​ ( 10,635 ) ​ ​ 169,320 ​ ​ ( 15,239 ) ​ ​ 153,626 ​ ​ ( 25,874 ) ​ ​ 322,946 Commercial - Government-sponsored enterprises ​ ​ ( 71,323 ) ​ ​ 562,986 ​ ​ ( 105,674 ) ​ ​ 682,848 ​ ​ ( 176,997 ) ​ ​ 1,245,834 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government agency ​ ​ ( 135,357 ) ​ ​ 1,904,905 ​ ​ ( 8,157 ) ​ ​ 73,679 ​ ​ ( 143,514 ) ​ ​ 1,978,584 Government-sponsored enterprises ​ ​ ( 161,761 ) ​ ​ 2,012,931 ​ ​ ( 48,364 ) ​ ​ 465,051 ​ ​ ( 210,125 ) ​ ​ 2,477,982 Collateralized loan obligations: ​ ​ ( 748 ) ​ ​ 79,181 ​ ​ — ​ ​ — ​ ​ ( 748 ) ​ ​ 79,181 Debt securities issued by states and political subdivisions ​ ​ ( 6,800 ) ​ ​ 54,235 ​ ​ — ​ ​ — ​ ​ ( 6,800 ) ​ ​ 54,235 Total available-for-sale securities with unrealized losses ​ $ ( 471,100 ) ​ $ 6,209,790 ​ $ ( 200,254 ) ​ $ 1,587,476 ​ $ ( 671,354 ) ​ $ 7,797,266 ​ 10 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Time in Continuous Loss as of December 31, 2021 ​ ​ Less Than 12 Months ​ 12 Months or More ​ Total ​ ​ Unrealized ​ ​ ​ ​ Unrealized ​ ​ ​ ​ Unrealized ​ ​ ​ (dollars in thousands) Losses Fair Value Losses Fair Value Losses Fair Value U.S. Treasury and government agency debt securities ​ $ ( 3,355 ) ​ $ 134,468 ​ $ ( 869 ) ​ $ 16,642 ​ $ ( 4,224 ) ​ $ 151,110 Mortgage-backed securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential - Government agency ​ ​ ( 291 ) ​ ​ 51,231 ​ ​ — ​ ​ — ​ ​ ( 291 ) ​ ​ 51,231 Residential - Government-sponsored enterprises ​ ​ ( 10,876 ) ​ ​ 1,230,104 ​ ​ ( 1,543 ) ​ ​ 32,415 ​ ​ ( 12,419 ) ​ ​ 1,262,519 Commercial - Government agency ​ ​ ( 5,239 ) ​ ​ 186,024 ​ ​ ( 1,282 ) ​ ​ 26,063 ​ ​ ( 6,521 ) ​ ​ 212,087 Commercial - Government-sponsored enterprises ​ ​ ( 22,179 ) ​ ​ 744,819 ​ ​ ( 26,535 ) ​ ​ 397,123 ​ ​ ( 48,714 ) ​ ​ 1,141,942 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government agency ​ ​ ( 31,432 ) ​ ​ 1,441,848 ​ ​ — ​ ​ — ​ ​ ( 31,432 ) ​ ​ 1,441,848 Government-sponsored enterprises ​ ​ ( 52,551 ) ​ ​ 2,255,535 ​ ​ ( 1,144 ) ​ ​ 24,959 ​ ​ ( 53,695 ) ​ ​ 2,280,494 Total available-for-sale securities with unrealized losses ​ $ ( 125,923 ) ​ $ 6,044,029 ​ $ ( 31,373 ) ​ $ 497,202 ​ $ ( 157,296 ) ​ $ 6,541,231 ​ At March 31, 2022 and December 31, 2021, the Company did not have any securities with the intent to sell and determined it was more likely than not that the Company would not be required to sell the securities prior to recovery of the amortized cost basis. As the Company had the intent and ability to hold the remaining securities in an unrealized loss position as of March 31, 2022 and December 31, 2021, each security with an unrealized loss position in the above tables has been further assessed to determine if a credit loss exists. As of March 31, 2022 and December 31, 2021, the Company did not expect any credit losses in its debt securities and no credit losses were recognized on securities during the three months ended March 31, 2022 and for the year ended December 31, 2021. ​ As of March 31, 2022 and December 31, 2021, the Company’s available-for-sale investment securities were comprised primarily of debt, mortgage-backed securities and collateralized mortgage obligations issued by the U.S. Government, its agencies and government-sponsored enterprises, with under 4 % of the available-for-sale investment securities comprised of collateralized loan obligations rated AA or better and obligations issued by local state and political subdivisions rated AA or better. For investment securities issued by the U.S. Government, its agencies and government-sponsored enterprises, management has concluded that the long history with no credit losses from these issuers indicates an expectation that nonpayment of the amortized cost basis is zero , and these securities are explicitly or implicitly fully guaranteed by the U.S. government. The U.S. government can print its own currency and its currency is routinely held by central banks and other major financial institutions. The dollar is used in international commerce, and commonly is viewed as a reserve currency, all of which qualitatively indicates that historical credit loss information should be minimally affected by current conditions and reasonable and supportable forecasts. For collateralized loan obligations and debt securities issued by local state and political subdivisions, these securities are investment grade and highly rated and carry either sufficient credit enhancement or days cash on hand to support timely payments of principal and interest. As a result, the Company does not expect any future payment defaults and has not recorded an allowance for credit losses for its available-for-sale debt securities as of March 31, 2022 and December 31, 2021. ​ The Company holds approximately 120,000 Visa Class B restricted shares as of both March 31, 2022 and December 31, 2021. These shares continued to be carried at $ 0 cost basis as of both March 31, 2022 and December 31, 2021. ​ 3. Loans and Leases ​ As of March 31, 2022 and December 31, 2021, loans and leases were comprised of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, (dollars in thousands) 2022 2021 Commercial and industrial ​ $ 1,923,534 ​ $ 2,087,099 Commercial real estate ​ ​ 3,759,980 ​ ​ 3,639,623 Construction ​ ​ 708,300 ​ ​ 813,969 Residential: ​ ​ ​ ​ ​ ​ Residential mortgage ​ ​ 4,153,824 ​ 4,083,367 Home equity line ​ ​ 918,101 ​ ​ 876,608 Total residential ​ 5,071,925 ​ ​ 4,959,975 Consumer ​ ​ 1,204,834 ​ ​ 1,229,939 Lease financing ​ ​ 223,170 ​ ​ 231,394 Total loans and leases ​ $ 12,891,743 ​ $ 12,961,999 ​ 11 Table of Contents Outstanding loan balances are reported net of deferred loan costs and fees of $ 48.7 million and $ 42.2 million at March 31, 2022 and December 31, 2021, respectively. ​ Accrued interest receivable related to loans and leases was $ 46.5 million and $ 49.0 million as of March 31, 2022 and December 31, 2021, respectively, and is recorded separately from the amortized cost basis of loans and leases on the Company’s unaudited interim consolidated balance sheets. ​ As of March 31, 2022, residential real estate loans totaling $ 2.3 billion were pledged to collateralize the Company’s borrowing capacity at the Federal Home Loan Bank of Des Moines (“FHLB”), and consumer, commercial and industrial, commercial real estate and residential real estate loans totaling $ 1.7 billion were pledged to collateralize the Company’s borrowing capacity at the Federal Reserve Bank of San Francisco (“FRB”). As of December 31, 2021, residential real estate loans totaling $ 2.4 billion were pledged to collateralize the Company’s borrowing capacity at the FHLB, and consumer, commercial and industrial, commercial real estate and residential real estate loans totaling $ 1.7 billion were pledged to collateralize the Company’s borrowing capacity at the FRB. Residential real estate loans collateralized by properties that were in the process of foreclosure totaled $ 5.3 million and $ 4.7 million as of March 31, 2022 and December 31, 2021, respectively. ​ In the course of evaluating the credit risk presented by a customer and the pricing that will adequately compensate the Company for assuming that risk, management may require a certain amount of collateral support. The type of collateral held varies, but may include accounts receivable, inventory, land, buildings, equipment, income-producing commercial properties and residential real estate. The Company applies the same collateral policy for loans whether they are funded immediately or on a delayed basis. The loan and lease portfolio is principally located in Hawaii and, to a lesser extent, on the U.S. Mainland, Guam and Saipan. The risk inherent in the portfolio depends upon both the economic strength and stability of the state or territories, which affects property values, and the financial strength and creditworthiness of the borrowers. ​ 4. Allowance for Credit Losses ​ The Company maintains the allowance for credit losses for loans and leases (the “ACL”) that is deducted from the amortized cost basis of loans and leases to present the net carrying value of loans and leases expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount of loans and leases. ​ The Company also maintains an estimated reserve for unfunded commitments on the unaudited interim consolidated balance sheets. The reserve for unfunded commitments is reduced in the period in which the off-balance sheet financial instruments expire, loan funding occurs, or is otherwise settled. ​ Rollforward of the Allowance for Credit Losses ​ The following presents the activity in the ACL by class of loans and leases for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2022 ​ ​ Commercial Lending ​ Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ Commercial ​ Commercial ​ ​ ​ ​ ​ ​ ​ Home ​ ​ ​ ​ ​ ​ ​ ​ and ​ Real ​ ​ ​ Lease ​ Residential ​ Equity ​ ​ ​ ​ ​ ​ (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Allowance for credit losses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of period ​ $ 20,080 ​ $ 42,951 ​ $ 9,773 ​ $ 1,659 ​ $ 34,364 ​ $ 5,642 ​ $ 42,793 ​ $ 157,262 Charge-offs ​ ​ ( 706 ) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 43 ) ​ ​ ( 4,109 ) ​ ​ ( 4,858 ) Recoveries ​ ​ 53 ​ ​ 14 ​ ​ — ​ ​ — ​ ​ 16 ​ ​ 28 ​ ​ 2,148 ​ ​ 2,259 Increase (decrease) in Provision ​ ​ ( 267 ) ​ ​ 2,273 ​ ​ ( 865 ) ​ ​ ( 297 ) ​ ​ ( 3,492 ) ​ ​ ( 543 ) ​ ​ ( 1,192 ) ​ ​ ( 4,383 ) Balance at end of period ​ $ 19,160 ​ $ 45,238 ​ $ 8,908 ​ $ 1,362 ​ $ 30,888 ​ $ 5,084 ​ $ 39,640 ​ $ 150,280 ​ 12 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2021 ​ ​ Commercial Lending ​ Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ Commercial ​ Commercial ​ ​ ​ ​ ​ ​ ​ Home ​ ​ ​ ​ ​ ​ ​ ​ and ​ Real ​ ​ ​ Lease ​ Residential ​ Equity ​ ​ ​ ​ ​ ​ (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Allowance for credit losses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of year ​ $ 24,711 ​ $ 58,123 ​ $ 10,039 ​ $ 3,298 ​ $ 40,461 ​ $ 7,163 ​ $ 64,659 ​ $ 208,454 Charge-offs ​ ​ ( 963 ) ​ ​ ( 66 ) ​ ​ — ​ ​ — ​ ​ ( 98 ) ​ ​ — ​ ​ ( 6,541 ) ​ ​ ( 7,668 ) Recoveries ​ ​ 215 ​ ​ 3 ​ ​ 166 ​ ​ — ​ ​ 17 ​ ​ 24 ​ ​ 2,655 ​ ​ 3,080 Increase (decrease) in Provision ​ ​ 3,359 ​ ​ ( 6,369 ) ​ ​ 347 ​ ​ ( 101 ) ​ ​ ( 1,909 ) ​ ​ ( 519 ) ​ ​ 1,692 ​ ​ ( 3,500 ) Balance at end of period ​ $ 27,322 ​ $ 51,691 ​ $ 10,552 ​ $ 3,197 ​ $ 38,471 ​ $ 6,668 ​ $ 62,465 ​ $ 200,366 ​ Rollforward of the Reserve for Unfunded Commitments ​ The following presents the activity in the Reserve for Unfunded Commitments for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2022 ​ ​ Commercial Lending ​ Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ Commercial ​ Commercial ​ ​ ​ ​ ​ ​ ​ Home ​ ​ ​ ​ ​ ​ ​ ​ and ​ Real ​ ​ ​ Lease ​ Residential ​ Equity ​ ​ ​ ​ ​ ​ (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Reserve for unfunded commitments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of period ​ $ 8,615 ​ $ 2,114 ​ $ 8,963 ​ $ — ​ $ 15 ​ $ 10,546 ​ $ 69 ​ $ 30,322 Increase (decrease) in Provision ​ ​ 693 ​ ​ ( 325 ) ​ ​ ( 917 ) ​ ​ — ​ ​ ( 12 ) ​ ​ ( 780 ) ​ ​ ( 23 ) ​ ​ ( 1,364 ) Balance at end of period ​ $ 9,308 ​ $ 1,789 ​ $ 8,046 ​ $ — ​ $ 3 ​ $ 9,766 ​ $ 46 ​ $ 28,958 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2021 ​ ​ Commercial Lending ​ Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ Commercial ​ Commercial ​ ​ ​ ​ ​ ​ ​ Home ​ ​ ​ ​ ​ ​ ​ ​ and ​ Real ​ ​ ​ Lease ​ Residential ​ Equity ​ ​ ​ ​ ​ ​ (dollars in thousands) Industrial Estate Construction Financing Mortgage Line Consumer Total Reserve for unfunded commitments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of period ​ $ 11,719 ​ $ 1,328 ​ $ 9,037 ​ $ — ​ $ 2 ​ $ 8,452 ​ $ 65 ​ $ 30,603 Increase (decrease) in Provision ​ ​ 4,410 ​ ​ ( 216 ) ​ ​ ( 724 ) ​ ​ — ​ ​ ( 2 ) ​ ​ 48 ​ ​ ( 16 ) ​ ​ 3,500 Balance at end of period ​ $ 16,129 ​ $ 1,112 ​ $ 8,313 ​ $ — ​ $ — ​ $ 8,500 ​ $ 49 ​ $ 34,103 ​ Credit Quality Information ​ The Company performs an internal loan review and grading or scoring procedures on an ongoing basis. The review provides management with periodic information as to the quality of the loan portfolio and effectiveness of the Company’s lending policies and procedures. The objective of the loan review and grading or scoring procedures is to identify, in a timely manner, existing or emerging credit quality issues so that appropriate steps can be initiated to avoid or minimize future losses. ​ Loans and leases subject to grading primarily include: commercial and industrial loans, commercial real estate loans, construction loans and lease financing. Other loans subject to grading include installment loans to businesses or individuals for business and commercial purposes, overdraft lines of credit, commercial credit cards, and other credits as may be determined. Credit quality indicators for internally graded loans and leases are generally updated on an annual basis or on a quarterly basis for those loans and leases deemed to be of potentially higher risk. ​ An internal credit risk rating system is used to determine loan grade and is based on borrower credit risk and transactional risk. The loan grading process is a mechanism used to determine the risk of a particular borrower and is based on the following factors of a borrower: character, earnings and operating cash flow, asset and liability structure, debt capacity, management and controls, borrowing entity, and industry and operating environment. ​ Pass – “Pass” (uncriticized) loans and leases, are not considered to carry greater than normal risk. The borrower has the apparent ability to satisfy obligations to the Company, and therefore no loss in ultimate collection is anticipated. ​ Special Mention – Loans and leases that have potential