Ladies and gentlemen, thank you for standing by, and welcome to the First Hawaiian Inc., Third Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there'll be a question-and-answer session. Please be advised that the call will be recorded. I will now turn the call over to Kevin Haseyama. Please go ahead.

Thank you, everyone, for joining us as we review our financial results for the third quarter of 2020. With me today are Bob Harrison, Chairman, President and CEO; Ravi Mallela, CFO; and Ralph Mesick, Chief Risk Officer. We have prepared a slide presentation that we will refer to in our remarks today. The presentation is available for downloading and viewing on our website at fhb.com in the Investor Relations section. During today's call, we will be making forward-looking statements, so please refer to Slide 1 for our safe harbor statement. We will also discuss certain non-GAAP financial measures. The appendix to this presentation contains reconciliations of these non-GAAP financial measurements to the most directly comparable GAAP measurements. And now I'll turn the call over to Bob.

Good morning and thank you for joining us as we review our third quarter results. I'd like to start with an update on the current situation here in Hawaii, if you can look at Slide 2. As we reported on our last call, the local economy reopened in early July, and following a rise in the number of new COVID cases in late July and August, the island of Oahu went into a second stay-at-home order in early September. Oahu began reopening in late September under a new 4-tier reopening strategy with quantitative criteria for loosening and tightening restrictions. The island started at tier 1, the most restrictive tier, and moved to tier 2 yesterday as we were successful in holding down the number of new daily cases and had a low positivity rate. Another important step in the reopening of the Hawaii economy was the start of the pre-travel testing program on October 15. The program allows transpacific travelers to bypass the state's 14-day quarantine if they test negative for COVID-19 within 72 hours of traveling to Hawaii. Over the last few days, we've seen the number of visitor arrivals in the 2,000 to 4,000 per day range. This is an important step in restarting the tourist industry, which is the main reason for the state's unemployment rate, which remained high in September at 15.1%. At the bank, we have begun the process of reopening the branches that were closed as a result of the pandemic. But after further evaluation, we decided that four of the branches will remain closed permanently. In July, we launched our online mortgage origination portal, enabling borrowers to apply for mortgages digitally. We also started helping PPP borrowers prepare to apply for loan forgiveness. We have hosted several webinars in conjunction with the SBA to educate borrowers on the forgiveness process, and we have already begun submitting applications for forgiveness to the SBA. Now if you turn to Slide 3, I'll go over the third quarter highlights. We had a solid quarter. Our results reflect increased economic activity from the reopening of the local economy, careful balance sheet management, and improved asset quality. Third-quarter pretax pre-provision net revenue increased 11.3% over the second quarter to $91.3 million. We had net interest income and noninterest income increased while holding expenses flat. In the quarter, we were also able to improve our deposit mix, as consumer and commercial deposits increased by $166 million, and we reduced public deposits by $630 million. As a result, our total cost of deposits declined six basis points to 13 basis points. This contributed to the 12 basis point improvement in net interest margin. Asset quality improved in the third quarter, and our current economic outlook remains relatively unchanged from the second quarter. As a result, we did not need to add much to our allowance for credit loss, and our provision expense was $5.1 million for the quarter. We finished the quarter with strong liquidity and capital, and the Board maintained the dividend at $0.26 per share, a 52% dividend payout ratio. Now I'll turn it over to Ralph to discuss asset quality, provisioning, and loan deferrals.

