CENTRAL PACIFIC FINANCIAL CORP SEC 10-Q Report

Central Pacific Financial Corp has released its Form 10-Q report for Q3, showcasing significant financial growth. Key highlights include Total Interest Income of $79.959 million, up from $77.897 million, and Net Income of $18.574 million, rising from $13.305 million. Basic EPS increased to $0.69 from $0.49. The report also notes operational adjustments, including a reclassification of $58.3 million in loans and updates to the Allowance for Credit Losses model. The company continues to manage interest rate risks effectively and focuses on strategic initiatives in Hawaii's economic landscape.

Central Pacific Financial Corp, a prominent financial institution primarily operating in Hawaii, has released its Form 10-Q report for the third quarter. The report highlights significant financial growth and operational adjustments, reflecting the company's robust performance and strategic initiatives in a dynamic economic environment.

Financial Highlights

Central Pacific Financial Corp reported impressive financial metrics for the third quarter:

Total Interest Income: $79.959 million, up from $77.897 million in the same period last year, driven by higher interest and fees on loans.
Net Interest Income: $61.301 million, an increase from $53.851 million, indicating improved interest margins.
Net Income: $18.574 million, a significant rise from $13.305 million, showcasing strong profitability.
Basic Earnings Per Share (EPS): $0.69, compared to $0.49 in the previous year, indicating enhanced shareholder value.
Diluted EPS: $0.69, consistent with basic EPS, reflecting no significant dilution effects.

Business Highlights

The company's business performance was marked by several key operational highlights:

Revenue Segments: The company reported revenue from various segments, including commercial and industrial loans, construction loans, residential mortgage loans, home equity lines of credit, commercial mortgage loans, and consumer loans. Notably, the construction loan segment showed significant growth.
Geographical Performance: Operating primarily in Hawaii, the company’s performance was influenced by local economic conditions such as unemployment levels and home prices. The company uses Moody’s Analytics for economic forecast assumptions, considering both national and Hawaii-specific economic indicators.
Sales Units: There was a significant volume of loan originations and sales, particularly in the consumer automobile loan segment, with notable purchases of U.S. Mainland consumer automobile loans.
Future Outlook: The company updated its Allowance for Credit Losses (ACL) model to incorporate post-COVID-19 pandemic data, while continuing to exclude periods impacted by the pandemic due to abnormal and volatile behavior. This update aligns with the Current Expected Credit Losses (CECL) standard by incorporating more granular assumptions and forward-looking forecasts.
Operational Adjustments: During the first quarter of 2025, the company reclassified $58.3 million in consumer loans to the commercial and industrial loan class, based on the loans' structure and characteristics, which more closely aligned with commercial and industrial lending criteria.
Risk Management: The company utilizes both designated and undesignated derivative financial instruments to manage exposure to interest rate fluctuations, including interest rate lock and forward sale commitments, risk participation agreements, and back-to-back swap agreements.

SEC Filing: CENTRAL PACIFIC FINANCIAL CORP [ CPF ] - 10-Q - Oct. 29, 2025