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Commission
File Number
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Registrant; State of Incorporation;
Address; and Telephone Number
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I.R.S. Employer
Identification No.
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1-8503
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HAWAIIAN ELECTRIC INDUSTRIES, INC.
, a Hawaii corporation
1001 Bishop Street, Suite 2900, Honolulu, Hawaii 96813
Telephone (808) 543-5662
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99-0208097
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1-4955
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HAWAIIAN ELECTRIC COMPANY, INC.
, a Hawaii corporation
900 Richards Street, Honolulu, Hawaii 96813
Telephone (808) 543-7771
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99-0040500
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Registrant
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Title of each class
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Name of each exchange
on which registered
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Hawaiian Electric Industries, Inc.
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Common Stock, Without Par Value
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New York Stock Exchange
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Hawaiian Electric Company, Inc.
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Guarantee with respect to 6.50% Cumulative Quarterly
Income Preferred Securities Series 2004 (QUIPS
SM
)
of HECO Capital Trust III
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New York Stock Exchange
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Registrant
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Title of each class
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Hawaiian Electric Industries, Inc.
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None
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Hawaiian Electric Company, Inc.
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Cumulative Preferred Stock
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Hawaiian Electric Industries Inc. Yes
X
No
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Hawaiian Electric Company, Inc. Yes
No
X
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Hawaiian Electric Industries Inc. Yes
No
X
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Hawaiian Electric Company, Inc. Yes
No
X
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Hawaiian Electric Industries Inc. Yes
X
No
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Hawaiian Electric Company, Inc. Yes
X
No
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Hawaiian Electric Industries Inc. Yes
X
No
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Hawaiian Electric Company, Inc. Yes
X
No
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Hawaiian Electric Industries Inc.
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Large accelerated filer
X
Accelerated filer
Non-accelerated filer
(Do not check if a smaller reporting company)
Smaller reporting company
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Hawaiian Electric Company, Inc.
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Large accelerated filer
Accelerated filer
Non-accelerated filer
X
(Do not check if a smaller reporting company)
Smaller reporting company
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Hawaiian Electric Industries Inc. Yes
No
X
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Hawaiian Electric Company, Inc. Yes
No
X
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Aggregate market value
of the voting and non-
voting common equity
held by non-affiliates of
the registrants as of
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Number of shares of common stock
outstanding of the registrants as of
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||
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June 30, 2016
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June 30, 2016
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February 13, 2017
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Hawaiian Electric Industries, Inc. (HEI)
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$3,547,453,796
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108,187,063
(Without par value)
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108,745,265
(Without par value)
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Hawaiian Electric Company, Inc. (Hawaiian Electric)
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None
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15,805,327
($6 2/3 par value)
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16,019,785
($6 2/3 par value)
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This combined Form 10-K represents separate filings by Hawaiian Electric Industries, Inc. and Hawaiian Electric Company, Inc. Information contained herein relating to any individual registrant is filed by each registrant on its own behalf. Hawaiian Electric makes no representations as to any information not relating to it or its subsidiaries.
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Page
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Cautionary Note Regarding
Forward-Looking Statements
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Executive Officers of the Registrant (HEI)
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Terms
|
|
Definitions
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ABO
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Accumulated benefit obligation
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AES Hawaii
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AES Hawaii, Inc.
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AFUDC
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Allowance for funds used during construction
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AOCI
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Accumulated other comprehensive income (loss)
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AOS
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Adequacy of supply
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APBO
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Accumulated postretirement benefit obligation
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ARO
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Asset retirement obligations
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ASB
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American Savings Bank, F.S.B., a wholly-owned subsidiary of ASB Hawaii Inc.
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ASB Hawaii
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ASB Hawaii, Inc. (formerly American Savings Holdings, Inc.), a wholly-owned subsidiary of Hawaiian Electric Industries, Inc. and the parent company of American Savings Bank, F.S.B.
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ASC
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Accounting Standards Codification
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ASU
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Accounting Standards Update
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Btu
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British thermal unit
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CAA
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Clean Air Act
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CERCLA
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Comprehensive Environmental Response, Compensation and Liability Act
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Chevron
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Chevron Products Company, which assigned their fuel oil supply contracts with the Utilities to Island Energy Services, LLC.
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CIP
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Campbell Industrial Park
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CIS
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Customer Information System
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Company
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When used in Hawaiian Electric Industries, Inc. sections and in the Notes to Consolidated Financial Statements, “Company” refers to Hawaiian Electric Industries, Inc. and its direct and indirect subsidiaries, including, without limitation, Hawaiian Electric Company, Inc. and its subsidiaries (listed under Hawaiian Electric); ASB Hawaii, Inc. and its subsidiary, American Savings Bank, F.S.B.; HEI Properties, Inc. (dissolved in 2015); Hawaiian Electric Industries Capital Trust II and Hawaiian Electric Industries Capital Trust III (inactive financing entities - dissolved and terminated in 2015); and The Old Oahu Tug Service, Inc. (formerly Hawaiian Tug & Barge Corp.).
When used in Hawaiian Electric Company, Inc. sections, “Company” refers to Hawaiian Electric Company, Inc. and its direct subsidiaries.
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Consolidated Financial Statements
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HEI’s and Hawaiian Electric's combined Consolidated Financial Statements, including notes, in Item 8 of this Form 10-K
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Consumer Advocate
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Division of Consumer Advocacy, Department of Commerce and Consumer Affairs of the State of Hawaii
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CT-1
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Combustion turbine No. 1
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D&O
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Decision and order from the PUC
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DBEDT
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State of Hawaii Department of Business Economic Development and Tourism
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DBF
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State of Hawaii Department of Budget and Finance
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DG
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Distributed generation
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Dodd-Frank Act
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Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
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DOH
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Department of Health of the State of Hawaii
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DRIP
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HEI Dividend Reinvestment and Stock Purchase Plan
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DSM
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Demand-side management
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ECAC
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Energy cost adjustment clause
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EEPS
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Energy Efficiency Portfolio Standards
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EGU
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Electrical generating unit
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EIP
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2010 Executive Incentive Plan, as amended
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EPA
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Environmental Protection Agency - federal
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EPS
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Earnings per share
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ERISA
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Employee Retirement Income Security Act of 1974, as amended
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ERL
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Environmental Response Law of the State of Hawaii
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Exchange Act
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Securities Exchange Act of 1934
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FASB
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Financial Accounting Standards Board
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FDIC
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Federal Deposit Insurance Corporation
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FDICIA
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Federal Deposit Insurance Corporation Improvement Act of 1991
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Terms
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Definitions
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federal
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U.S. Government
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FERC
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Federal Energy Regulatory Commission
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FHLB
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Federal Home Loan Bank
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FHLMC
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Federal Home Loan Mortgage Corporation
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FICO
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Financing Corporation
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Fitch
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Fitch Ratings, Inc.
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FNMA
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Federal National Mortgage Association
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FRB
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Federal Reserve Board
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GAAP
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Accounting principles generally accepted in the United States of America
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GHG
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Greenhouse gas
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GNMA
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Government National Mortgage Association
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Gramm Act
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Gramm-Leach-Bliley Act of 1999
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HC&S
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Hawaiian Commercial & Sugar Company, a division of A&B-Hawaii, Inc.
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Hawaii Electric Light
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Hawaii Electric Light Company, Inc., an electric utility subsidiary of Hawaiian Electric Company, Inc.
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Hawaiian Electric
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Hawaiian Electric Company, Inc., an electric utility subsidiary of Hawaiian Electric Industries, Inc. and parent company of Hawaii Electric Light Company, Inc., Maui Electric Company, Limited, HECO Capital Trust III (unconsolidated financing subsidiary), Renewable Hawaii, Inc. and Uluwehiokama Biofuels Corp.
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Hawaiian Electric’s MD&A
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Hawaiian Electric Company, Inc.’s Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of this Form 10-K
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HEI
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Hawaiian Electric Industries, Inc., direct parent company of Hawaiian Electric Company, Inc., ASB Hawaii, Inc., HEI Properties, Inc. (dissolved in 2015), Hawaiian Electric Industries Capital Trust II (dissolved and terminated in 2015), Hawaiian Electric Industries Capital Trust III (dissolved and terminated in 2015) and The Old Oahu Tug Service, Inc. (formerly Hawaiian Tug & Barge Corp.).
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HEI's 2017 Proxy Statement
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Selected sections of Proxy Statement for the 2017 Annual Meeting of Shareholders of Hawaiian Electric Industries, Inc. to be filed after the date of this Form 10-K, which are incorporated in this Form 10-K by reference
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HEI’s MD&A
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Hawaiian Electric Industries, Inc.’s Management’s Discussion and Analysis of Financial Condition and Results of Operations in Item 7 of this Form 10-K
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HEIPI
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HEI Properties, Inc. (dissolved in 2015), a wholly-owned subsidiary of Hawaiian Electric Industries, Inc.
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HEIRSP
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Hawaiian Electric Industries Retirement Savings Plan
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HEP
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Hamakua Energy Partners, L.P., successor in interest to Encogen Hawaii, L.P.
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HTB
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Hawaiian Tug & Barge Corp. On November 10, 1999, HTB sold substantially all of its operating assets and the stock of its subsidiary, Young Brothers, Limited, and changed its name to The Old Oahu Tug Services, Inc.
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HPOWER
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City and County of Honolulu with respect to a power purchase agreement for a refuse-fired plant
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IPP
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Independent power producer
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IRP
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Integrated resource plan
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IRR
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Interest rate risk
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Island Energy
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Island Energy Services, LLC (a fuel oil supplier and subsidiary of One Rock Capital Partners, L.P.), who purchased Chevron's Hawaii assets on November 1, 2016 and was assigned Chevron's fuel oil supply contracts with the Utilities.
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Kalaeloa
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Kalaeloa Partners, L.P.
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kV
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Kilovolt
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kW
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Kilowatt/s (as applicable)
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KWH
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Kilowatthour/s (as applicable)
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LNG
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Liquefied natural gas
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LSFO
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Low sulfur fuel oil
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LTIP
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Long-term incentive plan
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MATS
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Mercury and Air Toxics Standards
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Maui Electric
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Maui Electric Company, Limited, an electric utility subsidiary of Hawaiian Electric Company, Inc.
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MBtu
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Million British thermal unit
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MD&A
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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Merger
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As provided in the Merger Agreement (see below), merger of NEE Acquisition Sub II, Inc. with and into HEI, with HEI surviving, and then merger of HEI with and into NEE Acquisition Sub I, LLC, with NEE Acquisition Sub I, LLC surviving as a wholly owned subsidiary of NextEra Energy, Inc.
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Terms
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Definitions
|
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Merger Agreement
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Agreement and Plan of Merger by and among HEI, NextEra Energy, Inc., NEE Acquisition Sub II, Inc. and NEE Acquisition Sub I, LLC, dated December 3, 2014 and terminated July 16, 2016
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Moody’s
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Moody’s Investors Service’s
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MSFO
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Medium sulfur fuel oil
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MOU
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Memorandum of Understanding
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MW
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Megawatt/s (as applicable)
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MWh
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Megawatthour/s (as applicable)
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NA
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Not applicable
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NAAQS
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National Ambient Air Quality Standard
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NEE
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NextEra Energy, Inc.
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NEM
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Net energy metering
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NII
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Net interest income
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NM
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Not meaningful
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NPBC
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Net periodic benefits costs
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NQSO
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Nonqualified stock options
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O&M
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Other operation and maintenance
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OCC
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Office of the Comptroller of the Currency
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OPEB
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Postretirement benefits other than pensions
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OTS
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Office of Thrift Supervision, Department of Treasury
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OTTI
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Other-than-temporary impairment
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PBO
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Projected benefit obligation
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PCB
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Polychlorinated biphenyls
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PGV
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Puna Geothermal Venture
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PPA
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Power purchase agreement
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PPAC
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Purchased power adjustment clause
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PSD
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Prevention of Significant Deterioration
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PSIPs
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Power Supply Improvement Plans
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PUC
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Public Utilities Commission of the State of Hawaii
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PURPA
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Public Utility Regulatory Policies Act of 1978
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QF
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Qualifying Facility under the Public Utility Regulatory Policies Act of 1978
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QTL
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Qualified Thrift Lender
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RAM
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Rate adjustment mechanism
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RBA
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Revenue balancing account
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Registrant
|
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Each of Hawaiian Electric Industries, Inc. and Hawaiian Electric Company, Inc.
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REIP
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Renewable Energy Infrastructure Program
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RFP
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Request for proposals
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RHI
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Renewable Hawaii, Inc., a wholly-owned nonregulated subsidiary of Hawaiian Electric Company, Inc.
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ROA
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Return on assets
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ROACE
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Return on average common equity
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RORB
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Return on rate base
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RPS
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Renewable portfolio standards
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S&P
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Standard & Poor’s
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SAR
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Stock appreciation right
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SEC
|
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Securities and Exchange Commission
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See
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Means the referenced material is incorporated by reference (or means refer to the referenced section in this document or the referenced exhibit or other document)
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SLHCs
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Savings & Loan Holding Companies
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SOIP
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1987 Stock Option and Incentive Plan, as amended. Shares of HEI common stock reserved for issuance under the SOIP were deregistered and delisted in 2015.
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Spin-Off
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The previously planned distribution to HEI shareholders of all of the common stock of ASB Hawaii immediately prior to the Merger, which was terminated
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SPRBs
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Special Purpose Revenue Bonds
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ST
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Steam turbine
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state
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State of Hawaii
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Terms
|
|
Definitions
|
|
|
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TDR
|
|
Troubled debt restructuring
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Tesoro
|
|
Tesoro Hawaii Corporation dba BHP Petroleum Americas Refining Inc., a fuel oil supplier
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TOOTS
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The Old Oahu Tug Service, Inc., a wholly-owned subsidiary of Hawaiian Electric Industries, Inc.
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Trust III
|
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HECO Capital Trust III
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UBC
|
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Uluwehiokama Biofuels Corp., a wholly-owned nonregulated subsidiary of Hawaiian Electric Company, Inc.
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Utilities
|
|
Hawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited
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VIE
|
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Variable interest entity
|
Cautionary Note Regarding Forward-Looking Statements
|
•
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international, national and local economic conditions, including the state of the Hawaii tourism, defense and construction industries, the strength or weakness of the Hawaii and continental U.S. real estate markets (including the fair value and/or the actual performance of collateral underlying loans held by ASB, which could result in higher loan loss provisions and write-offs), decisions concerning the extent of the presence of the federal government and military in Hawaii, the implications and potential impacts of U.S. and foreign capital and credit market conditions and federal, state and international responses to those conditions, and the potential impacts of global developments (including global economic conditions and uncertainties, the effects of the United Kingdom’s referendum to withdraw from the European Union, unrest, the conflict in Syria, terrorist acts by ISIS or others, potential conflict or crisis with North Korea and potential pandemics);
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•
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the effects of future actions or inaction of the U.S. government or related agencies, including those related to the U.S. debt ceiling, monetary policy and policy and regulation changes advanced or proposed by President Trump and his administration;
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•
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weather and natural disasters (e.g., hurricanes, earthquakes, tsunamis, lightning strikes, lava flows and the potential effects of climate change, such as more severe storms and rising sea levels), including their impact on the Company's and Utilities' operations and the economy;
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•
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the timing and extent of changes in interest rates and the shape of the yield curve;
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•
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the ability of the Company and the Utilities to access the credit and capital markets (e.g., to obtain commercial paper and other short-term and long-term debt financing, including lines of credit, and, in the case of HEI, to issue common stock) under volatile and challenging market conditions, and the cost of such financings, if available;
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•
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the risks inherent in changes in the value of the Company’s pension and other retirement plan assets and ASB’s securities available for sale;
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•
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changes in laws, regulations, market conditions and other factors that result in changes in assumptions used to calculate retirement benefits costs and funding requirements;
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•
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the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) and of the rules and regulations that the Dodd-Frank Act requires to be promulgated;
|
•
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increasing competition in the banking industry (e.g., increased price competition for deposits, or an outflow of deposits to alternative investments, which may have an adverse impact on ASB’s cost of funds);
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•
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the impacts of the termination of the Merger with NextEra Energy, Inc. (NEE) and the resulting loss of NEE’s resources, expertise and support (e.g., financial and technological), including potentially higher costs and longer lead times to increase levels of renewable energy and to complete projects like Enterprise Resource Planning/Enterprise Asset Management (ERP/ERM) and smart grids, and a higher cost of capital;
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•
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the potential delay by the Public Utilities Commission of the State of Hawaii (PUC) in considering (and potential disapproval of actual or proposed) renewable energy proposals and related costs; reliance by the Utilities on outside parties such as the state, independent power producers (IPPs) and developers; and uncertainties surrounding technologies, solar power, wind power, proposed undersea cables, biofuels, environmental assessments required to meet renewable portfolio standards (RPS) goals and the impacts of implementation of the renewable energy proposals on future costs of electricity;
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•
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the ability of the Utilities to develop, implement and recover the costs of implementing the Utilities’ action plans and business model changes proposed and being developed in response to the four orders that the PUC issued in April 2014, in which the PUC: directed the Utilities to develop, among other things, Power Supply Improvement Plans, a Demand Response Portfolio Plan and a Distributed Generation Interconnection Plan; described the PUC’s inclinations on the future of Hawaii’s electric utilities and the vision, business strategies and regulatory policy changes required to align the Utilities’ business model with customer interests and the state’s public policy goals; and emphasized the need to “leap ahead” of other states in creating a 21st century generation system and modern transmission and distribution grids;
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•
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capacity and supply constraints or difficulties, especially if generating units (utility-owned or IPP-owned) fail or measures such as demand-side management (DSM), distributed generation (DG), combined heat and power or other firm capacity supply-side resources fall short of achieving their forecasted benefits or are otherwise insufficient to reduce or meet peak demand;
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•
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fuel oil price changes, delivery of adequate fuel by suppliers and the continued availability to the electric utilities of their energy cost adjustment clauses (ECACs);
|
•
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the continued availability to the electric utilities or modifications of other cost recovery mechanisms, including the purchased power adjustment clauses (PPACs), rate adjustment mechanisms (RAMs) and pension and postretirement benefits other than pensions (OPEB) tracking mechanisms, and the continued decoupling of revenues from sales to mitigate the effects of declining kilowatthour sales;
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•
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the impact of fuel price volatility on customer satisfaction and political and regulatory support for the Utilities;
|
•
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the risks associated with increasing reliance on renewable energy, including the availability and cost of non-fossil fuel supplies for renewable energy generation and the operational impacts of adding intermittent sources of renewable energy to the electric grid;
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•
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the growing risk that energy production from renewable generating resources may be curtailed and the interconnection of additional resources will be constrained as more generating resources are added to the Utilities' electric systems and as customers reduce their energy usage;
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•
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the ability of IPPs to deliver the firm capacity anticipated in their power purchase agreements (PPAs);
|
•
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the potential that, as IPP contracts near the end of their terms, there may be less economic incentive for the IPPs to make investments in their units to ensure the availability of their units;
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•
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the ability of the Utilities to negotiate, periodically, favorable agreements for significant resources such as fuel supply contracts and collective bargaining agreements;
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•
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new technological developments that could affect the operations and prospects of the Utilities and ASB or their competitors;
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•
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new technological developments, such as the commercial development of energy storage and microgrids, that could affect the operations of the Utilities;
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•
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cyber security risks and the potential for cyber incidents, including potential incidents at HEI, ASB and the Utilities (including at ASB branches and electric utility plants) and incidents at data processing centers they use, to the extent not prevented by intrusion detection and prevention systems, anti-virus software, firewalls and other general information technology controls;
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•
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federal, state, county and international governmental and regulatory actions, such as existing, new and changes in laws, rules and regulations applicable to HEI, the Utilities and ASB (including changes in taxation, increases in capital requirements, regulatory policy changes, environmental laws and regulations (including resulting compliance costs and risks of fines and penalties and/or liabilities), the regulation of greenhouse gas (GHG) emissions, governmental fees and assessments (such as Federal Deposit Insurance Corporation assessments), and potential carbon “cap and trade” legislation that may fundamentally alter costs to produce electricity and accelerate the move to renewable generation);
|
•
|
developments in laws, regulations and policies governing protections for historic, archaeological and cultural sites, and plant and animal species and habitats, as well as developments in the implementation and enforcement of such laws, regulations and policies;
|
•
|
discovery of conditions that may be attributable to historical chemical releases, including any necessary investigation and remediation, and any associated enforcement, litigation or regulatory oversight;
|
•
|
decisions by the PUC in rate cases and other proceedings (including the risks of delays in the timing of decisions, adverse changes in final decisions from interim decisions and the disallowance of project costs as a result of adverse regulatory audit reports or otherwise);
|
•
|
decisions by the PUC and by other agencies and courts on land use, environmental and other permitting issues (such as required corrective actions, restrictions and penalties that may arise, such as with respect to environmental conditions or RPS);
|
•
|
potential enforcement actions by the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board (FRB), the Federal Deposit Insurance Corporation (FDIC) and/or other governmental authorities (such as consent orders, required corrective actions, restrictions and penalties that may arise, for example, with respect to compliance deficiencies under existing or new banking and consumer protection laws and regulations or with respect to capital adequacy);
|
•
|
the ability of the Utilities to recover increasing costs and earn a reasonable return on capital investments not covered by RAMs;
|
•
|
the risks associated with the geographic concentration of HEI’s businesses and ASB’s loans, ASB’s concentration in a single product type (i.e., first mortgages) and ASB’s significant credit relationships (i.e., concentrations of large loans and/or credit lines with certain customers);
|
•
|
changes in accounting principles applicable to HEI, the Utilities and ASB, including the adoption of new U.S. accounting standards, the potential discontinuance of regulatory accounting and the effects of potentially required consolidation of variable interest entities (VIEs) or required capital lease accounting for PPAs with IPPs;
|
•
|
changes by securities rating agencies in their ratings of the securities of HEI and Hawaiian Electric and the results of financing efforts;
|
•
|
faster than expected loan prepayments that can cause an acceleration of the amortization of premiums on loans and investments and the impairment of mortgage-servicing assets of ASB;
|
•
|
changes in ASB’s loan portfolio credit profile and asset quality which may increase or decrease the required level of provision for loan losses, allowance for loan losses and charge-offs;
|
•
|
changes in ASB’s deposit cost or mix which may have an adverse impact on ASB’s cost of funds;
|
•
|
the final outcome of tax positions taken by HEI, the Utilities and ASB;
|
•
|
the risks of suffering losses and incurring liabilities that are uninsured (e.g., damages to the Utilities’ transmission and distribution system and losses from business interruption) or underinsured (e.g., losses not covered as a result of insurance deductibles or other exclusions or exceeding policy limits); and
|
•
|
other risks or uncertainties described elsewhere in this report (e.g., Item 1A. Risk Factors) and in other reports previously and subsequently filed by HEI and/or Hawaiian Electric with the Securities and Exchange Commission (SEC).
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ITEM 1.
|
BUSINESS
|
December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
HEI
|
41
|
|
|
39
|
|
|
44
|
|
|
43
|
|
|
42
|
|
Hawaiian Electric and its subsidiaries
|
2,662
|
|
|
2,727
|
|
|
2,759
|
|
|
2,764
|
|
|
2,658
|
|
ASB and its subsidiaries
|
1,093
|
|
|
1,152
|
|
|
1,162
|
|
|
1,159
|
|
|
1,170
|
|
|
3,796
|
|
|
3,918
|
|
|
3,965
|
|
|
3,966
|
|
|
3,870
|
|
Years ended December 31
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||
(dollars in thousands)
|
Customer accounts*
|
|
Electric sales revenues
|
|
Customer accounts*
|
|
Electric sales revenues
|
|
Customer accounts*
|
|
Electric sales revenues
|
|||||||||
Hawaiian Electric
|
304,261
|
|
|
$
|
1,466,225
|
|
|
302,958
|
|
|
$
|
1,636,245
|
|
|
301,953
|
|
|
$
|
2,134,094
|
|
Hawaii Electric Light
|
85,029
|
|
|
309,521
|
|
|
84,309
|
|
|
343,843
|
|
|
83,421
|
|
|
420,647
|
|
|||
Maui Electric
|
70,872
|
|
|
306,767
|
|
|
70,533
|
|
|
343,722
|
|
|
70,042
|
|
|
420,734
|
|
|||
|
460,162
|
|
|
$
|
2,082,513
|
|
|
457,800
|
|
|
$
|
2,323,810
|
|
|
455,416
|
|
|
$
|
2,975,475
|
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
KWH sales (millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential
|
2,332.7
|
|
|
2,396.5
|
|
|
2,379.7
|
|
|
2,450.9
|
|
|
2,582.0
|
|
|||||
Commercial
|
2,911.5
|
|
|
2,977.8
|
|
|
3,022.0
|
|
|
3,105.9
|
|
|
3,074.4
|
|
|||||
Large light and power
|
3,555.1
|
|
|
3,532.9
|
|
|
3,524.5
|
|
|
3,462.7
|
|
|
3,499.8
|
|
|||||
Other
|
46.0
|
|
|
49.3
|
|
|
50.0
|
|
|
50.0
|
|
|
49.8
|
|
|||||
|
8,845.3
|
|
|
8,956.5
|
|
|
8,976.2
|
|
|
9,069.5
|
|
|
9,206.0
|
|
|||||
KWH net generated and purchased (millions)
|
|
|
|
|
|
|
|
|
|
||||||||||
Net generated
|
4,940.4
|
|
|
5,124.5
|
|
|
5,131.3
|
|
|
5,352.0
|
|
|
5,601.7
|
|
|||||
Purchased
|
4,349.1
|
|
|
4,308.3
|
|
|
4,306.7
|
|
|
4,195.2
|
|
|
4,093.2
|
|
|||||
|
9,289.5
|
|
|
9,432.8
|
|
|
9,438.0
|
|
|
9,547.2
|
|
|
9,694.9
|
|
|||||
Losses and system uses (%)
|
4.6
|
|
|
4.8
|
|
|
4.7
|
|
|
4.8
|
|
|
4.8
|
|
|||||
Energy supply (December 31)
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net generating capability—MW
|
1,669
|
|
|
1,669
|
|
|
1,787
|
|
|
1,787
|
|
|
1,787
|
|
|||||
Firm and other purchased capability—MW
|
551
|
|
|
555
|
|
|
575
|
|
|
567
|
|
|
545
|
|
|||||
|
2,220
|
|
|
2,224
|
|
|
2,362
|
|
|
2,354
|
|
|
2,332
|
|
|||||
Net peak demand—MW
1
|
1,593
|
|
|
1,610
|
|
|
1,554
|
|
|
1,535
|
|
|
1,535
|
|
|||||
Btu per net KWH generated
|
10,710
|
|
|
10,632
|
|
|
10,613
|
|
|
10,570
|
|
|
10,533
|
|
|||||
Average fuel oil cost per Mbtu (cents)
|
862.3
|
|
|
1,206.5
|
|
|
2,087.6
|
|
|
2,103.2
|
|
|
2,210.4
|
|
|||||
Customer accounts (December 31)
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
402,818
|
|
|
400,655
|
|
|
398,256
|
|
|
394,910
|
|
|
392,025
|
|
|||||
Commercial
|
55,089
|
|
|
54,878
|
|
|
54,924
|
|
|
54,616
|
|
|
54,005
|
|
|||||
Large light and power
|
670
|
|
|
659
|
|
|
596
|
|
|
556
|
|
|
577
|
|
|||||
Other
|
1,585
|
|
|
1,608
|
|
|
1,640
|
|
|
1,660
|
|
|
1,636
|
|
|||||
|
460,162
|
|
|
457,800
|
|
|
455,416
|
|
|
451,742
|
|
|
448,243
|
|
|||||
Electric revenues (thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential
|
$
|
638,776
|
|
|
$
|
709,886
|
|
|
$
|
879,605
|
|
|
$
|
892,438
|
|
|
$
|
952,159
|
|
Commercial
|
711,553
|
|
|
798,202
|
|
|
1,027,588
|
|
|
1,044,166
|
|
|
1,060,983
|
|
|||||
Large light and power
|
720,878
|
|
|
802,366
|
|
|
1,051,119
|
|
|
1,015,079
|
|
|
1,062,226
|
|
|||||
Other
|
11,306
|
|
|
13,356
|
|
|
17,163
|
|
|
17,008
|
|
|
17,392
|
|
|||||
|
$
|
2,082,513
|
|
|
$
|
2,323,810
|
|
|
$
|
2,975,475
|
|
|
$
|
2,968,691
|
|
|
$
|
3,092,760
|
|
Average revenue per KWH sold (cents)
|
23.54
|
|
|
25.90
|
|
|
33.15
|
|
|
32.73
|
|
|
33.60
|
|
|||||
Residential
|
27.38
|
|
|
29.62
|
|
|
36.96
|
|
|
36.41
|
|
|
36.88
|
|
|||||
Commercial
|
24.44
|
|
|
26.81
|
|
|
34.00
|
|
|
33.62
|
|
|
34.51
|
|
|||||
Large light and power
|
20.28
|
|
|
22.71
|
|
|
29.82
|
|
|
29.31
|
|
|
30.35
|
|
|||||
Other
|
24.61
|
|
|
27.05
|
|
|
34.36
|
|
|
34.02
|
|
|
34.93
|
|
|||||
Residential statistics
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Average annual use per customer account (KWH)
|
5,806
|
|
|
5,996
|
|
|
6,000
|
|
|
6,220
|
|
|
6,596
|
|
|||||
Average annual revenue per customer account
|
$
|
1,590
|
|
|
$
|
1,776
|
|
|
$
|
2,218
|
|
|
$
|
2,265
|
|
|
$
|
2,432
|
|
Average number of customer accounts
|
401,796
|
|
|
399,674
|
|
|
396,640
|
|
|
394,024
|
|
|
391,437
|
|
1
|
Sum of the net peak demands on all islands served, noncoincident and nonintegrated.
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
|
|
||||||||||
|
Island of
Oahu |
|
Island of
Hawaii |
|
Island of
Maui |
|
Island of
Lanai |
|
Island of
Molokai |
|
Total
|
|
||||||
Net generating and firm purchased capability (MW) as of December 31, 2016
1
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Conventional oil-fired steam units
|
999.5
|
|
|
49.4
|
|
|
35.9
|
|
|
—
|
|
|
—
|
|
|
1,084.8
|
|
|
Diesel
|
—
|
|
|
27.0
|
|
|
96.8
|
|
|
9.3
|
|
|
9.6
|
|
|
142.7
|
|
|
Combustion turbines (peaking units)
|
101.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
101.8
|
|
|
Other combustion turbines
|
—
|
|
|
46.3
|
|
|
—
|
|
|
—
|
|
|
2.2
|
|
|
48.5
|
|
|
Combined-cycle unit
|
—
|
|
|
56.3
|
|
|
113.6
|
|
|
—
|
|
|
—
|
|
|
169.9
|
|
|
Biodiesel
|
121.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
121.0
|
|
|
Firm contract power
2
|
456.5
|
|
|
94.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
551.1
|
|
|
|
1,678.8
|
|
|
273.6
|
|
|
246.3
|
|
|
9.3
|
|
|
11.8
|
|
|
2,219.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net peak demand (MW)
3
|
1,192.0
|
|
|
188.5
|
|
|
201.0
|
|
|
5.7
|
|
|
5.7
|
|
|
1,592.9
|
|
|
Reserve margin
|
40.2
|
%
|
|
45.1
|
%
|
|
23.2
|
%
|
|
63.2
|
%
|
|
107.0
|
%
|
|
40.8
|
%
|
|
Annual load factor
|
66.7
|
%
|
|
69.4
|
%
|
|
63.5
|
%
|
|
62.9
|
%
|
|
62.3
|
%
|
|
66.6
|
%
|
|
KWH net generated and purchased (millions)
|
6,963.1
|
|
|
1,145.7
|
|
|
1,118.2
|
|
|
31.4
|
|
|
31.1
|
|
|
9,289.5
|
|
|
1
|
Hawaiian Electric units at normal ratings; Hawaii Electric Light and Maui Electric units at reserve ratings.
|
2
|
Nonutility generators - Hawaiian Electric: 208 MW (Kalaeloa Partners, L.P., oil-fired), 180 MW (AES Hawaii, Inc., coal-fired) and 68.5 MW (HPOWER, refuse-fired); Hawaii Electric Light: 34.6 MW (Puna Geothermal venture, geothermal) and 60 MW (Hamakua Energy Partners, L.P., oil-fired).
|
3
|
Noncoincident and nonintegrated.