Thank you, Bob. Slide 4 provides highlights on asset quality. With minimal change to our reserve estimate, the provision this quarter was small. Loan recoveries exceeded charge-offs, and the level of nonperforming and criticized loans decreased as we implemented plans to manage higher-risk credits. For the quarter, the provision was $5.1 million, down from $55.4 million in Q2. We experienced a slight net recovery in Q3 compared to net charge-offs of $23.4 million in the previous quarter. Recoveries of $4.9 million exceeded charge-offs by $84,000. Nonperforming assets that are 90 days past due decreased by $28.4 million from $43.4 million. We transferred about $14.6 million in nonaccrual loans to held for sale, which were sold in early October, resulting in a gain of about $7 million. Criticized commercial loans decreased by approximately 17% to $619 million from $742 million in the second quarter. Past due loans, both accruing and nonaccrual, slightly decreased from the last quarter to $35.7 million, or about 26 basis points of total loans and leases. On Slide 5, you can see the roll forward of the allowance for the quarter by disclosure segments. The reserve increased by about $3.8 million to $195.9 million, which is 1.4% of all loans and 1.56% excluding PPP loans. This smaller increase reflects a relatively unchanged view of the economy, a smaller balance sheet, and an improvement in the risk profile of the portfolio. Our economic forecast is closely aligned with the current University of Hawaii Economic Research Organization forecast. It predicts local unemployment will average in the low teens, personal income will decline by about 4%, and real GDP will drop by 12%. A rebound in these measures is not expected until the middle of 2021, with a stronger recovery not until 2022. We continue to rely on a qualitative overlay to support default expectations that are not included in the loan portfolio. At the end of the quarter, this accounted for about 20% of the reserve, with around 80% of that overlay attributed to COVID. Turning to Slide 6, you can see a snapshot of the outstanding loans that received deferrals at the start of the pandemic and a recap on how these loans have performed since then. We granted 90-day deferrals to most borrowers, except for residential mortgages and some tied to SBA programs, where we provided up to six months of relief. About 77% of the loans by balance have completed their deferral period, and around 96% of those loans have returned to payment, with a small portion offered a second deferral based on additional considerations. Most loans still under the original deferral are related to residential mortgages, which are well collateralized, with only 3% of the balance showing a loan-to-value ratio over 80%. Moving to Slide 7, we show the composition of our commercial portfolio by risk rating at quarter end. Last quarter, we completed a review of loans, assuming a delayed recovery, to identify higher-risk credits requiring active management. This quarter, we focused on implementing strategies to manage these credits and taking actions to support retention, rehabilitation, or exit objectives. During the quarter, we saw a net reduction in special mention loans of $121 million and substandard loans by $2 million. These reductions reflect nonaccrual loans that were under contract for sale and sold after the quarter. On Slide 8, you can see a recap on the impacted industry slide we have presented in the past. Our exposure remains modest, but it's an area of focus as we aim to stay ahead of potential credit issues. About 60% of our criticized loans are in these industries. Hospitality companies and hotel properties continue to be affected by the reduction in global travel. Our borrowers have managed to bolster their liquidity reserves and cut expenses during this time. We expect some modest reductions in our portfolio largely through recapitalizations. As mentioned in previous calls, lending in this space has always been selective to ensure stronger credit profiles to mitigate inherent business volatility. We are also monitoring retail businesses and properties to assess their ability to adapt to current conditions. We anticipate that property loans in this area could face additional stress if tenant-related vacancies or collection issues arise. Lastly, I would note that our dealers have reopened and are seeing a rebound in demand. We expect that balance here will continue to decline as their inventory levels fall, partly due to disruptions in new vehicle production. Now I'll turn the call over to Ravi to discuss the balance sheet and income statement.

Thank you, Ralph. Turning to Slide 9. Period-end loans and leases were $13.5 billion, down $264 million or 1.9% versus the prior quarter. C&I balances declined $253 million in Q3 due to pay downs in the Shared National Credit portfolio, declines in dealer flooring that occurred in the early part of the quarter and a number of smaller credits that took the opportunity to pay down their balances. In Q3, we saw solid growth in construction and commercial real estate. We also saw strong origination volume in our mortgage portfolio due to low rates and an active residential real estate market. Mortgage loan originations were over $300 million in the quarter. Turning to Slide 10. Total deposit balances ended the quarter at $18.9 billion, a $464 million decrease versus the prior quarter. Consumer and commercial deposit balances grew by $166 million. As we had planned, public deposit balances declined by $630 million, as $853 million in public time deposits matured and rolled off. We expect public deposits in Q4 to trend slightly down as stimulus money gets deployed before year-end. Our cost of deposits fell to 13 basis points in the quarter. Turning to Slide 11. Net interest income was $134 million, a $6.2 million increase versus the prior quarter. The increase was primarily due to $4.9 million in lower interest expense and a $2.8 million increase from the investment portfolio due to higher balances. These were partially offset by lower interest income from the loan portfolio. Net interest margin was 2.70%, a 12 basis point increase from the previous quarter. The increase in margin was primarily due to the reduction of about $550 million of excess liquidity, a full quarter's benefit from lower FHLB balances, and lower deposit costs. Going forward, we continue to face headwinds from the low interest rate environment. However, we anticipate that NIM in the fourth quarter will remain relatively stable. Turning to Slide 12. Noninterest income was $48.9 million, $3.2 million higher than the prior quarter. The increase in noninterest income in the third quarter was driven by higher levels of customer activity following the gradual reopening of the local economy that started in early July. Noninterest expenses were $91.6 million, essentially flat to the previous quarter, and the efficiency ratio was 50%. And now I'll turn it back to Bob.