weaknesses deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for assets or in the institution’s credit position at some future date. Special mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. ​ 13 Table of Contents Substandard – Loans and leases that are inadequately protected by the current financial condition and paying capacity of the obligor or by any collateral pledged. Loans and leases so classified must have a well-defined weakness or weaknesses that jeopardize the collection of the debt. They are characterized by the distinct possibility that the bank may sustain some loss if the deficiencies are not corrected. ​ Doubtful – Loans and leases that have weaknesses found in substandard borrowers with the added provision that the weaknesses make collection of debt in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. ​ Loss – Loans and leases classified as loss are considered uncollectible and of such little value that their continuance as an asset is not warranted. This classification does not mean that the loan or lease has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this basically worthless asset even though partial recovery may be effected in the future. ​ Loans that are primarily monitored for credit quality using FICO scores include: residential mortgage loans, home equity lines and consumer loans. FICO scores are calculated primarily based on a consideration of payment history, the current amount of debt, the length of credit history available, a recent history of new sources of credit and the mix of credit type. FICO scores are updated on a monthly, quarterly or bi-annual basis, depending on the product type. ​ The amortized cost basis by year of origination and credit quality indicator of the Company’s loans and leases as of March 31, 2022 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Converted ​ ​ ​ ​ ​ Term Loans ​ Revolving ​ to Term ​ ​ ​ ​ ​ Amortized Cost Basis by Origination Year ​ Loans ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Amortized ​ ​ ​ (dollars in thousands) ​ 2022 ​ 2021 ​ 2020 ​ 2019 ​ 2018 ​ Prior ​ Cost Basis ​ Cost Basis ​ Total Commercial Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial and Industrial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ $ 158,853 ​ $ 483,473 ​ $ 98,061 ​ $ 184,897 ​ $ 79,810 ​ $ 166,075 ​ $ 594,007 ​ $ 31,048 ​ $ 1,796,224 Special Mention ​ ​ 2,876 ​ ​ 356 ​ ​ 3,898 ​ ​ 3,983 ​ ​ 52 ​ ​ 5,594 ​ ​ 1,601 ​ ​ 867 ​ ​ 19,227 Substandard ​ ​ — ​ ​ 337 ​ ​ 1,296 ​ ​ 1,776 ​ ​ 13,251 ​ ​ 757 ​ ​ 15,877 ​ ​ 138 ​ ​ 33,432 Other (1) ​ ​ 4,028 ​ ​ 10,510 ​ ​ 6,171 ​ ​ 6,450 ​ ​ 3,516 ​ ​ 1,664 ​ ​ 42,312 ​ ​ — ​ ​ 74,651 Total Commercial and Industrial ​ ​ 165,757 ​ ​ 494,676 ​ ​ 109,426 ​ ​ 197,106 ​ ​ 96,629 ​ ​ 174,090 ​ ​ 653,797 ​ ​ 32,053 ​ ​ 1,923,534 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial Real Estate ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 240,807 ​ ​ 682,346 ​ ​ 351,893 ​ ​ 523,735 ​ ​ 471,899 ​ ​ 1,291,495 ​ ​ 77,724 ​ ​ 14,752 ​ ​ 3,654,651 Special Mention ​ ​ — ​ ​ — ​ ​ — ​ ​ 47,897 ​ ​ 473 ​ ​ 39,064 ​ ​ 696 ​ ​ — ​ ​ 88,130 Substandard ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,757 ​ ​ 15,280 ​ ​ 4 ​ ​ — ​ ​ 17,041 Other (1) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 158 ​ ​ — ​ ​ — ​ ​ 158 Total Commercial Real Estate ​ ​ 240,807 ​ ​ 682,346 ​ ​ 351,893 ​ ​ 571,632 ​ ​ 474,129 ​ ​ 1,345,997 ​ ​ 78,424 ​ ​ 14,752 ​ ​ 3,759,980 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Construction ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 6,160 ​ ​ 167,645 ​ ​ 118,526 ​ ​ 136,209 ​ ​ 112,919 ​ ​ 89,172 ​ ​ 19,470 ​ ​ — ​ ​ 650,101 Special Mention ​ ​ — ​ ​ — ​ ​ — ​ ​ 244 ​ ​ 705 ​ ​ 353 ​ ​ — ​ ​ — ​ ​ 1,302 Substandard ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 357 ​ ​ 827 ​ ​ — ​ ​ — ​ ​ 1,184 Other (1) ​ ​ 7,871 ​ ​ 29,932 ​ ​ 5,774 ​ ​ 2,957 ​ ​ 3,922 ​ ​ 4,435 ​ ​ 822 ​ ​ — ​ ​ 55,713 Total Construction ​ ​ 14,031 ​ ​ 197,577 ​ ​ 124,300 ​ ​ 139,410 ​ ​ 117,903 ​ ​ 94,787 ​ ​ 20,292 ​ ​ — ​ ​ 708,300 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease Financing ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 3,913 ​ ​ 31,974 ​ ​ 57,192 ​ ​ 45,698 ​ ​ 8,813 ​ ​ 69,286 ​ ​ — ​ ​ — ​ ​ 216,876 Special Mention ​ ​ — ​ ​ 479 ​ ​ 2,672 ​ ​ 1,360 ​ ​ 12 ​ ​ 20 ​ ​ — ​ ​ — ​ ​ 4,543 Substandard ​ ​ — ​ ​ — ​ ​ 270 ​ ​ 123 ​ ​ 15 ​ ​ 1,343 ​ ​ — ​ ​ — ​ ​ 1,751 Total Lease Financing ​ ​ 3,913 ​ ​ 32,453 ​ ​ 60,134 ​ ​ 47,181 ​ ​ 8,840 ​ ​ 70,649 ​ ​ — ​ ​ — ​ ​ 223,170 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Commercial Lending ​ $ 424,508 ​ $ 1,407,052 ​ $ 645,753 ​ $ 955,329 ​ $ 697,501 ​ $ 1,685,523 ​ $ 752,513 ​ $ 46,805 ​ $ 6,614,984 (continued) 14 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Converted ​ ​ ​ ​ ​ Term Loans ​ Revolving ​ to Term ​ ​ ​ ​ ​ Amortized Cost Basis by Origination Year ​ Loans ​ Loans ​ ​ ​ (continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Amortized ​ ​ ​ (dollars in thousands) ​ 2022 ​ 2021 ​ 2020 ​ 2019 ​ 2018 ​ Prior ​ Cost Basis ​ Cost Basis ​ Total Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential Mortgage ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ $ 185,434 ​ $ 1,096,789 ​ $ 615,500 ​ $ 264,419 ​ $ 183,368 ​ $ 1,012,447 ​ $ — ​ $ — ​ $ 3,357,957 680 - 739 ​ ​ 26,812 ​ ​ 128,172 ​ ​ 72,766 ​ ​ 44,872 ​ ​ 25,913 ​ ​ 159,950 ​ ​ — ​ ​ — ​ ​ 458,485 620 - 679 ​ ​ 3,088 ​ ​ 13,196 ​ ​ 12,304 ​ ​ 5,995 ​ ​ 5,021 ​ ​ 39,145 ​ ​ — ​ ​ — ​ ​ 78,749 550 - 619 ​ ​ — ​ ​ 2,267 ​ ​ 1,570 ​ ​ 720 ​ ​ 731 ​ ​ 8,847 ​ ​ — ​ ​ — ​ ​ 14,135 Less than 550 ​ ​ 2,116 ​ ​ 228 ​ ​ 60 ​ ​ — ​ ​ 82 ​ ​ 4,098 ​ ​ — ​ ​ — ​ ​ 6,584 No Score (3) ​ ​ 6,550 ​ ​ 15,806 ​ ​ 7,676 ​ ​ 13,968 ​ ​ 17,545 ​ ​ 56,444 ​ ​ — ​ ​ — ​ ​ 117,989 Other (2) ​ ​ 18,485 ​ ​ 30,872 ​ ​ 16,042 ​ ​ 9,704 ​ ​ 10,810 ​ ​ 32,600 ​ ​ 43 ​ ​ 1,369 ​ ​ 119,925 Total Residential Mortgage ​ ​ 242,485 ​ ​ 1,287,330 ​ ​ 725,918 ​ ​ 339,678 ​ ​ 243,470 ​ ​ 1,313,531 ​ ​ 43 ​ ​ 1,369 ​ ​ 4,153,824 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Home Equity Line ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 705,570 ​ ​ 1,892 ​ ​ 707,462 680 - 739 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 147,290 ​ ​ 3,202 ​ ​ 150,492 620 - 679 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 39,370 ​ ​ 2,129 ​ ​ 41,499 550 - 619 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 10,310 ​ ​ 1,426 ​ ​ 11,736 Less than 550 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,482 ​ ​ 494 ​ ​ 1,976 No Score (3) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 4,936 ​ ​ — ​ ​ 4,936 Total Home Equity Line ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 908,958 ​ ​ 9,143 ​ ​ 918,101 Total Residential Lending ​ ​ 242,485 ​ ​ 1,287,330 ​ ​ 725,918 ​ ​ 339,678 ​ ​ 243,470 ​ ​ 1,313,531 ​ ​ 909,001 ​ ​ 10,512 ​ ​ 5,071,925 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Consumer Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ ​ 60,821 ​ ​ 145,550 ​ ​ 74,436 ​ ​ 68,970 ​ ​ 46,731 ​ ​ 24,261 ​ ​ 112,298 ​ ​ 217 ​ ​ 533,284 680 - 739 ​ ​ 26,319 ​ ​ 87,933 ​ ​ 50,976 ​ ​ 48,120 ​ ​ 28,498 ​ ​ 18,340 ​ ​ 68,407 ​ ​ 647 ​ ​ 329,240 620 - 679 ​ ​ 6,222 ​ ​ 39,016 ​ ​ 19,677 ​ ​ 25,307 ​ ​ 16,453 ​ ​ 14,473 ​ ​ 30,462 ​ ​ 1,038 ​ ​ 152,648 550 - 619 ​ ​ 292 ​ ​ 7,159 ​ ​ 7,314 ​ ​ 11,776 ​ ​ 8,904 ​ ​ 8,485 ​ ​ 10,352 ​ ​ 1,129 ​ ​ 55,411 Less than 550 ​ ​ 53 ​ ​ 2,003 ​ ​ 3,445 ​ ​ 5,732 ​ ​ 2,939 ​ ​ 3,089 ​ ​ 3,166 ​ ​ 471 ​ ​ 20,898 No Score (3) ​ ​ 280 ​ ​ 458 ​ ​ 9 ​ ​ 53 ​ ​ 35 ​ ​ 52 ​ ​ 35,063 ​ ​ 337 ​ ​ 36,287 Other (2) ​ ​ 502 ​ ​ 4,247 ​ ​ 363 ​ ​ 1,691 ​ ​ 4 ​ ​ 2,181 ​ ​ 68,078 ​ ​ — ​ ​ 77,066 Total Consumer Lending ​ ​ 94,489 ​ ​ 286,366 ​ ​ 156,220 ​ ​ 161,649 ​ ​ 103,564 ​ ​ 70,881 ​ ​ 327,826 ​ ​ 3,839 ​ ​ 1,204,834 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Loans and Leases ​ $ 761,482 ​ $ 2,980,748 ​ $ 1,527,891 ​ $ 1,456,656 ​ $ 1,044,535 ​ $ 3,069,935 ​ $ 1,989,340 ​ $ 61,156 ​ $ 12,891,743 (1) Other credit quality indicators used for monitoring purposes are primarily FICO scores. The majority of the loans in this population were originated to borrowers with a prime FICO score. (2) Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. The majority of the loans in this population were graded with a “Pass” rating. (3) No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance. ​ 15 Table of Contents The amortized cost basis by year of origination and credit quality indicator of the Company’s loans and leases as of December 31, 2021 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Converted ​ ​ ​ ​ ​ Term Loans ​ Revolving ​ to Term ​ ​ ​ ​ ​ Amortized Cost Basis by Origination Year ​ Loans ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Amortized ​ ​ ​ (dollars in thousands) ​ 2021 ​ 2020 ​ 2019 ​ 2018 ​ 2017 ​ Prior ​ Cost Basis ​ Cost Basis ​ Total Commercial Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial and Industrial ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ $ 623,098 ​ $ 129,665 ​ $ 223,388 ​ $ 88,409 ​ $ 29,380 ​ $ 168,591 ​ $ 644,947 ​ $ 40,193 ​ $ 1,947,671 Special Mention ​ ​ 397 ​ ​ 4,382 ​ ​ 4,213 ​ ​ 12,552 ​ ​ 974 ​ ​ 5,313 ​ ​ 4,804 ​ ​ 986 ​ ​ 33,621 Substandard ​ ​ 354 ​ ​ 1,380 ​ ​ 1,951 ​ ​ 1,285 ​ ​ 60 ​ ​ 3,551 ​ ​ 17,893 ​ ​ 1,043 ​ ​ 27,517 Other (1) ​ ​ 13,277 ​ ​ 7,070 ​ ​ 7,741 ​ ​ 4,453 ​ ​ 1,995 ​ ​ 370 ​ ​ 43,384 ​ ​ — ​ ​ 78,290 Total Commercial and Industrial ​ ​ 637,126 ​ ​ 142,497 ​ ​ 237,293 ​ ​ 106,699 ​ ​ 32,409 ​ ​ 177,825 ​ ​ 711,028 ​ ​ 42,222 ​ ​ 2,087,099 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Commercial Real Estate ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 693,370 ​ ​ 338,140 ​ ​ 533,887 ​ ​ 487,739 ​ ​ 415,186 ​ ​ 940,732 ​ ​ 78,479 ​ ​ 14,891 ​ ​ 3,502,424 Special Mention ​ ​ — ​ ​ — ​ ​ 48,499 ​ ​ 7,470 ​ ​ 25,513 ​ ​ 30,255 ​ ​ 7,600 ​ ​ — ​ ​ 119,337 Substandard ​ ​ — ​ ​ — ​ ​ — ​ ​ 1,776 ​ ​ 164 ​ ​ 15,303 ​ ​ 459 ​ ​ — ​ ​ 17,702 Other (1) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 160 ​ ​ — ​ ​ — ​ ​ 160 Total Commercial Real Estate ​ ​ 693,370 ​ ​ 338,140 ​ ​ 582,386 ​ ​ 496,985 ​ ​ 440,863 ​ ​ 986,450 ​ ​ 86,538 ​ ​ 14,891 ​ ​ 3,639,623 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Construction ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 154,558 ​ ​ 107,767 ​ ​ 210,314 ​ ​ 155,311 ​ ​ 62,770 ​ ​ 48,021 ​ ​ 22,859 ​ ​ — ​ ​ 761,600 Special Mention ​ ​ — ​ ​ — ​ ​ 244 ​ ​ 707 ​ ​ — ​ ​ 356 ​ ​ — ​ ​ — ​ ​ 1,307 Substandard ​ ​ — ​ ​ — ​ ​ — ​ ​ 363 ​ ​ — ​ ​ 839 ​ ​ — ​ ​ — ​ ​ 1,202 Other (1) ​ ​ 26,835 ​ ​ 8,875 ​ ​ 4,317 ​ ​ 4,308 ​ ​ 2,684 ​ ​ 2,048 ​ ​ 793 ​ ​ — ​ ​ 49,860 Total Construction ​ ​ 181,393 ​ ​ 116,642 ​ ​ 214,875 ​ ​ 160,689 ​ ​ 65,454 ​ ​ 51,264 ​ ​ 23,652 ​ ​ — ​ ​ 813,969 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Lease Financing ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Risk rating: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pass ​ ​ 33,980 ​ ​ 60,650 ​ ​ 48,236 ​ ​ 9,449 ​ ​ 15,009 ​ ​ 57,130 ​ ​ — ​ ​ — ​ ​ 224,454 Special Mention ​ ​ 501 ​ ​ 2,702 ​ ​ 1,506 ​ ​ 311 ​ ​ 153 ​ ​ — ​ ​ — ​ ​ — ​ ​ 5,173 Substandard ​ ​ — ​ ​ 270 ​ ​ 140 ​ ​ 16 ​ ​ 871 ​ ​ 470 ​ ​ — ​ ​ — ​ ​ 1,767 Total Lease Financing ​ ​ 34,481 ​ ​ 63,622 ​ ​ 49,882 ​ ​ 9,776 ​ ​ 16,033 ​ ​ 57,600 ​ ​ — ​ ​ — ​ ​ 231,394 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Commercial Lending ​ $ 1,546,370 ​ $ 660,901 ​ $ 1,084,436 ​ $ 774,149 ​ $ 554,759 ​ $ 1,273,139 ​ $ 821,218 ​ $ 57,113 ​ $ 6,772,085 (continued) 16 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revolving ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Converted ​ ​ ​ ​ ​ Term Loans ​ Revolving ​ to Term ​ ​ ​ ​ ​ Amortized Cost Basis by Origination Year ​ Loans ​ Loans ​ ​ ​ (continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amortized ​ Amortized ​ ​ ​ (dollars in thousands) ​ 2021 ​ 2020 ​ 2019 ​ 2018 ​ 2017 ​ Prior ​ Cost Basis ​ Cost Basis ​ Total Residential Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential Mortgage ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ $ 1,101,958 ​ $ 635,061 ​ $ 286,993 ​ $ 198,622 ​ $ 251,906 ​ $ 829,175 ​ $ — ​ $ — ​ $ 3,303,715 680 - 739 ​ ​ 140,997 ​ ​ 81,590 ​ ​ 45,163 ​ ​ 27,315 ​ ​ 32,855 ​ ​ 125,906 ​ ​ — ​ ​ — ​ ​ 453,826 620 - 679 ​ ​ 15,781 ​ ​ 11,943 ​ ​ 5,268 ​ ​ 10,149 ​ ​ 9,069 ​ ​ 37,404 ​ ​ — ​ ​ — ​ ​ 89,614 550 - 619 ​ ​ 1,735 ​ ​ 873 ​ ​ 698 ​ ​ 533 ​ ​ 2,033 ​ ​ 7,475 ​ ​ — ​ ​ — ​ ​ 13,347 Less than 550 ​ ​ — ​ ​ — ​ ​ — ​ ​ 345 ​ ​ 2,603 ​ ​ 2,838 ​ ​ — ​ ​ — ​ ​ 5,786 No Score (3) ​ ​ 18,882 ​ ​ 7,938 ​ ​ 15,051 ​ ​ 18,107 ​ ​ 17,333 ​ ​ 42,185 ​ ​ — ​ ​ — ​ ​ 119,496 Other (2) ​ ​ 25,625 ​ ​ 16,263 ​ ​ 10,242 ​ ​ 11,297 ​ ​ 16,242 ​ ​ 17,152 ​ ​ 44 ​ ​ 718 ​ ​ 97,583 Total Residential Mortgage ​ ​ 1,304,978 ​ ​ 753,668 ​ ​ 363,415 ​ ​ 266,368 ​ ​ 332,041 ​ ​ 1,062,135 ​ ​ 44 ​ ​ 718 ​ ​ 4,083,367 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Home Equity Line ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 671,566 ​ ​ 1,873 ​ ​ 673,439 680 - 739 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 141,889 ​ ​ 3,968 ​ ​ 145,857 620 - 679 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 37,815 ​ ​ 2,500 ​ ​ 40,315 550 - 619 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 9,090 ​ ​ 948 ​ ​ 10,038 Less than 550 ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 2,574 ​ ​ 68 ​ ​ 2,642 No Score (3) ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 4,317 ​ ​ — ​ ​ 4,317 Total Home Equity Line ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 867,251 ​ ​ 9,357 ​ ​ 876,608 Total Residential Lending ​ ​ 1,304,978 ​ ​ 753,668 ​ ​ 363,415 ​ ​ 266,368 ​ ​ 332,041 ​ ​ 1,062,135 ​ ​ 867,295 ​ ​ 10,075 ​ ​ 4,959,975 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Consumer Lending ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ FICO: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 740 and greater ​ ​ 155,929 ​ ​ 83,337 ​ ​ 79,617 ​ ​ 56,707 ​ ​ 24,525 ​ ​ 8,067 ​ ​ 117,843 ​ ​ 209 ​ ​ 526,234 680 - 739 ​ ​ 93,214 ​ ​ 56,327 ​ ​ 55,126 ​ ​ 34,049 ​ ​ 17,527 ​ ​ 6,315 ​ ​ 69,366 ​ ​ 707 ​ ​ 332,631 620 - 679 ​ ​ 41,671 ​ ​ 21,986 ​ ​ 28,491 ​ ​ 19,403 ​ ​ 12,952 ​ ​ 5,324 ​ ​ 31,165 ​ ​ 1,175 ​ ​ 162,167 550 - 619 ​ ​ 7,836 ​ ​ 8,265 ​ ​ 13,265 ​ ​ 10,497 ​ ​ 7,469 ​ ​ 3,244 ​ ​ 10,359 ​ ​ 1,089 ​ ​ 62,024 Less than 550 ​ ​ 2,272 ​ ​ 3,867 ​ ​ 6,646 ​ ​ 3,484 ​ ​ 2,739 ​ ​ 1,175 ​ ​ 3,195 ​ ​ 536 ​ ​ 23,914 No Score (3) ​ ​ 481 ​ ​ 19 ​ ​ 56 ​ ​ 40 ​ ​ 65 ​ ​ 2 ​ ​ 35,414 ​ ​ 320 ​ ​ 36,397 Other (2) ​ ​ 4,737 ​ ​ 365 ​ ​ 1,712 ​ ​ 17 ​ ​ 2,182 ​ ​ 31 ​ ​ 77,528 ​ ​ — ​ ​ 86,572 Total Consumer Lending ​ ​ 306,140 ​ ​ 174,166 ​ ​ 184,913 ​ ​ 124,197 ​ ​ 67,459 ​ ​ 24,158 ​ ​ 344,870 ​ ​ 4,036 ​ ​ 1,229,939 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Loans and Leases ​ $ 3,157,488 ​ $ 1,588,735 ​ $ 1,632,764 ​ $ 1,164,714 ​ $ 954,259 ​ $ 2,359,432 ​ $ 2,033,383 ​ $ 71,224 ​ $ 12,961,999 (1) Other credit quality indicators used for monitoring purposes are primarily FICO scores. The majority of the loans in this population were originated to borrowers with a prime FICO score. (2) Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. The majority of the loans in this population were graded with a “Pass” rating. (3) No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance. ​ There were no loans and leases graded as Loss as of March 31, 2022 and December 31, 2021. ​ 17 Table of Contents The amortized cost basis of revolving loans that were converted to term loans during the three months ended March 31, 2022 and 2021 was as follows: ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended (dollars in thousands) ​ March 31, 2022 Commercial and industrial ​ $ 203 Home equity line ​ ​ 1,015 Consumer ​ ​ 354 Total Revolving Loans Converted to Term Loans During the Period ​ $ 1,572 ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended (dollars in thousands) ​ March 31, 2021 Commercial and industrial ​ $ 229 Home equity line ​ ​ 1,079 Consumer ​ ​ 493 Total Revolving Loans Converted to Term Loans During the Period ​ $ 1,801 ​ Past-Due Status ​ The Company continually updates its aging analysis for loans and leases to monitor the migration of loans and leases into past due categories. The Company considers loans and leases that are delinquent for 30 days or more to be past due. As of March 31, 2022 and December 31, 2021, the aging analysis of the amortized cost basis of the Company’s past due loans and leases was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ ​ Past Due ​ ​ ​ ​ ​ Loans and ​ ​ ​ ​ ​ ​ Greater ​ ​ ​ ​ ​ ​ ​ Leases Past ​ ​ ​ ​ ​ ​ Than or ​ ​ ​ ​ ​ ​ ​ Due 90 Days ​ ​ 30-59 ​ 60-89 ​ Equal to ​ ​ ​ ​ ​ ​ ​ or More and ​ ​ Days ​ Days ​ 90 Days ​ Total ​ ​ ​ Total Loans ​ Still Accruing (dollars in thousands) Past Due Past Due Past Due Past Due Current and Leases ​ Interest Commercial and industrial ​ $ 2,825 ​ $ 2,351 ​ $ 1,160 ​ $ 6,336 ​ $ 1,917,198 ​ $ 1,923,534 ​ $ 591 Commercial real estate ​ ​ 2,503 ​ ​ — ​ ​ 727 ​ ​ 3,230 ​ ​ 3,756,750 ​ ​ 3,759,980 ​ ​ — Construction ​ ​ 247 ​ ​ — ​ ​ — ​ ​ 247 ​ ​ 708,053 ​ ​ 708,300 ​ ​ — Lease financing ​ ​ — ​ ​ — ​ ​ 75 ​ ​ 75 ​ ​ 223,095 ​ ​ 223,170 ​ ​ — Residential mortgage ​ ​ 1,229 ​ ​ 1,301 ​ ​ 5,665 ​ ​ 8,195 ​ ​ 4,145,629 ​ ​ 4,153,824 ​ ​ 13 Home equity line ​ ​ 1,640 ​ ​ 589 ​ ​ 2,252 ​ ​ 4,481 ​ ​ 913,620 ​ ​ 918,101 ​ ​ 2,252 Consumer ​ ​ 14,144 ​ ​ 2,589 ​ ​ 1,588 ​ ​ 18,321 ​ ​ 1,186,513 ​ ​ 1,204,834 ​ ​ 1,588 Total ​ $ 22,588 ​ $ 6,830 ​ $ 11,467 ​ $ 40,885 ​ $ 12,850,858 ​ $ 12,891,743 ​ $ 4,444 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ ​ Past Due ​ ​ ​ ​ ​ Loans and ​ ​ ​ ​ ​ ​ Greater ​ ​ ​ ​ ​ ​ ​ Leases Past ​ ​ ​ ​ ​ ​ Than or ​ ​ ​ ​ ​ ​ ​ Due 90 Days ​ ​ 30-59 ​ 60-89 ​ Equal to ​ ​ ​ ​ ​ ​ ​ or More and ​ ​ Days ​ Days ​ 90 Days ​ Total ​ ​ ​ Total Loans ​ Still Accruing (dollars in thousands) Past Due Past Due Past Due Past Due Current and Leases ​ Interest Commercial and industrial ​ $ 1,195 ​ $ 1,195 ​ $ 1,318 ​ $ 3,708 ​ $ 2,083,391 ​ $ 2,087,099 ​ $ 740 Commercial real estate ​ ​ 631 ​ ​ — ​ ​ — ​ ​ 631 ​ ​ 3,638,992 ​ ​ 3,639,623 ​ ​ — Construction ​ ​ 162 ​ ​ — ​ ​ — ​ ​ 162 ​ ​ 813,807 ​ ​ 813,969 ​ ​ — Lease financing ​ ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 231,394 ​ ​ 231,394 ​ ​ — Residential mortgage ​ ​ 3,030 ​ ​ 1,002 ​ ​ 5,617 ​ ​ 9,649 ​ ​ 4,073,718 ​ ​ 4,083,367 ​ ​ 987 Home equity line ​ ​ 1,538 ​ ​ 538 ​ ​ 3,681 ​ ​ 5,757 ​ ​ 870,851 ​ ​ 876,608 ​ ​ 3,681 Consumer ​ ​ 16,534 ​ ​ 3,366 ​ ​ 1,800 ​ ​ 21,700 ​ ​ 1,208,239 ​ ​ 1,229,939 ​ ​ 1,800 Total ​ $ 23,090 ​ $ 6,101 ​ $ 12,416 ​ $ 41,607 ​ $ 12,920,392 ​ $ 12,961,999 ​ $ 7,208 ​ 18 Table of Contents Nonaccrual Loans and Leases ​ The Company generally places a loan or lease on nonaccrual status when management believes that collection of principal or interest has become doubtful or when a loan or lease becomes 90 days past due as to principal or interest, unless it is well secured and in the process of collection. The Company charges off a loan or lease when facts indicate that the loan or lease is considered uncollectible. ​ The amortized cost basis of loans and leases on nonaccrual status as of March 31, 2022 and December 31, 2021 and the amortized cost basis of loans and leases on nonaccrual status with no ACL as of March 31, 2022 and December 31, 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ ​ Nonaccrual ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ and Leases ​ ​ ​ ​ ​ With No ​ Nonaccrual ​ ​ Allowance ​ Loans (dollars in thousands) for Credit Losses ​ and Leases Commercial and industrial ​ $ — ​ $ 707 Commercial real estate ​ ​ 727 ​ ​ 727 Lease financing ​ ​ — ​ ​ 75 Residential mortgage ​ ​ 2,163 ​ ​ 7,092 Total Nonaccrual Loans and Leases ​ $ 2,890 ​ $ 8,601 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ ​ Nonaccrual ​ ​ ​ ​ ​ Loans ​ ​ ​ ​ ​ and Leases ​ ​ ​ ​ ​ With No ​ Nonaccrual ​ ​ Allowance ​ Loans (dollars in thousands) for Credit Losses ​ and Leases Commercial and industrial ​ $ — ​ $ 718 Commercial real estate ​ ​ 727 ​ ​ 727 Residential mortgage ​ ​ 1,192 ​ ​ 5,637 Total Nonaccrual Loans and Leases ​ $ 1,919 ​ $ 7,082 ​ For the three months ended March 31, 2022 and 2021, the Company recognized interest income of nil and $ 0.1 million, respectively, on nonaccrual loans and leases. Furthermore, for the three months ended March 31, 2022 and 2021, the amount of accrued interest receivables written off by reversing interest income was $ 0.2 million and $ 0.4 million, respectively. ​ Collateral-Dependent Loans and Leases ​ Collateral-dependent loans and leases are those for which repayment (on the basis of the Company’s assessment as of the reporting date) is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty. As of March 31, 2022 and December 31, 2021, the amortized cost basis of collateral-dependent loans were $ 8.4 million and $ 7.5 million, respectively. As of both March 31, 2022 and December 31, 2021, these loans were primarily collateralized by residential real estate property. As of both March 31, 2022 and December 31, 2021, the fair value of collateral on substantially all collateral-dependent loans were significantly in excess of their amortized cost basis. ​ 19 Table of Contents Modifications ​ Commercial and industrial loans modified in a TDR may involve temporary interest-only payments, term and amortization extensions, and converting revolving credit lines to term loans. Modifications of commercial real estate and construction loans in a TDR may involve reducing the interest rate for the remaining term of the loan, extending the maturity date at an interest rate lower than the current market rate for new debt with similar risk, or substituting or adding a new borrower or guarantor. Modifications of construction loans in a TDR may also involve extending the interest-only payment period. Interest continues to accrue on the missed payments and as a result, the effective yield on the loan remains unchanged. Residential real estate loans modified in a TDR may be comprised of loans where monthly payments are lowered to accommodate the borrowers’ financial needs for a period of time, including extended interest-only periods and re-amortization of the balance. Modifications of consumer loans in a TDR may involve temporary or permanent reduced payments, temporary interest-only payments and below-market interest rates. ​ Loans modified in a TDR may already be on nonaccrual status and in some cases, partial charge-offs may have already been taken against the outstanding loan balance. Loans modified in a TDR are evaluated for impairment. As a result, this may have a financial effect of increasing the specific ACL associated with the loan. An ACL for impaired commercial loans, including commercial real estate and construction loans, that have been modified in a TDR is measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or if the loan is collateral-dependent, the estimated fair value of the collateral, less any selling costs. An ACL for impaired residential real estate loans that have been modified in a TDR is measured based on the estimated fair value of the collateral, less any selling costs. Management exercises significant judgment in developing these estimates. ​ The following presents, by class, information related to loans modified in a TDR during the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended ​ Three Months Ended ​ ​ March 31, 2022 ​ March 31, 2021 ​ ​ Number of ​ Recorded ​ Related ​ Number of ​ Recorded ​ Related (dollars in thousands) Contracts (1) Investment (2) ACL Contracts (1) Investment (2) ACL Commercial and industrial ​ — ​ $ — ​ $ — ​ 17 ​ $ 2,945 ​ $ 1,648 Construction ​ — ​ ​ — ​ ​ — ​ 2 ​ ​ 716 ​ ​ 342 Residential mortgage ​ — ​ ​ — ​ ​ — ​ 10 ​ ​ 4,916 ​ ​ 374 Consumer ​ 144 ​ ​ 1,759 ​ ​ 202 ​ 1,690 ​ ​ 15,763 ​ ​ 11,832 Total ​ 144 ​ $ 1,759 ​ $ 202 ​ 1,719 ​ $ 24,340 ​ $ 14,196 ​ (1) The number of contracts does not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. (2) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. ​ The above loans were modified in a TDR through an extension of maturity dates, temporary interest-only payments, temporary payment deferrals, reduced payments, converting revolving credit lines to term loans or below-market interest rates. ​ The Company had commitments to extend credit, standby letters of credit, and commercial letters of credit totaling $ 6.7 billion as of both March 31, 2022 and December 31, 2021. Of the $ 6.7 billion at March 31, 2022, there were commitments of $ 0.1 million to lend additional funds related to borrowers who had loan terms modified in a TDR. Of the $ 6.7 billion at December 31, 2021, there were commitments of $ 0.2 million to lend additional funds related to borrowers who had loan terms modified in a TDR. ​ 20 Table of Contents The following table presents, by class, loans modified in TDRs that have defaulted in the current period within 12 months of their permanent modification date for the periods indicated. The Company is reporting these defaulted TDRs based on a payment default definition of 30 days past due: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, ​ ​ 2022 2021 ​ ​ Number of ​ Recorded ​ Number of ​ Recorded (dollars in thousands) Contracts (1) ​ Investment (2) Contracts (1) Investment (2) Commercial and industrial ​ 1 ​ $ 216 ​ 2 ​ $ 397 Construction ​ — ​ ​ — ​ 1 ​ ​ 361 Residential mortgage ​ — ​ ​ — ​ 1 ​ ​ 372 Consumer ​ 142 ​ ​ 1,991 ​ 93 ​ ​ 1,068 Total ​ 143 ​ $ 2,207 ​ 97 ​ $ 2,198 (1) The number of contracts does not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. (2) The recorded investment balances reflect all partial paydowns and charge-offs since the modification date and do not include TDRs that have been fully paid off, charged off, or foreclosed upon by the end of the period. ​ Foreclosure Proceedings ​ As of both March 31, 2022 and December 31, 2021, there was one residential mortgage loan of $ 0.3 million collateralized by real estate property that was modified in a TDR that was in process of foreclosure. ​ Foreclosed Property ​ As of March 31, 2022, there were no residential real estate properties held from foreclosed residential real estate loans. As of December 31, 2021, residential real estate property held from one foreclosed residential mortgage loan of $ 0.2 million was included in other real estate owned and repossessed personal property shown in the unaudited interim consolidated balance sheets. ​ 5. Mortgage Servicing Rights ​ Mortgage servicing activities include collecting principal, interest, tax, and insurance payments from borrowers while accounting for and remitting payments to investors, taxing authorities, and insurance companies. The Company also monitors delinquencies and administers foreclosure proceedings. ​ Mortgage loan servicing income is recorded in noninterest income as a part of other service charges and fees and amortization of the servicing assets is recorded in noninterest income as part of other income. The unpaid principal amount of residential real estate loans serviced for others was $ 1.6 billion and $ 1.7 billion as of March 31, 2022 and December 31, 2021, respectively. Servicing fees include contractually specified fees, late charges, and ancillary fees, and were $ 1.0 million and $ 1.3 million for the three months ended March 31, 2022 and 2021, respectively. ​ Amortization of mortgage servicing rights (“MSRs”) was $ 0.7 million and $ 0.5 million for three months ended March 31, 2022 and 2021, respectively. The estimated future