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Consolidated
|
||||||||||||||||
|
$/Barrel
|
|
¢/MBtu
|
|
$/Barrel
|
|
¢/MBtu
|
|
$/Barrel
|
|
¢/MBtu
|
|
$/Barrel
|
|
¢/MBtu
|
||||||||
2016
|
51.30
|
|
|
815.2
|
|
|
53.27
|
|
|
876.9
|
|
|
62.21
|
|
|
1,048.6
|
|
|
53.49
|
|
|
862.3
|
|
2015
|
71.86
|
|
|
1,144.8
|
|
|
79.03
|
|
|
1,307.3
|
|
|
84.38
|
|
|
1,425.7
|
|
|
74.71
|
|
|
1,206.5
|
|
2014
|
130.71
|
|
|
2,075.4
|
|
|
121.49
|
|
|
2,002.5
|
|
|
130.51
|
|
|
2,198.9
|
|
|
129.65
|
|
|
2,087.6
|
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
||||||||||||
|
% LSFO
|
|
|
% Biodiesel/Diesel
|
|
|
% IFO
|
|
|
% Diesel
|
|
|
% MSFO
|
|
|
% Diesel
|
|
2016
|
97
|
|
|
3
|
|
|
49
|
|
|
51
|
|
|
19
|
|
|
81
|
|
2015
|
96
|
|
|
4
|
|
|
43
|
|
|
57
|
|
|
16
|
|
|
84
|
|
2014
|
97
|
|
|
3
|
|
|
47
|
|
|
53
|
|
|
20
|
|
|
80
|
|
|
2016 vs. 2015
|
|
2015 vs. 2014
|
||||||||||||||||||||
(in thousands)
|
Rate
|
|
Volume
|
|
Total
|
|
Rate
|
|
Volume
|
|
Total
|
||||||||||||
Interest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest-earning deposits
|
$
|
228
|
|
|
$
|
(169
|
)
|
|
$
|
59
|
|
|
$
|
9
|
|
|
$
|
92
|
|
|
$
|
101
|
|
FHLB stock
|
192
|
|
|
(148
|
)
|
|
44
|
|
|
144
|
|
|
(84
|
)
|
|
60
|
|
||||||
Securities purchased under resale agreements
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(10
|
)
|
|
(20
|
)
|
||||||
Available-for-sale investment securities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Taxable
|
(1,018
|
)
|
|
4,961
|
|
|
3,943
|
|
|
(158
|
)
|
|
3,471
|
|
|
3,313
|
|
||||||
Non-taxable
|
14
|
|
|
14
|
|
|
28
|
|
|
(214
|
)
|
|
(215
|
)
|
|
(429
|
)
|
||||||
Total available-for-sale investment securities
|
(1,004
|
)
|
|
4,975
|
|
|
3,971
|
|
|
(372
|
)
|
|
3,256
|
|
|
2,884
|
|
||||||
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential 1-4 family
|
(2,103
|
)
|
|
444
|
|
|
(1,659
|
)
|
|
(2,451
|
)
|
|
1,793
|
|
|
(658
|
)
|
||||||
Commercial real estate
|
1,037
|
|
|
8,345
|
|
|
9,382
|
|
|
(1,831
|
)
|
|
4,485
|
|
|
2,654
|
|
||||||
Home equity line of credit
|
686
|
|
|
1,052
|
|
|
1,738
|
|
|
(402
|
)
|
|
1,197
|
|
|
795
|
|
||||||
Residential land
|
(77
|
)
|
|
94
|
|
|
17
|
|
|
(73
|
)
|
|
68
|
|
|
(5
|
)
|
||||||
Commercial
|
2,538
|
|
|
(2,077
|
)
|
|
461
|
|
|
(552
|
)
|
|
540
|
|
|
(12
|
)
|
||||||
Consumer
|
1,908
|
|
|
3,145
|
|
|
5,053
|
|
|
1,933
|
|
|
734
|
|
|
2,667
|
|
||||||
Total loans
|
3,989
|
|
|
11,003
|
|
|
14,992
|
|
|
(3,376
|
)
|
|
8,817
|
|
|
5,441
|
|
||||||
Total increase (decrease) in interest income
|
3,405
|
|
|
15,661
|
|
|
19,066
|
|
|
(3,605
|
)
|
|
12,071
|
|
|
8,466
|
|
||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Savings
|
(103
|
)
|
|
(42
|
)
|
|
(145
|
)
|
|
—
|
|
|
(123
|
)
|
|
(123
|
)
|
||||||
Interest-bearing checking
|
—
|
|
|
(34
|
)
|
|
(34
|
)
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
||||||
Money market
|
(5
|
)
|
|
8
|
|
|
3
|
|
|
—
|
|
|
9
|
|
|
9
|
|
||||||
Time certificates
|
(589
|
)
|
|
(1,054
|
)
|
|
(1,643
|
)
|
|
—
|
|
|
(144
|
)
|
|
(144
|
)
|
||||||
Advances from Federal Home Loan Bank
|
21
|
|
|
(35
|
)
|
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Securities sold under agreements to repurchase
|
(285
|
)
|
|
689
|
|
|
404
|
|
|
672
|
|
|
(919
|
)
|
|
(247
|
)
|
||||||
Total (increase) decrease in interest expense
|
(961
|
)
|
|
(468
|
)
|
|
(1,429
|
)
|
|
672
|
|
|
(1,190
|
)
|
|
(518
|
)
|
||||||
Increase (decrease) in net interest income
|
$
|
2,444
|
|
|
$
|
15,193
|
|
|
$
|
17,637
|
|
|
$
|
(2,933
|
)
|
|
$
|
10,881
|
|
|
$
|
7,948
|
|
December 31
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|||||||||||||||||||||||||
(dollars in thousands)
|
Balance
|
|
% of
total
|
|
|
Balance
|
|
% of
total |
|
|
Balance
|
|
% of
total |
|
|
Balance
|
|
% of
total |
|
|
Balance
|
|
% of
total |
|
||||||||||
Real estate:
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential 1-4 family
|
$
|
2,048,051
|
|
|
43.2
|
|
|
$
|
2,069,665
|
|
|
44.8
|
|
|
$
|
2,044,205
|
|
|
46.0
|
|
|
$
|
2,006,007
|
|
|
48.2
|
|
|
$
|
1,866,450
|
|
|
49.2
|
|
Commercial real estate
|
800,395
|
|
|
16.9
|
|
|
690,561
|
|
|
14.9
|
|
|
531,917
|
|
|
12.0
|
|
|
440,443
|
|
|
10.6
|
|
|
375,677
|
|
|
9.9
|
|
|||||
Home equity line of credit
|
863,163
|
|
|
18.2
|
|
|
846,294
|
|
|
18.3
|
|
|
818,815
|
|
|
18.4
|
|
|
739,331
|
|
|
17.8
|
|
|
630,175
|
|
|
16.6
|
|
|||||
Residential land
|
18,889
|
|
|
0.4
|
|
|
18,229
|
|
|
0.4
|
|
|
16,240
|
|
|
0.4
|
|
|
16,176
|
|
|
0.4
|
|
|
25,815
|
|
|
0.7
|
|
|||||
Commercial construction
|
126,768
|
|
|
2.7
|
|
|
100,796
|
|
|
2.2
|
|
|
96,438
|
|
|
2.2
|
|
|
52,112
|
|
|
1.3
|
|
|
43,988
|
|
|
1.2
|
|
|||||
Residential construction
|
16,080
|
|
|
0.3
|
|
|
14,089
|
|
|
0.3
|
|
|
18,961
|
|
|
0.4
|
|
|
12,774
|
|
|
0.3
|
|
|
6,171
|
|
|
0.2
|
|
|||||
Total real estate
|
3,873,346
|
|
|
81.7
|
|
|
3,739,634
|
|
|
80.9
|
|
|
3,526,576
|
|
|
79.4
|
|
|
3,266,843
|
|
|
78.6
|
|
|
2,948,276
|
|
|
77.8
|
|
|||||
Commercial
|
692,051
|
|
|
14.6
|
|
|
758,659
|
|
|
16.4
|
|
|
791,757
|
|
|
17.8
|
|
|
783,388
|
|
|
18.8
|
|
|
721,349
|
|
|
19.0
|
|
|||||
Consumer
|
178,222
|
|
|
3.7
|
|
|
123,775
|
|
|
2.7
|
|
|
122,656
|
|
|
2.8
|
|
|
108,722
|
|
|
2.6
|
|
|
121,231
|
|
|
3.2
|
|
|||||
Total loans
|
4,743,619
|
|
|
100.0
|
|
|
4,622,068
|
|
|
100.0
|
|
|
4,440,989
|
|
|
100.0
|
|
|
4,158,953
|
|
|
100.0
|
|
|
3,790,856
|
|
|
100.0
|
|
|||||
Less: Deferred fees and discounts
|
(4,926
|
)
|
|
|
|
|
(6,249
|
)
|
|
|
|
|
(6,338
|
)
|
|
|
|
|
(8,724
|
)
|
|
|
|
|
(11,638
|
)
|
|
|
|
|||||
Allowance for loan losses
|
(55,533
|
)
|
|
|
|
|
(50,038
|
)
|
|
|
|
|
(45,618
|
)
|
|
|
|
|
(40,116
|
)
|
|
|
|
|
(41,985
|
)
|
|
|
|
|||||
Total loans, net
|
$
|
4,683,160
|
|
|
|
|
|
$
|
4,565,781
|
|
|
|
|
|
$
|
4,389,033
|
|
|
|
|
|
$
|
4,110,113
|
|
|
|
|
|
$
|
3,737,233
|
|
|
|
|
1
|
Includes renegotiated loans.
|
December 31
|
2016
|
||||||||||||||
Due
|
In
1 year
or less
|
|
|
After 1 year
through
5 years
|
|
|
After
5 years
|
|
|
Total
|
|
||||
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Commercial – Fixed
|
$
|
51
|
|
|
$
|
129
|
|
|
$
|
22
|
|
|
$
|
202
|
|
Commercial – Adjustable
|
209
|
|
|
241
|
|
|
40
|
|
|
490
|
|
||||
Total commercial
|
260
|
|
|
370
|
|
|
62
|
|
|
692
|
|
||||
Commercial construction – Fixed
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Commercial construction – Adjustable
|
31
|
|
|
96
|
|
|
—
|
|
|
127
|
|
||||
Total commercial construction
|
31
|
|
|
96
|
|
|
—
|
|
|
127
|
|
||||
Residential construction – Fixed
|
16
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||
Residential construction – Adjustable
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total residential construction
|
16
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||
Total loans – Fixed
|
67
|
|
|
129
|
|
|
22
|
|
|
218
|
|
||||
Total loans – Adjustable
|
240
|
|
|
337
|
|
|
40
|
|
|
617
|
|
||||
Total loans
|
$
|
307
|
|
|
$
|
466
|
|
|
$
|
62
|
|
|
$
|
835
|
|
December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Nonaccrual loans—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential 1-4 family
|
$
|
11,154
|
|
|
$
|
20,554
|
|
|
$
|
19,253
|
|
|
$
|
19,679
|
|
|
$
|
26,721
|
|
Commercial real estate
|
223
|
|
|
1,188
|
|
|
5,112
|
|
|
4,439
|
|
|
6,750
|
|
|||||
Home equity line of credit
|
3,080
|
|
|
2,254
|
|
|
1,087
|
|
|
2,060
|
|
|
2,349
|
|
|||||
Residential land
|
878
|
|
|
970
|
|
|
720
|
|
|
3,161
|
|
|
8,561
|
|
|||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total real estate
|
15,335
|
|
|
24,966
|
|
|
26,172
|
|
|
29,339
|
|
|
44,381
|
|
|||||
Commercial
|
6,708
|
|
|
20,174
|
|
|
10,053
|
|
|
18,781
|
|
|
20,222
|
|
|||||
Consumer
|
1,282
|
|
|
895
|
|
|
661
|
|
|
401
|
|
|
284
|
|
|||||
Total nonaccrual loans
|
$
|
23,325
|
|
|
$
|
46,035
|
|
|
$
|
36,886
|
|
|
$
|
48,521
|
|
|
$
|
64,887
|
|
Troubled debt restructured loans not included above—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential 1-4 family
|
$
|
14,450
|
|
|
$
|
13,962
|
|
|
$
|
13,525
|
|
|
$
|
9,744
|
|
|
$
|
6,759
|
|
Commercial real estate
|
1,346
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Home equity line of credit
|
4,934
|
|
|
2,467
|
|
|
480
|
|
|
171
|
|
|
—
|
|
|||||
Residential land
|
2,751
|
|
|
4,713
|
|
|
7,130
|
|
|
7,476
|
|
|
11,090
|
|
|||||
Total real estate
|
23,481
|
|
|
21,142
|
|
|
21,135
|
|
|
17,391
|
|
|
17,849
|
|
|||||
Commercial
|
14,146
|
|
|
1,104
|
|
|
2,972
|
|
|
1,649
|
|
|
43
|
|
|||||
Consumer
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total troubled debt restructured loans
|
$
|
37,637
|
|
|
$
|
22,246
|
|
|
$
|
24,107
|
|
|
$
|
19,040
|
|
|
$
|
17,892
|
|
(dollars in millions)
|
Year ended December 31, 2016
|
||
Gross amount of interest income that would have been recorded in accordance with original contractual terms, and had been outstanding throughout the period or since origination, if held for only part of the period
1
|
$
|
3
|
|
Interest income actually recognized
|
2
|
|
|
Total interest income foregone
|
$
|
1
|
|
1
|
Based on the contractual rate that was being charged at the time the loan was restructured or placed on nonaccrual status.
|
(dollars in thousands)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Allowance for loan losses, January 1
|
$
|
50,038
|
|
|
$
|
45,618
|
|
|
$
|
40,116
|
|
|
$
|
41,985
|
|
|
$
|
37,906
|
|
Provision for loan losses
|
16,763
|
|
|
6,275
|
|
|
6,126
|
|
|
1,507
|
|
|
12,883
|
|
|||||
Charge-offs
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential 1-4 family
|
639
|
|
|
356
|
|
|
987
|
|
|
1,162
|
|
|
3,183
|
|
|||||
Home equity line of credit
|
112
|
|
|
205
|
|
|
196
|
|
|
782
|
|
|
716
|
|
|||||
Residential land
|
138
|
|
|
—
|
|
|
81
|
|
|
485
|
|
|
2,808
|
|
|||||
Total real estate
|
889
|
|
|
561
|
|
|
1,264
|
|
|
2,429
|
|
|
6,707
|
|
|||||
Commercial
|
5,943
|
|
|
1,074
|
|
|
1,872
|
|
|
3,056
|
|
|
3,606
|
|
|||||
Consumer
|
7,413
|
|
|
4,791
|
|
|
2,414
|
|
|
2,717
|
|
|
2,517
|
|
|||||
Total charge-offs
|
14,245
|
|
|
6,426
|
|
|
5,550
|
|
|
8,202
|
|
|
12,830
|
|
|||||
Recoveries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Residential 1-4 family
|
421
|
|
|
226
|
|
|
1,180
|
|
|
1,881
|
|
|
1,328
|
|
|||||
Home equity line of credit
|
59
|
|
|
80
|
|
|
752
|
|
|
358
|
|
|
108
|
|
|||||
Residential land
|
461
|
|
|
507
|
|
|
469
|
|
|
868
|
|
|
1,443
|
|
|||||
Total real estate
|
941
|
|
|
813
|
|
|
2,401
|
|
|
3,107
|
|
|
2,879
|
|
|||||
Commercial
|
1,093
|
|
|
2,773
|
|
|
1,636
|
|
|
1,089
|
|
|
649
|
|
|||||
Consumer
|
943
|
|
|
985
|
|
|
889
|
|
|
630
|
|
|
498
|
|
|||||
Total recoveries
|
2,977
|
|
|
4,571
|
|
|
4,926
|
|
|
4,826
|
|
|
4,026
|
|
|||||
Allowance for loan losses, December 31
|
$
|
55,533
|
|
|
$
|
50,038
|
|
|
$
|
45,618
|
|
|
$
|
40,116
|
|
|
$
|
41,985
|
|
Ratio of allowance for loan losses to loans receivable held for investment
|
1.17
|
%
|
|
1.08
|
%
|
|
1.03
|
%
|
|
0.97
|
%
|
|
1.11
|
%
|
|||||
Ratio of provision for loan losses during the year to average total loans
|
0.36
|
%
|
|
0.14
|
%
|
|
0.14
|
%
|
|
0.04
|
%
|
|
0.35
|
%
|
|||||
Ratio of net charge-offs during the year to average total loans
|
0.24
|
%
|
|
0.04
|
%
|
|
0.01
|
%
|
|
0.09
|
%
|
|
0.24
|
%
|
December 31
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||||||||
(dollars in thousands)
|
Allow-ance balance
|
|
Allowance
to loan
receivable
%
|
|
Loan
receivable
% of
total
|
|
Allow-ance balance
|
|
Allowance
to loan receivable % |
|
Loan
receivable % of total |
|
Allow-ance balance
|
|
Allowance
to loan receivable % |
|
Loan
receivable % of total |
||||||||||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Residential 1-4 family
|
$
|
2,873
|
|
|
0.14
|
|
|
43.2
|
|
|
$
|
4,186
|
|
|
0.20
|
|
|
44.8
|
|
|
$
|
4,662
|
|
|
0.23
|
|
|
46.0
|
|
Commercial real estate
|
16,004
|
|
|
2.00
|
|
|
16.9
|
|
|
11,342
|
|
|
1.64
|
|
|
14.9
|
|
|
8,954
|
|
|
1.68
|
|
|
12.0
|
|
|||
Home equity line of credit
|
5,039
|
|
|
0.58
|
|
|
18.2
|
|
|
7,260
|
|
|
0.86
|
|
|
18.3
|
|
|
6,982
|
|
|
0.85
|
|
|
18.4
|
|
|||
Residential land
|
1,738
|
|
|
9.20
|
|
|
0.4
|
|
|
1,671
|
|
|
9.17
|
|
|
0.4
|
|
|
1,875
|
|
|
11.55
|
|
|
0.4
|
|
|||
Commercial construction
|
6,449
|
|
|
5.09
|
|
|
2.7
|
|
|
4,461
|
|
|
4.43
|
|
|
2.2
|
|
|
5,471
|
|
|
5.67
|
|
|
2.2
|
|
|||
Residential construction
|
12
|
|
|
0.07
|
|
|
0.3
|
|
|
13
|
|
|
0.09
|
|
|
0.3
|
|
|
28
|
|
|
0.15
|
|
|
0.4
|
|
|||
Total real estate
|
32,115
|
|
|
0.83
|
|
|
81.7
|
|
|
28,933
|
|
|
0.77
|
|
|
80.9
|
|
|
27,972
|
|
|
0.79
|
|
|
79.4
|
|
|||
Commercial
|
16,618
|
|
|
2.40
|
|
|
14.6
|
|
|
17,208
|
|
|
2.27
|
|
|
16.4
|
|
|
14,017
|
|
|
1.77
|
|
|
17.8
|
|
|||
Consumer
|
6,800
|
|
|
3.82
|
|
|
3.7
|
|
|
3,897
|
|
|
3.15
|
|
|
2.7
|
|
|
3,629
|
|
|
2.96
|
|
|
2.8
|
|
|||
|
55,533
|
|
|
1.17
|
|
|
100.0
|
|
|
50,038
|
|
|
1.08
|
|
|
100.0
|
|
|
45,618
|
|
|
1.03
|
|
|
100.0
|
|
|||
Unallocated
|
—
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|||
Total allowance for loan losses
|
$
|
55,533
|
|
|
|
|
|
|
|
|
$
|
50,038
|
|
|
|
|
|
|
|
|
$
|
45,618
|
|
|
|
|
|
|
|
December 31
|
2013
|
|
2012
|
||||||||||||||||
(dollars in thousands)
|
Allowance balance
|
|
Allowance
to loan receivable % |
|
Loan
receivable % of total |
|
Allowance balance
|
|
Allowance
to loan receivable % |
|
Loan
receivable % of total |
||||||||
Real estate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Residential 1-4 family
|
$
|
5,534
|
|
|
0.28
|
|
|
48.2
|
|
|
$
|
6,068
|
|
|
0.33
|
|
|
49.2
|
|
Commercial real estate
|
5,059
|
|
|
1.15
|
|
|
10.6
|
|
|
2,965
|
|
|
0.79
|
|
|
9.9
|
|
||
Home equity line of credit
|
5,229
|
|
|
0.71
|
|
|
17.8
|
|
|
4,493
|
|
|
0.71
|
|
|
16.6
|
|
||
Residential land
|
1,817
|
|
|
11.23
|
|
|
0.4
|
|
|
4,275
|
|
|
16.56
|
|
|
0.7
|
|
||
Commercial construction
|
2,397
|
|
|
4.60
|
|
|
1.3
|
|
|
2,023
|
|
|
4.60
|
|
|
1.2
|
|
||
Residential construction
|
19
|
|
|
0.15
|
|
|
0.3
|
|
|
9
|
|
|
0.15
|
|
|
0.2
|
|
||
Total real estate
|
20,055
|
|
|
0.61
|
|
|
78.6
|
|
|
19,833
|
|
|
0.67
|
|
|
77.8
|
|
||
Commercial
|
15,803
|
|
|
2.02
|
|
|
18.8
|
|
|
15,931
|
|
|
2.21
|
|
|
19.0
|
|
||
Consumer
|
2,367
|
|
|
2.18
|
|
|
2.6
|
|
|
4,019
|
|
|
3.32
|
|
|
3.2
|
|
||
|
38,225
|
|
|
0.92
|
|
|
100.0
|
|
|
39,783
|
|
|
1.05
|
|
|
100.0
|
|
||
Unallocated
|
1,891
|
|
|
|
|
|
|
|
|
2,202
|
|
|
|
|
|
|
|
||
Total allowance for loan losses
|
$
|
40,116
|
|
|
|
|
|
|
|
|
$
|
41,985
|
|
|
|
|
|
|
|
|
In 1 year
or less
|
|
After 1 year
through 5 years
|
|
After 5 years
through 10 years
|
|
After
10 years
|
|
Mortgage-Related Securities
|
|
Total
1
|
||||||||||||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
U.S. Treasury and federal agency obligations
|
$
|
10
|
|
|
$
|
77
|
|
|
$
|
82
|
|
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
194
|
|
Mortgage-related securities - FNMA, FHLMC and GNMA
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
909
|
|
|
909
|
|
||||||
Mortgage revenue bond
2
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
15
|
|
||||||
|
$
|
10
|
|
|
$
|
77
|
|
|
$
|
82
|
|
|
$
|
40
|
|
|
$
|
909
|
|
|
$
|
1,118
|
|
Weighted average yield
|
1.13
|
%
|
|
1.78
|
%
|
|
2.32
|
%
|
|
2.77
|
%
|
|
1.99
|
%
|
|
2.02
|
%
|
1
|
As of December 31, 2016, no investment exceeded 10% of shareholder's equity.
|
2
|
Weighted average yield on the mortgage revenue bond is computed on a tax equivalent basis using a federal statutory tax rate of 35%.
|
Years ended December 31
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||||||||
(dollars in thousands)
|
Average
balance
|
|
|
% of
total
deposits
|
|
|
Weighted
average
rate %
|
|
|
Average
balance
|
|
|
% of
total
deposits
|
|
|
Weighted
average
rate %
|
|
|
Average
balance
|
|
|
% of
total
deposits
|
|
|
Weighted
average
rate %
|
|
|||
Interest-bearing deposit liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Savings
|
$
|
2,117,186
|
|
|
57.5
|
%
|
|
0.07
|
%
|
|
$
|
1,980,151
|
|
|
58.6
|
%
|
|
0.06
|
%
|
|
$
|
1,879,373
|
|
|
58.3
|
%
|
|
0.06
|
%
|
Checking
|
839,339
|
|
|
22.8
|
|
|
0.02
|
|
|
782,811
|
|
|
23.2
|
|
|
0.02
|
|
|
738,651
|
|
|
22.9
|
|
|
0.02
|
|
|||
Money market
|
160,700
|
|
|
4.4
|
|
|
0.13
|
|
|
164,568
|
|
|
4.9
|
|
|
0.12
|
|
|
171,889
|
|
|
5.3
|
|
|
0.12
|
|
|||
Certificate
|
565,135
|
|
|
15.3
|
|
|
0.95
|
|
|
449,179
|
|
|
13.3
|
|
|
0.83
|
|
|
434,934
|
|
|
13.5
|
|
|
0.83
|
|
|||
Total interest-bearing deposit liabilities
|
$
|
3,682,360
|
|
|
100.0
|
%
|
|
0.19
|
%
|
|
$
|
3,376,709
|
|
|
100.0
|
%
|
|
0.16
|
%
|
|
$
|
3,224,847
|
|
|
100.0
|
%
|
|
0.16
|
%
|
Total noninterest-bearing demand deposit liabilities
|
1,559,132
|
|
|
|
|
|
|
1,426,962
|
|
|
|
|
|
|
1,285,964
|
|
|
|
|
|
|||||||||
Total deposit liabilities
|
$
|
5,241,492
|
|
|
|
|
|
|
$
|
4,803,671
|
|
|
|
|
|
|
$
|
4,510,811
|
|
|
|
|
|
(in thousands)
|
Amount
|
|
|
Three months or less
|
$
|
99,452
|
|
Greater than three months through six months
|
54,795
|
|
|
Greater than six months through twelve months
|
37,888
|
|
|
Greater than twelve months
|
136,002
|
|
|
|
$
|
328,137
|
|
|
Number of branches
|
|||||||
December 31, 2016
|
Owned
|
|
Leased
|
|
Total
1
|
|||
Oahu
|
7
|
|
|
29
|
|
|
36
|
|
Maui
|
3
|
|
|
4
|
|
|
7
|
|
Hawaii
|
3
|
|
|
2
|
|
|
5
|
|
Kauai
|
2
|
|
|
1
|
|
|
3
|
|
Molokai
|
—
|
|
|
1
|
|
|
1
|
|
|
15
|
|
|
37
|
|
|
52
|
|
ITEM 1A.
|
RISK FACTORS
|
•
|
the provisions of an HEI agreement with the PUC, which could limit the ability of HEI’s principal electric public utility subsidiary, Hawaiian Electric, to pay dividends to HEI in the event that the consolidated common stock equity of the Utilities falls below 35% of total capitalization of the electric utilities;
|
•
|
the provisions of an HEI agreement entered into with federal bank regulators in connection with its acquisition of its bank subsidiary, ASB, which require HEI to contribute additional capital to ASB (up to a maximum amount of additional capital of $28.3 million as of December 31, 2016) upon request of the regulators in order to maintain ASB’s regulatory capital at the level required by regulation;
|
•
|
the minimum capital and capital distribution regulations of the OCC that are applicable to ASB and capital regulations that become applicable to HEI and ASB Hawaii;
|
•
|
the receipt of a letter from the FRB communicating to the OCC and FRB's non-objection to the payment of any dividend ASB proposes to declare and pay to ASB Hawaii and HEI; and
|
•
|
the provisions of preferred stock resolutions and debt instruments of HEI and its subsidiaries.
|
•
|
ASB, one of the largest financial institutions in the state, is in direct competition for deposits and loans not only with two larger institutions that have substantial capital, technology and marketing resources, but also with smaller Hawaii institutions and other U.S. institutions, including credit unions, mutual funds, mortgage brokers, finance companies and investment banking firms. Larger financial institutions may have greater access to capital at lower costs, which could impair ASB’s ability to compete effectively. Significant advances in technology could render the operations of ASB less competitive or obsolete.
|
•
|
The Utilities face competition from IPPs; customer self-generation, with or without cogeneration; customer energy storage; and the potential formation of community-based, cooperative ownership or municipality structures for electrical service on all islands it serves. With the exception of certain identified projects, the Utilities are required to use competitive bidding to acquire a future generation resource unless the PUC finds competitive bidding to be unsuitable. The PUC set policies for distributed generation (DG) interconnection agreements and standby rates. The results of competitive bidding, competition from IPPs, customer self-generation, and potential cooperative ownership or municipality structures for electric utility service, and the rate at which technological developments facilitating nonutility generation of electricity, combined heat and power technology, off-grid microgrids, and customer energy storage may adversely affect the Utilities and the results of their operations.
|
•
|
New technological developments, such as the commercial development of energy storage and microgrids, may render the operations of the Utilities less competitive or outdated.
|
•
|
local, regional, national and other economic and political conditions that could result in declines in employment and real estate values, which in turn could adversely affect the ability of borrowers to make loan payments and the ability of ASB to recover the full amounts owing to it under defaulted loans;
|
•
|
the ability of borrowers to obtain insurance and the ability of ASB to place insurance where borrowers fail to do so, particularly in the event of catastrophic damage to collateral securing loans made by ASB;
|
•
|
faster than expected loan prepayments that can cause an acceleration of the amortization of premiums on loans and investments and the impairment of mortgage servicing assets of ASB;
|
•
|
changes in ASB’s loan portfolio credit profiles and asset quality, which may increase or decrease the required level of allowance for loan losses;
|
•
|
technological disruptions affecting ASB’s operations or financial or operational difficulties experienced by any outside vendor on whom ASB relies to provide key components of its business operations, such as business processing, network access or internet connections;
|
•
|
the impact of legislative and regulatory changes, including changes affecting capital requirements, increasing oversight of and reporting by banks, or affecting the lending programs or other business activities of ASB;
|
•
|
additional legislative changes regulating the assessment of overdraft, interchange and credit card fees, which can have a negative impact on noninterest income;
|
•
|
public opinion about ASB and financial institutions in general, which, if negative, could impact the public’s trust and confidence in ASB and adversely affect ASB’s ability to attract and retain customers and expose ASB to adverse legal and regulatory consequences;
|
•
|
increases in operating costs (including employee compensation expense and benefits and regulatory compliance costs), inflation and other factors, that exceed increases in ASB’ s net interest, fee and other income; and
|
•
|
the ability of ASB to maintain or increase the level of deposits, ASB’s lowest costing funds.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
Name
|
|
Age
|
|
Business experience for last 5 years and prior positions with the Company
|
Constance H. Lau
|
|
64
|
|
HEI President and Chief Executive Officer since 5/06
HEI Director, 6/01 to 12/04 and since 5/06 Hawaiian Electric Chairman of the Board since 5/06
ASB Hawaii Director since 5/06
ASB Chairman of the Board since 5/06, Risk Committee member since 2012 and Director since 1999
· ASB Chief Executive Officer, 6/01 to 11/10, and President, 6/01 to 1/08
· ASB Senior Executive Vice President and Chief Operating Officer and Director, 12/99 to 5/01
· HEI Power Corp. Financial Vice President and Treasurer, 5/97 to 8/99
· HEI Treasurer, 4/89 to 10/99, and HEI Assistant Treasurer, 12/87 to 4/89
· Hawaiian Electric Treasurer 12/87 to 4/89 and Assistant Corporate Counsel, 9/84 to 12/87
|
James A. Ajello*
|
|
63
|
|
HEI Executive Vice President and Chief Financial Officer since 8/13
ASB Hawaii Director since 8/09
· HEI Executive Vice President, Chief Financial Officer and Treasurer, 5/11 to 8/13
· HEI Senior Financial Vice President, Treasurer and Chief Financial Officer, 1/09 to 5/11
|
Gregory C. Hazelton*
|
|
52
|
|
HEI Senior Vice President, Finance since 10/16
· Prior to rejoining the Company in 2016: Northwest Natural Gas Company, Senior Vice President, Chief Financial Officer and Treasurer, 2/16 to 9/16, and Northwest Natural Gas Company, Senior Vice President and Chief Financial Officer, 6/15 to 2/16
· HEI Vice President, Finance, Treasurer and Controller, 8/13 to 6/15
·
Prior to joining the Company in 2013: UBS Investment Bank, Managing Director, Global Power & Utilities Group 3/11 to 5/13
|
Alan M. Oshima
|
|
69
|
|
Hawaiian Electric President and Chief Executive Officer since 10/14
Hawaiian Electric Director, 2008 to 10/11 and since 10/14
HEI Charitable Foundation President since 10/11
· Hawaiian Electric Senior Executive Officer on loan from HEI, 5/14 to 9/14
· HEI Executive Vice President, Corporate and Community Advancement, 10/11 to 5/14
|
Richard F. Wacker
|
|
54
|
|
ASB President and Chief Executive Officer since 11/10
ASB Director since 11/10
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Period*
|
(a)
Total Number
of Shares Purchased **
|
|
(b)
Average
Price Paid
per Share **
|
(c)
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
(d)
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
|
||||
October 1 to 31, 2016
|
—
|
|
|
$
|
—
|
|
—
|
|
|
NA
|
November 1 to 30, 2016
|
—
|
|
|
$
|
—
|
|
—
|
|
|
NA
|
December 1 to 31, 2016
|
207,373
|
|
|
$
|
32.28
|
|
—
|
|
|
NA
|
Quarters ended
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
||||
March 31
|
$
|
33,367
|
|
|
$
|
31,840
|
|
June 30
|
33,481
|
|
|
33,300
|
|
||
September 30
|
33,550
|
|
|
33,312
|
|
||
December 31
|
33,652
|
|
|
33,313
|
|
Quarters ended
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
||||
March 31
|
$
|
23,400
|
|
|
$
|
22,601
|
|
June 30
|
23,400
|
|
|
22,602
|
|
||
September 30
|
23,399
|
|
|
22,601
|
|
||
December 31
|
23,400
|
|
|
22,601
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
Selected Financial Data
|
|
|
|
|
|
|
|
|
|
||||||||||
Hawaiian Electric Industries, Inc. and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
(dollars in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Results of operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
2,380,654
|
|
|
$
|
2,602,982
|
|
|
$
|
3,239,542
|
|
|
$
|
3,238,470
|
|
|
$
|
3,374,995
|
|
Net income for common stock
|
$
|
248,256
|
|
|
$
|
159,877
|
|
|
$
|
168,129
|
|
|
$
|
161,709
|
|
|
$
|
138,705
|
|
Basic earnings per common share
|
$
|
2.30
|
|
|
$
|
1.50
|
|
|
$
|
1.65
|
|
|
$
|
1.63
|
|
|
$
|
1.43
|
|
Diluted earnings per common share
|
$
|
2.29
|
|
|
$
|
1.50
|
|
|
$
|
1.63
|
|
|
$
|
1.62
|
|
|
$
|
1.42
|
|
Return on average common equity
|
12.4
|
%
|
|
8.6
|
%
|
|
9.6
|
%
|
|
9.7
|
%
|
|
8.9
|
%
|
|||||
Financial position *
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total assets
|
$
|
12,425,506
|
|
|
$
|
11,782,018
|
|
|
$
|
11,177,143
|
|
|
$
|
10,331,921
|
|
|
$
|
10,139,569
|
|
Deposit liabilities
|
5,548,929
|
|
|
5,025,254
|
|
|
4,623,415
|
|
|
4,372,477
|
|
|
4,229,916
|
|
|||||
Other bank borrowings
|
192,618
|
|
|
328,582
|
|
|
290,656
|
|
|
244,514
|
|
|
195,926
|
|
|||||
Long-term debt, net
|
1,619,019
|
|
|
1,578,368
|
|
|
1,498,547
|
|
|
1,483,960
|
|
|
1,412,386
|
|
|||||
Preferred stock of subsidiaries – not subject to mandatory redemption
|
34,293
|
|
|
34,293
|
|
|
34,293
|
|
|
34,293
|
|
|
34,293
|
|
|||||
Common stock equity
|
2,066,753
|
|
|
1,927,640
|
|
|
1,790,573
|
|
|
1,726,406
|
|
|
1,593,008
|
|
|||||
Common stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Book value per common share *
|
$
|
19.05
|
|
|
$
|
17.94
|
|
|
$
|
17.46
|
|
|
$
|
17.05
|
|
|
$
|
16.27
|
|
Market price per common share
|
|
|
|
|
|
|
|
|
|
|
|||||||||
High
|
34.98
|
|
|
34.86
|
|
|
35.00
|
|
|
28.30
|
|
|
29.24
|
|
|||||
Low
|
27.30
|
|
|
27.02
|
|
|
22.71
|
|
|
23.84
|
|
|
23.65
|
|
|||||
December 31
|
33.07
|
|
|
28.95
|
|
|
33.48
|
|
|
26.06
|
|
|
25.14
|
|
|||||
Dividends per common share
|
1.24
|
|
|
1.24
|
|
|
1.24
|
|
|
1.24
|
|
|
1.24
|
|
|||||
Dividend payout ratio
|
54
|
%
|
|
82
|
%
|
|
75
|
%
|
|
76
|
%
|
|
87
|
%
|
|||||
Market price to book value per common share *
|
174
|
%
|
|
161
|
%
|
|
192
|
%
|
|
153
|
%
|
|
155
|
%
|
|||||
Price earnings ratio **
|
14.4x
|
|
|
19.3x
|
|
|
20.3
|
x
|
|
16.0
|
x
|
|
17.6
|
x
|
|||||
Common shares outstanding (thousands) *
|
108,583
|
|
|
107,460
|
|
|
102,565
|
|
|
101,260
|
|
|
97,928
|
|
|||||
Weighted-average
|
108,102
|
|
|
106,418
|
|
|
101,968
|
|
|
98,968
|
|
|
96,908
|
|
|||||
Shareholders ***
|
26,831
|
|
|
27,927
|
|
|
29,415
|
|
|
30,653
|
|
|
31,349
|
|
|||||
Employees *
|
3,796
|
|
|
3,918
|
|
|
3,965
|
|
|
3,966
|
|
|
3,870
|
|
*
|
At December 31.