Thank you, Ravi. So to wrap up in the third quarter, the local economy reopened, we had a recovery in activity-based revenue, and an improvement in asset quality. Our overall outlook on the economy hasn't changed significantly since the second quarter, and we continue to actively manage our credit risk. It's still early days for the economy in Hawaii as we only began the pre-travel testing program for transpacific travel a week ago. Hopefully, this will be the first step on the road to recovery for the visitor industry. And now we'd be happy to take your questions.

Our first question comes from Steven Alexopoulos of JPMorgan. Your line is open.

Let me start, maybe, Bob, with a big picture question, just regarding the travel resuming back into Hawaii. I know it's only a week. But when you mentioned 2,000 to 4,000 visitors per day, how did that compare to the initial expectations? And where does that need to go to take pressure off the local economies?

Yes. It's an excellent question, Steve. We didn't have a lot of expectations. We thought it would start out slow, and it has. States are working out the logistics at the airport, quite frankly, checking people and did you download the app? And has it got the right provider partner that the state has identified to qualify for pretesting? Is it the correct test? All those things, we communicated very well to the visitor industry, and the airline partners have done a fantastic job getting the word out. But there's still process to work through. What is good about starting slow is we get to work all that out as we start to see a build for the holidays. My thought would be that we won't really have a good idea of the volume and comfort level people will have with traveling until we get to the Thanksgiving and Christmas holidays. This period of time between now and then will allow us to work out the kinks in the process and get people moving again. As far as what we need is a level to kind of return to normalcy, I think you'll see that in the UHERO forecast that they see the tourism industry building over time over the next six months. That's why we have a conservative outlook.

Okay. That's a helpful way to think about it, Bob. On the margin, Ravi, it's funny when you were talking about NIM, it sounded like you were pretty cautious, but then you guided to flat in Q4. Can you maybe talk about what you see supporting them near-term? And is that temporary support, and then do you expect pressure afterward?

Certainly, I believe there will be some pressure on the asset side. New securities yields are obviously decreasing. We expect refinancing activity mainly in our mortgage portfolio and will continue to see paydowns. I think there are some positive aspects related to interest expense. In the third quarter, we had $200 million of FHLB maturities come off the balance sheet, which actually happened at the end of July, and we anticipate gaining a bit more in the fourth quarter. I believe there is a little bit of flexibility on the deposit side. We were at 13 basis points for the quarter, and while there isn't a lot of room, I think there may be some potential for deposit costs to decrease. We do not have control over how much liquidity comes onto the balance sheet; we might see commercial and consumer deposits returning and increasing. However, regarding public deposits, given the current trends, we expect those deposits to potentially decline over the course of the quarter, which suggests the NIM will be stable for the quarter, although it does face some pressures.

Okay. To wrap up, most investors are becoming comfortable in the near term regarding credit. The focus now is on what can be achieved in pretax pre-provision growth over the next year, given that we expect net interest margin to remain flat or decrease. Bob, could you share what the expectations should be for pretax pre-provision growth? Should we consider flat growth as a reasonable assumption moving forward? Is there anything we should consider that could lead to improved growth?

Yes, good question, Steve. I will approach it from this standpoint. Loan balances will play a crucial role in helping us recover and safeguard our pre-provision net revenue. There are a few different factors to consider. Firstly, we anticipate ongoing churn in the residential portfolio. Our teams are fully engaged in managing the volume, and you will witness that. We have been selling a significant portion of that production while also placing some of it on our balance sheet, which may lead to growth in that area. Additionally, dealer balances have decreased by several hundred million since the end of the year, and many of us have been taken aback by the robust sales. As manufacturers ramp up production, we expect to see a gradual increase from that line item as dealers begin to replenish their currently low inventories, though they will proceed with caution. Furthermore, with some construction projects now receiving funding, we are seeing deals come to fruition that were initiated over the past 12 to 18 months. Therefore, I believe these three areas present potential for loan growth.