amortization expenses for MSRs over the next five years are as follows: ​ ​ ​ ​ ​ ​ ​ Estimated (dollars in thousands) Amortization Under one year ​ $ 1,296 One to two years ​ ​ 1,094 Two to three years ​ ​ 928 Three to four years ​ ​ 787 Four to five years ​ ​ 672 ​ 21 Table of Contents The details of the Company’s MSRs are presented below: ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, (dollars in thousands) 2022 2021 Gross carrying amount $ 69,187 ​ $ 69,103 Less: accumulated amortization ​ 61,537 ​ ​ 60,801 Net carrying value $ 7,650 ​ $ 8,302 ​ ​ ​ ​ ​ ​ ​ The following table presents changes in amortized MSRs for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, (dollars in thousands) 2022 2021 Balance at beginning of period $ 8,302 ​ $ 10,731 Originations ​ 84 ​ ​ 683 Amortization ​ ( 736 ) ​ ​ ( 545 ) Balance at end of period $ 7,650 ​ $ 10,869 Fair value of amortized MSRs at beginning of period $ 12,243 ​ $ 14,029 Fair value of amortized MSRs at end of period $ 13,585 ​ $ 14,921 ​ MSRs are evaluated for impairment if events and circumstances indicate a possible impairment. No impairment of MSRs was recorded for the three months ended March 31, 2022 and 2021. ​ The quantitative assumptions used in determining the lower of cost or fair value of the Company’s MSRs as of March 31, 2022 and December 31, 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ ​ ​ Weighted ​ ​ Range ​ Average ​ Range ​ Average ​ Conditional prepayment rate ​ 10.93 % - 24.10 % 11.19 % 13.77 % - 25.19 % 14.61 % Life in years (of the MSR) ​ 2.18 ​ - 6.09 ​ 4.70 ​ 1.99 ​ - 5.31 ​ 5.03 ​ Weighted-average coupon rate ​ 3.56 % - 6.47 % 3.69 % 3.58 % - 6.56 % 3.71 % Discount rate ​ 10.00 % - 10.01 % 10.00 % 10.00 % - 10.01 % 10.00 % ​ The sensitivities surrounding MSRs are expected to have an immaterial impact on fair value. ​ 6. Transfers of Financial Assets ​ The Company’s transfers of financial assets with continuing interest may include pledges of collateral to secure public deposits and repurchase agreements, FHLB and FRB borrowing capacity, automated clearing house (“ACH”) transactions and interest rate swaps. ​ For public deposits and repurchase agreements, the Company enters into bilateral agreements with the entity to pledge investment securities as collateral in the event of default. The right of setoff for a repurchase agreement resembles a secured borrowing, whereby the collateral pledged by the Company would be used to settle the fair value of the repurchase agreement should the Company be in default. The counterparty has the right to sell or repledge the investment securities. The Company is required by the counterparty to maintain adequate collateral levels. In the event the collateral fair value falls below stipulated levels, the Company will pledge additional investment securities. For transfers of assets with the FHLB and the FRB, the Company enters into bilateral agreements to pledge loans as collateral to secure borrowing capacity. For ACH transactions, the Company enters into bilateral agreements to collateralize possible daylight overdrafts. For interest rate swaps, the Company enters into bilateral agreements to pledge collateral when either party is in a negative fair value position to mitigate counterparty credit risk. Counterparties to ACH transactions, certain interest rate swaps, the FHLB and the FRB do not have the right to sell or repledge the collateral. ​ 22 Table of Contents The carrying amounts of the assets pledged as collateral to secure public deposits, borrowing arrangements and other transactions as of March 31, 2022 and December 31, 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) March 31, 2022 December 31, 2021 Public deposits ​ $ 1,783,882 ​ $ 1,913,369 Federal Home Loan Bank ​ ​ 2,269,584 ​ ​ 2,380,042 Federal Reserve Bank ​ ​ 1,725,291 ​ ​ 1,724,279 ACH transactions ​ ​ 112,800 ​ ​ 115,038 Interest rate swaps ​ ​ 20,889 ​ ​ 48,430 Total ​ $ 5,912,446 ​ $ 6,181,158 ​ As of March 31, 2022 and December 31, 2021, the borrowing capacity with the FHLB was $ 1.7 billion and $ 1.8 billion, respectively. The FHLB fixed-rate advances and remaining borrowing capacity were secured by residential real estate loan collateral as of March 31, 2022 and December 31, 2021. As of March 31, 2022 and December 31, 2021, the Company had an undrawn line of credit of $ 1.3 billion and $ 1.1 billion, respectively, from the FRB. The borrowing capacity with the FRB was secured by consumer, commercial and industrial, commercial real estate and residential real estate loans as of March 31, 2022 and December 31, 2021. ​ As the Company did not enter into reverse repurchase agreements or repurchase agreements, no collateral was accepted or pledged as of March 31, 2022 and December 31, 2021. In addition, no debt was extinguished by in-substance defeasance. ​ ​ ​ 7. Deposits ​ As of March 31, 2022 and December 31, 2021, deposits were categorized as interest-bearing or noninterest-bearing as follows: ​ ​ ​ ​ ​ ​ ​ ​ (dollars in thousands) March 31, 2022 December 31, 2021 U.S.: ​ ​ ​ ​ ​ ​ Interest-bearing ​ $ 11,642,353 ​ $ 11,553,298 Noninterest-bearing ​ ​ 8,855,088 ​ ​ 8,498,187 Foreign: ​ ​ ​ ​ ​ ​ Interest-bearing ​ ​ 862,468 ​ ​ 868,985 Noninterest-bearing ​ ​ 910,521 ​ ​ 895,676 Total deposits ​ $ 22,270,430 ​ $ 21,816,146 ​ The following table presents the maturity distribution of time certificates of deposit as of March 31, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Under ​ $250,000 ​ ​ ​ (dollars in thousands) $250,000 or More Total Three months or less ​ $ 228,660 ​ $ 155,546 ​ $ 384,206 Over three through six months ​ ​ 152,926 ​ ​ 119,732 ​ ​ 272,658 Over six through twelve months ​ ​ 360,870 ​ ​ 409,218 ​ ​ 770,088 One to two years ​ ​ 80,002 ​ ​ 20,850 ​ ​ 100,852 Two to three years ​ ​ 50,970 ​ ​ 10,126 ​ ​ 61,096 Three to four years ​ ​ 41,724 ​ ​ 19,291 ​ ​ 61,015 Four to five years ​ ​ 42,545 ​ ​ 9,206 ​ ​ 51,751 Thereafter ​ ​ 172 ​ ​ — ​ ​ 172 Total ​ $ 957,869 ​ $ 743,969 ​ $ 1,701,838 ​ Time certificates of deposit in denominations of $250,000 or more, in the aggregate, were $ 0.7 billion and $ 0.8 billion as of March 31, 2022 and December 31, 2021, respectively. Overdrawn deposit accounts are classified as loans and totaled $ 1.7 million and $ 2.1 million as of March 31, 2022 and December 31, 2021, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 23 Table of Contents 8. Accumulated Other Comprehensive Loss ​ Accumulated other comprehensive loss is defined as the revenues, expenses, gains and losses that are included in comprehensive loss but excluded from net income. The Company’s significant items of accumulated other comprehensive loss are pension and other benefits, net unrealized gains or losses on investment securities and net unrealized gains or losses on cash flow derivative hedges. ​ Changes in accumulated other comprehensive loss for the three months ended March 31, 2022 and 2021 are presented below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income ​ ​ ​ ​ ​ ​ ​ ​ Tax ​ ​ ​ ​ ​ Pre-tax ​ Benefit ​ Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive loss at December 31, 2021 ​ $ ( 165,967 ) ​ $ 44,274 ​ $ ( 121,693 ) Three months ended March 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ Investment securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized net losses arising during the period ​ ​ ( 538,085 ) ​ ​ 143,534 ​ ​ ( 394,551 ) Net change in investment securities ​ ​ ( 538,085 ) ​ ​ 143,534 ​ ​ ( 394,551 ) Cash flow derivative hedges: ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized net losses on cash flow derivative hedges arising during the period ​ ​ ( 1,716 ) ​ ​ 458 ​ ​ ( 1,258 ) Net change in cash flow derivative hedges ​ ​ ( 1,716 ) ​ ​ 458 ​ ​ ( 1,258 ) Other comprehensive loss ​ ​ ( 539,801 ) ​ ​ 143,992 ​ ​ ( 395,809 ) Accumulated other comprehensive loss at March 31, 2022 ​ $ ( 705,768 ) ​ $ 188,266 ​ $ ( 517,502 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income ​ ​ ​ ​ ​ ​ ​ ​ Tax ​ ​ ​ ​ ​ Pre-tax ​ Benefit ​ Net of (dollars in thousands) Amount (Expense) Tax Accumulated other comprehensive income at December 31, 2020 ​ $ 43,098 ​ $ ( 11,494 ) ​ $ 31,604 Three months ended March 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ Investment securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized net losses arising during the period ​ ​ ( 102,336 ) ​ ​ 27,297 ​ ​ ( 75,039 ) Net change in investment securities ​ ​ ( 102,336 ) ​ ​ 27,297 ​ ​ ( 75,039 ) Other comprehensive loss ​ ​ ( 102,336 ) ​ ​ 27,297 ​ ​ ( 75,039 ) Accumulated other comprehensive loss at March 31, 2021 ​ $ ( 59,238 ) ​ $ 15,803 ​ $ ( 43,435 ) ​ The following table summarizes changes in accumulated other comprehensive loss, net of tax, for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pensions ​ ​ ​ ​ ​ Accumulated ​ ​ and ​ ​ ​ Cash Flow ​ Other ​ ​ Other ​ Investment ​ Derivative ​ Comprehensive (dollars in thousands) Benefits Securities Hedges Loss Three Months Ended March 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of year ​ $ ( 24,390 ) ​ $ ( 97,303 ) ​ $ — ​ $ ( 121,693 ) Other comprehensive loss ​ ​ — ​ ​ ( 394,551 ) ​ ​ ( 1,258 ) ​ ​ ( 395,809 ) Balance at end of period ​ $ ( 24,390 ) ​ $ ( 491,854 ) ​ $ ( 1,258 ) ​ $ ( 517,502 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at beginning of year ​ $ ( 31,737 ) ​ $ 63,341 ​ $ — ​ $ 31,604 Other comprehensive loss ​ ​ — ​ ​ ( 75,039 ) ​ ​ — ​ ​ ( 75,039 ) Balance at end of period ​ $ ( 31,737 ) ​ $ ( 11,698 ) ​ $ — ​ $ ( 43,435 ) ​ ​ 24 Table of Contents 9. Regulatory Capital Requirements ​ Federal and state laws and regulations limit the amount of dividends the Company may declare or pay. The Company depends primarily on dividends from FHB as the source of funds for the Company’s payment of dividends. ​ The Company and the Bank are subject to various regulatory capital requirements imposed by federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s operating activities and financial condition. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and Bank must meet specific capital guidelines that involve quantitative measures of its assets and certain off-balance sheet items. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. ​ Quantitative measures established by regulation to ensure capital adequacy require the Company and Bank to maintain minimum amounts and ratios of Common Equity Tier 1 (“CET1”) capital, Tier 1 capital and total capital to risk-weighted assets, as well as a minimum leverage ratio. ​ The table below sets forth those ratios at March 31, 2022 and December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ First Hawaiian ​ Minimum ​ Well- ​ ​ ​ First Hawaiian, Inc. ​ Bank ​ Capital ​ Capitalized ​ (dollars in thousands) Amount Ratio ​ Amount Ratio ​ Ratio (1) Ratio (1) ​ March 31, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common equity tier 1 capital to risk-weighted assets ​ $ 1,806,115 ​ 12.27 % $ 1,795,292 ​ 12.19 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets ​ ​ 1,806,115 ​ 12.27 % ​ 1,795,292 ​ 12.19 % 6.00 % 8.00 % Total capital to risk-weighted assets ​ ​ 1,985,353 ​ 13.48 % ​ 1,974,530 ​ 13.41 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) ​ ​ 1,806,115 ​ 7.50 % ​ 1,795,292 ​ 7.46 % 4.00 % 5.00 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Common equity tier 1 capital to risk-weighted assets ​ $ 1,783,113 ​ 12.24 % $ 1,769,214 ​ 12.14 % 4.50 % 6.50 % Tier 1 capital to risk-weighted assets ​ ​ 1,783,113 ​ 12.24 % ​ 1,769,214 ​ 12.14 % 6.00 % 8.00 % Total capital to risk-weighted assets ​ ​ 1,965,280 ​ 13.49 % ​ 1,951,377 ​ 13.40 % 8.00 % 10.00 % Tier 1 capital to average assets (leverage ratio) ​ ​ 1,783,113 ​ 7.24 % ​ 1,769,214 ​ 7.18 % 4.00 % 5.00 % (1) As defined by the regulations issued by the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation (“FDIC”). ​ Federal regulations require a 2.5 % capital conservation buffer designed to absorb losses during periods of economic stress. The capital conservation buffer is composed entirely of CET1, on top of these minimum risk weighted asset ratios, effectively resulting in minimum ratios of (i) 7 % CET1 to risk-weighted assets, (ii) 8.5 % Tier 1 capital to risk-weighted assets, and (iii) 10.5 % total capital to risk-weighted assets. As of March 31, 2022, under the bank regulatory capital guidelines, the Company and Bank were both classified as well-capitalized. Management is not aware of any conditions or events that have occurred since March 31, 2022, to change the capital adequacy category of the Company or the Bank. ​ 10. Derivative Financial Instruments ​ The Company enters into derivative contracts primarily to manage its interest rate risk, as well as for customer accommodation purposes. Derivatives used for risk management purposes consist of interest rate swaps that are designated as a fair value hedge. The derivatives are recognized on the unaudited interim consolidated balance sheets as either assets or liabilities at fair value. Derivatives entered into for customer accommodation purposes consist of various free-standing interest rate derivative products and foreign exchange contracts. The Company is party to master netting arrangements with its financial institution counterparties; however, the Company does not offset assets and liabilities under these arrangements for financial statement presentation purposes. ​ 25 Table of Contents The following table summarizes notional amounts and fair values of derivatives held by the Company as of March 31, 2022 and December 31, 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ December 31, 2021 ​ ​ ​ ​ ​ Fair Value ​ ​ ​ ​ Fair Value ​ ​ Notional ​ Asset ​ Liability ​ Notional ​ Asset ​ Liability (dollars in thousands) Amount Derivatives (1) Derivatives (2) Amount Derivatives (1) Derivatives (2) Derivatives designated as hedging instruments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest rate swaps ​ $ 267,500 ​ $ 301 ​ $ ( 1,716 ) ​ $ 67,500 ​ $ — ​ $ ( 1,211 ) Derivatives not designated as hedging instruments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest rate swaps ​ ​ 2,908,144 ​ ​ 16,107 ​ ​ ( 11,697 ) ​ ​ 2,827,582 ​ ​ 50,898 ​ ​ — Visa derivative ​ ​ 100,887 ​ ​ — ​ ​ ( 5,794 ) ​ ​ 105,916 ​ ​ — ​ ​ ( 5,530 ) Interest rate caps and floors ​ ​ — ​ ​ — ​ ​ — ​ ​ 148,800 ​ ​ 27 ​ ​ ( 27 ) Foreign exchange contracts ​ ​ 1,005 ​ ​ 6 ​ ​ — ​ ​ 217 ​ ​ — ​ ​ — (1) The positive fair values of derivative assets are included in other assets. (2) The negative fair values of derivative liabilities are included in other liabilities. ​ Certain interest rate swaps noted above, are cleared through clearinghouses, rather than directly with counterparties. Those transactions cleared through a clearinghouse require initial margin collateral and variation margin payments depending on the contracts being in a net asset or liability position. As of March 31, 2022, the amount of initial margin cash collateral received by the Company was $ 1.5 million. As of December 31, 2021, the amount of initial margin cash collateral received by the Company was $ 1.7 million. As of March 31, 2022 and December 31, 2021, the variation margin was $ 4.4 million and $ 50.9 million, respectively. ​ As of March 31, 2022, the Company pledged $ 29.9 million in financial instruments and received $ 9.1 million in cash as collateral for interest rate swaps. As of December 31, 2021, the Company pledged $ 30.3 million in financial instruments and $ 18.1 million in cash as collateral for interest rate swaps. As of March 31, 2022 and December 31, 2021, the cash collateral includes the excess initial margin for interest rate swaps cleared through clearinghouses and cash collateral for interest rate swaps with financial institution counterparties. ​ Fair Value Hedges ​ To manage the risk related to the Company’s net interest margin, interest rate swaps are utilized to hedge certain fixed-rate loans. These swaps have maturity, amortization and prepayment features that correspond to the loans hedged, and are designated and qualify as fair value hedges. Any gain or loss on the swaps, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, is recognized in current period earnings. ​ At March 31, 2022 and December 31, 2021, the Company carried one interest rate swap with a notional amount of $ 67.5 million, which was designated and qualified as a fair value hedge for a commercial and industrial loan. As of March 31, 2022 and December 31, 2021, the interest rate swap had a positive fair value of $ 0.3 million and a negative fair value of $ 1.0 million, respectively. The swap was executed in the fourth quarter of 2021, will start in the fourth quarter of 2023, and will mature in 2041. The Company will receive a USD Federal Funds floating rate and will pay a fixed rate of 2.07 % . ​ The following table shows the gains and losses recognized in income related to derivatives in fair value hedging relationships for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gains (losses) recognized in ​ Three Months Ended ​ ​ the consolidated statements ​ March 31, (dollars in thousands) of income line item 2022 2021 Gains (losses) on fair value hedging relationships recognized in interest income: ​ ​ ​ ​ ​ ​ ​ ​ Recognized on interest rate swap ​ Loans and lease financing ​ $ 1,512 ​ $ 193 Recognized on hedged item ​ Loans and lease financing ​ ​ ( 1,617 ) ​ ​ ( 249 ) ​ 26 Table of Contents As of March 31, 2022 and December 31, 2021, the following amounts were recorded in the unaudited interim consolidated balance sheets related to the cumulative basis adjustments for fair value hedges: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cumulative Amount of Fair Value ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Hedging Adjustment Included in the ​ ​ Carrying Amount of the Hedged Asset ​ Carrying Amount of the Hedged Asset (dollars in thousands) March 31, 2022 December 31, 2021 March 31, 2022 December 31, 2021 Line item in the consolidated balance sheets in which the hedged item is included ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans and leases ​ $ 67,181 ​ $ 68,707 ​ $ ( 319 ) ​ $ 1,207 ​ Cash Flow Hedges ​ The Company utilized interest rate swaps to reduce asset sensitivity and enhance current yields associated with interest payments received on a pool of floating-rate loans. The Company entered into interest rate swaps paying floating rates and receiving fixed rates. The floating-rate index (Bloomberg Short-Term Bank Yield Index, or “BSBY”) corresponds to the floating-rate nature of the interest receipts being hedged (based on USD Prime). The swaps provide an initial benefit to interest income as the Company receives the higher fixed rate, which persists for as long as the floating rate remains below the swap’s fixed rate. By hedging with interest rate swaps, the Company minimizes the adverse impact on interest income associated with a low interest rate environment on floating-rate loans. ​ As of March 31, 2022, the Company carried two interest rate swaps with notional amounts totaling $ 200.0 million, with a negative fair value totaling $ 1.7 million. The swaps were executed in the first quarter of 2022, will start in the second quarter of 2022, and will mature in 2024. The Company will receive fixed rates ranging from 1.70 % to 2.08 % and will pay 1-month BSBY. ​ The interest rate swaps are designated and qualify as cash flow hedges. To the extent that the hedge is considered highly effective, the gain or loss on the interest rate swaps is reported as a component of other comprehensive income (loss) and reclassified into earnings in the same period that the hedged transaction affects earnings. The Company recognized a $ 1.7 million loss in other comprehensive income (loss) during the three months ended March 31, 2022. There were no gains or losses reclassified from accumulated other comprehensive income (loss) into earnings during the three months ended March 31, 2022. The estimated net amount to be reclassified within the next 12 months out of accumulated other comprehensive income (loss) into earnings is $ 0.4 million as an increase to interest income from loans and lease financing. As of March 31, 2022, the maximum length of time over which forecasted transactions are hedged is approximately two years . ​ Free-Standing Derivative Instruments ​ For the derivatives that are not designated as hedges, changes in fair value are reported in current period earnings. The following table summarizes the impact on pretax earnings of derivatives not designated as hedges, as reported on the unaudited interim consolidated statements of income for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net gains (losses) recognized Three Months Ended ​ ​ in the consolidated statements March 31, (dollars in thousands) of income line item 2022 2021 Derivatives Not Designated As Hedging Instruments: ​ ​ ​ ​ ​ ​ ​ Visa derivative ​ Other noninterest income ​ ( 1,480 ) ​ ​ 26 Foreign exchange contracts ​ Other noninterest income ​ 6 ​ ​ — ​ As of March 31, 2022, the Company carried multiple interest rate swaps with notional amounts totaling $ 2.9 billion, all of which were related to the Company’s customer swap program, with a positive fair value of $ 16.1 million and a negative fair value of $ 11.7 million. The Company received floating rates ranging from 0.23 % to 3.23 % and paid fixed rates ranging from 2.02 % to 6.19 %. The swaps mature between May 2022 and June 2040. As of December 31, 2021, the Company carried multiple interest rate swaps with notional amounts totaling $ 2.8 billion, all of which were related to the Company’s customer swap program, with a positive fair value of $ 50.9 million and a negative fair value of nil . The Company received floating rates ranging from 0.00 % to 3.55 % and paid fixed rates ranging from 2.02 % to 6.19 %. These swaps resulted in net interest expense of nil during both the three months ended March 31, 2022 and 2021. ​ 27 Table of Contents The Company’s customer swap program is designed by offering customers a variable-rate loan that is swapped to fixed-rate through an interest rate swap. The Company simultaneously executes an offsetting interest rate swap with a swap dealer. Upfront fees on the dealer swap are recorded in other noninterest income and totaled $ 1.0 million and $ 0.5 million for the three months ended March 31, 2022 and 2021, respectively. ​ Visa Class B Restricted Shares ​ In 2016, the Company recorded a $ 22.7 million net realized gain related to the sale of 274,000 Visa Class B restricted shares. Concurrent with the sale of the Visa Class B restricted shares, the Company entered into a funding swap agreement with the buyer that requires payment to the buyer in the event Visa reduces each member bank’s Class B conversion rate to unrestricted Class A common shares. During 2018, 2019 and 2021, Visa funded its litigation escrow account, thereby reducing each member bank’s Class B conversion rate to unrestricted Class A common shares from 1.6483 to the current conversion rate of 1.6181 . Under the terms of the funding swap agreement, the Company will make monthly payments to the buyer based on Visa’s Class A stock price and the number of Visa Class B restricted shares that were sold until the date on which the covered litigation is settled. A derivative liability (“Visa derivative”) of $ 5.8 million and $ 5.5 million was included in the unaudited interim consolidated balance sheets at March 31, 2022 and December 31, 2021, respectively, to provide for the fair value of this liability. There were no sales of these shares prior to 2016. See “Note 15. Fair Value” for more information. ​ Counterparty Credit Risk ​ By using derivatives, the Company is exposed to counterparty credit risk if counterparties to the derivative contracts do not perform as expected. If a counterparty fails to perform, the Company’s counterparty credit risk is equal to the amount reported as a derivative asset, net of cash or other collateral received, and net of derivatives in a loss position with the same counterparty to the extent master netting arrangements exist. The Company minimizes counterparty credit risk through credit approvals, limits, monitoring procedures, executing master netting arrangements and obtaining collateral, where appropriate. Counterparty credit risk related to derivatives is considered in determining fair value. ​ The Company’s interest rate swap agreements include bilateral collateral agreements with collateral requirements, which begin with exposures in excess of $ 0.3 million. For each counterparty, the Company reviews the interest rate swap collateral daily. Collateral for customer interest rate swap agreements, calculated as the pledged asset less loan balance, requires valuation of the pledged asset. Counterparty credit risk adjustments of $ 0.1 million were recognized during both the three months ended March 31, 2022 and 2021. ​ Credit-Risk Related Contingent Features ​ Some of our derivative contracts contain provisions whereby if the Company’s credit rating were to be downgraded by certain major credit rating agencies as a result of a merger or material adverse change in the Company’s financial condition, the counterparty could require an early termination of derivative instruments in a net liability position. The aggregate fair value of all derivative instruments with such credit-risk related contingent features that are in a net liability position was $ 0.8 million and $ 26.9 million at March 31, 2022 and December 31, 2021, respectively, for which we posted $ 0.8 million and $ 19.8 million, respectively, in collateral in the normal course of business. If the Company’s credit rating had been downgraded as of March 31, 2022 and December 31, 2021, we may have been required to settle the contracts in an amount equal to their fair value. ​ 11. Commitments and Contingent Liabilities ​ Contingencies ​ On November 2, 2020, a lawsuit was filed in Hawaii Circuit Court by a Bank customer related to the sale of credit facilities that the Bank had previously extended to the customer. The customer asserts claims against the Bank for interference with the customer’s contract and business opportunity, unfair methods of competition and declaratory and injunctive relief. The outcome of this legal proceeding is uncertain at this point. Based on information available to the Company at present, the Company cannot reasonably estimate a range of potential loss, if any, for this action. Accordingly, the Company has not recognized any liability associated with this action. Management disputes any wrongdoing and the case is being vigorously defended. ​ ​ 28 Table of Contents In addition to the litigation noted above, various legal proceedings are pending or threatened against the Company. After consultation with legal counsel, management does not expect that the aggregate liability, if any, resulting from these proceedings would have a material effect on the Company’s unaudited interim consolidated financial position, results of operations or cash flows. ​ Financial Instruments with Off-Balance Sheet Risk ​ The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby and commercial letters of credit which are not reflected in the unaudited interim consolidated financial statements. ​ Unfunded Commitments to Extend Credit ​ A commitment to extend credit is a legally binding agreement to lend funds to a customer, usually at a stated interest rate and for a specified purpose. Commitments are reported net of participations sold to other