Honolulu-based First Hawaiian Inc., as part of its balance sheet optimization strategy, completed the sale of about $898 million of its lower-yielding available-for-sale securities.
The sale resulted in an after-tax loss of about $17.6 million, or 13 cents per share, to be recognized in the fourth quarter of 2018 and $2.1 million to be recorded in the first quarter of 2019.
The proceeds were reinvested in debt securities issued by U.S. government agencies, at a weighted average yield of 3.03% with an estimated duration of 2.2 years.
First Hawaiian believes the restructuring will lead to nearly $6.1 million of after-tax earnings accretion in 2019. The payback period of the loss will be about 2.5 years.