Maybe I'd just add a couple of comments on the expense side. We've been fortunate to hold expenses flat. Certainly, we've slowed down some of our discretionary spending. There will be some pressure looking forward. We expect those to tick up a little bit. We're continuing to invest in the business itself. We're working on our core platform implementation. We're investing in the businesses. Relax. As we start reopening, we'll start to see more expenses related to incentive compensation as the economic activity starts to pick up. Just wanted to provide a qualification on the expenses side related to PPP.

Finally, as we continue the reopening, we did not experience a full quarter of income related to activity, such as credit and debit card fees and merchant processing. While it has improved compared to the second quarter, it is still not at the expected normal levels. As the economy reopens and more visitors return, we will observe an increase in activity, which should be advantageous.

Our next question comes from Ebrahim Poonawala of Bank of America Securities. Your line is open.

Just wanted to follow up on credit. I mean, I think...

I'm sorry, Ebrahim, could you speak up a little bit? We can hardly hear you.

Yes. Is this any better now?

A little bit. Yes. Go ahead.

Yes. Just wanted to follow up on credit for a second. I guess from a distance, there's still a lot of concern around recovery in Hawaii. When we look at sort of the reserving this quarter, just talk to us in terms of your comfort level, Bob, after six months of this pandemic and lockdowns around the portfolio. Does it feel that based on the review you've done, you were adequately reserved despite expectations for losses? Or does this just feel like a pause in the middle before you actually start having a better sense around credit risk and credit losses?

Excellent question. Maybe I'll start and then turn it over to Ralph. We spent a lot of time with our commercial borrowers, certainly the larger commercial borrowers, and we feel we have a very good handle on what's going on in that portfolio. Residential is still very strong. So we have very little concerns in that area. The unknown candidly lies around the consumer. The consumer is performing much better than we would expect and better than guys like Ralph and I have seen in previous cycles after 30 years in the business. Because of the 15% unemployment rate, you would not expect to see the low levels of delinquencies and the strong return to payment. I think that's positively impacted by government stimulus, and that's been a huge help. If there is additional stimulus before full recovery in Hawaii, that would help. But we just don't know yet. As far as how we look at our provision and our allowance for credit loss today, we've taken all that into account, and looking at the model, as Ralph mentioned, I'll let him speak to it, we also have a qualitative overlay in that area just for that reason. But Ralph?

Sure. I would say, if you look at the composition of the portfolio between special mention and substandard, the substandard loans are the smaller companies, the ones that we would have anticipated having difficulty. The larger companies have been able to reposition their businesses, so from my standpoint, I think the business side is repositioning. The questions really are about laying off employees and what that means to the consumer book. Secondarily, looking at our landlords. Right now, we haven't had a lot of issues collecting rents, and they've been able to work with their tenants, but that's one area that we'll continue to watch. We have a number of credits on special mention just for that purpose.

Does that address your question, Ebrahim?

Yes, it does. Just a follow-up to that. I'm trying to see if you're out of the woods. The stock is trading at a 6% dividend yield at a relatively cheap valuation compared to your history. I'm trying to get a sense, like when I listened to airlines, Hawaiian Air increasing flights into Hawaii, we heard the same from Alaska recently. It seems like a lot of things are coming back into motion. Is it fair to assume that the worst in terms of credit cost is likely behind? As we look forward into next summer, I know that's around your baseline forecast, but a fair amount of normalcy should have returned as we think about next year, middle of next year?

That's pretty far to forecast. Our base case in the UHERO forecast includes uncertainty, and that's why we've added that qualitative overlay. We're comfortable with where we're at with the allowance, but we will see more issues come up within the portfolio, but we think we're adequately reserved at this time.

Our next question comes from Alex Matters from Goldman Sachs. Your line is open.

So obviously, this was a very strong quarter for credit results given the environment, criticized and nonperformers down materially. First, I'm just wondering if you could comment on what the embedded assumptions for credit migration up to this point would have been earlier in the year? Second, as an add-on to that, if we continue to see metrics remain benign in the near term, at some point, does that start to reduce your expectations through the cycle losses and over what time frame would you think about that?

Yes. I would say we're assuming that we're still in the early stages of this. We have set aside what we believe is appropriate based on the portfolio's makeup. Over time, we do anticipate some decline in asset quality metrics within the portfolio, but if the provisions remain relatively stable, we might reconsider our outlook. Initially, we expected more people to face issues, but the return to payment has been impressive.

Maybe just a follow-up on the second part of your question, this is Bob. I would say if we’re looking to determine when we feel comfortable calling when the worst is behind us, that's too early to tell right now. It would be at least one to two more quarters before we have a good idea of what the Hawaii economy is in a full recovery and the impact of the recession.