institutions. Such commitments have fixed expiration dates and generally require a fee. The extension of a commitment gives rise to credit risk. The actual liquidity requirements or credit risk that the Company will experience is expected to be lower than the contractual amount of commitments to extend credit because a significant portion of those commitments are expected to expire without being drawn upon. Certain commitments are subject to loan agreements containing covenants regarding the financial performance of the customer that must be met before the Company is required to fund the commitment. The Company uses the same credit policies in making commitments to extend credit as it does in making loans. In addition, the Company manages the potential credit risk in commitments to extend credit by limiting the total amount of arrangements, both by individual customer and in the aggregate, by monitoring the size and expiration structure of these portfolios and by applying the same credit standards maintained for all of its related credit activities. Commitments to extend credit are reported net of participations sold to other institutions of $ 93.5 million and $ 95.5 million at March 31, 2022 and December 31, 2021, respectively. ​ Standby and Commercial Letters of Credit ​ Standby letters of credit are issued on behalf of customers in connection with contracts between the customers and third parties. Under standby letters of credit, the Company assures that the third parties will receive specified funds if customers fail to meet their contractual obligations. The credit risk to the Company arises from its obligation to make payment in the event of a customer’s contractual default. Standby letters of credit are reported net of participations sold to other institutions of $ 10.7 million at March 31, 2022 and December 31, 2021. The Company also had commitments for commercial and similar letters of credit. Commercial letters of credit are issued specifically to facilitate commerce whereby the commitment is typically drawn upon when the underlying transaction between the customer and a third-party is consummated. The maximum amount of potential future payments guaranteed by the Company is limited to the contractual amount of these letters. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. Collateral held supports those commitments for which collateral is deemed necessary. The commitments outstanding as of March 31, 2022 have maturities ranging from April 2022 to September 2026. Substantially all fees received from the issuance of such commitments are deferred and amortized on a straight-line basis over the term of the commitment. ​ 29 Table of Contents Financial instruments with off-balance sheet risk at March 31, 2022 and December 31, 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, ​ December 31, (dollars in thousands) 2022 2021 Financial instruments whose contract amounts represent credit risk: ​ ​ ​ ​ ​ ​ Commitments to extend credit ​ $ 6,546,389 ​ $ 6,490,301 Standby letters of credit ​ ​ 182,423 ​ ​ 182,447 Commercial letters of credit ​ ​ 7,149 ​ ​ 3,307 ​ Guarantees ​ The Company sells residential mortgage loans in the secondary market primarily to the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation that may potentially require repurchase under certain conditions. This risk is managed through the Company’s underwriting practices. The Company services loans sold to investors and loans originated by other originators under agreements that may include repurchase remedies if certain servicing requirements are not met. This risk is managed through the Company’s quality assurance and monitoring procedures. Management does not anticipate any material losses as a result of these transactions. ​ Foreign Exchange Contracts ​ The Company has forward foreign exchange contracts that represent commitments to purchase or sell foreign currencies at a future date at a specified price. The Company’s utilization of forward foreign exchange contracts is subject to the primary underlying risk of movements in foreign currency exchange rates and to additional counterparty risk should its counterparties fail to meet the terms of their contracts. Forward foreign exchange contracts are utilized to mitigate the Company’s risk to satisfy customer demand for foreign currencies and are not used for trading purposes. See “Note 10. Derivative Financial Instruments” for more information. ​ Reorganization Transactions ​ On April 1, 2016, a series of reorganization transactions were undertaken to facilitate FHI’s initial public offering. In connection with the reorganization transactions, FHI distributed its interest in BancWest Holding Inc. (“BWHI”), including Bank of the West (“BOW”) to BNP Paribas (“BNPP”) so that BWHI was held directly by BNPP. As a result of the reorganization transactions that occurred on April 1, 2016, various tax or other contingent liabilities could arise related to the business of BOW, or related to the Company’s operations prior to the restructuring when it was known as BancWest Corporation, including its then wholly owned subsidiary, BOW. In December 2021, Bank of Montreal agreed to purchase Bank of the West from BNP Paribas SA. The Company is not able to determine the ultimate outcome or estimate the amounts of these contingent liabilities, if any, at this time. ​ 12. Revenue from Contracts with Customers ​ Revenue Recognition ​ In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of Topic 606, the Company assesses the goods or services that are promised within each contract and identifies those that contain performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. ​ 30 Table of Contents Disaggregation of Revenue ​ In the second quarter of 2021, the Company made changes to the internal measurement of segment operating profits for the purpose of evaluating segment performance and resource allocation. The Company has restated the selected financial information for the three months ended March 31, 2021 in order to conform with the current presentation. See “Note 16. Reportable Operating Segments” contained in our unaudited interim consolidated financial statements for further information. ​ The following table summarizes the Company’s revenues, which includes net interest income on financial instruments and noninterest income, disaggregated by type of service and business segments for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2022 ​ ​ ​ ​ ​ ​ ​ Treasury ​ ​ ​ ​ ​ Retail ​ Commercial ​ and ​ ​ ​ (dollars in thousands) Banking Banking Other Total Net interest income (1) ​ $ 94,048 ​ $ 35,088 ​ $ 4,736 ​ $ 133,872 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Service charges on deposit accounts ​ ​ 6,650 ​ ​ 346 ​ ​ 505 ​ ​ 7,501 Credit and debit card fees ​ ​ — ​ ​ 13,026 ​ ​ 1,216 ​ ​ 14,242 Other service charges and fees ​ ​ 6,563 ​ ​ 781 ​ ​ 369 ​ ​ 7,713 Trust and investment services income ​ ​ 8,883 ​ ​ — ​ ​ — ​ ​ 8,883 Other ​ ​ 128 ​ ​ 2,584 ​ ​ 258 ​ ​ 2,970 Not in scope of Topic 606 (1) ​ ​ 1,091 ​ ​ 1,918 ​ ​ ( 2,938 ) ​ ​ 71 Total noninterest income ​ ​ 23,315 ​ ​ 18,655 ​ ​ ( 590 ) ​ ​ 41,380 Total revenue ​ $ 117,363 ​ $ 53,743 ​ $ 4,146 ​ $ 175,252 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers . The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, 2021 ​ ​ ​ ​ ​ ​ ​ Treasury ​ ​ ​ ​ ​ Retail ​ Commercial ​ and ​ ​ ​ (dollars in thousands) Banking Banking Other Total Net interest income (1) ​ $ 94,454 ​ $ 38,266 ​ $ ( 3,562 ) ​ $ 129,158 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Service charges on deposit accounts ​ ​ 6,086 ​ ​ 223 ​ ​ 409 ​ ​ 6,718 Credit and debit card fees ​ ​ — ​ ​ 12,525 ​ ​ 1,428 ​ ​ 13,953 Other service charges and fees ​ ​ 5,564 ​ ​ 475 ​ ​ 352 ​ ​ 6,391 Trust and investment services income ​ ​ 8,492 ​ ​ — ​ ​ — ​ ​ 8,492 Other ​ ​ 79 ​ ​ 1,496 ​ ​ 336 ​ ​ 1,911 Not in scope of Topic 606 (1) ​ ​ 3,354 ​ ​ 1,322 ​ ​ 1,727 ​ ​ 6,403 Total noninterest income ​ ​ 23,575 ​ ​ 16,041 ​ ​ 4,252 ​ ​ 43,868 Total revenue ​ $ 118,029 ​ $ 54,307 ​ $ 690 ​ $ 173,026 (1) Most of the Company’s revenue is not within the scope of ASU No. 2014-09, Revenue from Contracts with Customers. The guidance explicitly excludes net interest income from financial assets and liabilities as well as other noninterest income from loans, leases, investment securities and derivative financial instruments. ​ For the three months ended March 31, 2022 and 2021, substantially all of the Company’s revenues under the scope of Topic 606 were related to performance obligations satisfied at a point in time. ​ The following is a discussion of revenues within the scope of Topic 606. ​ Service Charges on Deposit Accounts Service charges on deposit accounts relate to fees generated from a variety of deposit products and services rendered to customers. Charges include, but are not limited to, overdraft fees, non-sufficient fund fees, dormant fees and monthly service charges. Such fees are recognized concurrent with the event on a daily basis or on a monthly basis depending upon the customer’s cycle date. ​ 31 Table of Contents Credit and Debit Card Fees Credit and debit card fees primarily represent revenues earned from interchange fees, ATM fees and merchant processing fees. Interchange and network revenues are earned on credit and debit card transactions conducted with payment networks. ATM fees are primarily earned as a result of surcharges assessed to non-FHB customers who use an FHB ATM. Merchant processing fees are primarily earned on transactions in which FHB is the acquiring bank. Such fees are generally recognized concurrently with the delivery of services on a daily basis. ​ Trust and Investment Services Fees Trust and investment services fees represent revenue earned by directing, holding and managing customers’ assets. Fees are generally computed based on a percentage of the previous period’s value of assets under management. The transaction price (i.e., percentage of assets under management) is established at the inception of each contract. Trust and investment services fees also include fees collected when the Company acts as agent or personal representative and executes security transactions, performs collection and disbursement of income, and completes investment management and other administrative tasks. ​ Other Fees Other fees primarily include revenues generated from wire transfers, lockboxes, bank issuance of checks and insurance commissions. Such fees are recognized concurrent with the event or on a monthly basis. ​ Contract Balances ​ A contract liability is an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer. In prior years, the Company received signing bonuses from three vendors which are being amortized over the term of the respective contracts. As of March 31, 2022 and December 31, 2021, the Company had contract liabilities of $ 2.7 million and $ 3.0 million, respectively, which it expects to recognize over the remaining term of the respective contracts with the vendors. For the three months ended March 31, 2022, the Company’s recognized revenues increased and contract liabilities decreased by approximately $ 0.3 million due to the passage of time. For the three months ended March 31, 2021, the Company’s recognized revenues increased and contract liabilities decreased by approximately $ 0.2 million due to the passage of time. There were no changes in contract liabilities due to changes in transaction price estimates. ​ A contract asset is the right to consideration for transferred goods or services when the amount is conditioned on something other than the passage of time. As of March 31, 2022 and December 31, 2021, there were no material receivables from contracts with customers or contract assets recorded on the Company’s consolidated balance sheets. ​ Other ​ Except for the contract liabilities noted above, the Company did no t have any significant performance obligations as of March 31, 2022 and December 31, 2021. The Company also did no t have any material contract acquisition costs or use any significant judgments or estimates in recognizing revenue for financial reporting purposes. ​ 32 Table of Contents 13. Earnings per Share ​ For the three months ended March 31, 2022, the Company made no adjustments to net income for the purpose of computing earnings per share and there were no antidilutive securities. For the three months ended March 31, 2021, the Company made no adjustments to net income for the purpose of computing earnings per share and there were 27,000 antidilutive securities. For the three months ended March 31, 2022 and 2021, the computations of basic and diluted earnings per share were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Three Months Ended March 31, (dollars in thousands, except shares and per share amounts) 2022 2021 Numerator: ​ ​ ​ ​ ​ ​ Net income ​ $ 57,719 ​ $ 57,693 ​ ​ ​ ​ ​ ​ ​ Denominator: ​ ​ ​ ​ ​ ​ Basic: weighted-average shares outstanding ​ ​ 127,556,242 ​ ​ 129,933,104 Add: weighted-average equity-based awards ​ ​ 564,884 ​ ​ 656,774 Diluted: weighted-average shares outstanding ​ ​ 128,121,126 ​ ​ 130,589,878 ​ ​ ​ ​ ​ ​ ​ Basic earnings per share ​ $ 0.45 ​ $ 0.44 Diluted earnings per share ​ $ 0.45 ​ $ 0.44 ​ ​ 14. Noninterest Income and Noninterest Expense ​ Benefit Plans ​ The following table sets forth the components of net periodic benefit cost for the Company’s pension and postretirement benefit plans for the three months ended March 31, 2022 and 2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income line item where recognized in ​ Pension Benefits ​ Other Benefits (dollars in thousands) ​ the consolidated statements of income 2022 2021 2022 2021 Three Months Ended March 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Service cost ​ Salaries