|
**
|
Calculated using December 31 market price per common share divided by basic earnings per common share. The principal trading market for HEI’s common stock is the New York Stock Exchange (NYSE).
|
***
|
At December 31. Represents registered shareholders plus participants in the HEI Dividend Reinvestment and Stock Purchase Plan (DRIP) who are not registered shareholders. As of February 13, 2017, HEI had 6,429 registered shareholders (i.e., holders of record of HEI common stock), 23,723 DRIP participants and total shareholders of 26,753.
|
Years ended December 31
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||
(in thousands)
|
|
|
|
|
|
||||||||||
Results of operations
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
2,094,368
|
|
$
|
2,335,166
|
|
$
|
2,987,323
|
|
$
|
2,980,172
|
|
$
|
3,109,439
|
|
Net income for common stock
|
142,317
|
|
135,714
|
|
137,641
|
|
122,929
|
|
99,276
|
|
|||||
|
|
|
|
|
|
||||||||||
Financial position *
|
|
|
|
|
|
||||||||||
Utility plant
|
$
|
6,870,627
|
|
$
|
6,543,799
|
|
$
|
6,220,397
|
|
$
|
5,896,991
|
|
$
|
5,567,346
|
|
Accumulated depreciation
|
(2,369,282
|
)
|
(2,266,004
|
)
|
(2,175,510
|
)
|
(2,111,229
|
)
|
(2,040,789
|
)
|
|||||
Net utility plant
|
$
|
4,501,345
|
|
$
|
4,277,795
|
|
$
|
4,044,887
|
|
$
|
3,785,762
|
|
$
|
3,526,557
|
|
Total assets
|
$
|
5,975,428
|
|
$
|
5,672,210
|
|
$
|
5,550,021
|
|
$
|
5,058,065
|
|
$
|
5,099,101
|
|
Current portion of long-term debt
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
11,383
|
|
$
|
—
|
|
Long-term debt, net
|
1,319,260
|
|
1,278,702
|
|
1,199,025
|
|
1,198,200
|
|
1,138,180
|
|
|||||
Common stock equity
|
1,799,787
|
|
1,728,325
|
|
1,682,144
|
|
1,593,564
|
|
1,472,136
|
|
|||||
Cumulative preferred stock-not
subject to mandatory redemption
|
34,293
|
|
34,293
|
|
34,293
|
|
34,293
|
|
34,293
|
|
|||||
Capital structure
|
$
|
3,153,340
|
|
$
|
3,041,320
|
|
$
|
2,915,462
|
|
$
|
2,837,440
|
|
$
|
2,644,609
|
|
Capital structure ratios (%)
|
|
|
|
|
|
||||||||||
Debt (short-term debt, which is nil, and long-term debt, net, including current portion)
|
41.8
|
|
42.1
|
|
41.1
|
|
42.6
|
|
43.0
|
|
|||||
Cumulative preferred stock
|
1.1
|
|
1.1
|
|
1.2
|
|
1.2
|
|
1.3
|
|
|||||
Common stock equity
|
57.1
|
|
56.8
|
|
57.7
|
|
56.2
|
|
55.7
|
|
*
|
At December 31.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
HEI Consolidated
|
(dollars in millions, except per share amounts)
|
2016
|
|
|
% change
|
|
|
2015
|
|
|
% change
|
|
|
2014
|
|
|||
Revenues
|
$
|
2,381
|
|
|
(9
|
)
|
|
$
|
2,603
|
|
|
(20
|
)
|
|
$
|
3,240
|
|
Operating income
|
349
|
|
|
8
|
|
|
323
|
|
|
(3
|
)
|
|
333
|
|
|||
Merger termination fee
|
90
|
|
|
NM
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net income for common stock
|
248
|
|
|
55
|
|
|
160
|
|
|
(5
|
)
|
|
168
|
|
|||
Net income (loss) by segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Electric utility
|
$
|
142
|
|
|
5
|
|
|
$
|
136
|
|
|
(1
|
)
|
|
$
|
138
|
|
Bank
|
57
|
|
|
5
|
|
|
55
|
|
|
7
|
|
|
51
|
|
|||
Other
|
49
|
|
|
NM
|
|
|
(31
|
)
|
|
NM
|
|
|
(21
|
)
|
|||
Net income for common stock
|
$
|
248
|
|
|
55
|
|
|
$
|
160
|
|
|
(5
|
)
|
|
$
|
168
|
|
Basic earnings per share
|
$
|
2.30
|
|
|
53
|
|
|
$
|
1.50
|
|
|
(9
|
)
|
|
$
|
1.65
|
|
Diluted earnings per share
|
$
|
2.29
|
|
|
53
|
|
|
$
|
1.50
|
|
|
(8
|
)
|
|
$
|
1.63
|
|
Dividends per share
|
$
|
1.24
|
|
|
—
|
|
|
$
|
1.24
|
|
|
—
|
|
|
$
|
1.24
|
|
Weighted-average number of common shares outstanding (millions)
|
108.1
|
|
|
2
|
|
|
106.4
|
|
|
4
|
|
|
102.0
|
|
|||
Dividend payout ratio
|
54
|
%
|
|
|
|
|
82
|
%
|
|
|
|
|
75
|
%
|
NM
|
Not meaningful.
|
December 31
|
2016
|
|
2015
|
||||||||||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||
Short-term borrowings—other than bank
|
$
|
—
|
|
|
—
|
%
|
|
$
|
103
|
|
|
3
|
%
|
Long-term debt, net—other than bank
|
1,619
|
|
|
43
|
|
|
1,578
|
|
|
43
|
|
||
Preferred stock of subsidiaries
|
34
|
|
|
1
|
|
|
34
|
|
|
1
|
|
||
Common stock equity
|
2,067
|
|
|
56
|
|
|
1,928
|
|
|
53
|
|
||
|
$
|
3,720
|
|
|
100
|
%
|
|
$
|
3,643
|
|
|
100
|
%
|
|
Year ended
December 31, 2016
|
|
|
||||||||
(in millions)
|
Average
balance
|
|
End-of-period
balance
|
|
December 31,
2015
|
||||||
Short-term borrowings
1
|
|
|
|
|
|
||||||
Commercial paper
|
$
|
43
|
|
|
$
|
—
|
|
|
$
|
103
|
|
Line of credit draws
|
—
|
|
|
—
|
|
|
—
|
|
|||
Undrawn capacity under HEI’s line of credit facility
|
150
|
|
|
150
|
|
|
150
|
|
1
|
This table does not include Hawaiian Electric’s separate commercial paper issuances and line of credit facilities and draws, which are disclosed below under “Electric utility—Financial Condition—Liquidity and capital resources.” At February 13, 2017, HEI had no outstanding commercial paper and its line of credit facility was undrawn. The maximum amount of HEI’s short-term borrowings in 2016 was $103 million.
|
|
Fitch
|
Moody’s
|
S&P
|
Long-term issuer default and senior unsecured; senior unsecured*; and long-term issuer credit; respectively
|
BBB
|
*
|
BBB-
|
Commercial paper
|
F3
|
P-3
|
A-3
|
Outlook
|
Stable
|
Stable
|
Stable
|
December 31, 2016
|
|
||||||||||||||||||
(in millions)
|
Less than
1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
|
Total
|
||||||||||
Contractual obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Investment in qualifying affordable housing projects
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
14
|
|
Time certificates
|
323
|
|
|
176
|
|
|
156
|
|
|
3
|
|
|
658
|
|
|||||
Other bank borrowings
|
143
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
193
|
|
|||||
Long-term debt
|
125
|
|
|
125
|
|
|
146
|
|
|
1,231
|
|
|
1,627
|
|
|||||
Interest on certificates of deposit, other bank borrowings and long-term debt
|
82
|
|
|
151
|
|
|
140
|
|
|
800
|
|
|
1,173
|
|
|||||
Operating leases, service bureau contract, maintenance and ASB construction-related agreements
|
35
|
|
|
40
|
|
|
27
|
|
|
18
|
|
|
120
|
|
|||||
Hawaiian Electric open purchase order obligations
1
|
56
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
170
|
|
|||||
Hawaiian Electric fuel oil purchase obligations (estimate based on December 31, 2016 fuel oil prices)
|
125
|
|
|
238
|
|
|
—
|
|
|
—
|
|
|
363
|
|
|||||
Hawaiian Electric power purchase obligations–minimum fixed capacity charges
|
121
|
|
|
188
|
|
|
189
|
|
|
388
|
|
|
886
|
|
|||||
Liabilities for uncertain tax positions
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Total (estimated)
|
$
|
1,023
|
|
|
$
|
1,086
|
|
|
$
|
658
|
|
|
$
|
2,441
|
|
|
$
|
5,208
|
|
1
|
Includes contractual obligations and commitments for capital expenditures and expense amounts.
|
1.
|
obligations under guarantee contracts,
|
2.
|
retained or contingent interests in assets transferred to an unconsolidated entity or similar arrangements that serve as credit, liquidity or market risk support to that entity for such assets,
|
3.
|
obligations under derivative instruments, and
|
4.
|
obligations under a material variable interest held by the Company or the Utilities in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to the Company or the Utilities, or engages in leasing, hedging or research and development services with the Company or the Utilities.
|
Actuarial assumption
|
Change in assumption
in basis points
|
Impact on HEI Consolidated
PBO or APBO
|
|
Impact on Consolidated Hawaiian Electric
PBO or APBO
|
(dollars in millions)
|
|
|
|
|
Pension benefits
|
|
|
|
|
Discount rate
|
+/- 50
|
$(140)/$158
|
|
$(130)/$148
|
Other benefits
|
|
|
|
|
Discount rate
|
'
+/- 50
|
(15)/17
|
|
(14)/16
|
Health care cost trend rate
|
'
+/- 100
|
4/(4)
|
|
3/(4)
|
Electric utility
|
%
|
|
Return on rate base (RORB)*
|
|
ROACE**
|
|
Rate-making ROACE***
|
|||||||||||||||||||||
Year ended December 31, 2016
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|||||||||
Utility returns
|
|
7.48
|
|
|
6.73
|
|
|
6.99
|
|
|
8.26
|
|
|
7.28
|
|
|
8.08
|
|
|
9.46
|
|
|
7.61
|
|
|
8.34
|
|
PUC-allowed returns
|
|
8.11
|
|
|
8.31
|
|
|
7.34
|
|
|
10.00
|
|
|
10.00
|
|
|
9.00
|
|
|
10.00
|
|
|
10.00
|
|
|
9.00
|
|
Difference
|
|
(0.63
|
)
|
|
(1.58
|
)
|
|
(0.35
|
)
|
|
(1.74
|
)
|
|
(2.72
|
)
|
|
(0.92
|
)
|
|
(0.54
|
)
|
|
(2.39
|
)
|
|
(0.66
|
)
|
•
|
2016 vs. 2015
|
2016
|
|
2015
|
|
Increase (decrease)
|
|
(dollars in millions, except per barrel amounts)
|
||||||||||
$
|
2,094
|
|
|
$
|
2,335
|
|
|
$
|
(241
|
)
|
|
|
|
|
Revenues.
Net decrease largely due to:
|
|
|
|
|
|
|
|
|
$
|
(198
|
)
|
|
lower fuel prices
1
|
|||||
|
|
|
|
|
|
|
(33
|
)
|
|
lower purchased power expense
2
|
||||||
|
|
|
|
|
|
|
(25
|
)
|
|
lower KWH generated
|
||||||
|
|
|
|
|
|
15
|
|
|
higher RAM revenues
|
|||||||
455
|
|
|
655
|
|
|
(200
|
)
|
|
|
|
Fuel oil expense.
Decrease due to lower fuel cost and lower KWH generated
|
|||||
563
|
|
|
594
|
|
|
(31
|
)
|
|
|
|
|
Purchased power expense.
Decrease due to lower purchased power energy prices, largely due to lower fuel prices
2
|
||||
406
|
|
|
413
|
|
|
(7
|
)
|
|
|
|
|
Operation and maintenance expense
. Net decrease due to:
|
||||
|
|
|
|
|
|
|
(5
|
)
|
|
write off of ERP software costs in 2015, as a result of a PUC ERP/EAM decision
|
||||||
|
|
|
|
|
|
|
(4
|
)
|
|
additional reserve for environmental costs in 2015
3
|
||||||
|
|
|
|
|
|
(1
|
)
|
|
lower storm weather repairs
|
|||||||
|
|
|
|
|
|
3
|
|
|
higher PSIP consulting costs incurred in 2016, in order to complete the PSIP update in April 2016 and December 2016
|
|||||||
|
|
|
|
|
|
1
|
|
|
higher LNG consulting costs to negotiate LNG contract, which was subsequently terminated following HEI/Nextera merger termination
|
|||||||
387
|
|
|
399
|
|
|
(12
|
)
|
|
|
|
|
Other expenses
. Decrease in revenue taxes due to lower revenue, partly offset by higher depreciation expense for plant investments
|
||||
284
|
|
|
274
|
|
|
10
|
|
|
|
|
|
Operating income.
Increase due to an overall decrease in expenses
|
||||
142
|
|
|
136
|
|
|
6
|
|
|
|
|
|
Net income for common stock.
Increase due to higher operating income
|
||||
8.1
|
%
|
|
8.0
|
%
|
|
0.1
|
%
|
|
|
|
Return on average common equity
|
|||||
53.49
|
|
|
74.71
|
|
|
(21.22
|
)
|
|
|
|
Average fuel oil cost per barrel
1
|
|||||
8,845
|
|
|
8,957
|
|
|
(112
|
)
|
|
|
|
Kilowatthour sales (millions)
4
|
|||||
4,788
|
|
|
5,082
|
|
|
(294
|
)
|
|
|
|
Cooling degree days (Oahu)
|
|||||
2,662
|
|
|
2,727
|
|
|
(65
|
)
|
|
|
|
Number of employees (at December 31)
|
1
|
The rate schedules of the electric utilities currently contain energy cost adjustment clauses (ECACs) through which changes in fuel oil prices and certain components of purchased energy costs are passed on to customers.
|
2
|
The rate schedule of the electric utilities currently contain purchase power adjustment clauses (PPAC) through which changes in purchase power expenses (except purchased energy costs) are passed on to customers.
|
3
|
Costs to complete Waiau Power Plant's onshore and offshore investigations and the remediation of PCB contamination in the offshore sediment in 2015.
|
4
|
KWH sales were lower in 2016 when compared to the prior year due largely to continued energy efficiency and conservation efforts by customers and increasing levels of private customer-sited renewable generation.
|
•
|
2015 vs. 2014
|
2015
|
|
2014
|
|
Increase (decrease)
|
|
(dollars in millions, except per barrel amounts)
|
||||||||||
$
|
2,335
|
|
|
$
|
2,987
|
|
|
$
|
(652
|
)
|
|
|
|
|
Revenues.
Decrease largely due to:
|
|
|
|
|
|
|
|
|
$
|
(520
|
)
|
|
lower fuel prices
1
|
|||||
|
|
|
|
|
|
|
(134
|
)
|
|
lower purchased power energy costs
2
|
||||||
|
|
|
|
|
|
|
2
|
|
|
higher KWH purchased
|
||||||
655
|
|
|
1,132
|
|
|
(477
|
)
|
|
|
|
|
Fuel oil expense.
Decrease largely due to lower fuel costs and lower KWH generated
|
||||
594
|
|
|
722
|
|
|
(128
|
)
|
|
|
|
|
Purchased power expense.
Decrease due to lower purchased power energy
prices, largely due to lower fuel prices, offset by higher KWH purchased |
||||
413
|
|
|
411
|
|
|
2
|
|
|
|
|
|
Operation and maintenance expense
. Net increase due to:
|
||||
|
|
|
|
|
|
|
5
|
|
|
ERP software costs write off resulting from PUC ERP/EAM decision in 2015
|
||||||
|
|
|
|
|
|
|
4
|
|
|
additional reserves for environmental costs
3
|
||||||
|
|
|
|
|
|
3
|
|
|
higher employee benefit costs due to affordable care act costs and higher health insurance premiums
|
|||||||
|
|
|
|
|
|
(9
|
)
|
|
higher 2014 smart grid initial phase costs
|
|||||||
399
|
|
|
447
|
|
|
(48
|
)
|
|
|
|
|
Other expenses
. Decrease in revenue taxes due to lower revenue, offset by higher
depreciation expense for plant investments
|
||||
274
|
|
|
276
|
|
|
(2
|
)
|
|
|
|
|
Operating income.
Decrease due to lower revenues
|
||||
136
|
|
|
138
|
|
|
(2
|
)
|
|
|
|
|
Net income for common stock.
Decrease due to lower operating income
|
||||
8.0
|
%
|
|
8.4
|
%
|
|
(0.4
|
)%
|
|
|
|
Return on average common equity
|
|||||
74.71
|
|
|
129.65
|
|
|
(54.94
|
)
|
|
|
|
Average fuel oil cost per barrel
1
|
|||||
8,957
|
|
|
8,976
|
|
|
(19
|
)
|
|
|
|
Kilowatthour sales (millions)
4
|
|||||
5,082
|
|
|
4,909
|
|
|
173
|
|
|
|
|
Cooling degree days (Oahu)
|
|||||
2,727
|
|
|
2,759
|
|
|
(32
|
)
|
|
|
|
Number of employees (at December 31)
|
1
|
The rate schedules of the electric utilities currently contain energy cost adjustment clauses (ECACs) through which changes in fuel oil prices and certain components of purchased energy costs are passed on to customers.
|
2
|
The rate schedule of the electric utilities currently contain purchase power adjustment clauses (PPAC) through which changes in purchase power expenses (except purchased energy costs) are passed on to customers.
|
3
|
Costs to complete Waiau Power Plant's onshore and offshore investigations and the remediation of PCB contamination in the offshore sediment in 2015.
|
4
|
KWH sales were lower in 2015 when compared to the prior year due largely to continued energy efficiency and conservation efforts by customers and increasing levels of private customer-sited renewable generation.
|
Test year
(dollars in millions)
|
|
Date
(filed/
implemented)
|
|
Amount
|
|
% over
rates in
effect
|
|
ROACE
(%)
|
|
RORB
(%)
|
|
Rate
base
|
|
Common
equity
%
|
|
Stipulated
agreement
reached with
Consumer
Advocate
|
||||||||
Hawaiian Electric
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
2011
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Request
|
|
7/30/10
|
|
$
|
113.5
|
|
|
6.6
|
|
|
10.75
|
|
|
8.54
|
|
|
$
|
1,569
|
|
|
56.29
|
|
|
Yes
|
Interim increase
|
|
7/26/11
|
|
53.2
|
|
|
3.1
|
|
|
10.00
|
|
|
8.11
|
|
|
1,354
|
|
|
56.29
|
|
|
|
||
Interim increase (adjusted)
|
|
4/2/12
|
|
58.2
|
|
|
3.4
|
|
|
10.00
|
|
|
8.11
|
|
|
1,385
|
|
|
56.29
|
|
|
|
||
Interim increase (adjusted)
|
|
5/21/12
|
|
58.8
|
|
|
3.4
|
|
|
10.00
|
|
|
8.11
|
|
|
1,386
|
|
|
56.29
|
|
|
|
||
Final increase
|
|
9/1/12
|
|
58.1
|
|
|
3.4
|
|
|
10.00
|
|
|
8.11
|
|
|
1,386
|
|
|
56.29
|
|
|
|
||
2014
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Request
|
|
6/27/14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2017
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Request
|
|
12/16/16
|
|
$
|
106.4
|
|
|
6.9
|
|
|
10.60
|
|
|
8.28
|
|
|
2,002
|
|
|
57.36
|
|
|
|
|
Hawaii Electric Light
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
2010
(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Request
|
|
12/9/09
|
|
$
|
20.9
|
|
|
6.0
|
|
|
10.75
|
|
|
8.73
|
|
|
$
|
487
|
|
|
55.91
|
|
|
Yes
|
Interim increase
|
|
1/14/11
|
|
6.0
|
|
|
1.7
|
|
|
10.50
|
|
|
8.59
|
|
|
465
|
|
|
55.91
|
|
|
|
||
Interim increase (adjusted)
|
|
1/1/12
|
|
5.2
|
|
|
1.5
|
|
|
10.50
|
|
|
8.59
|
|
|
465
|
|
|
55.91
|
|
|
|
||
Final increase
|
|
4/9/12
|
|
4.5
|
|
|
1.3
|
|
|
10.00
|
|
|
8.31
|
|
|
465
|
|
|
55.91
|
|
|
|
||
2013
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Request
|
|
8/16/12
|
|
$
|
19.8
|
|
|
4.2
|
|
|
10.25
|
|
|
8.30
|
|
|
$
|
455
|
|
|
57.05
|
|
|
|
Closed
|
|
3/27/13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
2016
(6)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Request
|
|
9/19/16
|
|
$
|
19.3
|
|
|
6.5
|
|
|
10.60
|
|
|
8.44
|
|
|
$
|
479
|
|
|
57.12
|
|
|
|
Maui Electric
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
2012
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Request
|
|
7/22/11
|
|
$
|
27.5
|
|
|
6.7
|
|
|
11.00
|
|
|
8.72
|
|
|
$
|
393
|
|
|
56.85
|
|
|
Yes
|
Interim increase
|
|
6/1/12
|
|
13.1
|
|
|
3.2
|
|
|
10.00
|
|
|
7.91
|
|
|
393
|
|
|
56.86
|
|
|
|
||
Final increase
|
|
8/1/13
|
|
5.3
|
|
|
1.3
|
|
|
9.00
|
|
|
7.34
|
|
|
393
|
|
|
56.86
|
|
|
|
||
2015
(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Request
|
|
12/30/14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
Hawaii Electric Light’s request was primarily to cover investments for system upgrade projects, two major transmission line upgrades and increasing O&M expenses. On February 8, 2012, the PUC issued a final D&O, which reflected the approval of decoupling and cost-recovery mechanisms, and on February 21, 2012, Hawaii Electric Light filed its revised tariffs to reflect the increase in rates. On April 4, 2012, the PUC issued an order approving the revised tariffs, which became effective April 9, 2012. Hawaii Electric Light implemented the decoupling mechanism and began tracking the target revenues and actual recorded revenues via a revenue balancing account. Hawaii Electric Light also reset the heat rates and implemented heat rate deadbands and the PPAC, which provides a surcharge mechanism that more closely aligns cost recovery with costs incurred. The revised tariffs reflect a lower increase in annual revenue requirement compared to the interim increase due to factors that became effective concurrently with the revised tariffs (lower depreciation rates and lower ROACE) and therefore, no refund to customers was required.
|
(6)
|
See “Hawaii Electric Light 2016 test year rate case” below.
|
(8)
|
See “Maui Electric 2015 test year rate case” below.
|
•
|
In August 2012, the PUC approved a waiver from the competitive bidding framework to allow Hawaiian Electric to negotiate with the U.S. Army for construction of a 50-MW utility-owned and operated firm, renewable and dispatchable generation facility at Schofield Barracks on the island of Oahu. In September 2015, the PUC approved Hawaiian Electric's application with conditions and limitations. See "Schofield Generating Station Project" in Note 4 of the Consolidated Financial Statements. Once online, biodiesel currently delivered to Hawaiian Electric's Campbell Industrial Park Combustion Turbine 1 (CIP CT-1) will be diverted to the Schofield Generating Station at no additional cost.
|
•
|
In December 2013, Hawaiian Electric requested PUC approval for a waiver of the Na Pua Makani Power Partners, LLC’s (NPM) proposed 24-MW wind farm located in the Kahuku area on Oahu from the competitive bidding process and the PPA for Renewable As-Available Energy dated October 3, 2013 between Hawaiian Electric and NPM for the proposed 24-MW wind farm. In December 2014, the PUC approved both the waiver request and the PPA. On September 15, 2016, Hawaiian Electric filed the Amended and Restated PPA, dated August 12, 2016, which reflects the completion of the interconnection requirements study, including, among other things, amendments related to the final design of the facility, scope of work, cost, schedule and reporting milestones. The PUC conducted a public hearing on February 2, 2017, regarding the request for PUC approval to construct an overhead 46 sub-transmission line to accommodate the interconnection of the NPM wind farm. This project is expected to be placed into service by August 31, 2019.
|
•
|
In July 2015, the PUC approved the PPA for the 27.6 MW Waianae Solar project that is being developed by Eurus Energy America. The project achieved commercial operations in January 2017 and is now the largest solar project in Hawaii.
|
•
|
In July 2015, Maui Electric signed two PPAs, with Kuia Solar and South Maui Renewable Resources (which subsequently assigned its PPA to SSA Solar of HI 3, LLC), each for a 2.87-MW solar facility. In February 2016, the PUC approved both PPAs, subject to certain conditions and modifications. The guaranteed commercial operations date for the facilities was December 31, 2016, however both projects are experiencing delays and are expected to be completed by mid-2017.
|
•
|
In September 2015, the PUC approved Hawaiian Electric’s 2-year biodiesel supply contract with Pacific Biodiesel Technologies, LLC to supply 2 million to 3 million gallons of biodiesel at CIP CT-1 and the Honolulu International
|
•
|
In October 2015, the Utilities filed with the PUC a proposal for a Community-Based Renewable Energy program and tariff that would allow customers who cannot, or chose not to, take advantage of private rooftop solar to receive the benefits of renewable energy to help offset their monthly electric bills and support clean energy for Hawaii. In November 2015, the PUC suspended the filing and opened a docket to investigate the matter. In February 2017, the PUC issued a proposed CBRE Program Framework, a Proposed Model Tariff Language, and requested comments and feedback from the parties by March 1, 2017. Under the proposed CBRE Program Framework, the CBRE program will utilize a phased approach. The Program Framework proposes a Phase 1 with an 80 MW capacity statewide with 73 MW allocated to the Utilities' service territories. During the two year initial phase, the Utilities' primary role is to serve as the program administrator. In addition, the Framework requires a minimum allocation of 7.5 MW to develop CBRE targeting low-to-moderate income subscribers with 6.75 MW allocated to the Utilities' service territories.
|
•
|
On May 5, 2016, Maui Electric filed a request for the PUC to open a docket and assign an Independent Observer to oversee the Maui Electric Dispatchable Firm Generation Request for Proposals. The solicitation intends to seek approximately 20 MW of new renewable generation capacity and approximately 20 MW of fuel flexible firm generation resources on the island of Maui by 2022, as proposed in the PSIP Update Report.
|
•
|
On June 6, 2016, Hawaiian Electric filed a request for the PUC to open a docket and assign an Independent Observer to oversee the Hawaiian Electric Renewable Energy Request for Proposals. The solicitation intends to seek new renewable energy generation on the island of Oahu to be placed into service by the end of 2020, consistent with the Five-Year Action Plan proposed in the PSIP Update Report.
|
•
|
In July 2016, Hawaiian Electric announced plans to build, own and operate a 20-MW solar facility in conjunction with the Department of the Navy at a Navy/Air Force joint base, subject to PUC approval. On October 3, 2016, Hawaiian Electric filed with the PUC a request to waive the $67 million project from the Competitive Bidding Framework and to approve expenditures for the project. If approved by the PUC, the solar facility would generate renewable energy that will feed into Oahu's electrical grid at a very reasonable cost of 9.54 cents per KWH.
|
•
|
The Utilities began accepting energy from feed-in tariff projects in 2011. As of December 31, 2016, there were 24 MW, 3 MW and 4 MW of installed feed-in tariff capacity from renewable energy technologies at Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively.
|
•
|
As of December 31, 2016, there were approximately 305 MW, 71 MW and 81 MW of installed distributed renewable energy technologies (mainly PV) at Hawaiian Electric, Hawaii Electric Light and Maui Electric, respectively, for tariff-based private customer generation programs, namely NEM, Customer Grid Supply (CGS) and Customer Self Supply (CSS). As of December 31, 2016, an estimated 26% of single family homes on the islands the Utilities serve have installed private rooftop solar systems, and an estimated 29% of single family homes have installed private rooftop solar systems or have been approved to install systems. As of December 31, 2016, approximately 15% of the Utilities' total customers have solar systems.
|
•
|
On January 5, 2017, Hawaiian Electric issued an Onshore Wind Expression of Interest requesting expressions of interest from independent power producers that are capable of developing utility scale onshore wind projects that are eligible to capture the federal Investment Tax Credit for Large Wind on the island of Oahu. Responses have been accepted and are being evaluated.
|
•
|
On December 12, 2016, the Utilities issued a Request for Information asking interested landowners to provide information about properties on Oahu, Hawaii Island, Maui, Molokai, and Lanai, available for utility-scale renewable energy projects or for growing biofuel feedstock. Responses have been accepted and are being evaluated.