Okay, that's helpful. And then maybe just a quick follow-up on the NII side, particularly regarding your mortgage portfolio. Could you comment on what drove the step-up in the reported yields this quarter versus last quarter? And where you're seeing new production this quarter?

Yes, I'll address that, Alex. What we observed in Q3 was mainly due to an accrual we recorded that perhaps should have been accounted for in Q2. Looking ahead, I would begin with our average yields in Q2, which were 3.88%. You can use that as a baseline. We are experiencing considerable refinancing activity in that area, and I believe 3.88% is a solid starting point for your forecast for Q4.

Okay. I appreciate that. Do you have a sense of where new loans are coming on currently?

I don't think we provide that information out as public.

Our next question comes from Jackie Bohlen of KBW. Your line is open.

Just wanted to talk a little bit about the nonperformer sale that you had in October. That's a pretty sizable gain on the balance. Was that something that you'd already taken a credit mark on?

Yes. There are a number of credits we did an impairment analysis, took some charges on that. We ended up getting a price on those loans much better than we had anticipated, resulting in the gain.

Okay. And for geography purposes, what line items do you expect to run the gain through next quarter?

I think that goes through the other income line, but we'll get back to you.

Okay. And then just based on looking at point-to-point balances and calling our discussion from last quarter as well with the commercial and commercial real estate, was there any commonality between these loans in terms of balance or industry, anything like that?

I'm sorry, Jackie, just to clarify, which loans are you referring to, the ones that we had to recover?

Yes. The nonperformers that were sold, I'm just wondering if there's more to come down the pipeline in the future as workouts continue.

No, those were credits that we had on the books for a while that had challenges, and we were actively looking at strategies to get out of those deals. We were able to do that.

As far as geography, they were in the C&I and commercial real estate portfolios.

Okay. So everything that you were looking to get out of, you've since gotten out of?

It's a large portfolio. We still have nonperformers. We're actively working all those credits.

Yes. Every credit is going to have an asset plan. For the most part, I think we'll either retain or exit credits depending on the situation.

Okay. And then switching gears and looking at expenses. You mentioned that you're going to permanently close four branches. What kind of offset does this provide to some of the investments that Ravi was discussing?

We've been managing our personnel quite closely, given how many branches we had closed. We repositioned many of those people in other areas of the bank where they were needed, and we have natural attrition. As that works through and you work to re-staff the branches, there's been quite a mix in the personnel for the retail side of the bank. Ravi, anything further to comment?

No.

Our next question comes from Andrew Liesch of Piper Sandler. Your line is open.

Just curious about the securities book right here; it increased the last few quarters. And obviously, the opportunities to invest liquidity into loans are a little more challenging than in the past. But I'm just curious, the average yield was only down seven basis points. What have you been adding to keep the yield up near this level?

Maybe I'd characterize it a little differently, Andrew. I'd say they’re sort of coming to a low point. What we're seeing out in the marketplace is somewhere close to about 1% in terms of yield. What we're buying has been pretty big. We were at $5.1 billion, I believe, in Q2. There's a lot of momentum in that book already built up that is keeping it relatively flat. Our strategy there is not only to deploy excess liquidity and sort of low-risk-weighted assets that we feel comfortable with and that provide liquidity to us but also to offset a little bit of asset sensitivity by extending the duration of that portfolio. The duration on that portfolio was about 2.25, and I think we're a little bit above 3.5. We've been buying some specific types of securities that have embedded duration in them. We feel good about the portfolio and where it's heading.

That's really helpful. Just in the presentation reference that started the PPP forgiveness process. Just curious what updates you can provide there. How is the process going? Any timing or early results that you've seen on those being forgiven by the SBA?

Sure. We've submitted well over 100 and have heard back on zero of them so far, so it's still early. I think that’s common. There's been a fair amount of loans submitted, but not a lot have been forgiven yet. Everybody is working through the process; you know that treasury secretary changed or through the SBA, and they revised the requirement for loans under $50,000. We held off contacting those borrowers, hoping for something like that to happen. So we have to redo the documentation a bit, and then we'll be doing broader outreach to that borrower group as well. But it's early in the process, and it looks like it's going to take some time. A quick turnaround isn't going to happen.

Our next question comes from Brock Vandervliet of UBS. Your line is open.