and employee benefits ​ $ — ​ $ — ​ $ 215 ​ $ 264 Interest cost ​ Other noninterest expense ​ ​ 1,361 ​ ​ 1,231 ​ ​ 144 ​ ​ 131 Expected return on plan assets ​ Other noninterest expense ​ ​ ( 783 ) ​ ​ ( 766 ) ​ ​ — ​ ​ — Recognized net actuarial loss (gain) ​ Other noninterest expense ​ ​ 1,268 ​ ​ 1,720 ​ ​ ( 101 ) ​ ​ — Total net periodic benefit cost ​ ​ ​ $ 1,846 ​ $ 2,185 ​ $ 258 ​ $ 395 ​ Leases ​ The Company recognized operating lease income related to lease payments of $ 1.5 million and $ 1.7 million for the three months ended March 31, 2022 and 2021, respectively. In addition, the Company recognized $ 1.6 million and $ 1.5 million of lease income related to variable lease payments for the three months ended March 31, 2022 and 2021, respectively. ​ ​ ​ 15. Fair Value ​ The Company determines the fair values of its financial instruments based on the requirements established in Accounting Standards Codification Topic 820 (“Topic 820”), Fair Value Measurements , which provides a framework for measuring fair value under GAAP and requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Topic 820 defines fair value as the exit price, the price that would be received for an asset or paid to transfer a liability, in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date under current market conditions. ​ 33 Table of Contents Fair Value Hierarchy ​ Topic 820 establishes three levels of fair values based on the markets in which the assets or liabilities are traded and the reliability of the assumptions used to determine fair value. The levels are: ​ ◾ Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. ◾ Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ◾ Level 3: Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect the Company’s own estimates of assumptions that market participants would use in pricing the asset or liability (“Company-level data”). Level 3 assets and liabilities include financial instruments whose value is determined using unobservable inputs to pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. ​ Topic 820 requires that the Company disclose estimated fair values for certain financial instruments. Financial instruments include such items as investment securities, loans, deposits, interest rate and foreign exchange contracts, swaps and other instruments as defined by the standard. The Company has an organized and established process for determining and reviewing the fair value of financial instruments reported in the Company’s financial statements. The fair value measurements are reviewed to ensure they are reasonable and in line with market experience in similar asset and liability classes. ​ Additionally, the Company may be required to record at fair value other assets on a nonrecurring basis, such as other real estate owned, other customer relationships, and other intangible assets. These nonrecurring fair value adjustments typically involve the application of lower-of-cost-or-fair-value accounting or write-downs of individual assets. ​ Disclosure of fair values is not required for certain items such as lease financing, obligations for pension and other postretirement benefits, premises and equipment, prepaid expenses, deposit liabilities with no defined or contractual maturity, and income tax assets and liabilities. ​ Reasonable comparisons of fair value information with that of other financial institutions cannot necessarily be made because the standard permits many alternative calculation techniques, and numerous assumptions have been used to estimate the Company’s fair values. ​ 34 Table of Contents Valuation Techniques Used in the Fair Value Measurement of Assets and Liabilities Carried at Fair Value ​ For the assets and liabilities measured at fair value on a recurring basis (categorized in the valuation hierarchy table below), the Company applies the following valuation techniques: ​ Available-for-sale securities Available-for-sale debt securities are recorded at fair value on a recurring basis. Fair value measurement is based on quoted prices, including estimates by third-party pricing services, if available. If quoted prices are not available, fair values are measured using proprietary valuation models that utilize market observable parameters from active market makers and inter-dealer brokers whereby securities are valued based upon available market data for securities with similar characteristics. Management reviews the pricing information received from the Company’s third-party pricing service to evaluate the inputs and valuation methodologies used to place securities into the appropriate level of the fair value hierarchy and transfers of securities within the fair value hierarchy are made if necessary. On a monthly basis, management reviews the pricing information received from the third-party pricing service which includes a comparison to non-binding third-party broker quotes, as well as a review of market-related conditions impacting the information provided by the third-party pricing service. Management also identifies investment securities which may have traded in illiquid or inactive markets by identifying instances of a significant decrease in the volume or frequency of trades, relative to historical levels, as well as instances of a significant widening of the bid-ask spread in the brokered markets. As of March 31, 2022 and December 31, 2021, management did not make adjustments to prices provided by the third-party pricing services as a result of illiquid or inactive markets. The Company’s third-party pricing service has also established processes for the Company to submit inquiries regarding quoted prices. Periodically, the Company will challenge the quoted prices provided by the third-party pricing service. The Company’s third-party pricing service will review the inputs to the evaluation in light of the new market data presented by the Company. The Company’s third-party pricing service may then affirm the original quoted price or may update the evaluation on a going forward basis. The Company classifies all available-for-sale securities as Level 2. ​ Derivatives Most of the Company’s derivatives are traded in over-the-counter markets where quoted market prices are not readily available. For those derivatives, the Company measures fair value on a recurring basis using proprietary valuation models that primarily use market observable inputs, such as yield curves, and option volatilities. The fair value of derivatives includes values associated with counterparty credit risk and the Company’s own credit standing. The Company classifies these derivatives, included in other assets and other liabilities, as Level 2. ​ Concurrent with the sale of the Visa Class B restricted shares, the Company entered into an agreement with the buyer that requires payment to the buyer in the event Visa reduces each member bank’s Class B conversion rate to unrestricted Class A common shares. During 2018, 2019 and 2021, Visa funded its litigation escrow account, thereby reducing each member bank’s Class B conversion rate to unrestricted Class A common shares from 1.6483 to the current conversion rate of 1.6181 . The Visa derivative of $ 5.8 million and $ 5.5 million was included in the unaudited interim consolidated balance sheets at March 31, 2022 and December 31, 2021, respectively, to provide for the fair value of this liability. The potential liability related to this funding swap agreement was determined based on management’s estimate of the timing and the amount of Visa’s litigation settlement and the resulting payments due to the counterparty under the terms of the contract. As such, the funding swap agreement is classified as Level 3 in the fair value hierarchy. The significant unobservable inputs used in the fair value measurement of the Company’s funding swap agreement are the potential future changes in the conversion rate, expected term and growth rate of the market price of Visa Class A common shares. Material increases (or decreases) in any of those inputs may result in a significantly higher (or lower) fair value measurement. ​ 35 Table of Contents Assets and Liabilities Recorded at Fair Value on a Recurring Basis ​ Assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021 are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements as of March 31, 2022 ​ ​ Quoted Prices in ​ Significant ​ ​ ​ ​ ​ ​ Active Markets for ​ Other ​ Significant ​ ​ ​ ​ Identical Assets ​ Observable ​ Unobservable ​ ​ (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Treasury and government agency debt securities ​ $ — ​ $ 199,544 ​ $ — ​ $ 199,544 Mortgage-backed securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential - Government agency (1) ​ ​ — ​ ​ 122,965 ​ ​ — ​ ​ 122,965 Residential - Government-sponsored enterprises (1) ​ ​ — ​ ​ 1,362,345 ​ ​ — ​ ​ 1,362,345 Commercial - Government agency ​ ​ — ​ ​ 333,089 ​ ​ — ​ ​ 333,089 Commercial - Government-sponsored enterprises ​ ​ — ​ ​ 1,249,834 ​ ​ — ​ ​ 1,249,834 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government agency ​ ​ — ​ ​ 2,009,781 ​ ​ — ​ ​ 2,009,781 Government-sponsored enterprises ​ ​ — ​ ​ 2,509,707 ​ ​ — ​ ​ 2,509,707 Collateralized loan obligations ​ ​ — ​ ​ 220,884 ​ ​ — ​ ​ 220,884 Debt securities issued by states and political subdivisions ​ ​ — ​ ​ 54,235 ​ ​ — ​ ​ 54,235 Total available-for-sale securities ​ ​ — ​ ​ 8,062,384 ​ ​ — ​ ​ 8,062,384 Other assets (2) ​ ​ 6,617 ​ ​ 16,414 ​ ​ — ​ ​ 23,031 Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other liabilities (3) ​ ​ — ​ ​ ( 13,413 ) ​ ​ ( 5,794 ) ​ ​ ( 19,207 ) Total ​ $ 6,617 ​ $ 8,065,385 ​ $ ( 5,794 ) ​ $ 8,066,208 (1) Backed by residential real estate. (2) Other assets classified as Level 1 include mutual funds and money market funds that have quoted prices in active markets and are related to the Company’s deferred compensation plans. Other assets classified as Level 2 include derivative assets. (3) Other liabilities include derivative liabilities. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 36 Table of Contents ​ Fair Value Measurements as of December 31, 2021 ​ ​ Quoted Prices in ​ Significant ​ ​ ​ ​ ​ ​ ​ Active Markets for ​ Other ​ Significant ​ ​ ​ ​ Identical Assets ​ Observable ​ Unobservable ​ ​ (dollars in thousands) (Level 1) Inputs (Level 2) Inputs (Level 3) Total Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Treasury and government agency debt securities ​ $ — ​ $ 192,563 ​ $ — ​ $ 192,563 Mortgage-backed securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential - Government agency (1) ​ ​ — ​ ​ 137,264 ​ ​ — ​ ​ 137,264 Residential - Government-sponsored enterprises (1) ​ ​ — ​ ​ 1,491,100 ​ ​ — ​ ​ 1,491,100 Commercial - Government agency ​ ​ — ​ ​ 387,663 ​ ​ — ​ ​ 387,663 Commercial - Government-sponsored enterprises ​ ​ — ​ ​ 1,369,443 ​ ​ — ​ ​ 1,369,443 Collateralized mortgage obligations: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Government agency ​ ​ — ​ ​ 2,079,523 ​ ​ — ​ ​ 2,079,523 Government-sponsored enterprises ​ ​ — ​ ​ 2,621,044 ​ ​ — ​ ​ 2,621,044 Collateralized loan obligations ​ ​ — ​ ​ 105,247 ​ ​ — ​ ​ 105,247 Debt securities issued by states and political subdivisions ​ ​ — ​ ​ 44,185 ​ ​ — ​ ​ 44,185 Total available-for-sale securities ​ ​ — ​ ​ 8,428,032 ​ ​ — ​ ​ 8,428,032 Other assets (2) ​ ​ 7,382 ​ ​ 50,925 ​ ​ — ​ ​ 58,307 Liabilities ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other liabilities (3) ​ ​ — ​ ​ ( 1,238 ) ​ ​ ( 5,530 ) ​ ​ ( 6,768 ) Total ​ $ 7,382 ​ $ 8,477,719 ​ $ ( 5,530 ) ​ $ 8,479,571 (1) Backed by residential real estate. (2) Other assets classified as Level 1 include mutual funds and money market funds that have quoted prices in active markets and are related to the Company’s deferred compensation plans. Other assets classified as Level 2 include derivative assets. (3) Other liabilities include derivative liabilities. ​ For Level 3 assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021, the significant unobservable inputs used in the fair value measurements were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quantitative Information about Level 3 Fair Value Measurements at March 31, 2022 ​ ​ ​ ​ ​ ​ ​ Significant ​ ​ (dollars in thousands) ​ Fair value Valuation Technique Unobservable Input Range Visa derivative ​ $ ( 5,794 ) ​ Discounted Cash Flow ​ Expected Conversation Rate - 1.6181 (1) ​ 1.5885 - 1.6181 ​ ​ ​ ​ ​ ​ ​ Expected Term - 1 year (2) ​ 0.5 to 1.5 years ​ ​ ​ ​ ​ ​ ​ Growth Rate - 26 % (3) ​ 10 % - 38 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quantitative Information about Level 3 Fair Value Measurements at December 31, 2021 ​ ​ ​ ​ ​ ​ ​ Significant ​ ​ (dollars in thousands) ​ Fair value Valuation Technique Unobservable Input Range Visa derivative ​ $ ( 5,530 ) ​ Discounted Cash Flow ​ Expected Conversation Rate - 1.6181 (1) ​ 1.5885 - 1.6181 ​ ​ ​ ​ ​ ​ ​ Expected Term - 1 year (2) ​ 0.5 to 1.5 years ​ ​ ​ ​ ​ ​ ​ Growth Rate - 26 % (3) ​ 10 % - 38 % (1) Due to the uncertainty in the movement of the conversion rate, the current conversion rate was utilized in the fair value calculation. (2) The expected term of 1 year was based on the median of 0.5 to 1.5 years. (3) The growth rate was based on the arithmetic average of analyst price targets. 