|
•
|
Hawaiian Electric had PPAs to purchase solar energy with three affiliates of SunEdison—Waipio PV, LLC (formerly known as Waiawa PV, LLC), Lanikuhana Solar, LLC and Kawailoa Solar, LLC. In February 2016, as a result of the project entities missing contract milestones, Hawaiian Electric terminated the original PPAs for the three projects. SunEdison filed Chapter 11 bankruptcy proceedings and during those proceedings the three SunEdison affiliates were acquired by an affiliate of NRG Energy, Inc. (NRG). Hawaiian Electric then negotiated with NRG and its newly acquired affiliates and has entered into amended and restated PPAs with two of the former SunEdison affiliates,
|
December 31
|
2016
|
|
2015
|
||||||||||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||
Long-term debt, net
|
$
|
1,319
|
|
|
42
|
%
|
|
$
|
1,279
|
|
|
42
|
%
|
Preferred stock
|
34
|
|
|
1
|
|
|
34
|
|
|
1
|
|
||
Common stock equity
|
1,800
|
|
|
57
|
|
|
1,728
|
|
|
57
|
|
||
|
$
|
3,153
|
|
|
100
|
%
|
|
$
|
3,041
|
|
|
100
|
%
|
|
Year ended
December 31, 2016
|
|
|
||||||||
(in millions)
|
Average
balance
|
|
End-of-period
balance
|
|
December 31,
2015
|
||||||
Short-term borrowings
1
|
|
|
|
|
|
||||||
Commercial paper
|
$
|
13
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Line of credit draws
|
—
|
|
|
—
|
|
|
—
|
|
|||
Borrowings from HEI
|
4
|
|
|
—
|
|
|
—
|
|
|||
Undrawn capacity under line of credit facility
|
200
|
|
|
200
|
|
|
200
|
|
1
|
The maximum amount of external short-term borrowings in 2016 was $61 million. At December 31, 2016, Hawaiian Electric had short-term borrowings from Hawaii Electric Light and Maui Electric of $3.5 million and $10 million, respectively, which intercompany borrowings are eliminated in consolidation. At February 13, 2017, Hawaiian Electric had no outstanding commercial paper, its line of credit facility was undrawn, it had no borrowings from HEI and it had short-term borrowings from Hawaii Electric Light and Maui Electric of $3.5 million and $3 million, respectively.
|
|
Fitch
|
Moody’s
|
S&P
|
Long-term issuer default, long-term issuer and corporate credit, respectively
|
BBB+
|
Baa2
|
BBB-
|
Commercial paper
|
F2
|
P-2
|
A-3
|
Senior unsecured debt/special purpose revenue bonds
|
A-
|
Baa2
|
BBB-
|
Hawaiian Electric-obligated preferred securities of trust subsidiary
|
*
|
Baa3
|
BB
|
Cumulative preferred stock (selected series)
|
*
|
Ba1
|
*
|
Subordinated debt
|
BBB
|
*
|
*
|
Outlook
|
Stable
|
Stable
|
Stable
|
|
Years ended December 31
|
||||||||||||||||||
(in thousands)
|
2016
|
|
Change
|
|
2015
|
|
Change
|
|
2014
|
||||||||||
Net cash provided by operating activities
|
$
|
369,917
|
|
|
$
|
36,511
|
|
|
$
|
333,406
|
|
|
$
|
26,411
|
|
|
$
|
306,995
|
|
Net cash used in investing activities
|
(288,199
|
)
|
|
20,583
|
|
|
(308,782
|
)
|
|
(15,073
|
)
|
|
(293,709
|
)
|
|||||
Net cash used in financing activities
|
(31,881
|
)
|
|
(17,944
|
)
|
|
(13,937
|
)
|
|
48,412
|
|
|
(62,349
|
)
|
•
|
Higher cash from a refund of federal income taxes in 2016 due to the extension of bonus depreciation enacted in the fourth quarter of 2015 and lower revenue taxes paid resulting from lower revenues due largely to lower fuel prices.
|
•
|
Lower unbilled revenues due to timing and lower fuel prices.
|
•
|
Higher unbilled revenues due to timing and lower fuel prices.
|
•
|
Lower revenue taxes paid resulting from lower revenues due largely to lower fuel prices.
|
December 31, 2016
|
Payments due by period
|
||||||||||||||||||
(in millions)
|
Less than 1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
|
$
|
—
|
|
|
$
|
50
|
|
|
$
|
96
|
|
|
$
|
1,181
|
|
|
$
|
1,327
|
|
Interest on long-term debt
|
66
|
|
|
132
|
|
|
130
|
|
|
797
|
|
|
1,125
|
|
|||||
Operating leases
|
9
|
|
|
11
|
|
|
9
|
|
|
7
|
|
|
36
|
|
|||||
Open purchase order obligations ¹
|
56
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
170
|
|
|||||
Fuel oil purchase obligations (estimate based on December 31, 2016 fuel oil prices)
|
125
|
|
|
238
|
|
|
—
|
|
|
—
|
|
|
363
|
|
|||||
Purchase power obligations-minimum fixed capacity charges
|
121
|
|
|
188
|
|
|
189
|
|
|
388
|
|
|
886
|
|
|||||
Liabilities for uncertain tax positions
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Total (estimated)
|
$
|
377
|
|
|
$
|
737
|
|
|
$
|
424
|
|
|
$
|
2,373
|
|
|
$
|
3,911
|
|
Bank
|
1.
|
attracting and retaining low-cost, core deposits, particularly those in non-interest bearing transaction accounts;
|
2.
|
reducing the overall exposure to fixed-rate residential mortgage loans and diversifying the loan portfolio with higher-spread, shorter-maturity loans and/or variable-rate loans such as commercial real estate and consumer loans;
|
3.
|
managing interest-bearing liabilities to optimize cost of funds and managing interest rate sensitivity; and
|
4.
|
focusing new investments on shorter duration or variable rate securities.
|
•
|
2016 vs. 2015
|
(in millions)
|
|
2016
|
|
2015
|
|
Increase
(decrease)
|
|
Primary reason(s)
|
||||||
Interest income
|
|
$
|
219
|
|
|
$
|
200
|
|
|
$
|
19
|
|
|
Higher interest income was due to higher average earning asset balances and higher loan yields. ASB’s average loan portfolio balance for 2016 was $223 million higher than 2015 as the average commercial real estate, HELOC and consumer loan balances increased by $204 million, $32 million and $30 million, respectively. The growth in these loan portfolios was consistent with ASB’s portfolio mix targets and loan growth strategy. The commercial loan average balance decreased $55 million due to the strategic reduction of the nationally syndicated loan portfolio. The loan portfolio yield benefited from a shift in the mix of the loan portfolio and the repricing of the adjustable rate loans with the increase in the prime rate. The average investment and mortgage-related securities portfolio balance increased by $248 million as ASB purchased investments with liquidity in excess of loan growth funding.
|
Noninterest income
|
|
67
|
|
|
67
|
|
|
—
|
|
|
Noninterest income was flat as higher gains on sale of investment securities and insurance proceeds in 2016 were offset by lower gains on sales of real estate and mortgage servicing rights.
|
|||
Revenues
|
|
286
|
|
|
267
|
|
|
19
|
|
|
|
|||
Interest expense
|
|
13
|
|
|
12
|
|
|
1
|
|
|
Higher interest expense was due to an increase in average interest-bearing liabilities. Average deposit balances for 2016 increased by $438 million compared to 2015 due to an increase in core deposits and term certificates of $322 million and $116 million, respectively. The other borrowings average balance decreased by $48 million due to a decrease in repurchase agreements.
|
|||
Provision for loan losses
|
|
17
|
|
|
6
|
|
|
11
|
|
|
Higher provision for loan losses for 2016 was primarily due to growth in the commercial real estate and consumer loan portfolios and additional reserves for specific commercial credits. The provision for loan losses in 2015 were used primarily to establish loan loss reserves for the growth in the loan portfolio and additional reserve levels for the commercial and unsecured consumer loan portfolios.
|
|||
Noninterest expense
|
|
169
|
|
|
166
|
|
|
3
|
|
|
Higher noninterest expense was primarily due to costs related to replacement and upgrade of ASB's electronic banking platform in mid 2016 to enhance the Bank's online and mobile banking services to consumer and business customers as well as expand its distribution channels.
|
|||
Expenses
|
|
199
|
|
|
184
|
|
|
15
|
|
|
|
|||
Operating income
|
|
87
|
|
|
83
|
|
|
4
|
|
|
Higher interest income, partly offset by higher provision for loan losses and noninterest expenses.
|
|||
Net income
|
|
57
|
|
|
55
|
|
|
2
|
|
|
Higher operating income, partly offset by higher taxes.
|
|||
Return on average common equity
1
|
|
9.9
|
%
|
|
9.9
|
%
|
|
—
|
%
|
|
|
•
|
2015 vs. 2014
|
(in millions)
|
|
2015
|
|
2014
|
|
Increase
(decrease)
|
|
Primary reason(s)
|
||||||
Interest income
|
|
$
|
200
|
|
|
$
|
191
|
|
|
$
|
9
|
|
|
The impact of higher average earning asset balances was partly offset by lower yields on earning assets. ASB’s average loan portfolio balance for 2015 was $213 million higher than 2014 as the average commercial real estate, residential, HELOC and commercial loan balances increased by $111 million, $40 million, $37 million and $15 million, respectively. The growth in these loan portfolios was consistent with ASB’s portfolio mix targets and loan growth strategy. The loan portfolio yield continued to be impacted by the interest rate environment as new loan production yields were lower than the average portfolio yield. The average investment and mortgage-related securities portfolio balance increased by $150 million as ASB purchased investments with liquidity in excess of loan growth funding.
|
Noninterest income
|
|
67
|
|
|
61
|
|
|
6
|
|
|
Higher noninterest income was due to an increase in gain on sale of loans as loan sales increased by $119 million as a result of ASB's decision to sell a larger portion of its low rate residential loan production, higher deposit related fee initiatives and gains on sales of real estate and mortgage servicing rights. 2014 noninterest income included the gain on sale of the municipal bond portfolio with no similar security sales in 2015.
|
|||
Revenues
|
|
267
|
|
|
252
|
|
|
15
|
|
|
|
|||
Interest expense
|
|
12
|
|
|
11
|
|
|
1
|
|
|
Higher interest expense was due to an increase in average interest-bearing liabilities. Average deposit balances for 2015 increased by $293 million compared to 2014 due to an increase in core deposits and term certificates of $279 million and $14 million, respectively. The other borrowings average balance increased by $64 million due to an increase in public repurchase agreements.
|
|||
Provision for loan losses
|
|
6
|
|
|
6
|
|
|
—
|
|
|
The provision for loan losses for 2015 and 2014 were used primarily to establish loan loss reserves for the growth in the loan portfolio and cover net loan charge-offs. The provision for loan losses in 2015 also included higher reserve levels for the commercial loan portfolio.
|
|||
Noninterest expense
|
|
166
|
|
|
156
|
|
|
10
|
|
|
Higher noninterest expense was primarily due to higher compensation and benefits expense as a result of an increase in retail delivery compensation cost, higher performance-based incentive cost and higher benefits expenses related to the frozen defined benefit plan and medical insurance premium costs.
|
|||
Expenses
|
|
184
|
|
|
173
|
|
|
11
|
|
|
|
|||
Operating income
|
|
83
|
|
|
79
|
|
|
4
|
|
|
Higher interest and noninterest income, partly offset by higher noninterest expenses.
|
|||
Net income
|
|
55
|
|
|
51
|
|
|
4
|
|
|
Higher operating income, partly offset by higher taxes.
|
|||
Return on average common equity
1
|
|
9.9
|
%
|
|
9.6
|
%
|
|
0.3
|
%
|
|
|
1
|
Calculated using the average daily balances.
|
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||||||||||||||
(dollars in thousands)
|
Average
balance
|
|
Interest
1
income/
expense
|
|
Yield/
rate
(%)
|
|
Average
balance |
|
Interest
1
income/ expense |
|
Yield/
rate (%) |
|
Average
balance |
|
Interest
1
income/
expense |
|
Yield/
rate (%) |
|||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest-earning deposits
|
$
|
75,092
|
|
|
$
|
383
|
|
|
0.51
|
|
|
$
|
124,874
|
|
|
$
|
323
|
|
|
0.26
|
|
|
$
|
88,089
|
|
|
$
|
222
|
|
|
0.25
|
|
FHLB stock
|
11,153
|
|
|
191
|
|
|
1.72
|
|
|
32,140
|
|
|
148
|
|
|
0.46
|
|
|
83,053
|
|
|
88
|
|
|
0.11
|
|
||||||
Securities purchased under resale agreements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,096
|
|
|
20
|
|
|
0.39
|
|
||||||
Available-for-sale investment securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Taxable
|
934,469
|
|
|
18,592
|
|
|
1.99
|
|
|
687,215
|
|
|
14,649
|
|
|
2.13
|
|
|
525,949
|
|
|
11,336
|
|
|
2.16
|
|
||||||
Non-taxable
|
717
|
|
|
28
|
|
|
3.87
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,600
|
|
|
429
|
|
|
3.69
|
|
||||||
Total available-for-sale investment securities
|
935,186
|
|
|
18,620
|
|
|
1.99
|
|
|
687,215
|
|
|
14,649
|
|
|
2.13
|
|
|
537,549
|
|
|
11,765
|
|
|
2.19
|
|
||||||
Loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Residential 1-4 family
|
2,074,564
|
|
|
88,274
|
|
|
4.26
|
|
|
2,064,170
|
|
|
89,933
|
|
|
4.36
|
|
|
2,023,816
|
|
|
90,591
|
|
|
4.48
|
|
||||||
Commercial real estate
|
872,694
|
|
|
35,940
|
|
|
4.12
|
|
|
669,184
|
|
|
26,558
|
|
|
3.97
|
|
|
557,924
|
|
|
23,904
|
|
|
4.28
|
|
||||||
Home equity line of credit
|
859,955
|
|
|
28,249
|
|
|
3.28
|
|
|
828,129
|
|
|
26,511
|
|
|
3.20
|
|
|
790,701
|
|
|
25,716
|
|
|
3.25
|
|
||||||
Residential land
|
18,850
|
|
|
1,118
|
|
|
5.93
|
|
|
17,304
|
|
|
1,101
|
|
|
6.36
|
|
|
16,276
|
|
|
1,106
|
|
|
6.79
|
|
||||||
Commercial
|
743,586
|
|
|
29,743
|
|
|
4.00
|
|
|
798,182
|
|
|
29,282
|
|
|
3.67
|
|
|
783,670
|
|
|
29,294
|
|
|
3.74
|
|
||||||
Consumer
|
149,287
|
|
|
16,450
|
|
|
11.02
|
|
|
119,267
|
|
|
11,397
|
|
|
9.56
|
|
|
110,440
|
|
|
8,730
|
|
|
7.90
|
|
||||||
Total loans
2,3
|
4,718,936
|
|
|
199,774
|
|
|
4.23
|
|
|
4,496,236
|
|
|
184,782
|
|
|
4.11
|
|
|
4,282,827
|
|
|
179,341
|
|
|
4.19
|
|
||||||
Total interest-earning assets
|
5,740,367
|
|
|
218,968
|
|
|
3.81
|
|
|
5,340,465
|
|
|
199,902
|
|
|
3.74
|
|
|
4,996,614
|
|
|
191,436
|
|
|
3.83
|
|
||||||
Allowance for loan losses
|
(54,338
|
)
|
|
|
|
|
|
|
|
(46,881
|
)
|
|
|
|
|
|
|
|
(42,242
|
)
|
|
|
|
|
|
|
||||||
Non-interest-earning assets
|
507,850
|
|
|
|
|
|
|
|
|
490,187
|
|
|
|
|
|
|
|
|
459,513
|
|
|
|
|
|
|
|
||||||
Total Assets
|
$
|
6,193,879
|
|
|
|
|
|
|
|
|
$
|
5,783,771
|
|
|
|
|
|
|
|
|
$
|
5,413,885
|
|
|
|
|
|
|
|
|||
Liabilities and Shareholder’s Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Savings
|
$
|
2,117,186
|
|
|
1,402
|
|
|
0.07
|
|
|
$
|
1,980,151
|
|
|
1,257
|
|
|
0.06
|
|
|
$
|
1,879,373
|
|
|
1,134
|
|
|
0.06
|
|
|||
Interest-bearing checking
|
839,339
|
|
|
173
|
|
|
0.02
|
|
|
782,811
|
|
|
139
|
|
|
0.02
|
|
|
738,651
|
|
|
126
|
|
|
0.02
|
|
||||||
Money market
|
160,700
|
|
|
202
|
|
|
0.13
|
|
|
164,568
|
|
|
205
|
|
|
0.12
|
|
|
171,889
|
|
|
214
|
|
|
0.12
|
|
||||||
Time certificates
|
565,135
|
|
|
5,390
|
|
|
0.95
|
|
|
449,179
|
|
|
3,747
|
|
|
0.83
|
|
|
434,934
|
|
|
3,603
|
|
|
0.83
|
|
||||||
Total interest-bearing deposits
|
3,682,360
|
|
|
7,167
|
|
|
0.19
|
|
|
3,376,709
|
|
|
5,348
|
|
|
0.16
|
|
|
3,224,847
|
|
|
5,077
|
|
|
0.16
|
|
||||||
Advances from Federal Home Loan Bank
|
101,597
|
|
|
3,160
|
|
|
3.11
|
|
|
100,438
|
|
|
3,146
|
|
|
3.13
|
|
|
100,389
|
|
|
3,146
|
|
|
3.13
|
|
||||||
Securities sold under agreements to repurchase
|
169,730
|
|
|
2,428
|
|
|
1.43
|
|
|
219,351
|
|
|
2,832
|
|
|
1.29
|
|
|
155,012
|
|
|
2,585
|
|
|
1.67
|
|
||||||
Total interest-bearing liabilities
|
3,953,687
|
|
|
12,755
|
|
|
0.32
|
|
|
3,696,498
|
|
|
11,326
|
|
|
0.31
|
|
|
3,480,248
|
|
|
10,808
|
|
|
0.31
|
|
||||||
Non-interest bearing liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Deposits
|
1,559,132
|
|
|
|
|
|
|
|
|
1,426,962
|
|
|
|
|
|
|
|
|
1,285,964
|
|
|
|
|
|
|
|
||||||
Other
|
102,302
|
|
|
|
|
|
|
|
|
109,386
|
|
|
|
|
|
|
|
|
113,401
|
|
|
|
|
|
|
|
||||||
Shareholder’s equity
|
578,758
|
|
|
|
|
|
|
|
|
550,925
|
|
|
|
|
|
|
|
|
534,272
|
|
|
|
|
|
|
|
||||||
Total Liabilities and Shareholder’s Equity
|
$
|
6,193,879
|
|
|
|
|
|
|
|
|
$
|
5,783,771
|
|
|
|
|
|
|
|
|
$
|
5,413,885
|
|
|
|
|
|
|
|
|||
Net interest income
|
|
|
|
$
|
206,213
|
|
|
|
|
|
|
|
|
$
|
188,576
|
|
|
|
|
|
|
|
|
$
|
180,628
|
|
|
|
|
|||
Net interest margin (%)
4
|
|
|
|
|
|
|
3.59
|
|
|
|
|
|
|
|
|
3.53
|
|
|
|
|
|
|
|
|
3.62
|
|
1
|
Interest income includes taxable equivalent basis adjustments, based upon a federal statutory tax rate of 35%, of $0.01 million, nil and $0.2 million for 2016, 2015 and 2014, respectively.
|
2
|
Includes loans held for sale, at lower of cost or fair value, of $5.4 million, $5.6 million and $3.1 million as of December 31, 2016, 2015 and 2014, respectively.
|
3
|
Includes recognition of net deferred loan fees of $2.8 million, $2.7 million and $3.7 million for 2016, 2015 and 2014, respectively, together with interest accrued prior to suspension of interest accrual on nonaccrual loans.
|
4
|
Defined as net interest income, on a fully taxable equivalent basis, as a percentage of average total interest-earning assets.
|
December 31
|
|
2016
|
|
2015
|
||||
Outstanding balance (in thousands)
|
|
$
|
863,163
|
|
|
$
|
846,294
|
|
Percent of portfolio in first lien position
|
|
45.1
|
%
|
|
42.9
|
%
|
||
Net charge-off ratio
|
|
0.01
|
%
|
|
0.02
|
%
|
||
Delinquency ratio
|
|
0.35
|
%
|
|
0.25
|
%
|
|
|
|
|
|
|
End of draw period – interest only
|
|
Current
|
||||||||||||||||
December 31, 2016
|
|
Total
|
|
Interest only
|
|
2017
|
|
2018-2020
|
|
Thereafter
|
|
amortizing
|
||||||||||||
Outstanding balance (in thousands)
|
|
$
|
863,163
|
|
|
$
|
678,348
|
|
|
$
|
8,524
|
|
|
$
|
122,966
|
|
|
$
|
546,858
|
|
|
$
|
184,815
|
|
% of total
|
|
100
|
%
|
|
79
|
%
|
|
1
|
%
|
|
14
|
%
|
|
64
|
%
|
|
21
|
%
|
December 31
|
|
2016
|
|
2015
|
||||||||||
(dollars in thousands)
|
|
Balance
|
|
% of total
|
|
Balance
|
|
% of total
|
||||||
U.S. Treasury and federal agency obligations
|
|
$
|
192,281
|
|
|
18
|
%
|
|
$
|
212,959
|
|
|
26
|
%
|
Mortgage-related securities — FNMA, FHLMC and GNMA
|
|
897,474
|
|
|
81
|
|
|
607,689
|
|
|
74
|
|
||
Mortgage revenue bond
|
|
15,427
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||
Total available-for-sale investment securities
|
|
$
|
1,105,182
|
|
|
100
|
%
|
|
$
|
820,648
|
|
|
100
|
%
|
Effective dates
|
|
1/1/2015
|
|
1/1/2016
|
|
1/1/2017
|
|
1/1/2018
|
|
1/1/2019
|
|||||
Capital conservation buffer
|
|
|
|
|
0.625
|
%
|
|
1.25
|
%
|
|
1.875
|
%
|
|
2.50
|
%
|
Common equity Tier 1 ratio + conservation buffer
|
|
4.50
|
%
|
|
5.125
|
%
|
|
5.75
|
%
|
|
6.375
|
%
|
|
7.00
|
%
|
Tier 1 capital ratio + conservation buffer
|
|
6.00
|
%
|
|
6.625
|
%
|
|
7.25
|
%
|
|
7.875
|
%
|
|
8.50
|
%
|
Total capital ratio + conservation buffer
|
|
8.00
|
%
|
|
8.625
|
%
|
|
9.25
|
%
|
|
9.875
|
%
|
|
10.50
|
%
|
Tier 1 leverage ratio
|
|
4.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
Countercyclical capital buffer — not applicable to ASB
|
|
|
|
|
0.625
|
%
|
|
1.25
|
%
|
|
1.875
|
%
|
|
2.50
|
%
|
December 31
|
2016
|
|
|
% change
|
|
|
2015
|
|
|
% change
|
|
||
(dollars in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||
Total assets
|
$
|
6,421
|
|
|
7
|
|
|
$
|
6,015
|
|
|
8
|
|
Available-for-sale investment securities
|
1,105
|
|
|
35
|
|
|
821
|
|
|
49
|
|
||
Loans receivable held for investment, net
|
4,683
|
|
|
3
|
|
|
4,566
|
|
|
4
|
|
||
Deposit liabilities
|
5,549
|
|
|
10
|
|
|
5,025
|
|
|
9
|
|
||
Other bank borrowings
|
193
|
|
|
(41
|
)
|
|
329
|
|
|
13
|
|
•
|
ASB met applicable minimum regulatory capital requirements (noted in parentheses) as of December 31, 2016 with a Tier 1 leverage ratio of 8.6% (4.0%), a common equity Tier 1 capital ratio of 12.2% (4.5%), a Tier 1 capital ratio of 12.2% (6.0%) and a total capital ratio of 13.4% (8.0%).
|
•
|
ASB met the capital requirements to be generally considered “well-capitalized” (noted in parentheses) as of December 31, 2016 with a Tier 1 leverage ratio of 8.6% (5.0%), a common equity Tier 1 capital ratio of 12.2% (6.5%), a Tier-1 capital ratio of 12.2% (8.0%) and a total capital ratio of 13.4% (10.0%).
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Bank interest rate risk
|
|
|
Change in NII
(gradual change in interest rates)
|
|
Change in EVE
(instantaneous change in interest rates)
|
||||||||
Change in interest rates
(basis points)
|
|
December 31, 2016
|
|
December 31, 2015
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
+300
|
|
1.9
|
%
|
|
1.6
|
%
|
|
(8.0
|
)%
|
|
(9.3
|
)%
|
+200
|
|
0.8
|
|
|
0.6
|
|
|
(4.6
|
)
|
|
(5.3
|
)
|
+100
|
|
—
|
|
|
(0.1
|
)
|
|
(1.6
|
)
|
|
(1.9
|
)
|
-100
|
|
(0.5
|
)
|
|
(0.5
|
)
|
|
(1.6
|
)
|
|
(1.2
|
)
|
Other than bank interest rate risk
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
Index to Consolidated Financial Statements
|
Page
|
HEI
|
|
Consolidated Statements of Income for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Balance Sheets at December 31, 2016 and 2015
|
|
Consolidated Statements of Changes in Shareholders’ Equity for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014
|
|
Hawaiian Electric
|
|
Consolidated Statements of Income for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Balance Sheets at December 31, 2016 and 2015
|
|
Consolidated Statements of Capitalization at December 31, 2016 and 2015
|
|
Consolidated Statements of Changes in Common Stock Equity for the years ended December 31, 2016, 2015 and 2014
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014
|
|
Notes to Consolidated Financial Statements
|
Report of Independent Registered Public Accounting Firm
|
Report of Independent Registered Public Accounting Firm
|
Consolidated Statements of Income
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|||
Revenues
|
|
|
|
|
|
|
|
|
|||
Electric utility
|
$
|
2,094,368
|
|
|
$
|
2,335,166
|
|
|
$
|
2,987,323
|
|
Bank
|
285,924
|
|
|
267,733
|
|
|
252,497
|
|
|||
Other
|
362
|
|
|
83
|
|
|
(278
|
)
|
|||
Total revenues
|
2,380,654
|
|
|
2,602,982
|
|
|
3,239,542
|
|
|||
Expenses
|
|
|
|
|
|
|
|
|
|||
Electric utility
|
1,809,900
|
|
|
2,061,050
|
|
|
2,711,555
|
|
|||
Bank
|
198,572
|
|
|
183,921
|
|
|
173,202
|
|
|||
Other
|
24,007
|
|
|
35,458
|
|
|
22,185
|
|
|||
Total expenses
|
2,032,479
|
|
|
2,280,429
|
|
|
2,906,942
|
|
|||
Operating income (loss)
|
|
|
|
|
|
|
|
|
|||
Electric utility
|
284,468
|
|
|
274,116
|
|
|
275,768
|
|
|||
Bank
|
87,352
|
|
|
83,812
|
|
|
79,295
|
|
|||
Other
|
(23,645
|
)
|
|
(35,375
|
)
|
|
(22,463
|
)
|
|||
Total operating income
|
348,175
|
|
|
322,553
|
|
|
332,600
|
|
|||
Merger termination fee
|
90,000
|
|
|
—
|
|
|
—
|
|
|||
Interest expense, net – other than on deposit liabilities and other bank borrowings
|
(75,803
|
)
|
|
(77,150
|
)
|
|
(76,352
|
)
|
|||
Allowance for borrowed funds used during construction
|
3,144
|
|
|
2,457
|
|
|
2,579
|
|
|||
Allowance for equity funds used during construction
|
8,325
|
|
|
6,928
|
|
|
6,771
|
|
|||
Income before income taxes
|
373,841
|
|
|
254,788
|
|
|
265,598
|
|
|||
Income taxes
|
123,695
|
|
|
93,021
|
|
|
95,579
|
|
|||
Net income
|
250,146
|
|
|
161,767
|
|
|
170,019
|
|
|||
Preferred stock dividends of subsidiaries
|
1,890
|
|
|
1,890
|
|
|
1,890
|
|
|||
Net income for common stock
|
$
|
248,256
|
|
|
$
|
159,877
|
|
|
$
|
168,129
|
|
Basic earnings per common share
|
$
|
2.30
|
|
|
$
|
1.50
|
|
|
$
|
1.65
|
|
Diluted earnings per common share
|
$
|
2.29
|
|
|
$
|
1.50
|
|
|
$
|
1.63
|
|
Dividends per common share
|
$
|
1.24
|
|
|
$
|
1.24
|
|
|
$
|
1.24
|
|
Weighted-average number of common shares outstanding
|
108,102
|
|
|
106,418
|
|
|
101,968
|
|
|||
Net effect of potentially dilutive shares
|
207
|
|
|
303
|
|
|
969
|
|
|||
Adjusted weighted-average shares
|
108,309
|
|
|
106,721
|
|
|
102,937
|
|
Consolidated Statements of Comprehensive Income
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Net income for common stock
|
$
|
248,256
|
|
|
$
|
159,877
|
|
|
$
|
168,129
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|||
Net unrealized gains (losses) on available-for sale investment securities:
|
|
|
|
|
|
|
|
|
|||
Net unrealized gains (losses) on available-for sale investment securities arising during the period, net of (taxes) benefits of $3,763, $1,541 and $(3,856) for 2016, 2015 and 2014, respectively
|
(5,699
|
)
|
|
(2,334
|
)
|
|
5,840
|
|
|||
Less: reclassification adjustment for net realized gains included in net income, net of taxes of $238, nil and $1,132 for 2016, 2015 and 2014, respectively
|
(360
|
)
|
|
—
|
|
|
(1,715
|
)
|
|||
Derivatives qualified as cash flow hedges:
|
|
|
|
|
|
|
|
|
|||
Effective portion of foreign currency hedge net unrealized losses arising during the period, net of tax benefits of $179, nil and nil for 2016, 2015 and 2014, respectively
|
(281
|
)
|
|
—
|
|
|
—
|
|
|||
Less: reclassification adjustment to net income, net of (taxes) benefit of $(76), $150 and $150 for 2016, 2015 and 2014, respectively
|
(119
|
)
|
|
235
|
|
|
236
|
|
|||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|||
Net gains (losses) arising during the period, net of (taxes) benefits of $27,703, $(3,753) and $149,364 for 2016, 2015 and 2014, respectively
|
(43,510
|
)
|
|
5,889
|
|
|
(234,166
|
)
|
|||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits of $9,267, $14,344 and $7,245 for 2016, 2015 and 2014, respectively
|
14,518
|
|
|
22,465
|
|
|
11,344
|
|
|||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of (taxes) benefits of $(18,206), $16,011 and $(132,373) for 2016, 2015 and 2014, respectively
|
28,584
|
|
|
(25,139
|
)
|
|
207,833
|
|
|||
Other comprehensive income (loss), net of taxes
|
(6,867
|
)
|
|
1,116
|
|
|
(10,628
|
)
|
|||
Comprehensive income attributable to Hawaiian Electric Industries, Inc.