This is for Brock. I just wanted to walk through the provisioning by segment that you disclosed on Slide 5. It looks like directionally there was some variance there with C&I and CRE provision being negative and then others being positive. It sounds like there's some qualitative differences maybe. But just specifically, wanted to know if there's anything we should be aware of there.

The provision was fairly small. The portfolio composition in terms of risk grade improved. We did put a little more on the side for smaller business credits as far as a qualitative overlay. We continue to hold a pretty substantial amount related to the consumer book, although we're not really seeing that stress yet.

Okay. Just keeping on that credit note, the cure rate looks like it's been pretty high thus far. For any deferrals that don't return to current by year-end, can you just talk about what your approach would be there in dealing with those? Would it be a longer-term modification under the CARES Act or something else?

Yes. Moving forward, we are approaching this like we would during any recession. If it's a commercial credit, we plan to handle it as a workout process. If we modify the credit, it will likely be classified as a troubled debt restructuring. On the mortgage lending side, we have a moratorium on foreclosures in place until January. Therefore, even though we've extended the timeframes for modifications, there will be very limited actions we can take at this moment.

Okay. Just lastly, can you remind us on the LTVs on retail and on the hospitality portfolios? Just how comfortable you are there with the actual loss content that could eventually come out of it?

We haven't updated LTVs for the purposes of providing that information, but I can tell you that as we look at the credits, we're doing evaluations. In many cases, we're assuming quite a bit of stress in the first couple of years. Some properties are treated like new construction and not stabilized, requiring lease-ups. That is informing the risk grade of the credit.

Our next question comes from Jared Shaw of Wells Fargo Securities. Your line is open.

Just to circle back on credit. In the past, you've said that the provision and allowance are model-driven based on the UHERO projections. But in September, the new UHERO forecast came out and was significantly weaker compared to earlier in the summer and certainly weaker compared to an improved Moody's forecast for the broader U.S. economy. I guess I'm surprised we didn't see a bigger provision this quarter, especially since the allowance ex-PPP at the end of the quarter is at or just below the mainland peers. Is the model going to be updated for the September UHERO, or was that included in the third quarter provision level?

This is Bob. I'll start off and then hand it over to Ralph. What we had in the previous UHERO model was we had the pessimistic view, and that's what we used for our model. They updated that to the current outlook at the end of the quarter, and we looked at it. Our view was not that different than their base model. So Ralph, do you have anything further?

I don't really have a lot more to add. Last quarter, the pessimistic case was sort of where we landed. This quarter, they transitioned to that case as their base case, and we think that's appropriate.

Honestly, what we're seeing in the portfolio supports that.

Our next question comes from Laurie Hunsicker of Compass Point. Your line is open.

I'll just start on Slide 6, which just looks absolutely beautiful. I want to make sure that I’m reading it right. So looking at your commercial deferrals, you were up at $2.1 billion. As of September 30, you're down to $70 million. Then your second deferral will be sometime in October, which takes it down to $56 million in the commercial. Am I reading this the right way?

The credits that are under deferral right now would be the $70 million plus the $56 million.

Okay, so it’s $126 million; that’s unbelievable. That's helpful. On Slide 8, I was hoping you could refresh us on deferrals since they're so massively down for each of those categories: the hotel, retail, auto, transportation, food service, and leverage.

I don’t have that for you, but I can tell you that it’s pretty small numbers, and no really large credits in the hospitality space.

We did have a number of deferrals in the auto space in the past.

Yes, we're off that.

I guess, just looking at that, the bucket last quarter was $1.2 billion on deferral out of your total commercial deferrals of $2.1 billion, right? And now you're down to $126 million? Could we maybe extrapolate and say, of the $126 million, 60% or so are in those highlighted categories? Is that a good way to think about it?

I actually don't have that number, Laurie, I'm sorry.

Okay. You know what, I'll follow up with you offline. Just one more question. The PPP fees that were remaining as of September 30, I'm thinking they’re right around $20 million. I just don't know if you had a tighter number on that.

What we've done is when we book them we book them for the term of the loan. And so they're being brought into the income statement over the term of each of those specific loans.

I'm just wondering how much remains. You had $24 million as of last quarter. I'll follow up with you offline. That's it for me.

Okay.

There are no further questions. I'd like to turn the call back over to Kevin Haseyama for any closing remarks.

We appreciate your interest in First Hawaiian, and please feel free to contact me if you have any additional questions. Thanks again for joining us, and have a good weekend.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.