37 Table of Contents Changes in Fair Value Levels ​ For the three months ended March 31, 2022 and 2021, there were no transfers between fair value hierarchy levels. ​ The changes in Level 3 liabilities measured at fair value on a recurring basis for the three months ended March 31, 2022 and 2021 are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Visa Derivative (dollars in thousands) ​ 2022 2021 Three Months Ended March 31, ​ ​ ​ ​ ​ ​ Balance as of January 1, ​ $ ( 5,530 ) ​ $ ( 4,554 ) Total net (losses) gains included in other noninterest income ​ ​ ( 1,480 ) ​ ​ 26 Settlements ​ ​ 1,216 ​ ​ 1,146 Balance as of March 31, ​ $ ( 5,794 ) ​ $ ( 3,382 ) Total net (losses) gains included in net income attributable to the change in unrealized gains or losses related to liabilities still held as of March 31, ​ $ ( 1,480 ) ​ $ 26 ​ Assets and Liabilities Carried at Other Than Fair Value ​ The following tables summarize for the periods indicated the estimated fair value of the Company’s financial instruments that are not required to be carried at fair value on a recurring basis, excluding leases and deposit liabilities with no defined or contractual maturity. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ March 31, 2022 ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ ​ ​ ​ Quoted Prices in ​ Significant ​ Significant ​ ​ ​ ​ ​ ​ ​ Active Markets ​ Other ​ Unobservable ​ ​ ​ ​ ​ ​ ​ for Identical ​ Observable ​ Inputs ​ ​ (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 1,626,160 ​ $ 274,022 ​ $ 1,352,138 ​ $ — ​ $ 1,626,160 Loans (1) ​ ​ 12,668,573 ​ ​ — ​ ​ — ​ ​ 12,447,576 ​ ​ 12,447,576 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Financial liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Time deposits (2) ​ $ 1,701,838 ​ $ — ​ $ 1,681,170 ​ $ — ​ $ 1,681,170 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ ​ ​ ​ Quoted Prices in ​ Significant ​ Significant ​ ​ ​ ​ ​ ​ ​ Active Markets ​ Other ​ Unobservable ​ ​ ​ ​ ​ ​ ​ for Identical ​ Observable ​ Inputs ​ ​ (dollars in thousands) Book Value Assets (Level 1) Inputs (Level 2) (Level 3) Total Financial assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 1,258,469 ​ $ 246,716 ​ $ 1,011,753 ​ $ — ​ $ 1,258,469 Loans held for sale ​ ​ 538 ​ ​ — ​ ​ 542 ​ ​ — ​ ​ 542 Loans (1) ​ ​ 12,730,605 ​ ​ — ​ ​ — ​ ​ 12,791,811 ​ ​ 12,791,811 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Financial liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Time deposits (2) ​ $ 1,776,438 ​ $ — ​ $ 1,773,321 ​ $ — ​ $ 1,773,321 (1) Excludes financing leases of $ 223.2 million at March 31, 2022 and $ 231.4 million at December 31, 2021. (2) Excludes deposit liabilities with no defined or contractual maturity of $ 20.6 billion as of March 31, 2022 and $ 20.0 billion as of December 31, 2021. ​ 38 Table of Contents Unfunded loan and lease commitments and letters of credit are not included in the tables above. As of both March 31, 2022 and December 31, 2021, the Company had $ 6.7 billion of unfunded loan and lease commitments and letters of credit. The Company believes that a reasonable estimate of the fair value of these instruments is the carrying value of deferred fees plus the related reserve for unfunded commitments, which totaled $ 42.6 million and $ 44.3 million at March 31, 2022 and December 31, 2021, respectively. No active trading market exists for these instruments, and the estimated fair value does not include value associated with the borrower relationship. The Company does not estimate the fair values of certain unfunded loan and lease commitments that can be canceled by providing notice to the borrower. As Company-level data is incorporated into the fair value measurement, unfunded loan and lease commitments and letters of credit are classified as Level 3. ​ Valuation Techniques Used in the Fair Value Measurement of Assets and Liabilities Carried at the Lower of Cost or Fair Value ​ The Company applies the following valuation techniques to assets measured at the lower of cost or fair value: ​ Mortgage servicing rights MSRs are carried at the lower of cost or fair value and are therefore subject to fair value measurements on a nonrecurring basis. The fair value of MSRs is determined using models which use significant unobservable inputs, such as estimates of prepayment rates, the resultant weighted average lives of the MSRs and the option-adjusted spread levels. Accordingly, the Company classifies MSRs as Level 3. ​ Collateral-dependent loans Collateral-dependent loans are those for which repayment is expected to be provided substantially through the operation or sale of the collateral. These loans are measured at fair value on a nonrecurring basis using collateral values as a practical expedient. The fair values of collateral are primarily based on real estate appraisal reports prepared by third-party appraisers less estimated selling costs. The Company measures the estimated credit losses on collateral-dependent loans by performing a lower of cost or fair value analysis. If the estimated credit losses are determined by the value of the collateral, the net carrying amount is adjusted to fair value on a nonrecurring basis as Level 3 by recognizing an ACL. ​ Other real estate owned The Company values these properties at fair value at the time the Company acquires them, which establishes their new cost basis. After acquisition, the Company carries such properties at the lower of cost or fair value less estimated selling costs on a nonrecurring basis. Fair value is measured on a nonrecurring basis using collateral values as a practical expedient. The fair values of collateral for other real estate owned are primarily based on real estate appraisal reports prepared by third-party appraisers less disposition costs, and are classified as Level 3. ​ Assets and Liabilities Recorded at Fair Value on a Nonrecurring Basis ​ The Company may be required to record certain assets at fair value on a nonrecurring basis in accordance with GAAP. These assets are subject to fair value adjustments that result from the application of lower of cost or fair value accounting or write-downs of individual assets to fair value. ​ There were no assets with nonrecurring fair value adjustments held as of March 31, 2022 and December 31, 2021. Additionally, there were no nonrecurring fair value adjustments for both the three months ended March 31, 2022 and 2021. ​ 16. Reportable Operating Segments ​ The Company’s operations are organized into three business segments – Retail Banking, Commercial Banking, and Treasury and Other. These segments reflect how discrete financial information is currently evaluated by the chief operating decision maker and how performance is assessed and resources allocated. The Company’s internal management process measures the performance of these business segments. This process, which is not necessarily comparable with similar information for any other financial institution, uses various techniques to assign balance sheet and income statement amounts to the business segments, including allocations of income, expense, the provision for credit losses, and capital. This process is dynamic and requires certain allocations based on judgment and other subjective factors. Unlike financial accounting, there is no comprehensive authoritative guidance for management accounting that is equivalent to GAAP. ​ 39 Table of Contents The net interest income of the business segments reflects the results of a funds transfer pricing process that matches assets and liabilities with similar interest rate sensitivity and maturity characteristics and reflects the allocation of net interest income related to the Company’s overall asset and liability management activities on a proportionate basis. The basis for the allocation of net interest income is a function of the Company’s assumptions that are subject to change based on changes in current interest rates and market conditions. Funds transfer pricing also serves to transfer interest rate risk to Treasury. ​ The Company allocates the provision for credit losses from the Treasury and Other business segment (which is comprised of many of the Company’s support units) to the Retail and Commercial business segments. These allocations are based on direct costs incurred by the Retail and Commercial business segments. ​ Noninterest income and expense includes allocations from support units to the business segments. These allocations are based on actual usage where practicably calculated or by management’s estimate of such usage. Income tax expense is allocated to each business segment based on the consolidated effective income tax rate for the period shown. ​ The Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), enacted on March 27, 2020, established, among other COVID-19 relief programs, a loan program (Paycheck Protection Program, or the “PPP”) for fully guaranteed loans (which may then be forgiven) to small businesses. In the second quarter of 2021, the Company made changes to the internal measurement of segment operating profits for the purpose of evaluating segment performance and resource allocation. The primary reason for the change was to align PPP loan balances within the business segment that directly manages them. Specifically, PPP loan balances previously included as part of the Retail Banking segment have been reclassified to the Commercial Banking segment. The reallocation of select PPP loan balances affected net interest income, net interest income after provision for credit losses, noninterest expense, provision for income taxes and net income. The Company has reported its selected financial information using the current PPP loan balance alignments for the three months ended March 31, 2022. The Company has restated the selected financial information for the three months ended March 31, 2021 in order to conform with the current presentation. ​ Business Segments ​ Retail Banking Retail Banking offers a broad range of financial products and services to consumers and small businesses. Loan and lease products offered include residential and commercial mortgage loans, home equity lines of credit and loans, automobile loans and leases, secured and unsecured lines of credit, installment loans and small business loans and leases. Deposit products offered include checking, savings, and time deposit accounts. Retail Banking also offers wealth management services. Products and services from Retail Banking are delivered to customers through 51 banking locations throughout the State of Hawaii, Guam, and Saipan. ​ Commercial Banking Commercial Banking offers products that include corporate banking related products, commercial real estate loans, commercial lease financing, secured and unsecured lines of credit, automobile loans and auto dealer financing, business deposit products and credit cards. Commercial lending and deposit products are offered primarily to middle-market and large companies locally, nationally, and internationally. ​ Treasury and Other Treasury consists of corporate asset and liability management activities including interest rate risk management. The segment’s assets and liabilities (and related interest income and expense) consist of interest-bearing deposits, investment securities, federal funds sold and purchased, government deposits, short- and long-term borrowings and bank-owned properties. The primary sources of noninterest income are from bank-owned life insurance, net gains from the sale of investment securities, foreign exchange income related to customer-driven currency requests from merchants and island visitors and management of bank-owned properties. The net residual effect of the transfer pricing of assets and liabilities is included in Treasury, along with the elimination of intercompany transactions. ​ Other organizational units (Technology, Operations, Credit and Risk Management, Human Resources, Finance, Administration, Marketing, and Corporate and Regulatory Administration) provide a wide-range of support to the Company’s other income earning segments. Expenses incurred by these support units are charged to the business segments through an internal cost allocation process. ​ 40 Table of Contents The following tables present selected business segment financial information for the periods indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Treasury ​ ​ ​ ​ ​ Retail ​ Commercial ​ and ​ ​ ​ (dollars in thousands) Banking Banking Other Total Three Months Ended March 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income ​ $ 94,048 ​ $ 35,088 ​ $ 4,736 ​ $ 133,872 Benefit for credit losses ​ ​ 1,841 ​ ​ 2,542 ​ ​ 1,364 ​ ​ 5,747 Net interest income after benefit for credit losses ​ ​ 95,889 ​ ​ 37,630 ​ ​ 6,100 ​ ​ 139,619 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Noninterest income ​ ​ 23,315 ​ ​ 18,655 ​ ​ ( 590 ) ​ ​ 41,380 Noninterest expense ​ ​ ( 70,220 ) ​ ​ ( 26,505 ) ​ ​ ( 7,317 ) ​ ​ ( 104,042 ) Income (loss) before (provision) benefit for income taxes ​ ​ 48,984 ​ ​ 29,780 ​ ​ ( 1,807 ) ​ ​ 76,957 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Provision) benefit for income taxes ​ ​ ( 12,150 ) ​ ​ ( 7,253 ) ​ ​ 165 ​ ​ ( 19,238 ) Net income (loss) ​ $ 36,834 ​ $ 22,527 ​ $ ( 1,642 ) ​ $ 57,719 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Treasury ​ ​ ​ ​ ​ Retail ​ Commercial ​ and ​ ​ ​ (dollars in thousands) Banking Banking Other Total Three Months Ended March 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net interest income (expense) ​ $ 94,454 ​ $ 38,266 ​ $ ( 3,562 ) ​ $ 129,158 Benefit (Provision) for credit losses ​ ​ 1,470 ​ ​ 2,030 ​ ​ ( 3,500 ) ​ ​ — Net interest income (expense) after provision for credit losses ​ ​ 95,924 ​ ​ 40,296 ​ ​ ( 7,062 ) ​ ​ 129,158 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Noninterest income ​ ​ 23,575 ​ ​ 16,041 ​ ​ 4,252 ​ ​ 43,868 Noninterest expense ​ ​ ( 62,889 ) ​ ​ ( 22,478 ) ​ ​ ( 10,939 ) ​ ​ ( 96,306 ) Income (loss) before (provision) benefit for income taxes ​ ​ 56,610 ​ ​ 33,859 ​ ​ ( 13,749 ) ​ ​ 76,720 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Provision) benefit for income taxes ​ ​ ( 14,126 ) ​ ​ ( 8,344 ) ​ ​ 3,443 ​ ​ ( 19,027 ) Net income (loss) ​ $ 42,484 ​ $ 25,515 ​ $ ( 10,306 ) ​ $ 57,693 ​ ​ ​ 41 Table of Contents