|
$
|
241,389
|
|
|
$
|
160,993
|
|
|
$
|
157,501
|
|
Consolidated Balance Sheets
|
December 31
|
|
|
|
2016
|
|
|
|
|
|
2015
|
|
||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
|
|
$
|
278,452
|
|
|
|
|
|
$
|
300,478
|
|
||
Accounts receivable and unbilled revenues, net
|
|
|
|
237,950
|
|
|
|
|
|
242,766
|
|
||||
Available-for-sale investment securities, at fair value
|
|
|
|
1,105,182
|
|
|
|
|
|
820,648
|
|
||||
Stock in Federal Home Loan Bank, at cost
|
|
|
|
11,218
|
|
|
|
|
|
10,678
|
|
||||
Loans receivable held for investment, net
|
|
|
|
4,683,160
|
|
|
|
|
|
4,565,781
|
|
||||
Loans held for sale, at lower of cost or fair value
|
|
|
|
18,817
|
|
|
|
|
|
4,631
|
|
||||
Property, plant and equipment, net
|
|
|
|
|
|
|
|
|
|
|
|
||||
Land
|
$
|
97,423
|
|
|
|
|
|
$
|
90,890
|
|
|
|
|
||
Plant and equipment
|
6,727,935
|
|
|
|
|
|
6,444,214
|
|
|
|
|
||||
Construction in progress
|
222,455
|
|
|
|
|
|
181,873
|
|
|
|
|
||||
|
7,047,813
|
|
|
|
|
|
6,716,977
|
|
|
|
|
||||
Less – accumulated depreciation
|
(2,444,348
|
)
|
|
4,603,465
|
|
|
(2,339,319
|
)
|
|
4,377,658
|
|
||||
Regulatory assets
|
|
|
|
957,451
|
|
|
|
|
|
896,731
|
|
||||
Other
|
|
|
|
447,621
|
|
|
|
|
|
480,457
|
|
||||
Goodwill
|
|
|
|
82,190
|
|
|
|
|
|
82,190
|
|
||||
Total assets
|
|
|
|
$
|
12,425,506
|
|
|
|
|
|
$
|
11,782,018
|
|
||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accounts payable
|
|
|
|
$
|
143,279
|
|
|
|
|
|
$
|
138,523
|
|
||
Interest and dividends payable
|
|
|
|
25,225
|
|
|
|
|
|
26,042
|
|
||||
Deposit liabilities
|
|
|
|
5,548,929
|
|
|
|
|
|
5,025,254
|
|
||||
Short-term borrowings—other than bank
|
|
|
|
—
|
|
|
|
|
|
103,063
|
|
||||
Other bank borrowings
|
|
|
|
192,618
|
|
|
|
|
|
328,582
|
|
||||
Long-term debt, net—other than bank
|
|
|
|
1,619,019
|
|
|
|
|
|
1,578,368
|
|
||||
Deferred income taxes
|
|
|
|
728,806
|
|
|
|
|
|
680,877
|
|
||||
Regulatory liabilities
|
|
|
|
410,693
|
|
|
|
|
|
371,543
|
|
||||
Contributions in aid of construction
|
|
|
|
543,525
|
|
|
|
|
|
506,087
|
|
||||
Defined benefit pension and other postretirement benefit plans liability
|
|
|
|
638,854
|
|
|
|
|
|
589,918
|
|
||||
Other
|
|
|
|
473,512
|
|
|
|
|
|
471,828
|
|
||||
Total liabilities
|
|
|
|
10,324,460
|
|
|
|
|
|
9,820,085
|
|
||||
Preferred stock of subsidiaries - not subject to mandatory redemption
|
|
|
|
34,293
|
|
|
|
|
|
34,293
|
|
||||
Commitments and contingencies (Notes 4 and 5)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
|
|
|
|
|
|
|
|
||||
Preferred stock, no par value, authorized 10,000,000 shares; issued: none
|
|
|
|
—
|
|
|
|
|
|
—
|
|
||||
Common stock, no par value, authorized 200,000,000 shares; issued and outstanding: 108,583,413 shares and 107,460,406 shares at December 31, 2016 and 2015, respectively
|
|
|
|
1,660,910
|
|
|
|
|
|
1,629,136
|
|
||||
Retained earnings
|
|
|
|
438,972
|
|
|
|
|
|
324,766
|
|
||||
Accumulated other comprehensive loss, net of tax benefits
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net unrealized losses on securities
|
$
|
(7,931
|
)
|
|
|
|
|
$
|
(1,872
|
)
|
|
|
|
||
Unrealized losses on derivatives
|
(454
|
)
|
|
|
|
|
(54
|
)
|
|
|
|
||||
Retirement benefit plans
|
(24,744
|
)
|
|
(33,129
|
)
|
|
(24,336
|
)
|
|
(26,262
|
)
|
||||
Total shareholders’ equity
|
|
|
|
2,066,753
|
|
|
|
|
|
1,927,640
|
|
||||
Total liabilities and shareholders’ equity
|
|
|
|
$
|
12,425,506
|
|
|
|
|
|
$
|
11,782,018
|
|
Consolidated Statements of Changes in Shareholders’ Equity
|
|
Common stock
|
|
Retained
|
|
Accumulated
other
comprehensive
|
|
|
|||||||||||
(in thousands, except per share amounts)
|
Shares
|
|
Amount
|
|
earnings
|
|
income (loss)
|
|
Total
|
|||||||||
Balance, December 31, 2013
|
101,260
|
|
|
$
|
1,488,126
|
|
|
$
|
255,030
|
|
|
$
|
(16,750
|
)
|
|
$
|
1,726,406
|
|
Net income for common stock
|
—
|
|
|
—
|
|
|
168,129
|
|
|
—
|
|
|
168,129
|
|
||||
Other comprehensive loss, net of tax benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,628
|
)
|
|
(10,628
|
)
|
||||
Issuance of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Partial settlement of equity forward
|
1,000
|
|
|
24,873
|
|
|
—
|
|
|
—
|
|
|
24,873
|
|
||||
Dividend reinvestment and stock purchase plan
|
95
|
|
|
2,461
|
|
|
—
|
|
|
—
|
|
|
2,461
|
|
||||
Retirement savings and other plans
|
210
|
|
|
6,816
|
|
|
—
|
|
|
—
|
|
|
6,816
|
|
||||
Expenses and other, net
|
—
|
|
|
(979
|
)
|
|
—
|
|
|
—
|
|
|
(979
|
)
|
||||
Common stock dividends ($1.24 per share)
|
—
|
|
|
—
|
|
|
(126,505
|
)
|
|
—
|
|
|
(126,505
|
)
|
||||
Balance, December 31, 2014
|
102,565
|
|
|
1,521,297
|
|
|
296,654
|
|
|
(27,378
|
)
|
|
1,790,573
|
|
||||
Net income for common stock
|
—
|
|
|
—
|
|
|
159,877
|
|
|
—
|
|
|
159,877
|
|
||||
Other comprehensive income, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
1,116
|
|
|
1,116
|
|
||||
Issuance of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Partial settlement of equity forward
|
4,700
|
|
|
109,183
|
|
|
—
|
|
|
—
|
|
|
109,183
|
|
||||
Retirement savings and other plans
|
195
|
|
|
5,578
|
|
|
—
|
|
|
—
|
|
|
5,578
|
|
||||
Expenses and other, net
|
—
|
|
|
(6,922
|
)
|
|
—
|
|
|
—
|
|
|
(6,922
|
)
|
||||
Common stock dividends ($1.24 per share)
|
—
|
|
|
—
|
|
|
(131,765
|
)
|
|
—
|
|
|
(131,765
|
)
|
||||
Balance, December 31, 2015
|
107,460
|
|
|
1,629,136
|
|
|
324,766
|
|
|
(26,262
|
)
|
|
1,927,640
|
|
||||
Net income for common stock
|
—
|
|
|
—
|
|
|
248,256
|
|
|
—
|
|
|
248,256
|
|
||||
Other comprehensive loss, net of tax benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,867
|
)
|
|
(6,867
|
)
|
||||
Issuance of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Dividend reinvestment and stock purchase plan
|
859
|
|
|
26,844
|
|
|
—
|
|
|
—
|
|
|
26,844
|
|
||||
Retirement savings and other plans
|
264
|
|
|
9,298
|
|
|
—
|
|
|
—
|
|
|
9,298
|
|
||||
Expenses and other, net
|
—
|
|
|
(4,368
|
)
|
|
—
|
|
|
—
|
|
|
(4,368
|
)
|
||||
Common stock dividends ($1.24 per share)
|
—
|
|
|
—
|
|
|
(134,050
|
)
|
|
—
|
|
|
(134,050
|
)
|
||||
Balance, December 31, 2016
|
108,583
|
|
|
$
|
1,660,910
|
|
|
$
|
438,972
|
|
|
$
|
(33,129
|
)
|
|
$
|
2,066,753
|
|
Consolidated Statements of Cash Flows
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
250,146
|
|
|
$
|
161,767
|
|
|
$
|
170,019
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|||
Depreciation of property, plant and equipment
|
194,273
|
|
|
183,966
|
|
|
172,762
|
|
|||
Other amortization
|
10,473
|
|
|
11,619
|
|
|
10,282
|
|
|||
Provision for loan losses
|
16,763
|
|
|
6,275
|
|
|
6,126
|
|
|||
Impairment of utility assets
|
—
|
|
|
6,021
|
|
|
1,866
|
|
|||
Loans receivable originated and purchased, held for sale
|
(236,769
|
)
|
|
(268,279
|
)
|
|
(155,755
|
)
|
|||
Proceeds from sale of loans receivable, held for sale
|
236,062
|
|
|
275,296
|
|
|
155,030
|
|
|||
Deferred income taxes
|
47,118
|
|
|
41,432
|
|
|
104,225
|
|
|||
Share-based compensation expense
|
4,789
|
|
|
6,542
|
|
|
9,287
|
|
|||
Excess tax benefits from share-based payment arrangements
|
(404
|
)
|
|
(978
|
)
|
|
(277
|
)
|
|||
Allowance for equity funds used during construction
|
(8,325
|
)
|
|
(6,928
|
)
|
|
(6,771
|
)
|
|||
Other
|
(12,422
|
)
|
|
1,672
|
|
|
(280
|
)
|
|||
Changes in assets and liabilities
|
|
|
|
|
|
|
|
|
|||
Decrease (increase) in accounts receivable and unbilled revenues, net
|
(898
|
)
|
|
62,304
|
|
|
33,089
|
|
|||
Decrease in fuel oil stock
|
4,786
|
|
|
34,830
|
|
|
28,041
|
|
|||
Increase in regulatory assets
|
(18,273
|
)
|
|
(24,182
|
)
|
|
(17,000
|
)
|
|||
Decrease in accounts, interest and dividends payable
|
(9,643
|
)
|
|
(52,663
|
)
|
|
(67,189
|
)
|
|||
Change in prepaid and accrued income taxes, tax credits and utility revenue taxes
|
39,109
|
|
|
(42,596
|
)
|
|
(39,091
|
)
|
|||
Increase in defined benefit pension and other postretirement benefit plans liability
|
1,587
|
|
|
852
|
|
|
22,251
|
|
|||
Change in other assets and liabilities
|
(23,118
|
)
|
|
(41,070
|
)
|
|
(101,195
|
)
|
|||
Net cash provided by operating activities
|
495,254
|
|
|
355,880
|
|
|
325,420
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|||
Available-for-sale investment securities purchased
|
(533,956
|
)
|
|
(429,262
|
)
|
|
(183,778
|
)
|
|||
Principal repayments on available-for-sale investment securities
|
219,845
|
|
|
153,271
|
|
|
91,013
|
|
|||
Proceeds from sale of available-for-sale investment securities
|
16,423
|
|
|
—
|
|
|
79,564
|
|
|||
Purchase of stock from Federal Home Loan Bank
|
(7,773
|
)
|
|
(1,600
|
)
|
|
—
|
|
|||
Redemption of stock from Federal Home Loan Bank
|
7,233
|
|
|
60,223
|
|
|
23,244
|
|
|||
Net increase in loans held for investment
|
(194,042
|
)
|
|
(181,343
|
)
|
|
(283,810
|
)
|
|||
Proceeds from sale of commercial loans
|
52,299
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from sale of real estate acquired in settlement of loans
|
829
|
|
|
1,329
|
|
|
3,213
|
|
|||
Proceeds from sale of real estate held for sale
|
1,764
|
|
|
7,283
|
|
|
—
|
|
|||
Capital expenditures
|
(330,043
|
)
|
|
(363,804
|
)
|
|
(364,826
|
)
|
|||
Contributions in aid of construction
|
30,100
|
|
|
40,239
|
|
|
41,806
|
|
|||
Other
|
856
|
|
|
7,940
|
|
|
1,125
|
|
|||
Net cash used in investing activities
|
(736,465
|
)
|
|
(705,724
|
)
|
|
(592,449
|
)
|
Consolidated Statements of Cash Flows (continued)
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|||
Net increase in deposit liabilities
|
523,675
|
|
|
401,839
|
|
|
250,938
|
|
|||
Net increase (decrease) in short-term borrowings with original maturities of three months or less
|
(103,063
|
)
|
|
(15,909
|
)
|
|
13,490
|
|
|||
Net increase (decrease) in retail repurchase agreements
|
(43,601
|
)
|
|
37,925
|
|
|
(9,465
|
)
|
|||
Proceeds from other bank borrowings
|
180,835
|
|
|
50,000
|
|
|
130,601
|
|
|||
Repayments of other bank borrowings
|
(272,902
|
)
|
|
(50,000
|
)
|
|
(75,000
|
)
|
|||
Proceeds from issuance of long-term debt
|
115,000
|
|
|
80,000
|
|
|
125,000
|
|
|||
Repayment of long-term debt
|
(75,000
|
)
|
|
—
|
|
|
(111,400
|
)
|
|||
Excess tax benefits from share-based payment arrangements
|
404
|
|
|
978
|
|
|
277
|
|
|||
Net proceeds from issuance of common stock
|
13,220
|
|
|
104,435
|
|
|
26,898
|
|
|||
Common stock dividends
|
(117,274
|
)
|
|
(131,765
|
)
|
|
(126,458
|
)
|
|||
Preferred stock dividends of subsidiaries
|
(1,890
|
)
|
|
(1,890
|
)
|
|
(1,890
|
)
|
|||
Other
|
(219
|
)
|
|
(833
|
)
|
|
(456
|
)
|
|||
Net cash provided by financing activities
|
219,185
|
|
|
474,780
|
|
|
222,535
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
(22,026
|
)
|
|
124,936
|
|
|
(44,494
|
)
|
|||
Cash and cash equivalents, January 1
|
300,478
|
|
|
175,542
|
|
|
220,036
|
|
|||
Cash and cash equivalents, December 31
|
$
|
278,452
|
|
|
$
|
300,478
|
|
|
$
|
175,542
|
|
Consolidated Statements of Income
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Revenues
|
$
|
2,094,368
|
|
|
$
|
2,335,166
|
|
|
$
|
2,987,323
|
|
Expenses
|
|
|
|
|
|
|
|
|
|||
Fuel oil
|
454,704
|
|
|
654,600
|
|
|
1,131,685
|
|
|||
Purchased power
|
562,740
|
|
|
594,096
|
|
|
722,008
|
|
|||
Other operation and maintenance
|
405,533
|
|
|
413,089
|
|
|
410,612
|
|
|||
Depreciation
|
187,061
|
|
|
177,380
|
|
|
166,387
|
|
|||
Taxes, other than income taxes
|
199,862
|
|
|
221,885
|
|
|
280,863
|
|
|||
Total expenses
|
1,809,900
|
|
|
2,061,050
|
|
|
2,711,555
|
|
|||
Operating income
|
284,468
|
|
|
274,116
|
|
|
275,768
|
|
|||
Allowance for equity funds used during construction
|
8,325
|
|
|
6,928
|
|
|
6,771
|
|
|||
Interest expense and other charges, net
|
(66,824
|
)
|
|
(66,370
|
)
|
|
(64,757
|
)
|
|||
Allowance for borrowed funds used during construction
|
3,144
|
|
|
2,457
|
|
|
2,579
|
|
|||
Income before income taxes
|
229,113
|
|
|
217,131
|
|
|
220,361
|
|
|||
Income taxes
|
84,801
|
|
|
79,422
|
|
|
80,725
|
|
|||
Net income
|
144,312
|
|
|
137,709
|
|
|
139,636
|
|
|||
Preferred stock dividends of subsidiaries
|
915
|
|
|
915
|
|
|
915
|
|
|||
Net income attributable to Hawaiian Electric
|
143,397
|
|
|
136,794
|
|
|
138,721
|
|
|||
Preferred stock dividends of Hawaiian Electric
|
1,080
|
|
|
1,080
|
|
|
1,080
|
|
|||
Net income for common stock
|
$
|
142,317
|
|
|
$
|
135,714
|
|
|
$
|
137,641
|
|
Consolidated Statements of Comprehensive Income
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
||||||
Net income for common stock
|
$
|
142,317
|
|
|
$
|
135,714
|
|
|
$
|
137,641
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|||
Derivatives qualified as cash flow hedges:
|
|
|
|
|
|
||||||
Effective portion of foreign currency hedge net unrealized losses arising during the period, net of tax benefits of $179, nil and nil for 2016, 2015 and 2014, respectively
|
(281
|
)
|
|
—
|
|
|
—
|
|
|||
Less: reclassification adjustment to net income, net of taxes of $110, nil and nil for 2016, 2015 and 2014, respectively
|
(173
|
)
|
|
—
|
|
|
—
|
|
|||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|||
Net gains (losses) arising during the period, net of (taxes) benefits of $27,153,$(3,590) and $139,236 for 2016, 2015 and 2014, respectively
|
(42,631
|
)
|
|
5,638
|
|
|
(218,608
|
)
|
|||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits of $8,442, $12,981 and $6,504 for 2016, 2015 and 2014, respectively
|
13,254
|
|
|
20,381
|
|
|
10,212
|
|
|||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of (taxes) benefits of $(18,206), $16,011 and $(132,373) for 2016, 2015 and 2014, respectively
|
28,584
|
|
|
(25,139
|
)
|
|
207,833
|
|
|||
Other comprehensive income (loss), net of taxes
|
(1,247
|
)
|
|
880
|
|
|
(563
|
)
|
|||
Comprehensive income attributable to Hawaiian Electric Company, Inc.
|
$
|
141,070
|
|
|
$
|
136,594
|
|
|
$
|
137,078
|
|
Consolidated Balance Sheets
|
December 31
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
|
|
||
Assets
|
|
|
|
|
|
||
Property, plant and equipment
|
|
|
|
||||
Utility property, plant and equipment
|
|
|
|
|
|
||
Land
|
$
|
53,153
|
|
|
$
|
52,792
|
|
Plant and equipment
|
6,605,732
|
|
|
6,315,698
|
|
||
Less accumulated depreciation
|
(2,369,282
|
)
|
|
(2,266,004
|
)
|
||
Construction in progress
|
211,742
|
|
|
175,309
|
|
||
Utility property, plant and equipment, net
|
4,501,345
|
|
|
4,277,795
|
|
||
Nonutility property, plant and equipment, less accumulated depreciation of $1,232 as of December 31, 2016 and $1,229 as of December 31, 2015
|
7,407
|
|
|
7,272
|
|
||
Total property, plant and equipment, net
|
4,508,752
|
|
|
4,285,067
|
|
||
Current assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
74,286
|
|
|
24,449
|
|
||
Customer accounts receivable, net
|
123,688
|
|
|
132,778
|
|
||
Accrued unbilled revenues, net
|
91,693
|
|
|
84,509
|
|
||
Other accounts receivable, net
|
5,233
|
|
|
10,408
|
|
||
Fuel oil stock, at average cost
|
66,430
|
|
|
71,216
|
|
||
Materials and supplies, at average cost
|
53,679
|
|
|
54,429
|
|
||
Prepayments and other
|
23,100
|
|
|
36,640
|
|
||
Regulatory assets
|
66,032
|
|
|
72,231
|
|
||
Total current assets
|
504,141
|
|
|
486,660
|
|
||
Other long-term assets
|
|
|
|
|
|
||
Regulatory assets
|
891,419
|
|
|
824,500
|
|
||
Unamortized debt expense
|
208
|
|
|
497
|
|
||
Other
|
70,908
|
|
|
75,486
|
|
||
Total other long-term assets
|
962,535
|
|
|
900,483
|
|
||
Total assets
|
$
|
5,975,428
|
|
|
$
|
5,672,210
|
|
Capitalization and liabilities
|
|
|
|
|
|
||
Capitalization
(see Consolidated Statements of Capitalization)
|
|
|
|
|
|
||
Common stock equity
|
$
|
1,799,787
|
|
|
$
|
1,728,325
|
|
Cumulative preferred stock – not subject to mandatory redemption
|
34,293
|
|
|
34,293
|
|
||
Commitments and contingencies (Note 4)
|
|
|
|
|
|
||
Long-term debt, net
|
1,319,260
|
|
|
1,278,702
|
|
||
Total capitalization
|
3,153,340
|
|
|
3,041,320
|
|
||
Current liabilities
|
|
|
|
|
|
||
Accounts payable
|
117,814
|
|
|
114,846
|
|
||
Interest and preferred dividends payable
|
22,838
|
|
|
23,111
|
|
||
Taxes accrued
|
172,730
|
|
|
191,084
|
|
||
Regulatory liabilities
|
3,762
|
|
|
2,204
|
|
||
Other
|
55,221
|
|
|
54,079
|
|
||
Total current liabilities
|
372,365
|
|
|
385,324
|
|
||
Deferred credits and other liabilities
|
|
|
|
|
|
||
Deferred income taxes
|
733,659
|
|
|
654,806
|
|
||
Regulatory liabilities
|
406,931
|
|
|
369,339
|
|
||
Unamortized tax credits
|
88,961
|
|
|
84,214
|
|
||
Defined benefit pension and other postretirement benefit plans liability
|
599,726
|
|
|
552,974
|
|
||
Other
|
76,921
|
|
|
78,146
|
|
||
Total deferred credits and other liabilities
|
1,906,198
|
|
|
1,739,479
|
|
||
Contributions in aid of construction
|
543,525
|
|
|
506,087
|
|
||
Total capitalization and liabilities
|
$
|
5,975,428
|
|
|
$
|
5,672,210
|
|
Consolidated Statements of Capitalization
|
December 31
|
2016
|
|
2015
|
||||||||||
(dollars in thousands, except par value)
|
|
|
|
|
|
|
|
|
|
||||
Common stock equity
|
|
|
|
|
|
|
|
|
|
||||
Common stock of $6 2/3 par value
|
|
|
|
|
|
|
|
|
|
||||
Authorized: 50,000,000 shares. Outstanding: 16,019,785 shares and
|
|
|
|
|
|
|
|
|
|
||||
15,805,327 shares at December 31, 2016 and 2015, respectively
|
|
|
$
|
106,818
|
|
|
|
|
$
|
105,388
|
|
||
Premium on capital stock
|
|
|
601,491
|
|
|
|
|
578,930
|
|
||||
Retained earnings
|
|
|
1,091,800
|
|
|
|
|
1,043,082
|
|
||||
Accumulated other comprehensive income (loss), net of taxes
|
|
|
|
|
|
|
|
||||||
Unrealized losses on derivatives
|
(454
|
)
|
|
|
|
—
|
|
|
|
||||
Retirement benefit plans
|
132
|
|
|
(322
|
)
|
|
925
|
|
|
925
|
|
||
Common stock equity
|
|
|
1,799,787
|
|
|
|
|
1,728,325
|
|
||||
Cumulative preferred stock not subject to mandatory redemption
|
|
|
|
|
|
|
|
|
|
||||
Authorized: 5,000,000 shares of $20 par value and 7,000,000 shares of $100 par value.
|
|
|
|
|
|
|
|
|
|
Series
|
|
Par Value
|
|
Par
Value
|
|
Shares outstanding December 31, 2016 and 2015
|
|
2016
|
|
2015
|
|||||||
(dollars in thousands, except par value and shares outstanding)
|
|
|
|
|
|||||||||||||
C-4 1/4%
|
|
$
|
20
|
|
|
(Hawaiian Electric)
|
|
150,000
|
|
|
$
|
3,000
|
|
|
$
|
3,000
|
|
D-5%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
50,000
|
|
|
1,000
|
|
|
1,000
|
|
|||
E-5%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
150,000
|
|
|
3,000
|
|
|
3,000
|
|
|||
H-5 1/4%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
250,000
|
|
|
5,000
|
|
|
5,000
|
|
|||
I-5%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
89,657
|
|
|
1,793
|
|
|
1,793
|
|
|||
J-4 3/4%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
250,000
|
|
|
5,000
|
|
|
5,000
|
|
|||
K-4.65%
|
|
20
|
|
|
(Hawaiian Electric)
|
|
175,000
|
|
|
3,500
|
|
|
3,500
|
|
|||
G-7 5/8%
|
|
100
|
|
|
(Hawaii Electric Light)
|
|
70,000
|
|
|
7,000
|
|
|
7,000
|
|
|||
H-7 5/8%
|
|
100
|
|
|
(Maui Electric)
|
|
50,000
|
|
|
5,000
|
|
|
5,000
|
|
|||
|
|
|
|
|
|
|
1,234,657
|
|
|
34,293
|
|
|
34,293
|
|
Consolidated Statements of Capitalization (continued)
|
December 31
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
|
|
||
Long-term debt
|
|
|
|
|
|
||
Obligations to the State of Hawaii for the repayment of Special Purpose Revenue Bonds (subsidiary obligations unconditionally guaranteed by Hawaiian Electric):
|
|
|
|
|
|
||
Hawaiian Electric, 3.25%, refunding series 2015, due 2025
|
$
|
40,000
|
|
|
$
|
40,000
|
|
Hawaii Electric Light, 3.25%, refunding series 2015, due 2025
|
5,000
|
|
|
5,000
|
|
||
Maui Electric, 3.25%, refunding series 2015, due 2025
|
2,000
|
|
|
2,000
|
|
||
Hawaiian Electric, 6.50%, series 2009, due 2039
|
90,000
|
|
|
90,000
|
|
||
Hawaii Electric Light, 6.50%, series 2009, due 2039
|
60,000
|
|
|
60,000
|
|
||
Hawaiian Electric, 4.60%, refunding series 2007B, due 2026
|
62,000
|
|
|
62,000
|
|
||
Hawaii Electric Light, 4.60%, refunding series 2007B, due 2026
|
8,000
|
|
|
8,000
|
|
||
Maui Electric, 4.60%, refunding series 2007B, due 2026
|
55,000
|
|
|
55,000
|
|
||
Hawaiian Electric, 4.65%, series 2007A, due 2037
|
100,000
|
|
|
100,000
|
|
||
Hawaii Electric Light, 4.65%, series 2007A, due 2037
|
20,000
|
|
|
20,000
|
|
||
Maui Electric, 4.65%, series 2007A, due 2037
|
20,000
|
|
|
20,000
|
|
||
Total obligations to the State of Hawaii
|
462,000
|
|
|
462,000
|
|
||
Other long-term debt – unsecured:
|
|
|
|
|
|
||
Taxable senior notes:
|
|
|
|
||||
Hawaiian Electric, 4.54%, Series 2016A, due 2046
|
40,000
|
|
|
—
|
|
||
Hawaiian Electric, 5.23%, Series 2015A, due 2045
|
50,000
|
|
|
50,000
|
|
||
Hawaii Electric Light, 5.23%, Series 2015A, due 2045
|
25,000
|
|
|
25,000
|
|
||
Maui Electric, 5.23%, Series 2015A, due 2045
|
5,000
|
|
|
5,000
|
|
||
Hawaii Electric Light, 3.83%, Series 2013A, due 2020
|
14,000
|
|
|
14,000
|
|
||
Hawaiian Electric, 4.45%, Series 2013A, due 2022
|
40,000
|
|
|
40,000
|
|
||
Hawaii Electric Light, 4.45%, Series 2013B, due 2022
|
12,000
|
|
|
12,000
|
|
||
Hawaiian Electric, 4.84%, Series 2013B, due 2027
|
50,000
|
|
|
50,000
|
|
||
Hawaii Electric Light, 4.84%, Series 2013C, due 2027
|
30,000
|
|
|
30,000
|
|
||
Maui Electric, 4.84%, Series 2013A, due 2027
|
20,000
|
|
|
20,000
|
|
||
Hawaiian Electric, 5.65%, Series 2013C, due 2043
|
50,000
|
|
|
50,000
|
|
||
Maui Electric, 5.65%, Series 2013B, due 2043
|
20,000
|
|
|
20,000
|
|
||
Hawaiian Electric, 3.79%, Series 2012A, due 2018
|
30,000
|
|
|
30,000
|
|
||
Hawaii Electric Light, 3.79%, Series 2012A, due 2018
|
11,000
|
|
|
11,000
|
|
||
Maui Electric, 3.79%, Series 2012A, due 2018
|
9,000
|
|
|
9,000
|
|
||
Hawaiian Electric, 4.03%, Series 2012B, due 2020
|
62,000
|
|
|
62,000
|
|
||
Maui Electric, 4.03%, Series 2012B, due 2020
|
20,000
|
|
|
20,000
|
|
||
Hawaiian Electric, 4.55%, Series 2012C, due 2023
|
50,000
|
|
|
50,000
|
|
||
Hawaii Electric Light, 4.55%, Series 2012B, due 2023
|
20,000
|
|
|
20,000
|
|
||
Maui Electric, 4.55%, Series 2012C, due 2023
|
30,000
|
|
|
30,000
|
|
||
Hawaiian Electric, 4.72%, Series 2012D, due 2029
|
35,000
|
|
|
35,000
|
|
||
Hawaiian Electric, 5.39%, Series 2012E, due 2042
|
150,000
|
|
|
150,000
|
|
||
Hawaiian Electric, 4.53%, Series 2012F, due 2032
|
40,000
|
|
|
40,000
|
|
||
Total taxable senior notes
|
813,000
|
|
|
773,000
|
|
||
6.50 %, series 2004, Junior subordinated deferrable interest debentures, due 2034
|
51,546
|
|
|
51,546
|
|
||
Total other long-term debt – unsecured
|
864,546
|
|
|
824,546
|
|
||
Total long-term debt
|
1,326,546
|
|
|
1,286,546
|
|
||
Less unamortized debt issuance costs
|
7,286
|
|
|
7,844
|
|
||
Long-term debt, net
|
1,319,260
|
|
|
1,278,702
|
|
||
Total capitalization
|
$
|
3,153,340
|
|
|
$
|
3,041,320
|
|
Consolidated Statements of Changes in Common Stock Equity
|
|
Common stock
|
|
Premium
on
capital
|
|
Retained
|
|
Accumulated
other
comprehensive
|
|
|
|||||||||||||
(in thousands)
|
Shares
|
|
Amount
|
|
stock
|
|
earnings
|
|
income (loss)
|
|
Total
|
|||||||||||
Balance, December 31, 2013
|
15,429
|
|
|
$
|
102,880
|
|
|
$
|
541,452
|
|
|
$
|
948,624
|
|
|
$
|
608
|
|
|
$
|
1,593,564
|
|
Net income for common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
137,641
|
|
|
—
|
|
|
137,641
|
|
|||||
Other comprehensive loss, net of tax benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(563
|
)
|
|
(563
|
)
|
|||||
Issuance of common stock, net of expenses
|
376
|
|
|
2,508
|
|
|
37,486
|
|
|
—
|
|
|
—
|
|
|
39,994
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(88,492
|
)
|
|
—
|
|
|
(88,492
|
)
|
|||||
Balance, December 31, 2014
|
15,805
|
|
|
105,388
|
|
|
578,938
|
|
|
997,773
|
|
|
45
|
|
|
1,682,144
|
|
|||||
Net income for common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
135,714
|
|
|
—
|
|
|
135,714
|
|
|||||
Other comprehensive income, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
880
|
|
|
880
|
|
|||||
Common stock issuance expenses
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(90,405
|
)
|
|
—
|
|
|
(90,405
|
)
|
|||||
Balance, December 31, 2015
|
15,805
|
|
|
105,388
|
|
|
578,930
|
|
|
1,043,082
|
|
|
925
|
|
|
1,728,325
|
|
|||||
Net income for common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
142,317
|
|
|
—
|
|
|
142,317
|
|
|||||
Other comprehensive loss, net of tax benefits
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,247
|
)
|
|
(1,247
|
)
|
|||||
Issuance of common stock, net of expenses
|
215
|
|
|
1,430
|
|
|
22,561
|
|
|
—
|
|
|
—
|
|
|
23,991
|
|
|||||
Common stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(93,599
|
)
|
|
—
|
|
|
(93,599
|
)
|
|||||
Balance, December 31, 2016
|
16,020
|
|
|
$
|
106,818
|
|
|
$
|
601,491
|
|
|
$
|
1,091,800
|
|
|
$
|
(322
|
)
|
|
$
|
1,799,787
|
|
Consolidated Statements of Cash Flows
|
Years ended December 31
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
144,312
|
|
|
$
|
137,709
|
|
|
$
|
139,636
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|||
Depreciation of property, plant and equipment
|
187,061
|
|
|
177,380
|
|
|
166,387
|
|
|||
Other amortization
|
6,935
|
|
|
8,939
|
|
|
9,897
|
|
|||
Impairment of utility assets
|
—
|
|
|
6,021
|
|
|
1,866
|
|
|||
Deferred income taxes
|
74,386
|
|
|
75,626
|
|
|
82,947
|
|
|||
Income tax credits, net
|
231
|
|
|
4,844
|
|
|
6,062
|
|
|||
Allowance for equity funds used during construction
|
(8,325
|
)
|
|
(6,928
|
)
|
|
(6,771
|
)
|
|||
Change in cash overdraft
|
—
|
|
|
—
|
|
|
(1,038
|
)
|
|||
Other
|
(3,931
|
)
|
|
1,672
|
|
|
758
|
|
|||
Changes in assets and liabilities
|
|
|
|
|
|
|
|
|
|||
Decrease in accounts receivable
|
8,551
|
|
|
23,727
|
|
|
26,743
|
|
|||
Decrease (increase) in accrued unbilled revenues
|
(7,184
|
)
|
|
40,093
|
|
|
6,750
|
|
|||
Decrease in fuel oil stock
|
4,786
|
|
|
34,830
|
|
|
28,041
|
|
|||
Decrease (increase) in materials and supplies
|
750
|
|
|
2,821
|
|
|
(72
|
)
|
|||
Increase in regulatory assets
|
(18,273
|
)
|
|
(24,182
|
)
|
|
(17,000
|
)
|
|||
Decrease in accounts payable
|
(10,614
|
)
|
|
(54,555
|
)
|
|
(65,527
|
)
|
|||
Change in prepaid and accrued income taxes, tax credits and revenue taxes
|
2,123
|
|
|
(63,096
|
)
|
|
(4,036
|
)
|
|||
Increase (decrease) in defined benefit pension and other postretirement
benefit plans liability
|
484
|
|
|
1,125
|
|
|
(961
|
)
|
|||
Change in other assets and liabilities
|
(11,375
|
)
|
|
(32,620
|
)
|
|
(66,687
|
)
|
|||
Net cash provided by operating activities
|
369,917
|
|
|
333,406
|
|
|
306,995
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
(320,437
|
)
|
|
(350,161
|
)
|
|
(336,679
|
)
|
|||
Contributions in aid of construction
|
30,100
|
|
|
40,239
|
|
|
41,806
|
|
|||
Other
|
2,138
|
|
|
1,140
|
|
|
1,164
|
|
|||
Net cash used in investing activities
|
(288,199
|
)
|
|
(308,782
|
)
|
|
(293,709
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|||
Common stock dividends
|
(93,599
|
)
|
|
(90,405
|
)
|
|
(88,492
|
)
|
|||
Preferred stock dividends of Hawaiian Electric and subsidiaries
|
(1,995
|
)
|
|
(1,995
|
)
|
|
(1,995
|
)
|
|||
Proceeds from issuance of common stock
|
24,000
|
|
|
—
|
|
|
40,000
|
|
|||
Proceeds from issuance of long-term debt
|
40,000
|
|
|
80,000
|
|
|
—
|
|
|||
Repayment of long-term debt
|
—
|
|
|
—
|
|
|
(11,400
|
)
|
|||
Other
|
(287
|
)
|
|
(1,537
|
)
|
|
(462
|
)
|
|||
Net cash used in financing activities
|
(31,881
|
)
|
|
(13,937
|
)
|
|
(62,349
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
49,837
|
|
|
10,687
|
|
|
(49,063
|
)
|
|||
Cash and cash equivalents, January 1
|
24,449
|
|
|
13,762
|
|
|
62,825
|
|
|||
Cash and cash equivalents, December 31
|
$
|
74,286
|
|
|
$
|
24,449
|
|
|
$
|
13,762
|
|
Notes to Consolidated Financial Statements
|
1
·
Summary of significant accounting policies
|
General
|
(in millions)
|
HEI
|
|
Hawaiian Electric
|
||||
2017
|
$
|
12
|
|
|
$
|
6
|
|
2018
|
9
|
|
|
4
|
|
||
2019
|
7
|
|
|
4
|
|
||
2020
|
5
|
|
|
3
|
|
||
2021
|
4
|
|
|
3
|
|
||
Thereafter
|
8
|
|
|
4
|
|
||
|
$
|
45
|
|
|
$
|
24
|
|
Level 1:
|
Inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and is used to measure fair value whenever available.
|
Level 2:
|
Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; inputs to the valuation methodology include quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs to the valuation methodology that are derived principally from or can be corroborated by observable market data by correlation or other means.
|
Level 3:
|
Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using discounted cash flow methodologies, as well as instruments for which the determination of fair value requires significant management judgment or estimation.
|
|
|
2014
|
||||||
|
|
Basic
|
|
|
Diluted
|
|
||
Distributed earnings
|
|
$
|
1.24
|
|
|
$
|
1.24
|
|
Undistributed earnings
|
|
0.41
|
|
|
0.39
|
|
||
|
|
$
|
1.65
|
|
|
$
|
1.63
|
|
(in thousands)
|
As
previously
filed
|
Adjustment from adoption of ASU No. 2015-03
|
As
currently reported
|
|||||||
December 31, 2015
|
|
|
|
|||||||
HEI Consolidated Balance Sheet and Note 3 - Segment financial information (Total assets)
|
|
|
|
|||||||
Other assets
|
$
|
488,635
|
|
$
|
(8,178
|
)
|
$
|
480,457
|
|
|
Total assets and Total liabilities and shareholders’ equity
|
11,790,196
|
|
(8,178
|
)
|
11,782,018
|
|
||||
Long-term debt, net-other than bank
|
1,586,546
|
|
(8,178
|
)
|
1,578,368
|
|
||||
Total liabilities
|
9,828,263
|
|
(8,178
|
)
|
9,820,085
|
|
||||
Hawaiian Electric Consolidated Balance Sheet and Note 3 - Segment financial information (Total assets)
|
|
|
|
|||||||
Unamortized debt expense
|
8,341
|
|
(7,844
|
)
|
497
|
|
||||
Total other long-term assets
|
908,327
|
|
(7,844
|
)
|
900,483
|
|
||||
Total assets and Total capitalization and liabilities
|
5,680,054
|
|
(7,844
|
)
|
5,672,210
|
|
||||
Long-term debt, net
|
1,286,546
|
|
(7,844
|
)
|
1,278,702
|
|
||||
Total capitalization
|
3,049,164
|
|
(7,844
|
)
|
3,041,320
|
|
||||
Note 4 - Hawaiian Electric Consolidating Balance Sheet
|
|
|
|
|||||||
Hawaiian Electric (parent only)
|
|
|
|
|||||||
Unamortized debt expense
|
5,742
|
|
(5,383
|
)
|
359
|
|
||||
Total other long-term assets
|
662,430
|
|
(5,383
|
)
|
657,047
|
|
||||
Total assets and Total capitalization and liabilities
|
4,481,558
|
|
(5,383
|
)
|
4,476,175
|
|
||||
Long-term debt, net
|
880,546
|
|
(5,383
|
)
|
875,163
|
|
||||
Total capitalization
|
2,631,164
|
|
(5,383
|
)
|
2,625,781
|
|
||||
Hawaii Electric Light
|
|
|
|
|||||||
Unamortized debt expense
|
1,494
|
|
(1,420
|
)
|
74
|
|
||||
Total other long-term assets
|
130,749
|
|
(1,420
|
)
|
129,329
|
|
||||
Total assets and Total capitalization and liabilities
|
955,935
|
|
(1,420
|
)
|
954,515
|
|
||||
Long-term debt, net
|
215,000
|
|
(1,420
|
)
|
213,580
|
|
||||
Total capitalization
|
514,702
|
|
(1,420
|
)
|
513,282
|
|
||||
Maui Electric
|
|
|
|
|||||||
Unamortized debt expense
|
1,105
|
|
(1,041
|
)
|
64
|
|
||||
Total other long-term assets
|
115,148
|
|
(1,041
|
)
|
114,107
|
|
||||
Total assets and Total capitalization and liabilities
|
831,201
|
|
(1,041
|
)
|
830,160
|
|
||||
Long-term debt, net
|
191,000
|
|
(1,041
|
)
|
189,959
|
|
||||
Total capitalization
|
459,725
|
|
(1,041
|
)
|
458,684
|
|
•
|
Requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income.
|
•
|
Requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes.
|
•
|
Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables).
|
•
|
Eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost.
|
Electric utility
|
Bank (HEI only)
|
•
|
changes in lending policies and procedures;
|
•
|
changes in economic and business conditions and developments that affect the collectability of the portfolio;
|
•
|
changes in the nature, volume and terms of the loan portfolio;
|
•
|
changes in lending management and other relevant staff;
|
•
|
changes in loan quality (past due, non-accrual, classified loans);
|
•
|
changes in the quality of the loan review system;
|
•
|
changes in the value of underlying collateral;
|
•
|
effect of, and changes in the level of, any concentrations of credit; and
|
•
|
effect of other external and internal factors.
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in millions)
|
|
|
|
|
|
|
|
|
|||
Amounts in income taxes related to investments in qualifying affordable housing projects
|
|
|
|
|
|
|
|
|
|||
Amortization recognized in the provision for income taxes
|
$
|
(5.8
|
)
|
|
$
|
(5.4
|
)
|
|
$
|
(3.6
|
)
|
Tax credits and other tax benefits recognized in the provision for income taxes
|
8.4
|
|
|
8.0
|
|
|
5.4
|
|
|||
Net benefit to income tax expense
|
$
|
2.6
|
|
|
$
|
2.6
|
|
|
$
|
1.8
|
|
2
·
Termination of proposed merger and other matters
|
3
·
Segment financial information
|
Electric utility
|
Bank
|
Other
|
(in thousands)
|
Electric utility
|
|
Bank
|
|
|
Other
|
|
|
Total
|
|
|||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from external customers
|
$
|
2,094,224
|
|
|
$
|
285,924
|
|
|
$
|
506
|
|
|
$
|
2,380,654
|
|
Intersegment revenues (eliminations)
|
144
|
|
|
—
|
|
|
(144
|
)
|
|
—
|
|
||||
Revenues
|
2,094,368
|
|
|
285,924
|
|
|
362
|
|
|
2,380,654
|
|
||||
Depreciation and amortization
|
193,996
|
|
|
9,813
|
|
|
937
|
|
|
204,746
|
|
||||
Interest expense, net
|
66,824
|
|
|
12,755
|
|
|
8,979
|
|
|
88,558
|
|
||||
Income before income taxes
|
229,113
|
|
|
87,352
|
|
|
57,376
|
|
|
373,841
|
|
||||
Income taxes
|
84,801
|
|
|
30,073
|
|
|
8,821
|
|
|
123,695
|
|
||||
Net income
|
144,312
|
|
|
57,279
|
|
|
48,555
|
|
|
250,146
|
|
||||
Preferred stock dividends of subsidiaries
|
1,995
|
|
|
—
|
|
|
(105
|
)
|
|
1,890
|
|
||||
Net income for common stock
|
142,317
|
|
|
57,279
|
|
|
48,660
|
|
|
248,256
|
|
||||
Capital expenditures
|
320,437
|
|
|
9,394
|
|
|
212
|
|
|
330,043
|
|
||||
Assets (at December 31, 2016)
|
5,975,428
|
|
|
6,421,357
|
|
|
28,721
|
|
|
12,425,506
|
|
||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from external customers
|
$
|
2,335,135
|
|
|
$
|
267,733
|
|
|
$
|
114
|
|
|
$
|
2,602,982
|
|
Intersegment revenues (eliminations)
|
31
|
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
||||
Revenues
|
2,335,166
|
|
|
267,733
|
|
|
83
|
|
|
2,602,982
|
|
||||
Depreciation and amortization
|
186,319
|
|
|
7,928
|
|
|
1,338
|
|
|
195,585
|
|
||||
Interest expense, net
|
66,370
|
|
|
11,326
|
|
|
10,780
|
|
|
88,476
|
|
||||
Income (loss) before income taxes
|
217,131
|
|
|
83,812
|
|
|
(46,155
|
)
|
|
254,788
|
|
||||
Income taxes (benefit)
|
79,422
|
|
|
29,082
|
|
|
(15,483
|
)
|
|
93,021
|
|
||||
Net income (loss)
|
137,709
|
|
|
54,730
|
|
|
(30,672
|
)
|
|
161,767
|
|
||||
Preferred stock dividends of subsidiaries
|
1,995
|
|
|
—
|
|
|
(105
|
)
|
|
1,890
|
|
||||
Net income (loss) for common stock
|
135,714
|
|
|
54,730
|
|
|
(30,567
|
)
|
|
159,877
|
|
||||
Capital expenditures
|
350,161
|
|
|
13,470
|
|
|
173
|
|
|
363,804
|
|
||||
Assets (at December 31, 2015)
|
5,672,210
|
|
|
6,014,755
|
|
|
95,053
|
|
|
11,782,018
|
|
||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues from external customers
|
$
|
2,987,299
|
|
|
$
|
252,497
|
|
|
$
|
(254
|
)
|
|
$
|
3,239,542
|
|
Intersegment revenues (eliminations)
|
24
|
|
|
—
|
|
|
(24
|
)
|
|
—
|
|
||||
Revenues
|
2,987,323
|
|
|
252,497
|
|
|
(278
|
)
|
|
3,239,542
|
|
||||
Depreciation and amortization
|
176,284
|
|
|
5,399
|
|
|
1,361
|
|
|
183,044
|
|
||||
Interest expense, net
|
64,757
|
|
|
10,808
|
|
|
11,595
|
|
|
87,160
|
|
||||
Income (loss) before income taxes
|
220,361
|
|
|
79,295
|
|
|
(34,058
|
)
|
|
265,598
|
|
||||
Income taxes (benefit)
|
80,725
|
|
|
27,994
|
|
|
(13,140
|
)
|
|
95,579
|
|
||||
Net income (loss)
|
139,636
|
|
|
51,301
|
|
|
(20,918
|
)
|
|
170,019
|
|
||||
Preferred stock dividends of subsidiaries
|
1,995
|
|
|
—
|
|
|
(105
|
)
|
|
1,890
|
|
||||
Net income (loss) for common stock
|
137,641
|
|
|
51,301
|
|
|
(20,813
|
)
|
|
168,129
|
|
||||
Capital expenditures
|
336,679
|
|
|
28,073
|
|
|
74
|
|
|
364,826
|
|
||||
Assets (at December 31, 2014)
|
5,550,021
|
|
|
5,566,222
|
|
|
60,900
|
|
|
11,177,143
|
|
4
·
Electric utility segment
|
December 31
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
|
|
||
Retirement benefit plans (balance primarily varies with plans’ funded statuses)
|
$
|
745,367
|
|
|
$
|
679,766
|
|
Income taxes, net (1 to 55 years)
|
90,100
|
|
|
88,039
|
|
||
Decoupling revenue balancing account and RAM regulatory asset (1 to 2 years)
|
73,485
|
|
|
74,462
|
|
||
Unamortized expense and premiums on retired debt and equity issuances (19 to 30 years; 6 to 18 years remaining)
|
12,299
|
|
|
14,089
|
|
||
Vacation earned, but not yet taken (1 year)
|
10,970
|
|
|
10,420
|
|
||
Other (1 to 50 years; 1 to 46 years remaining)
|
25,230
|
|
|
29,955
|
|
||
|
$
|
957,451
|
|
|
$
|
896,731
|
|
Included in:
|
|
|
|
|
|
||
Current assets
|
$
|
66,032
|
|
|
$
|
72,231
|
|
Long-term assets
|
891,419
|
|
|
824,500
|
|
||
|
$
|
957,451
|
|
|
$
|
896,731
|
|
December 31
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
|
|
||
Cost of removal in excess of salvage value (1 to 60 years)
|
$
|
394,072
|
|
|
$
|
357,825
|
|
Retirement benefit plans (5 years beginning with respective utility’s next rate case)
|
10,824
|
|
|
9,835
|
|
||
Other (5 years; 1 to 2 years remaining)
|
5,797
|
|
|
3,883
|
|
||
|
$
|
410,693
|
|
|
$
|
371,543
|
|
Included in:
|
|
|
|
||||
Current liabilities
|
$
|
3,762
|
|
|
$
|
2,204
|
|
Long-term liabilities
|
406,931
|
|
|
369,339
|
|
||
|
$
|
410,693
|
|
|
$
|
371,543
|
|
December 31, 2016
|
Voluntary
liquidation price
|
|
Redemption
price
|
||||
Series
|
|
|
|
|
|
||
C, D, E, H, J and K (Hawaiian Electric)
|
$
|
20
|
|
|
$
|
21
|
|
I (Hawaiian Electric)
|
20
|
|
|
20
|
|
||
G (Hawaii Electric Light)
|
100
|
|
|
100
|
|
||
H (Maui Electric)
|
100
|
|
|
100
|
|
(in thousands)
|
2016
|
|
2015
|
||||
Balance, January 1
|
$
|
26,848
|
|
|
$
|
29,419
|
|
Accretion expense
|
10
|
|
|
24
|
|
||
Liabilities incurred
|
—
|
|
|
—
|
|
||
Liabilities settled
|
(1,269
|
)
|
|
(2,595
|
)
|
||
Revisions in estimated cash flows
|
—
|
|
|
—
|
|
||
Balance, December 31
|
$
|
25,589
|
|
|
$
|
26,848
|
|
•
|
A
90%
limitation on the incremental current year Rate Base RAM Adjustment effective with the Utilities’ 2014 decoupling filing.
|
•
|
Effective March 1, 2014, the interest rate to be applied on the outstanding RBA balances to be the short term debt rate used in each Utilities last rate case (ranging from
1.25%
to
3.25%
), instead of the
6%
that had been previously approved.
|
•
|
Hawaiian Electric's RAM revenues were limited to the RAM Cap in 2015 and 2016. In October 2015, Hawaiian Electric filed an application to recover the revenue requirements associated with 2015 net plant additions in the amount of
$40.3 million
and other associated costs for its Underground Cable Program and the
138
kV Transmission and
46
kV Sub-Transmission Structures Major Baseline Projects through the RAM above the 2015 RAM Cap. In April 2016, Hawaiian Electric modified its October 2015 application to reduce its request to recover revenue requirements associated with 2015 net plant additions from
$40.3 million
to
$35.7 million
as a result of the extension of bonus depreciation in 2015. In August 2016, the PUC dismissed Hawaiian Electric's October 2015 above the RAM Cap application because the application did not also request approval of the commitment of capital expenditures. Return on plant additions in excess of the amount provided by the RAM is being requested in the Hawaiian Electric 2017 test year rate case.
|
•
|
Maui Electric's RAM revenues were limited to the RAM Cap in 2015 and 2016. In October 2015, Maui Electric filed an application to recover the revenue requirements associated with 2015 net plant additions in the amount of
$4.3 million
and other associated costs for its transmission and distribution and generation plant reliability Major Baseline Project through the RAM above the 2015 RAM Cap. In March 2016, Maui Electric withdrew its October 2015 application. Maui Electric determined that the application was unnecessary because it could recover the revenue requirements associated with its 2015 net plant additions under the RAM Cap due to: (1) the extension of bonus depreciation in 2015 which resulted in an increased level of accumulated deferred income taxes as an offset to 2015 net plant additions; and (2) the recorded amount of net plant additions in 2015 was less than the estimate of net plant additions in the application. In anticipation of having plant additions in 2017 in excess of the amount provided for by the RAM. Maui Electric filed an application in August 2016, to recover the revenue requirements associated with 2017 plant additions for the Kaonoulu and Kuihelani substations in the total amount of
$27.2 million
and other associated costs through the RAM above the 2017 RAM Cap. In September 2016, the Consumer Advocate recommended the PUC reject the application, and Maui Electric subsequently objected to that recommendation. Maui Electric is awaiting the PUC's decision.
|
•
|
Hawaii Electric Light's RAM revenues were not limited to the RAM Cap in 2015 or 2016.
|
•
|
Distributed Generation Interconnection Plan - the Utilities’ Plan was filed in August 2014.
|
•
|
Plan to implement an on-going distribution circuit monitoring program to measure real-time voltage and other power quality parameters - the Utilities’ Plan was filed in June 2014.
|
•
|
Action Plan for improving efficiencies in the interconnection requirements studies - the Utilities’ Plan was filed in May 2014.
|
•
|
The Utilities are to file monthly reports providing details about interconnection requirements studies.
|
•
|
Integrated interconnection queue for each distribution circuit for each island grid - the Utilities’ integrated interconnection queue plan was filed in August 2014 and the integrated interconnection queues were implemented in January 2015.
|
(1)
|
new pricing provisions for future private rooftop photovoltaic (PV) systems,
|
(2)
|
technical standards for advanced inverters,
|
(3)
|
new options for customers including battery-equipped private rooftop PV systems,
|
(4)
|
a pilot time-of-use rate,
|
(5)
|
an improved method of calculating the amount of private rooftop PV that can be safely installed, and
|
(6)
|
a streamlined and standardized PV application process.
|
December 31
|
|
2016
|
||||||
(dollars in thousands)
|
|
Notional amount
|
|
Fair value
|
||||
Window forward contract
|
|
$
|
20,734
|
|
|
$
|
(743
|
)
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Revenues
|
$
|
1,474,384
|
|
|
311,385
|
|
|
308,705
|
|
|
—
|
|
|
(106
|
)
|
[1]
|
|
$
|
2,094,368
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel oil
|
305,359
|
|
|
55,094
|
|
|
94,251
|
|
|
—
|
|
|
—
|
|
|
|
454,704
|
|
||
Purchased power
|
431,009
|
|
|
81,018
|
|
|
50,713
|
|
|
—
|
|
|
—
|
|
|
|
562,740
|
|
||
Other operation and maintenance
|
273,176
|
|
|
63,897
|
|
|
68,460
|
|
|
—
|
|
|
—
|
|
|
|
405,533
|
|
||
Depreciation
|
126,086
|
|
|
37,797
|
|
|
23,178
|
|
|
—
|
|
|
—
|
|
|
|
187,061
|
|
||
Taxes, other than income taxes
|
141,615
|
|
|
29,017
|
|
|
29,230
|
|
|
—
|
|
|
—
|
|
|
|
199,862
|
|
||
Total expenses
|
1,277,245
|
|
|
266,823
|
|
|
265,832
|
|
|
—
|
|
|
—
|
|
|
|
1,809,900
|
|
||
Operating income
|
197,139
|
|
|
44,562
|
|
|
42,873
|
|
|
—
|
|
|
(106
|
)
|
|
|
284,468
|
|
||
Allowance for equity funds used during construction
|
6,659
|
|
|
765
|
|
|
901
|
|
|
—
|
|
|
—
|
|
|
|
8,325
|
|
||
Equity in earnings of subsidiaries
|
42,391
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,391
|
)
|
[2]
|
|
—
|
|
||
Interest expense and other charges, net
|
(45,839
|
)
|
|
(11,555
|
)
|
|
(9,536
|
)
|
|
—
|
|
|
106
|
|
[1]
|
|
(66,824
|
)
|
||
Allowance for borrowed funds used during construction
|
2,484
|
|
|
294
|
|
|
366
|
|
|
—
|
|
|
—
|
|
|
|
3,144
|
|
||
Income before income taxes
|
202,834
|
|
|
34,066
|
|
|
34,604
|
|
|
—
|
|
|
(42,391
|
)
|
|
|
229,113
|
|
||
Income taxes
|
59,437
|
|
|
12,277
|
|
|
13,087
|
|
|
—
|
|
|
—
|
|
|
|
84,801
|
|
||
Net income
|
143,397
|
|
|
21,789
|
|
|
21,517
|
|
|
—
|
|
|
(42,391
|
)
|
|
|
144,312
|
|
||
Preferred stock dividends of subsidiaries
|
—
|
|
|
534
|
|
|
381
|
|
|
—
|
|
|
—
|
|
|
|
915
|
|
||
Net income attributable to Hawaiian Electric
|
143,397
|
|
|
21,255
|
|
|
21,136
|
|
|
—
|
|
|
(42,391
|
)
|
|
|
143,397
|
|
||
Preferred stock dividends of Hawaiian Electric
|
1,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
1,080
|
|
||
Net income for common stock
|
$
|
142,317
|
|
|
21,255
|
|
|
21,136
|
|
|
—
|
|
|
(42,391
|
)
|
|
|
$
|
142,317
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Net income for common stock
|
$
|
142,317
|
|
|
21,255
|
|
|
21,136
|
|
|
—
|
|
|
(42,391
|
)
|
|
|
$
|
142,317
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivatives qualified as cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Effective portion of foreign currency hedge net unrealized losses arising during the period, net of tax benefits
|
(281
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(281
|
)
|
||
Less: reclassification adjustment to net income, net of taxes
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(173
|
)
|
||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Net losses arising during the period, net of tax benefits
|
(42,631
|
)
|
|
(5,141
|
)
|
|
(5,447
|
)
|
|
—
|
|
|
10,588
|
|
[1]
|
|
(42,631
|
)
|
||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
|
13,254
|
|
|
1,718
|
|
|
1,549
|
|
|
—
|
|
|
(3,267
|
)
|
[1]
|
|
13,254
|
|
||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes
|
28,584
|
|
|
3,269
|
|
|
3,852
|
|
|
—
|
|
|
(7,121
|
)
|
[1]
|
|
28,584
|
|
||
Other comprehensive loss, net of tax benefits
|
(1,247
|
)
|
|
(154
|
)
|
|
(46
|
)
|
|
—
|
|
|
200
|
|
|
|
(1,247
|
)
|
||
Comprehensive income attributable to common shareholder
|
$
|
141,070
|
|
|
21,101
|
|
|
21,090
|
|
|
—
|
|
|
(42,191
|
)
|
|
|
$
|
141,070
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Revenues
|
$
|
1,644,181
|
|
|
345,549
|
|
|
345,517
|
|
|
—
|
|
|
(81
|
)
|
[1]
|
|
$
|
2,335,166
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel oil
|
458,069
|
|
|
71,851
|
|
|
124,680
|
|
|
—
|
|
|
—
|
|
|
|
654,600
|
|
||
Purchased power
|
440,983
|
|
|
97,503
|
|
|
55,610
|
|
|
—
|
|
|
—
|
|
|
|
594,096
|
|
||
Other operation and maintenance
|
284,583
|
|
|
63,098
|
|
|
65,408
|
|
|
—
|
|
|
—
|
|
|
|
413,089
|
|
||
Depreciation
|
117,682
|
|
|
37,250
|
|
|
22,448
|
|
|
—
|
|
|
—
|
|
|
|
177,380
|
|
||
Taxes, other than income taxes
|
156,871
|
|
|
32,312
|
|
|
32,702
|
|
|
—
|
|
|
—
|
|
|
|
221,885
|
|
||
Total expenses
|
1,458,188
|
|
|
302,014
|
|
|
300,848
|
|
|
—
|
|
|
—
|
|
|
|
2,061,050
|
|
||
Operating income
|
185,993
|
|
|
43,535
|
|
|
44,669
|
|
|
—
|
|
|
(81
|
)
|
|
|
274,116
|
|
||
Allowance for equity funds used
during construction
|
5,641
|
|
|
604
|
|
|
683
|
|
|
—
|
|
|
—
|
|
|
|
6,928
|
|
||
Equity in earnings of subsidiaries
|
42,920
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,920
|
)
|
[2]
|
|
—
|
|
||
Interest expense and other charges, net
|
(45,899
|
)
|
|
(10,773
|
)
|
|
(9,779
|
)
|
|
|
|
81
|
|
[1]
|
|
(66,370
|
)
|
|||
Allowance for borrowed funds used during construction
|
1,967
|
|
|
215
|
|
|
275
|
|
|
—
|
|
|
—
|
|
|
|
2,457
|
|
||
Income before income taxes
|
190,622
|
|
|
33,581
|
|
|
35,848
|
|
|
—
|
|
|
(42,920
|
)
|
|
|
217,131
|
|
||
Income taxes
|
53,828
|
|
|
12,292
|
|
|
13,302
|
|
|
—
|
|
|
—
|
|
|
|
79,422
|
|
||
Net income
|
136,794
|
|
|
21,289
|
|
|
22,546
|
|
|
—
|
|
|
(42,920
|
)
|
|
|
137,709
|
|
||
Preferred stock dividends of subsidiaries
|
—
|
|
|
534
|
|
|
381
|
|
|
—
|
|
|
—
|
|
|
|
915
|
|
||
Net income attributable to Hawaiian Electric
|
136,794
|
|
|
20,755
|
|
|
22,165
|
|
|
—
|
|
|
(42,920
|
)
|
|
|
136,794
|
|
||
Preferred stock dividends of Hawaiian Electric
|
1,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
1,080
|
|
||
Net income for common stock
|
$
|
135,714
|
|
|
20,755
|
|
|
22,165
|
|
|
—
|
|
|
(42,920
|
)
|
|
|
$
|
135,714
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Net income for common stock
|
$
|
135,714
|
|
|
20,755
|
|
|
22,165
|
|
|
—
|
|
|
(42,920
|
)
|
|
|
$
|
135,714
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net gains (losses) arising during the period, net of taxes
|
5,638
|
|
|
(2,710
|
)
|
|
(1,352
|
)
|
|
—
|
|
|
4,062
|
|
[1]
|
|
5,638
|
|
||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
|
20,381
|
|
|
2,728
|
|
|
2,503
|
|
|
—
|
|
|
(5,231
|
)
|
[1]
|
|
20,381
|
|
||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes
|
(25,139
|
)
|
|
104
|
|
|
(1,107
|
)
|
|
—
|
|
|
1,003
|
|
[1]
|
|
(25,139
|
)
|
||
Other comprehensive income, net of taxes
|
880
|
|
|
122
|
|
|
44
|
|
|
—
|
|
|
(166
|
)
|
|
|
880
|
|
||
Comprehensive income attributable to common shareholder
|
$
|
136,594
|
|
|
20,877
|
|
|
22,209
|
|
|
—
|
|
|
(43,086
|
)
|
|
|
$
|
136,594
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Revenues
|
$
|
2,142,245
|
|
|
422,200
|
|
|
422,965
|
|
|
—
|
|
|
(87
|
)
|
[1]
|
|
$
|
2,987,323
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fuel oil
|
821,246
|
|
|
117,215
|
|
|
193,224
|
|
|
—
|
|
|
—
|
|
|
|
1,131,685
|
|
||
Purchased power
|
537,821
|
|
|
123,226
|
|
|
60,961
|
|
|
—
|
|
|
—
|
|
|
|
722,008
|
|
||
Other operation and maintenance
|
283,532
|
|
|
65,471
|
|
|
61,609
|
|
|
—
|
|
|
—
|
|
|
|
410,612
|
|
||
Depreciation
|
109,204
|
|
|
35,904
|
|
|
21,279
|
|
|
—
|
|
|
—
|
|
|
|
166,387
|
|
||
Taxes, other than income taxes
|
201,426
|
|
|
39,521
|
|
|
39,916
|
|
|
—
|
|
|
—
|
|
|
|
280,863
|
|
||
Total expenses
|
1,953,229
|
|
|
381,337
|
|
|
376,989
|
|
|
—
|
|
|
—
|
|
|
|
2,711,555
|
|
||
Operating income
|
189,016
|
|
|
40,863
|
|
|
45,976
|
|
|
—
|
|
|
(87
|
)
|
|
|
275,768
|
|
||
Allowance for equity funds used
during construction
|
6,085
|
|
|
472
|
|
|
214
|
|
|
—
|
|
|
—
|
|
|
|
6,771
|
|
||
Equity in earnings of subsidiaries
|
40,964
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40,964
|
)
|
[2]
|
|
—
|
|
||
Interest expense and other charges, net
|
(44,041
|
)
|
|
(11,030
|
)
|
|
(9,773
|
)
|
|
—
|
|
|
87
|
|
[1]
|
|
(64,757
|
)
|
||
Allowance for borrowed funds used during construction
|
2,306
|
|
|
182
|
|
|
91
|
|
|
—
|
|
|
—
|
|
|
|
2,579
|
|
||
Income before income taxes
|
194,330
|
|
|
30,487
|
|
|
36,508
|
|
|
—
|
|
|
(40,964
|
)
|
|
|
220,361
|
|
||
Income taxes
|
55,609
|
|
|
11,264
|
|
|
13,852
|
|
|
—
|
|
|
—
|
|
|
|
80,725
|
|
||
Net income
|
138,721
|
|
|
19,223
|
|
|
22,656
|
|
|
—
|
|
|
(40,964
|
)
|
|
|
139,636
|
|
||
Preferred stock dividends of subsidiaries
|
—
|
|
|
534
|
|
|
381
|
|
|
—
|
|
|
—
|
|
|
|
915
|
|
||
Net income attributable to Hawaiian Electric
|
138,721
|
|
|
18,689
|
|
|
22,275
|
|
|
—
|
|
|
(40,964
|
)
|
|
|
138,721
|
|
||
Preferred stock dividends of Hawaiian Electric
|
1,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
1,080
|
|
||
Net income for common stock
|
$
|
137,641
|
|
|
18,689
|
|
|
22,275
|
|
|
—
|
|
|
(40,964
|
)
|
|
|
$
|
137,641
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Net income for common stock
|
$
|
137,641
|
|
|
18,689
|
|
|
22,275
|
|
|
—
|
|
|
(40,964
|
)
|
|
|
$
|
137,641
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net losses arising during the period, net of tax benefits
|
(218,608
|
)
|
|
(28,725
|
)
|
|
(29,352
|
)
|
|
—
|
|
|
58,077
|
|
[1]
|
|
(218,608
|
)
|
||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
|
10,212
|
|
|
1,270
|
|
|
1,090
|
|
|
—
|
|
|
(2,360
|
)
|
[1]
|
|
10,212
|
|
||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of tax benefits
|
207,833
|
|
|
27,437
|
|
|
28,257
|
|
|
—
|
|
|
(55,694
|
)
|
[1]
|
|
207,833
|
|
||
Other comprehensive loss, net of tax benefits
|
(563
|
)
|
|
(18
|
)
|
|
(5
|
)
|
|
—
|
|
|
23
|
|
|
|
(563
|
)
|
||
Comprehensive income attributable to common shareholder
|
$
|
137,078
|
|
|
18,671
|
|
|
22,270
|
|
|
—
|
|
|
(40,941
|
)
|
|
|
$
|
137,078
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Utility property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Land
|
$
|
43,956
|
|
|
6,181
|
|
|
3,016
|
|
|
—
|
|
|
—
|
|
|
|
$
|
53,153
|
|
Plant and equipment
|
4,241,060
|
|
|
1,255,185
|
|
|
1,109,487
|
|
|
—
|
|
|
—
|
|
|
|
6,605,732
|
|
||
Less accumulated depreciation
|
(1,382,972
|
)
|
|
(507,666
|
)
|
|
(478,644
|
)
|
|
—
|
|
|
—
|
|
|
|
(2,369,282
|
)
|
||
Construction in progress
|
180,194
|
|
|
12,510
|
|
|
19,038
|
|
|
—
|
|
|
—
|
|
|
|
211,742
|
|
||
Utility property, plant and equipment, net
|
3,082,238
|
|
|
766,210
|
|
|
652,897
|
|
|
—
|
|
|
—
|
|
|
|
4,501,345
|
|
||
Nonutility property, plant and equipment, less accumulated depreciation
|
5,760
|
|
|
115
|
|
|
1,532
|
|
|
—
|
|
|
—
|
|
|
|
7,407
|
|
||
Total property, plant and equipment, net
|
3,087,998
|
|
|
766,325
|
|
|
654,429
|
|
|
—
|
|
|
—
|
|
|
|
4,508,752
|
|
||
Investment in wholly-owned subsidiaries, at equity
|
550,946
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(550,946
|
)
|
[2]
|
|
—
|
|
||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Cash and equivalents
|
61,388
|
|
|
10,749
|
|
|
2,048
|
|
|
101
|
|
|
—
|
|
|
|
74,286
|
|
||
Advances to affiliates
|
—
|
|
|
3,500
|
|
|
10,000
|
|
|
—
|
|
|
(13,500
|
)
|
[1]
|
|
—
|
|
||
Customer accounts receivable, net
|
86,373
|
|
|
20,055
|
|
|
17,260
|
|
|
—
|
|
|
—
|
|
|
|
123,688
|
|
||
Accrued unbilled revenues, net
|
65,821
|
|
|
13,564
|
|
|
12,308
|
|
|
—
|
|
|
—
|
|
|
|
91,693
|
|
||
Other accounts receivable, net
|
7,652
|
|
|
2,445
|
|
|
1,416
|
|
|
—
|
|
|
(6,280
|
)
|
[1]
|
|
5,233
|
|
||
Fuel oil stock, at average cost
|
47,239
|
|
|
8,229
|
|
|
10,962
|
|
|
—
|
|
|
—
|
|
|
|
66,430
|
|
||
Materials and supplies, at average cost
|
29,928
|
|
|
7,380
|
|
|
16,371
|
|
|
—
|
|
|
—
|
|
|
|
53,679
|
|
||
Prepayments and other
|
16,502
|
|
|
5,352
|
|
|
2,179
|
|
|
—
|
|
|
(933
|
)
|
[3]
|
|
23,100
|
|
||
Regulatory assets
|
60,185
|
|
|
3,483
|
|
|
2,364
|
|
|
—
|
|
|
—
|
|
|
|
66,032
|
|
||
Total current assets
|
375,088
|
|
|
74,757
|
|
|
74,908
|
|
|
101
|
|
|
(20,713
|
)
|
|
|
504,141
|
|
||
Other long-term assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Regulatory assets
|
662,232
|
|
|
120,863
|
|
|
108,324
|
|
|
—
|
|
|
—
|
|
|
|
891,419
|
|
||
Unamortized debt expense
|
151
|
|
|
23
|
|
|
34
|
|
|
—
|
|
|
—
|
|
|
|
208
|
|
||
Other
|
43,743
|
|
|
13,573
|
|
|
13,592
|
|
|
—
|
|
|
—
|
|
|
|
70,908
|
|
||
Total other long-term assets
|
706,126
|
|
|
134,459
|
|
|
121,950
|
|
|
—
|
|
|
—
|
|
|
|
962,535
|
|
||
Total assets
|
$
|
4,720,158
|
|
|
975,541
|
|
|
851,287
|
|
|
101
|
|
|
(571,659
|
)
|
|
|
$
|
5,975,428
|
|
Capitalization and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Capitalization
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Common stock equity
|
$
|
1,799,787
|
|
|
291,291
|
|
|
259,554
|
|
|
101
|
|
|
(550,946
|
)
|
[2]
|
|
$
|
1,799,787
|
|
Cumulative preferred stock–not subject to mandatory redemption
|
22,293
|
|
|
7,000
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
|
34,293
|
|
||
Long-term debt, net
|
915,437
|
|
|
213,703
|
|
|
190,120
|
|
|
—
|
|
|
—
|
|
|
|
1,319,260
|
|
||
Total capitalization
|
2,737,517
|
|
|
511,994
|
|
|
454,674
|
|
|
101
|
|
|
(550,946
|
)
|
|
|
3,153,340
|
|
||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Short-term borrowings-affiliate
|
13,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,500
|
)
|
[1]
|
|
—
|
|
||
Accounts payable
|
86,369
|
|
|
18,126
|
|
|
13,319
|
|
|
—
|
|
|
—
|
|
|
|
117,814
|
|
||
Interest and preferred dividends payable
|
15,761
|
|
|
4,206
|
|
|
2,882
|
|
|
—
|
|
|
(11
|
)
|
[1]
|
|
22,838
|
|
||
Taxes accrued
|
120,176
|
|
|
28,100
|
|
|
25,387
|
|
|
—
|
|
|
(933
|
)
|
[3]
|
|
172,730
|
|
||
Regulatory liabilities
|
—
|
|
|
2,219
|
|
|
1,543
|
|
|
—
|
|
|
—
|
|
|
|
3,762
|
|
||
Other
|
41,352
|
|
|
7,637
|
|
|
12,501
|
|
|
—
|
|
|
(6,269
|
)
|
[1]
|
|
55,221
|
|
||
Total current liabilities
|
277,158
|
|
|
60,288
|
|
|
55,632
|
|
|
—
|
|
|
(20,713
|
)
|
|
|
372,365
|
|
||
Deferred credits and other liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Deferred income taxes
|
524,433
|
|
|
108,052
|
|
|
100,911
|
|
|
—
|
|
|
263
|
|
[1]
|
|
733,659
|
|
||
Regulatory liabilities
|
281,112
|
|
|
93,974
|
|
|
31,845
|
|
|
—
|
|
|
—
|
|
|
|
406,931
|
|
||
Unamortized tax credits
|
57,844
|
|
|
15,994
|
|
|
15,123
|
|
|
—
|
|
|
—
|
|
|
|
88,961
|
|
||
Defined benefit pension and other postretirement benefit plans liability
|
444,458
|
|
|
75,005
|
|
|
80,263
|
|
|
—
|
|
|
—
|
|
|
|
599,726
|
|
||
Other
|
49,191
|
|
|
13,024
|
|
|
14,969
|
|
|
—
|
|
|
(263
|
)
|
[1]
|
|
76,921
|
|
||
Total deferred credits and other liabilities
|
1,357,038
|
|
|
306,049
|
|
|
243,111
|
|
|
—
|
|
|
—
|
|
|
|
1,906,198
|
|
||
Contributions in aid of construction
|
348,445
|
|
|
97,210
|
|
|
97,870
|
|
|
—
|
|
|
—
|
|
|
|
543,525
|
|
||
Total capitalization and liabilities
|
$
|
4,720,158
|
|
|
975,541
|
|
|
851,287
|
|
|
101
|
|
|
(571,659
|
)
|
|
|
$
|
5,975,428
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Utility property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Land
|
$
|
43,557
|
|
|
6,219
|
|
|
3,016
|
|
|
—
|
|
|
—
|
|
|
|
$
|
52,792
|
|
Plant and equipment
|
4,026,079
|
|
|
1,212,195
|
|
|
1,077,424
|
|
|
—
|
|
|
—
|
|
|
|
6,315,698
|
|
||
Less accumulated depreciation
|
(1,316,467
|
)
|
|
(486,028
|
)
|
|
(463,509
|
)
|
|
—
|
|
|
—
|
|
|
|
(2,266,004
|
)
|
||
Construction in progress
|
147,979
|
|
|
11,455
|
|
|
15,875
|
|
|
—
|
|
|
—
|
|
|
|
175,309
|
|
||
Utility property, plant and equipment, net
|
2,901,148
|
|
|
743,841
|
|
|
632,806
|
|
|
—
|
|
|
—
|
|
|
|
4,277,795
|
|
||
Nonutility property, plant and equipment, less accumulated depreciation
|
5,659
|
|
|
82
|
|
|
1,531
|
|
|
—
|
|
|
—
|
|
|
|
7,272
|
|
||
Total property, plant and equipment, net
|
2,906,807
|
|
|
743,923
|
|
|
634,337
|
|
|
—
|
|
|
—
|
|
|
|
4,285,067
|
|
||
Investment in wholly-owned subsidiaries, at equity
|
556,528
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(556,528
|
)
|
[2]
|
|
—
|
|
||
Current assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Cash and equivalents
|
16,281
|
|
|
2,682
|
|
|
5,385
|
|
|
101
|
|
|
—
|
|
|
|
24,449
|
|
||
Advances to affiliates
|
—
|
|
|
15,500
|
|
|
7,500
|
|
|
—
|
|
|
(23,000
|
)
|
[1]
|
|
—
|
|
||
Customer accounts receivable, net
|
93,515
|
|
|
20,508
|
|
|
18,755
|
|
|
—
|
|
|
—
|
|
|
|
132,778
|
|
||
Accrued unbilled revenues, net
|
60,080
|
|
|
12,531
|
|
|
11,898
|
|
|
—
|
|
|
—
|
|
|
|
84,509
|
|
||
Other accounts receivable, net
|
16,421
|
|
|
1,275
|
|
|
1,674
|
|
|
—
|
|
|
(8,962
|
)
|
[1]
|
|
10,408
|
|
||
Fuel oil stock, at average cost
|
49,455
|
|
|
8,310
|
|
|
13,451
|
|
|
—
|
|
|
—
|
|
|
|
71,216
|
|
||
Materials and supplies, at average cost
|
30,921
|
|
|
6,865
|
|
|
16,643
|
|
|
—
|
|
|
—
|
|
|
|
54,429
|
|
||
Prepayments and other
|
25,505
|
|
|
9,091
|
|
|
2,295
|
|
|
—
|
|
|
(251
|
)
|
[1], [3]
|
|
36,640
|
|
||
Regulatory assets
|
63,615
|
|
|
4,501
|
|
|
4,115
|
|
|
—
|
|
|
—
|
|
|
|
72,231
|
|
||
Total current assets
|
355,793
|
|
|
81,263
|
|
|
81,716
|
|
|
101
|
|
|
(32,213
|
)
|
|
|
486,660
|
|
||
Other long-term assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Regulatory assets
|
608,957
|
|
|
114,562
|
|
|
100,981
|
|
|
—
|
|
|
—
|
|
|
|
824,500
|
|
||
Unamortized debt expense
|
359
|
|
|
74
|
|
|
64
|
|
|
—
|
|
|
—
|
|
|
|
497
|
|
||
Other
|
47,731
|
|
|
14,693
|
|
|
13,062
|
|
|
—
|
|
|
—
|
|
|
|
75,486
|
|
||
Total other long-term assets
|
657,047
|
|
|
129,329
|
|
|
114,107
|
|
|
—
|
|
|
—
|
|
|
|
900,483
|
|
||
Total assets
|
$
|
4,476,175
|
|
|
954,515
|
|
|
830,160
|
|
|
101
|
|
|
(588,741
|
)
|
|
|
$
|
5,672,210
|
|
Capitalization and liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Capitalization
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Common stock equity
|
$
|
1,728,325
|
|
|
292,702
|
|
|
263,725
|
|
|
101
|
|
|
(556,528
|
)
|
[2]
|
|
$
|
1,728,325
|
|
Cumulative preferred stock–not subject to mandatory redemption
|
22,293
|
|
|
7,000
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
|
34,293
|
|
||
Long-term debt, net
|
875,163
|
|
|
213,580
|
|
|
189,959
|
|
|
—
|
|
|
—
|
|
|
|
1,278,702
|
|
||
Total capitalization
|
2,625,781
|
|
|
513,282
|
|
|
458,684
|
|
|
101
|
|
|
(556,528
|
)
|
|
|
3,041,320
|
|
||
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Short-term borrowings-affiliate
|
23,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,000
|
)
|
[1]
|
|
—
|
|
||
Accounts payable
|
84,631
|
|
|
17,702
|
|
|
12,513
|
|
|
—
|
|
|
—
|
|
|
|
114,846
|
|
||
Interest and preferred dividends payable
|
15,747
|
|
|
4,255
|
|
|
3,113
|
|
|
—
|
|
|
(4
|
)
|
[1]
|
|
23,111
|
|
||
Taxes accrued
|
131,668
|
|
|
30,342
|
|
|
29,325
|
|
|
—
|
|
|
(251
|
)
|
[3]
|
|
191,084
|
|
||
Regulatory liabilities
|
—
|
|
|
1,030
|
|
|
1,174
|
|
|
—
|
|
|
—
|
|
|
|
2,204
|
|
||
Other
|
41,083
|
|
|
8,760
|
|
|
13,194
|
|
|
—
|
|
|
(8,958
|
)
|
[1]
|
|
54,079
|
|
||
Total current liabilities
|
296,129
|
|
|
62,089
|
|
|
59,319
|
|
|
—
|
|
|
(32,213
|
)
|
|
|
385,324
|
|
||
Deferred credits and other liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Deferred income taxes
|
466,133
|
|
|
100,681
|
|
|
87,706
|
|
|
—
|
|
|
286
|
|
[1]
|
|
654,806
|
|
||
Regulatory liabilities
|
254,033
|
|
|
84,623
|
|
|
30,683
|
|
|
—
|
|
|
—
|
|
|
|
369,339
|
|
||
Unamortized tax credits
|
54,078
|
|
|
15,406
|
|
|
14,730
|
|
|
—
|
|
|
—
|
|
|
|
84,214
|
|
||
Defined benefit pension and other postretirement benefit plans liability
|
409,021
|
|
|
69,893
|
|
|
74,060
|
|
|
—
|
|
|
—
|
|
|
|
552,974
|
|
||
Other
|
51,273
|
|
|
13,243
|
|
|
13,916
|
|
|
—
|
|
|
(286
|
)
|
[1]
|
|
78,146
|
|
||
Total deferred credits and other liabilities
|
1,234,538
|
|
|
283,846
|
|
|
221,095
|
|
|
—
|
|
|
—
|
|
|
|
1,739,479
|
|
||
Contributions in aid of construction
|
319,727
|
|
|
95,298
|
|
|
91,062
|
|
|
—
|
|
|
—
|
|
|
|
506,087
|
|
||
Total capitalization and liabilities
|
$
|
4,476,175
|
|
|
954,515
|
|
|
830,160
|
|
|
101
|
|
|
(588,741
|
)
|
|
|
$
|
5,672,210
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
Hawaiian Electric
Consolidated |
||||||||
Balance, December 31, 2013
|
$
|
1,593,564
|
|
|
274,802
|
|
|
248,771
|
|
|
101
|
|
|
(523,674
|
)
|
|
$
|
1,593,564
|
|
Net income for common stock
|
137,641
|
|
|
18,689
|
|
|
22,275
|
|
|
—
|
|
|
(40,964
|
)
|
|
137,641
|
|
||
Other comprehensive loss, net of tax benefits
|
(563
|
)
|
|
(18
|
)
|
|
(5
|
)
|
|
—
|
|
|
23
|
|
|
(563
|
)
|
||
Issuance of common stock, net of expenses
|
39,994
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39,994
|
|
||
Common stock dividends
|
(88,492
|
)
|
|
(11,627
|
)
|
|
(14,349
|
)
|
|
—
|
|
|
25,976
|
|
|
(88,492
|
)
|
||
Balance, December 31, 2014
|
$
|
1,682,144
|
|
|
281,846
|
|
|
256,692
|
|
|
101
|
|
|
(538,639
|
)
|
|
$
|
1,682,144
|
|
Net income for common stock
|
135,714
|
|
|
20,755
|
|
|
22,165
|
|
|
—
|
|
|
(42,920
|
)
|
|
135,714
|
|
||
Other comprehensive income, net of taxes
|
880
|
|
|
122
|
|
|
44
|
|
|
—
|
|
|
(166
|
)
|
|
880
|
|
||
Common stock issuance expenses
|
(8
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
(8
|
)
|
||
Common stock dividends
|
(90,405
|
)
|
|
(10,021
|
)
|
|
(15,175
|
)
|
|
—
|
|
|
25,196
|
|
|
(90,405
|
)
|
||
Balance, December 31, 2015
|
$
|
1,728,325
|
|
|
292,702
|
|
|
263,725
|
|
|
101
|
|
|
(556,528
|
)
|
|
$
|
1,728,325
|
|
Net income for common stock
|
142,317
|
|
|
21,255
|
|
|
21,136
|
|
|
—
|
|
|
(42,391
|
)
|
|
142,317
|
|
||
Other comprehensive loss, net of tax benefits
|
(1,247
|
)
|
|
(154
|
)
|
|
(46
|
)
|
|
—
|
|
|
200
|
|
|
(1,247
|
)
|
||
Issuance of common stock, net of expenses
|
23,991
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
5
|
|
|
23,991
|
|
||
Common stock dividends
|
(93,599
|
)
|
|
(22,507
|
)
|
|
(25,261
|
)
|
|
—
|
|
|
47,768
|
|
|
(93,599
|
)
|
||
Balance, December 31, 2016
|
$
|
1,799,787
|
|
|
291,291
|
|
|
259,554
|
|
|
101
|
|
|
(550,946
|
)
|
|
$
|
1,799,787
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net income
|
$
|
143,397
|
|
|
21,789
|
|
|
21,517
|
|
|
—
|
|
|
(42,391
|
)
|
[2]
|
|
$
|
144,312
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Equity in earnings
|
(42,491
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,391
|
|
[2]
|
|
(100
|
)
|
||
Common stock dividends received from subsidiaries
|
47,843
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47,768
|
)
|
[2]
|
|
75
|
|
||
Depreciation of property, plant and equipment
|
126,086
|
|
|
37,797
|
|
|
23,178
|
|
|
—
|
|
|
—
|
|
|
|
187,061
|
|
||
Other amortization
|
2,979
|
|
|
1,817
|
|
|
2,139
|
|
|
—
|
|
|
—
|
|
|
|
6,935
|
|
||
Deferred income taxes
|
54,721
|
|
|
7,027
|
|
|
12,661
|
|
|
—
|
|
|
(23
|
)
|
[1]
|
|
74,386
|
|
||
Income tax credits, net
|
177
|
|
|
60
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
|
231
|
|
||
Allowance for equity funds used during construction
|
(6,659
|
)
|
|
(765
|
)
|
|
(901
|
)
|
|
—
|
|
|
—
|
|
|
|
(8,325
|
)
|
||
Other
|
(2,694
|
)
|
|
(810
|
)
|
|
(427
|
)
|
|
—
|
|
|
—
|
|
|
|
(3,931
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Decrease (increase) in accounts receivable
|
10,175
|
|
|
(718
|
)
|
|
1,776
|
|
|
—
|
|
|
(2,682
|
)
|
[1]
|
|
8,551
|
|
||
Increase in accrued unbilled revenues
|
(5,741
|
)
|
|
(1,033
|
)
|
|
(410
|
)
|
|
—
|
|
|
—
|
|
|
|
(7,184
|
)
|
||
Decrease in fuel oil stock
|
2,216
|
|
|
81
|
|
|
2,489
|
|
|
—
|
|
|
—
|
|
|
|
4,786
|
|
||
Decrease (increase) in materials and supplies
|
993
|
|
|
(515
|
)
|
|
272
|
|
|
—
|
|
|
—
|
|
|
|
750
|
|
||
Increase in regulatory assets
|
(16,161
|
)
|
|
(1,243
|
)
|
|
(869
|
)
|
|
—
|
|
|
—
|
|
|
|
(18,273
|
)
|
||
Increase (decrease) in accounts payable
|
(10,247
|
)
|
|
768
|
|
|
(1,135
|
)
|
|
—
|
|
|
—
|
|
|
|
(10,614
|
)
|
||
Change in prepaid and accrued income taxes, tax credits and revenue taxes
|
2,933
|
|
|
2,645
|
|
|
(3,478
|
)
|
|
—
|
|
|
23
|
|
[1]
|
|
2,123
|
|
||
Increase (decrease) in defined benefit pension and other postretirement benefit plans liability
|
599
|
|
|
53
|
|
|
(168
|
)
|
|
—
|
|
|
—
|
|
|
|
484
|
|
||
Change in other assets and liabilities
|
(11,682
|
)
|
|
(78
|
)
|
|
(2,272
|
)
|
|
—
|
|
|
2,682
|
|
[1]
|
|
(11,350
|
)
|
||
Net cash provided by operating activities
|
296,444
|
|
|
66,875
|
|
|
54,366
|
|
|
—
|
|
|
(47,768
|
)
|
|
|
369,917
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Capital expenditures
|
(236,425
|
)
|
|
(51,344
|
)
|
|
(32,668
|
)
|
|
—
|
|
|
—
|
|
|
|
(320,437
|
)
|
||
Contributions in aid of construction
|
23,611
|
|
|
3,412
|
|
|
3,077
|
|
|
—
|
|
|
—
|
|
|
|
30,100
|
|
||
Advances from affiliates
|
—
|
|
|
12,000
|
|
|
(2,500
|
)
|
|
—
|
|
|
(9,500
|
)
|
[1]
|
|
—
|
|
||
Other
|
1,932
|
|
|
175
|
|
|
31
|
|
|
—
|
|
|
—
|
|
|
|
2,138
|
|
||
Net cash used in investing activities
|
(210,882
|
)
|
|
(35,757
|
)
|
|
(32,060
|
)
|
|
—
|
|
|
(9,500
|
)
|
|
|
(288,199
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Common stock dividends
|
(93,599
|
)
|
|
(22,507
|
)
|
|
(25,261
|
)
|
|
—
|
|
|
47,768
|
|
[2]
|
|
(93,599
|
)
|
||
Preferred stock dividends of Hawaiian Electric and subsidiaries
|
(1,080
|
)
|
|
(534
|
)
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
|
|
(1,995
|
)
|
||
Proceeds from issuance of common stock
|
24,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
24,000
|
|
||
Proceeds from issuance of long-term debt
|
40,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
40,000
|
|
||
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less
|
(9,500
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,500
|
|
[1]
|
|
—
|
|
||
Other
|
(276
|
)
|
|
(10
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
|
(287
|
)
|
||
Net cash used in financing activities
|
(40,455
|
)
|
|
(23,051
|
)
|
|
(25,643
|
)
|
|
—
|
|
|
57,268
|
|
|
|
(31,881
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
45,107
|
|
|
8,067
|
|
|
(3,337
|
)
|
|
—
|
|
|
—
|
|
|
|
49,837
|
|
||
Cash and cash equivalents, January 1
|
16,281
|
|
|
2,682
|
|
|
5,385
|
|
|
101
|
|
|
—
|
|
|
|
24,449
|
|
||
Cash and cash equivalents, December 31
|
$
|
61,388
|
|
|
10,749
|
|
|
2,048
|
|
|
101
|
|
|
—
|
|
|
|
$
|
74,286
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments
|
|
|
Hawaiian Electric
Consolidated |
||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net income
|
$
|
136,794
|
|
|
21,289
|
|
|
22,546
|
|
|
—
|
|
|
(42,920
|
)
|
[2]
|
|
$
|
137,709
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Equity in earnings
|
(43,020
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,920
|
|
[2]
|
|
(100
|
)
|
||
Common stock dividends received from subsidiaries
|
25,296
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,196
|
)
|
[2]
|
|
100
|
|
||
Depreciation of property, plant and equipment
|
117,682
|
|
|
37,250
|
|
|
22,448
|
|
|
—
|
|
|
—
|
|
|
|
177,380
|
|
||
Other amortization
|
4,678
|
|
|
2,124
|
|
|
2,137
|
|
|
—
|
|
|
—
|
|
|
|
8,939
|
|
||
Impairment of utility assets
|
4,573
|
|
|
724
|
|
|
724
|
|
|
—
|
|
|
—
|
|
|
|
6,021
|
|
||
Other
|
4,403
|
|
|
(2,476
|
)
|
|
(255
|
)
|
|
—
|
|
|
—
|
|
|
|
1,672
|
|
||
Deferred income taxes
|
53,338
|
|
|
8,295
|
|
|
13,707
|
|
|
—
|
|
|
286
|
|
[1]
|
|
75,626
|
|
||
Income tax credits, net
|
4,284
|
|
|
527
|
|
|
33
|
|
|
—
|
|
|
—
|
|
|
|
4,844
|
|
||
Allowance for equity funds used during construction
|
(5,641
|
)
|
|
(604
|
)
|
|
(683
|
)
|
|
—
|
|
|
—
|
|
|
|
(6,928
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Decrease in accounts receivable
|
15,652
|
|
|
3,420
|
|
|
4,617
|
|
|
—
|
|
|
38
|
|
[1]
|
|
23,727
|
|
||
Decrease in accrued unbilled revenues
|
29,733
|
|
|
4,593
|
|
|
5,767
|
|
|
—
|
|
|
—
|
|
|
|
40,093
|
|
||
Decrease in fuel oil stock
|
25,060
|
|
|
5,490
|
|
|
4,280
|
|
|
—
|
|
|
—
|
|
|
|
34,830
|
|
||
Decrease (increase) in materials and supplies
|
2,233
|
|
|
(201
|
)
|
|
789
|
|
|
—
|
|
|
—
|
|
|
|
2,821
|
|
||
Decrease (increase) in regulatory assets
|
(20,356
|
)
|
|
(3,930
|
)
|
|
104
|
|
|
—
|
|
|
—
|
|
|
|
(24,182
|
)
|
||
Decrease in accounts payable
|
(42,751
|
)
|
|
(6,425
|
)
|
|
(5,379
|
)
|
|
—
|
|
|
—
|
|
|
|
(54,555
|
)
|
||
Change in prepaid and accrued income taxes, tax credits and revenue taxes
|
(50,382
|
)
|
|
(6,166
|
)
|
|
(6,548
|
)
|
|
—
|
|
|
—
|
|
|
|
(63,096
|
)
|
||
Increase (decrease) in defined benefit pension and other postretirement benefit plans liability
|
870
|
|
|
(161
|
)
|
|
416
|
|
|
—
|
|
|
—
|
|
|
|
1,125
|
|
||
Change in other assets and liabilities
|
(24,197
|
)
|
|
(3,545
|
)
|
|
(4,554
|
)
|
|
—
|
|
|
(324
|
)
|
[1]
|
|
(32,620
|
)
|
||
Net cash provided by operating activities
|
238,249
|
|
|
60,204
|
|
|
60,149
|
|
|
—
|
|
|
(25,196
|
)
|
|
|
333,406
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Capital expenditures
|
(267,621
|
)
|
|
(48,645
|
)
|
|
(33,895
|
)
|
|
—
|
|
|
—
|
|
|
|
(350,161
|
)
|
||
Contributions in aid of construction
|
35,955
|
|
|
2,160
|
|
|
2,124
|
|
|
—
|
|
|
—
|
|
|
|
40,239
|
|
||
Advances from (to) affiliates
|
16,100
|
|
|
(15,500
|
)
|
|
(7,500
|
)
|
|
—
|
|
|
6,900
|
|
[1]
|
|
—
|
|
||
Other
|
924
|
|
|
132
|
|
|
84
|
|
|
—
|
|
|
—
|
|
|
|
1,140
|
|
||
Net cash used in investing activities
|
(214,642
|
)
|
|
(61,853
|
)
|
|
(39,187
|
)
|
|
—
|
|
|
6,900
|
|
|
|
(308,782
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Common stock dividends
|
(90,405
|
)
|
|
(10,021
|
)
|
|
(15,175
|
)
|
|
—
|
|
|
25,196
|
|
[2]
|
|
(90,405
|
)
|
||
Preferred stock dividends of Hawaiian Electric and subsidiaries
|
(1,080
|
)
|
|
(534
|
)
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
|
|
(1,995
|
)
|
||
Proceeds from the issuance of long-term debt
|
50,000
|
|
|
25,000
|
|
|
5,000
|
|
|
—
|
|
|
—
|
|
|
|
80,000
|
|
||
Net increase (decrease) in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less
|
23,000
|
|
|
(10,500
|
)
|
|
(5,600
|
)
|
|
—
|
|
|
(6,900
|
)
|
[1]
|
|
—
|
|
||
Other
|
(1,257
|
)
|
|
(226
|
)
|
|
(54
|
)
|
|
—
|
|
|
—
|
|
|
|
(1,537
|
)
|
||
Net cash used in financing activities
|
(19,742
|
)
|
|
3,719
|
|
|
(16,210
|
)
|
|
—
|
|
|
18,296
|
|
|
|
(13,937
|
)
|
||
Net increase in cash and cash equivalents
|
3,865
|
|
|
2,070
|
|
|
4,752
|
|
|
—
|
|
|
—
|
|
|
|
10,687
|
|
||
Cash and cash equivalents, January 1
|
12,416
|
|
|
612
|
|
|
633
|
|
|
101
|
|
|
—
|
|
|
|
13,762
|
|
||
Cash and cash equivalents, December 31
|
$
|
16,281
|
|
|
2,682
|
|
|
5,385
|
|
|
101
|
|
|
—
|
|
|
|
$
|
24,449
|
|
(in thousands)
|
Hawaiian Electric
|
|
Hawaii Electric Light
|
|
Maui Electric
|
|
Other subsidiaries
|
|
Consolidating
adjustments |
|
|
Hawaiian Electric
Consolidated |
||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Net income
|
$
|
138,721
|
|
|
19,223
|
|
|
22,656
|
|
|
—
|
|
|
(40,964
|
)
|
[2]
|
|
$
|
139,636
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Equity in earnings
|
(41,064
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,964
|
|
[2]
|
|
(100
|
)
|
||
Common stock dividends received from subsidiaries
|
26,076
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,976
|
)
|
[2]
|
|
100
|
|
||
Depreciation of property, plant and equipment
|
109,204
|
|
|
35,904
|
|
|
21,279
|
|
|
—
|
|
|
—
|
|
|
|
166,387
|
|
||
Other amortization
|
4,535
|
|
|
2,926
|
|
|
2,436
|
|
|
—
|
|
|
—
|
|
|
|
9,897
|
|
||
Impairment of assets
|
1,866
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
1,866
|
|
||
Other
|
758
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
758
|
|
||
Deferred income taxes
|
56,901
|
|
|
12,083
|
|
|
13,963
|
|
|
—
|
|
|
—
|
|
|
|
82,947
|
|
||
Income tax credits, net
|
4,998
|
|
|
680
|
|
|
384
|
|
|
—
|
|
|
—
|
|
|
|
6,062
|
|
||
Allowance for equity funds used during construction
|
(6,085
|
)
|
|
(472
|
)
|
|
(214
|
)
|
|
—
|
|
|
—
|
|
|
|
(6,771
|
)
|
||
Change in cash overdraft
|
—
|
|
|
—
|
|
|
(1,038
|
)
|
|
—
|
|
|
—
|
|
|
|
(1,038
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Decrease in accounts receivable
|
16,213
|
|
|
7,150
|
|
|
3,483
|
|
|
—
|
|
|
(103
|
)
|
[1]
|
|
26,743
|
|
||
Decrease in accrued unbilled revenues
|
4,680
|
|
|
1,174
|
|
|
896
|
|
|
—
|
|
|
—
|
|
|
|
6,750
|
|
||
Decrease in fuel oil stock
|
25,098
|
|
|
378
|
|
|
2,565
|
|
|
—
|
|
|
—
|
|
|
|
28,041
|
|
||
Decrease (increase) in materials and supplies
|
2,357
|
|
|
219
|
|
|
(2,648
|
)
|
|
—
|
|
|
—
|
|
|
|
(72
|
)
|
||
Decrease (increase) in regulatory assets
|
(14,620
|
)
|
|
(3,357
|
)
|
|
977
|
|
|
—
|
|
|
—
|
|
|
|
(17,000
|
)
|
||
Decrease in accounts payable
|
(56,044
|
)
|
|
(6,645
|
)
|
|
(2,838
|
)
|
|
—
|
|
|
—
|
|
|
|
(65,527
|
)
|
||
Change in prepaid and accrued income taxes, tax credits and revenue taxes
|
(4,166
|
)
|
|
(3,251
|
)
|
|
3,381
|
|
|
—
|
|
|
—
|
|
|
|
(4,036
|
)
|
||
Decrease in defined benefit pension and other postretirement benefit plans liability
|
(562
|
)
|
|
—
|
|
|
(399
|
)
|
|
—
|
|
|
—
|
|
|
|
(961
|
)
|
||
Change in other assets and liabilities
|
(50,180
|
)
|
|
(12,907
|
)
|
|
(3,703
|
)
|
|
—
|
|
|
103
|
|
[1]
|
|
(66,687
|
)
|
||
Net cash provided by operating activities
|
218,686
|
|
|
53,105
|
|
|
61,180
|
|
|
—
|
|
|
(25,976
|
)
|
|
|
306,995
|
|
||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Capital expenditures
|
(237,970
|
)
|
|
(49,895
|
)
|
|
(48,814
|
)
|
|
—
|
|
|
—
|
|
|
|
(336,679
|
)
|
||
Contributions in aid of construction
|
30,021
|
|
|
7,695
|
|
|
4,090
|
|
|
—
|
|
|
—
|
|
|
|
41,806
|
|
||
Advances from (to) affiliates
|
(9,261
|
)
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
8,261
|
|
[1]
|
|
—
|
|
||
Other
|
604
|
|
|
492
|
|
|
68
|
|
|
—
|
|
|
—
|
|
|
|
1,164
|
|
||
Net cash used in investing activities
|
(216,606
|
)
|
|
(40,708
|
)
|
|
(44,656
|
)
|
|
—
|
|
|
8,261
|
|
|
|
(293,709
|
)
|
||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Common stock dividends
|
(88,492
|
)
|
|
(11,627
|
)
|
|
(14,349
|
)
|
|
—
|
|
|
25,976
|
|
[2]
|
|
(88,492
|
)
|
||
Preferred stock dividends of Hawaiian Electric and subsidiaries
|
(1,080
|
)
|
|
(534
|
)
|
|
(381
|
)
|
|
—
|
|
|
—
|
|
|
|
(1,995
|
)
|
||
Proceeds from the issuance of common stock
|
40,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
40,000
|
|
||
Repayment of long-term debt
|
—
|
|
|
(11,400
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(11,400
|
)
|
||
Net increase (decrease) in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less
|
(1,000
|
)
|
|
10,500
|
|
|
(1,239
|
)
|
|
—
|
|
|
(8,261
|
)
|
[1]
|
|
—
|
|
||
Other
|
(337
|
)
|
|
(50
|
)
|
|
(75
|
)
|
|
—
|
|
|
—
|
|
|
|
(462
|
)
|
||
Net cash used in financing activities
|
(50,909
|
)
|
|
(13,111
|
)
|
|
(16,044
|
)
|
|
—
|
|
|
17,715
|
|
|
|
(62,349
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
(48,829
|
)
|
|
(714
|
)
|
|
480
|
|
|
—
|
|
|
—
|
|
|
|
(49,063
|
)
|
||
Cash and cash equivalents, January 1
|
61,245
|
|
|
1,326
|
|
|
153
|
|
|
101
|
|
|
—
|
|
|
|
62,825
|
|
||
Cash and cash equivalents, December 31
|
$
|
12,416
|
|
|
612
|
|
|
633
|
|
|
101
|
|
|
—
|
|
|
|
$
|
13,762
|
|
[1]
|
Eliminations of intercompany receivables and payables and other intercompany transactions.
|
[2]
|
Elimination of investment in subsidiaries, carried at equity.
|
[3]
|
Reclassification of accrued income taxes for financial statement presentation.
|
5
·
Bank segment (HEI only)
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Interest and dividend income
|
|
|
|
|
|
|
|
|
|||
Interest and fees on loans
|
$
|
199,774
|
|
|
$
|
184,782
|
|
|
$
|
179,341
|
|
Interest and dividends on investment securities
|
19,184
|
|
|
15,120
|
|
|
11,945
|
|
|||
Total interest and dividend income
|
218,958
|
|
|
199,902
|
|
|
191,286
|
|
|||
Interest expense
|
|
|
|
|
|
|
|
|
|||
Interest on deposit liabilities
|
7,167
|
|
|
5,348
|
|
|
5,077
|
|
|||
Interest on other borrowings
|
5,588
|
|
|
5,978
|
|
|
5,731
|
|
|||
Total interest expense
|
12,755
|
|
|
11,326
|
|
|
10,808
|
|
|||
Net interest income
|
206,203
|
|
|
188,576
|
|
|
180,478
|
|
|||
Provision for loan losses
|
16,763
|
|
|
6,275
|
|
|
6,126
|
|
|||
Net interest income after provision for loan losses
|
189,440
|
|
|
182,301
|
|
|
174,352
|
|
|||
Noninterest income
|
|
|
|
|
|
|
|
|
|||
Fees from other financial services
|
22,384
|
|
|
22,211
|
|
|
21,747
|
|
|||
Fee income on deposit liabilities
|
21,759
|
|
|
22,368
|
|
|
19,249
|
|
|||
Fee income on other financial products
|
8,707
|
|
|
8,094
|
|
|
8,131
|
|
|||
Bank-owned life insurance
|
4,637
|
|
|
4,078
|
|
|
3,949
|
|
|||
Mortgage banking income
|
6,625
|
|
|
6,330
|
|
|
2,913
|
|
|||
Gains on sale of investment securities
|
598
|
|
|
—
|
|
|
2,847
|
|
|||
Other income, net
|
2,256
|
|
|
4,750
|
|
|
2,375
|
|
|||
Total noninterest income
|
66,966
|
|
|
67,831
|
|
|
61,211
|
|
|||
Noninterest expense
|
|
|
|
|
|
|
|
|
|||
Compensation and employee benefits
|
90,117
|
|
|
90,518
|
|
|
79,885
|
|
|||
Occupancy
|
16,321
|
|
|
16,365
|
|
|
17,197
|
|
|||
Data processing
|
13,030
|
|
|
12,103
|
|
|
11,690
|
|
|||
Services
|
11,054
|
|
|
10,204
|
|
|
10,269
|
|
|||
Equipment
|
6,938
|
|
|
6,577
|
|
|
6,564
|
|
|||
Office supplies, printing and postage
|
6,075
|
|
|
5,749
|
|
|
6,089
|
|
|||
Marketing
|
3,489
|
|
|
3,463
|
|
|
3,999
|
|
|||
FDIC insurance
|
3,543
|
|
|
3,274
|
|
|
3,261
|
|
|||
Other expense
|
18,487
|
|
|
18,067
|
|
|
17,314
|
|
|||
Total noninterest expense
|
169,054
|
|
|
166,320
|
|
|
156,268
|
|
|||
Income before income taxes
|
87,352
|
|
|
83,812
|
|
|
79,295
|
|
|||
Income taxes
|
30,073
|
|
|
29,082
|
|
|
27,994
|
|
|||
Net income
|
$
|
57,279
|
|
|
$
|
54,730
|
|
|
$
|
51,301
|
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
57,279
|
|
|
$
|
54,730
|
|
|
$
|
51,301
|
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|||
Net unrealized gains (losses) on available-for sale investment securities:
|
|
|
|
|
|
|
|
|
|||
Net unrealized gains (losses) on available-for sale investment securities arising during the period, net of (taxes) benefits of $3,763, $1,541 and $(3,856) for 2016, 2015 and 2014, respectively
|
(5,699
|
)
|
|
(2,334
|
)
|
|
5,840
|
|
|||
Less: reclassification adjustment for net realized gains included in net income, net of taxes of $238, nil and $1,132 for 2016, 2015 and 2014, respectively
|
(360
|
)
|
|
—
|
|
|
(1,715
|
)
|
|||
Retirement benefit plans:
|
|
|
|
|
|
|
|
|
|||
Net gains (losses) arising during the period, net of (taxes) benefits of nil, $(59) and $6,164 for 2016, 2015 and 2014, respectively
|
—
|
|
|
90
|
|
|
(9,336
|
)
|
|||
Less: amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits of $566, $1,011 and $561 for 2016, 2015 and 2014, respectively
|
857
|
|
|
1,531
|
|
|
850
|
|
|||
Other comprehensive income (loss), net of taxes
|
(5,202
|
)
|
|
(713
|
)
|
|
(4,361
|
)
|
|||
Comprehensive income
|
$
|
52,077
|
|
|
$
|
54,017
|
|
|
$
|
46,940
|
|
December 31
|
|
2016
|
|
|
2015
|
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Cash and due from banks
|
|
$
|
137,083
|
|
|
$
|
127,201
|
|
||||
Interest-bearing deposits
|
|
52,128
|
|
|
93,680
|
|
||||||
Restricted cash
|
|
1,764
|
|
|
—
|
|
||||||
Available-for-sale investment securities, at fair value
|
|
1,105,182
|
|
|
820,648
|
|
||||||
Stock in Federal Home Loan Bank, at cost
|
|
11,218
|
|
|
10,678
|
|
||||||
Loans receivable held for investment
|
|
4,738,693
|
|
|
4,615,819
|
|
||||||
Allowance for loan losses
|
|
(55,533
|
)
|
|
(50,038
|
)
|
||||||
Net loans
|
|
4,683,160
|
|
|
4,565,781
|
|
||||||
Loans held for sale, at lower of cost or fair value
|
|
18,817
|
|
|
4,631
|
|
||||||
Other
|
|
329,815
|
|
|
309,946
|
|
||||||
Goodwill
|
|
82,190
|
|
|
82,190
|
|
||||||
Total assets
|
|
$
|
6,421,357
|
|
|
$
|
6,014,755
|
|
||||
Liabilities and shareholder’s equity
|
|
|
|
|
|
|
||||||
Deposit liabilities–noninterest-bearing
|
|
$
|
1,639,051
|
|
|
$
|
1,520,374
|
|
||||
Deposit liabilities–interest-bearing
|
|
3,909,878
|
|
|
3,504,880
|
|
||||||
Other borrowings
|
|
192,618
|
|
|
328,582
|
|
||||||
Other
|
|
101,635
|
|
|
101,029
|
|
||||||
Total liabilities
|
|
5,843,182
|
|
|
5,454,865
|
|
||||||
Commitments and contingencies
|
|
|
|
|
|
|
||||||
Common stock
|
|
1
|
|
|
1
|
|
||||||
Additional paid in capital
|
|
342,704
|
|
|
340,496
|
|
||||||
Retained earnings
|
|
257,943
|
|
|
236,664
|
|
||||||
Accumulated other comprehensive loss, net of tax benefits
|
|
|
|
|
||||||||
Net unrealized losses on securities
|
$
|
(7,931
|
)
|
|
$
|
(1,872
|
)
|
|
||||
Retirement benefit plans
|
(14,542
|
)
|
(22,473
|
)
|
(15,399
|
)
|
(17,271
|
)
|
||||
Total shareholder’s equity
|
|
578,175
|
|
|
559,890
|
|
||||||
Total liabilities and shareholder’s equity
|
|
$
|
6,421,357
|
|
|
$
|
6,014,755
|
|
December 31
|
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
|
|
|
||
Other assets
|
|
|
|
|
|
|
||
Bank-owned life insurance
|
|
$
|
143,197
|
|
|
$
|
138,139
|
|
Premises and equipment, net
|
|
90,570
|
|
|
88,077
|
|
||
Prepaid expenses
|
|
3,348
|
|
|
3,550
|
|
||
Accrued interest receivable
|
|
16,824
|
|
|
15,192
|
|
||
Mortgage-servicing rights
|
|
9,373
|
|
|
8,884
|
|
||
Low-income housing equity investments
|
|
47,081
|
|
|
37,793
|
|
||
Real estate acquired in settlement of loans, net
|
|
1,189
|
|
|
1,030
|
|
||
Other
|
|
18,233
|
|
|
17,281
|
|
||
|
|
$
|
329,815
|
|
|
$
|
309,946
|
|
Other liabilities
|
|
|
|
|
|
|
||
Accrued expenses
|
|
$
|
36,754
|
|
|
$
|
30,705
|
|
Federal and state income taxes payable
|
|
4,728
|
|
|
13,448
|
|
||
Cashier’s checks
|
|
24,156
|
|
|
21,768
|
|
||
Advance payments by borrowers
|
|
10,335
|
|
|
10,311
|
|
||
Other
|
|
25,662
|
|
|
24,797
|
|
||
|
|
$
|
101,635
|
|
|
$
|
101,029
|
|
|
|
|
|
|
|
|
|
|
Gross unrealized losses
|
||||||||||||||||||||||||||
|
|
|
Gross
|
|
Gross
|
|
Estimated
|
|
Less than 12 months
|
|
12 months or longer
|
||||||||||||||||||||||||
(dollars in thousands)
|
Amortized
cost
|
|
unrealized
gains
|
|
unrealized
losses
|
|
fair
value
|
|
Number of issues
|
|
Fair value
|
|
Amount
|
|
Number of issues
|
|
Fair value
|
|
Amount
|
||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Available-for-sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and federal agency obligations
|
$
|
193,515
|
|
|
$
|
920
|
|
|
$
|
(2,154
|
)
|
|
$
|
192,281
|
|
|
18
|
|
$
|
123,475
|
|
|
$
|
(2,010
|
)
|
|
1
|
|
$
|
3,485
|
|
|
$
|
(144
|
)
|
Mortgage-related securities- FNMA, FHLMC and GNMA
|
909,408
|
|
|
1,742
|
|
|
(13,676
|
)
|
|
897,474
|
|
|
88
|
|
709,655
|
|
|
(12,143
|
)
|
|
13
|
|
47,485
|
|
|
(1,533
|
)
|
||||||||
Mortgage revenue bond
|
15,427
|
|
|
—
|
|
|
—
|
|
|
15,427
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
||||||||
|
$
|
1,118,350
|
|
|
$
|
2,662
|
|
|
$
|
(15,830
|
)
|
|
$
|
1,105,182
|
|
|
106
|
|
$
|
833,130
|
|
|
$
|
(14,153
|
)
|
|
14
|
|
$
|
50,970
|
|
|
$
|
(1,677
|
)
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Available-for-sale
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
U.S. Treasury and federal agency obligations
|
$
|
213,234
|
|
|
$
|
1,025
|
|
|
$
|
(1,300
|
)
|
|
$
|
212,959
|
|
|
13
|
|
$
|
83,053
|
|
|
$
|
(866
|
)
|
|
3
|
|
$
|
17,378
|
|
|
$
|
(434
|
)
|
Mortgage-related securities- FNMA, FHLMC and GNMA
|
610,522
|
|
|
3,564
|
|
|
(6,397
|
)
|
|
607,689
|
|
|
38
|
|
305,785
|
|
|
(2,866
|
)
|
|
25
|
|
125,817
|
|
|
(3,531
|
)
|
||||||||
|
$
|
823,756
|
|
|
$
|
4,589
|
|
|
$
|
(7,697
|
)
|
|
$
|
820,648
|
|
|
51
|
|
$
|
388,838
|
|
|
$
|
(3,732
|
)
|
|
28
|
|
$
|
143,195
|
|
|
$
|
(3,965
|
)
|
|
Amortized
|
|
|
Fair
|
|
||
December 31, 2016
|
Cost
|
|
|
value
|
|
||
(in thousands)
|
|
|
|
||||
Due in one year or less
|
$
|
9,979
|
|
|
$
|
10,001
|
|
Due after one year through five years
|
77,179
|
|
|
77,126
|
|
||
Due after five years through ten years
|
81,411
|
|
|
81,083
|
|
||
Due after ten years
|
40,373
|
|
|
39,498
|
|
||
|
208,942
|
|
|
207,708
|
|
||
Mortgage-related securities-FNMA,FHLMC and GNMA
|
909,408
|
|
|
897,474
|
|
||
Total available-for-sale securities
|
$
|
1,118,350
|
|
|
$
|
1,105,182
|
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in millions)
|
|
|
|
|
|
||||||
Proceeds
|
$
|
16.4
|
|
|
$
|
—
|
|
|
$
|
79.6
|
|
Gross gains
|
0.6
|
|
|
—
|
|
|
2.8
|
|
|||
Gross losses
|
—
|
|
|
—
|
|
|
—
|
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
||||||
Taxable
|
$
|
19,166
|
|
|
$
|
15,120
|
|
|
$
|
11,666
|
|
Non-taxable
|
18
|
|
|
—
|
|
|
279
|
|
|||
|
$
|
19,184
|
|
|
$
|
15,120
|
|
|
$
|
11,945
|
|
•
|
the net income and growth in retained earnings recorded by the FHLB in the first nine months of
2016
;
|
•
|
compliance by the FHLB with all of its regulatory capital requirements and being classified “adequately capitalized” by the Federal Housing Finance Agency (Finance Agency);
|
•
|
being authorized by the Finance Agency to repurchase excess stock;
|
•
|
the impact of legislative and regulatory changes on institutions and, accordingly, on the customer base of the FHLB;
|
•
|
the liquidity position of the FHLB; and
|
•
|
ASB’s intent and assessment of whether it will more likely than not be required to sell the FHLB stock before recovery of its par value.
|
December 31
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
|
|
||
Real estate:
|
|
|
|
|
|
||
Residential 1-4 family
|
$
|
2,048,051
|
|
|
$
|
2,069,665
|
|
Commercial real estate
|
800,395
|
|
|
690,561
|
|
||
Home equity line of credit
|
863,163
|
|
|
846,294
|
|
||
Residential land
|
18,889
|
|
|
18,229
|
|
||
Commercial construction
|
126,768
|
|
|
100,796
|
|
||
Residential construction
|
16,080
|
|
|
14,089
|
|
||
Total real estate
|
3,873,346
|
|
|
3,739,634
|
|
||
Commercial
|
692,051
|
|
|
758,659
|
|
||
Consumer
|
178,222
|
|
|
123,775
|
|
||
Total loans
|
4,743,619
|
|
|
4,622,068
|
|
||
Less: Deferred fees and discounts
|
(4,926
|
)
|
|
(6,249
|
)
|
||
Allowance for loan losses
|
(55,533
|
)
|
|
(50,038
|
)
|
||
Total loans, net
|
$
|
4,683,160
|
|
|
$
|
4,565,781
|
|
(in thousands)
|
Residential 1-4 family
|
|
Commercial
real estate |
|
Home equity
line of credit |
|
Residential land
|
|
Commercial construction
|
|
Residential construction
|
|
Commercial
|
|
Consumer
|
|
Unallo- cated
|
|
Total
|
||||||||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance
|
$
|
4,186
|
|
|
$
|
11,342
|
|
|
$
|
7,260
|
|
|
$
|
1,671
|
|
|
$
|
4,461
|
|
|
$
|
13
|
|
|
$
|
17,208
|
|
|
$
|
3,897
|
|
|
$
|
—
|
|
|
$
|
50,038
|
|
Charge-offs
|
(639
|
)
|
|
—
|
|
|
(112
|
)
|
|
(138
|
)
|
|
—
|
|
|
—
|
|
|
(5,943
|
)
|
|
(7,413
|
)
|
|
—
|
|
|
(14,245
|
)
|
||||||||||
Recoveries
|
421
|
|
|
—
|
|
|
59
|
|
|
461
|
|
|
—
|
|
|
—
|
|
|
1,093
|
|
|
943
|
|
|
—
|
|
|
2,977
|
|
||||||||||
Provision
|
(1,095
|
)
|
|
4,662
|
|
|
(2,168
|
)
|
|
(256
|
)
|
|
1,988
|
|
|
(1
|
)
|
|
4,260
|
|
|
9,373
|
|
|
—
|
|
|
16,763
|
|
||||||||||
Ending balance
|
$
|
2,873
|
|
|
$
|
16,004
|
|
|
$
|
5,039
|
|
|
$
|
1,738
|
|
|
$
|
6,449
|
|
|
$
|
12
|
|
|
$
|
16,618
|
|
|
$
|
6,800
|
|
|
$
|
—
|
|
|
$
|
55,533
|
|
Ending balance: individually evaluated for impairment
|
$
|
1,352
|
|
|
$
|
80
|
|
|
$
|
215
|
|
|
$
|
789
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,641
|
|
|
$
|
6
|
|
|
|
|
|
$
|
4,083
|
|
|
Ending balance: collectively evaluated for impairment
|
$
|
1,521
|
|
|
$
|
15,924
|
|
|
$
|
4,824
|
|
|
$
|
949
|
|
|
$
|
6,449
|
|
|
$
|
12
|
|
|
$
|
14,977
|
|
|
$
|
6,794
|
|
|
$
|
—
|
|
|
$
|
51,450
|
|
Financing Receivables:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ending balance
|
$
|
2,048,051
|
|
|
$
|
800,395
|
|
|
$
|
863,163
|
|
|
$
|
18,889
|
|
|
$
|
126,768
|
|
|
$
|
16,080
|
|
|
$
|
692,051
|
|
|
$
|
178,222
|
|
|
$
|
—
|
|
|
$
|
4,743,619
|
|
Ending balance: individually evaluated for impairment
|
$
|
19,854
|
|
|
$
|
1,569
|
|
|
$
|
6,158
|
|
|
$
|
3,629
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20,539
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
51,759
|
|
Ending balance: collectively evaluated for impairment
|
$
|
2,028,197
|
|
|
$
|
798,826
|
|
|
$
|
857,005
|
|
|
$
|
15,260
|
|
|
$
|
126,768
|
|
|
$
|
16,080
|
|
|
$
|
671,512
|
|
|
$
|
178,212
|
|
|
$
|
—
|
|
|
$
|
4,691,860
|
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Allowance for loan losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Beginning balance
|
$
|
4,662
|
|
|
$
|
8,954
|
|
|
$
|
6,982
|
|
|
$
|
1,875
|
|
|
$
|
5,471
|
|
|
$
|
28
|
|
|
$
|
14,017
|
|
|
$
|
3,629
|
|
|
$
|
—
|
|
|
$
|
45,618
|
|
Charge-offs
|
(356
|
)
|
|
—
|
|
|
(205
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,074
|
)
|
|
(4,791
|
)
|
|
—
|
|
|
(6,426
|
)
|
||||||||||
Recoveries
|
226
|
|
|
—
|
|
|
80
|
|
|
507
|
|
|
—
|
|
|
—
|
|
|
2,773
|
|
|
985
|
|
|
—
|
|
|
4,571
|
|
||||||||||
Provision
|
(346
|
)
|
|
2,388
|
|
|
403
|
|
|
(711
|
)
|
|
(1,010
|
)
|
|
(15
|
)
|
|
1,492
|
|
|
4,074
|
|
|
|
|
|
6,275
|
|
||||||||||
Ending balance
|
$
|
4,186
|
|
|
$
|
11,342
|
|
|
$
|
7,260
|
|
|
$
|
1,671
|
|
|
$
|
4,461
|
|
|
$
|
13
|
|
|
$
|
17,208
|
|
|
$
|
3,897
|
|
|
$
|
—
|
|
|
$
|
50,038
|
|
Ending balance: individually evaluated for impairment
|
$
|
1,453
|
|
|
$
|
—
|
|
|
$
|
442
|
|
|
$
|
891
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,527
|
|
|
$
|
7
|
|
|
|
|
|
$
|
6,320
|
|
|
Ending balance: collectively evaluated for impairment
|
$
|
2,733
|
|
|
$
|
11,342
|
|
|
$
|
6,818
|
|
|
$
|
780
|
|
|
$
|
4,461
|
|
|
$
|
13
|
|
|
$
|
13,681
|
|
|
$
|
3,890
|
|
|
$
|
—
|
|
|
$
|
43,718
|
|
Financing Receivables:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ending balance
|
$
|
2,069,665
|
|
|
$
|
690,561
|
|
|
$
|
846,294
|
|
|
$
|
18,229
|
|
|
$
|
100,796
|
|
|
$
|
14,089
|
|
|
$
|
758,659
|
|
|
$
|
123,775
|
|
|
|
|
|
$
|
4,622,068
|
|
|
Ending balance: individually evaluated for impairment
|
$
|
22,457
|
|
|
$
|
1,188
|
|
|
$
|
3,225
|
|
|
$
|
5,683
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
21,119
|
|
|
$
|
13
|
|
|
|
|
|
$
|
53,685
|
|
|
Ending balance: collectively evaluated for impairment
|
$
|
2,047,208
|
|
|
$
|
689,373
|
|
|
$
|
843,069
|
|
|
$
|
12,546
|
|
|
$
|
100,796
|
|
|
$
|
14,089
|
|
|
$
|
737,540
|
|
|
$
|
123,762
|
|
|
|
|
|
$
|
4,568,383
|
|
(dollars in thousands)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
Allowance for loan losses, January 1
|
$
|
50,038
|
|
|
$
|
45,618
|
|
|
$
|
40,116
|
|
Provision for loan losses
|
16,763
|
|
|
6,275
|
|
|
6,126
|
|
|||
Charge-offs, net of recoveries
|
|
|
|
|
|
|
|
|
|||
Real estate loans
|
(52
|
)
|
|
(252
|
)
|
|
(1,137
|
)
|
|||
Other loans
|
11,320
|
|
|
2,107
|
|
|
1,761
|
|
|||
Net charge-offs
|
11,268
|
|
|
1,855
|
|
|
624
|
|
|||
Allowance for loan losses, December 31
|
$
|
55,533
|
|
|
$
|
50,038
|
|
|
$
|
45,618
|
|
Ratio of net charge-offs to average total loans
|
0.24
|
%
|
|
0.04
|
%
|
|
0.01
|
%
|
December 31
|
2016
|
|
2015
|
|||||||||||||||||||||||||||
(in thousands)
|
Commercial
real estate
|
|
Commercial
construction
|
|
Commercial
|
|
Total
|
|
Commercial
real estate
|
|
Commercial
construction
|
|
Commercial
|
|
Total
|
|||||||||||||||
Grade:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Pass
|
$
|
701,657
|
|
|
$
|
102,955
|
|
|
$
|
614,139
|
|
|
1,418,751
|
|
|
$
|
642,410
|
|
|
$
|
86,991
|
|
|
$
|
703,208
|
|
|
$
|
1,432,609
|
|
Special mention
|
65,541
|
|
|
—
|
|
|
25,229
|
|
|
90,770
|
|
|
7,710
|
|
|
13,805
|
|
|
7,029
|
|
|
28,544
|
|
|||||||
Substandard
|
33,197
|
|
|
23,813
|
|
|
52,683
|
|
|
109,693
|
|
|
40,441
|
|
|
—
|
|
|
47,975
|
|
|
88,416
|
|
|||||||
Doubtful
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
447
|
|
|
447
|
|
|||||||
Loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total
|
$
|
800,395
|
|
|
$
|
126,768
|
|
|
$
|
692,051
|
|
|
1,619,214
|
|
|
$
|
690,561
|
|
|
$
|
100,796
|
|
|
$
|
758,659
|
|
|
$
|
1,550,016
|
|
(in thousands)
|
30-59
days
past due
|
|
60-89
days
past due
|
|
Greater
than
90 days
|
|
Total
past due
|
|
Current
|
|
Total
financing
receivables
|
|
Recorded
investment>
90 days and
accruing
|
||||||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Residential 1-4 family
|
$
|
5,467
|
|
|
$
|
2,338
|
|
|
$
|
3,505
|
|
|
$
|
11,310
|
|
|
$
|
2,036,741
|
|
|
$
|
2,048,051
|
|
|
$
|
—
|
|
Commercial real estate
|
2,416
|
|
|
—
|
|
|
—
|
|
|
2,416
|
|
|
797,979
|
|
|
800,395
|
|
|
—
|
|
|||||||
Home equity line of credit
|
1,263
|
|
|
381
|
|
|
1,342
|
|
|
2,986
|
|
|
860,177
|
|
|
863,163
|
|
|
—
|
|
|||||||
Residential land
|
—
|
|
|
—
|
|
|
255
|
|
|
255
|
|
|
18,634
|
|
|
18,889
|
|
|
—
|
|
|||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
126,768
|
|
|
126,768
|
|
|
—
|
|
|||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,080
|
|
|
16,080
|
|
|
—
|
|
|||||||
Commercial
|
413
|
|
|
510
|
|
|
1,303
|
|
|
2,226
|
|
|
689,825
|
|
|
692,051
|
|
|
—
|
|
|||||||
Consumer
|
1,945
|
|
|
1,001
|
|
|
963
|
|
|
3,909
|
|
|
174,313
|
|
|
178,222
|
|
|
—
|
|
|||||||
Total loans
|
$
|
11,504
|
|
|
$
|
4,230
|
|
|
$
|
7,368
|
|
|
$
|
23,102
|
|
|
$
|
4,720,517
|
|
|
$
|
4,743,619
|
|
|
$
|
—
|
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Residential 1-4 family
|
$
|
4,967
|
|
|
$
|
3,289
|
|
|
$
|
11,503
|
|
|
$
|
19,759
|
|
|
$
|
2,049,906
|
|
|
$
|
2,069,665
|
|
|
$
|
—
|
|
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
690,561
|
|
|
690,561
|
|
|
—
|
|
|||||||
Home equity line of credit
|
896
|
|
|
706
|
|
|
477
|
|
|
2,079
|
|
|
844,215
|
|
|
846,294
|
|
|
—
|
|
|||||||
Residential land
|
—
|
|
|
—
|
|
|
415
|
|
|
415
|
|
|
17,814
|
|
|
18,229
|
|
|
—
|
|
|||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
100,796
|
|
|
100,796
|
|
|
—
|
|
|||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,089
|
|
|
14,089
|
|
|
—
|
|
|||||||
Commercial
|
125
|
|
|
223
|
|
|
878
|
|
|
1,226
|
|
|
757,433
|
|
|
758,659
|
|
|
—
|
|
|||||||
Consumer
|
1,383
|
|
|
593
|
|
|
644
|
|
|
2,620
|
|
|
121,155
|
|
|
123,775
|
|
|
—
|
|
|||||||
Total loans
|
$
|
7,371
|
|
|
$
|
4,811
|
|
|
$
|
13,917
|
|
|
$
|
26,099
|
|
|
$
|
4,595,969
|
|
|
$
|
4,622,068
|
|
|
$
|
—
|
|
December 31
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Real estate:
|
|
|
|
|
|
||
Residential 1-4 family
|
$
|
11,154
|
|
|
$
|
20,554
|
|
Commercial real estate
|
223
|
|
|
1,188
|
|
||
Home equity line of credit
|
3,080
|
|
|
2,254
|
|
||
Residential land
|
878
|
|
|
970
|
|
||
Commercial construction
|
—
|
|
|
—
|
|
||
Residential construction
|
—
|
|
|
—
|
|
||
Commercial
|
6,708
|
|
|
20,174
|
|
||
Consumer
|
1,282
|
|
|
895
|
|
||
Total nonaccrual loans
|
$
|
23,325
|
|
|
$
|
46,035
|
|
Real estate:
|
|
|
|
||||
Residential 1-4 family
|
$
|
—
|
|
|
$
|
—
|
|
Commercial real estate
|
—
|
|
|
—
|
|
||
Home equity line of credit
|
—
|
|
|
—
|
|
||
Residential land
|
—
|
|
|
—
|
|
||
Commercial construction
|
—
|
|
|
—
|
|
||
Residential construction
|
—
|
|
|
—
|
|
||
Commercial
|
—
|
|
|
—
|
|
||
Consumer
|
—
|
|
|
—
|
|
||
Total accruing loans 90 days or more past due
|
$
|
—
|
|
|
$
|
—
|
|
Real estate:
|
|
|
|
||||
Residential 1-4 family
|
$
|
14,450
|
|
|
$
|
13,962
|
|
Commercial real estate
|
1,346
|
|
|
—
|
|
||
Home equity line of credit
|
4,934
|
|
|
2,467
|
|
||
Residential land
|
2,751
|
|
|
4,713
|
|
||
Commercial construction
|
—
|
|
|
—
|
|
||
Residential construction
|
—
|
|
|
—
|
|
||
Commercial
|
14,146
|
|
|
1,104
|
|
||
Consumer
|
10
|
|
|
—
|
|
||
Total troubled debt restructured loans not included above
|
$
|
37,637
|
|
|
$
|
22,246
|
|
December 31
|
2016
|
|
2015
|
||||||||||||||||||||||||||||||||||||
(in thousands)
|
Recorded
investment
|
|
Unpaid
principal
balance
|
|
Related
allow-
ance
|
|
Average
recorded
investment
|
|
Interest
income
recognized*
|
|
Recorded
investment
|
|
Unpaid
principal
balance
|
|
Related
allow-
ance
|
|
Average
recorded
investment
|
|
Interest
income
recognized*
|
||||||||||||||||||||
With no related allowance recorded
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential 1-4 family
|
$
|
9,571
|
|
|
$
|
10,400
|
|
|
$
|
—
|
|
|
$
|
10,136
|
|
|
$
|
324
|
|
|
$
|
10,596
|
|
|
$
|
11,805
|
|
|
$
|
—
|
|
|
$
|
11,215
|
|
|
$
|
332
|
|
Commercial real estate
|
223
|
|
|
228
|
|
|
—
|
|
|
1,124
|
|
|
—
|
|
|
1,188
|
|
|
1,436
|
|
|
—
|
|
|
370
|
|
|
74
|
|
||||||||||
Home equity line of credit
|
1,500
|
|
|
1,900
|
|
|
—
|
|
|
1,105
|
|
|
23
|
|
|
707
|
|
|
948
|
|
|
—
|
|
|
484
|
|
|
4
|
|
||||||||||
Residential land
|
1,218
|
|
|
1,803
|
|
|
—
|
|
|
1,518
|
|
|
66
|
|
|
1,644
|
|
|
2,412
|
|
|
—
|
|
|
2,397
|
|
|
137
|
|
||||||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Commercial
|
6,299
|
|
|
8,869
|
|
|
—
|
|
|
8,694
|
|
|
370
|
|
|
5,671
|
|
|
6,333
|
|
|
—
|
|
|
5,185
|
|
|
157
|
|
||||||||||
Consumer
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
|
18,811
|
|
|
23,200
|
|
|
—
|
|
|
22,579
|
|
|
783
|
|
|
19,806
|
|
|
22,934
|
|
|
—
|
|
|
19,651
|
|
|
704
|
|
||||||||||
With an allowance recorded
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential 1-4 family
|
10,283
|
|
|
10,486
|
|
|
1,352
|
|
|
11,589
|
|
|
457
|
|
|
11,861
|
|
|
11,914
|
|
|
1,453
|
|
|
11,578
|
|
|
562
|
|
||||||||||
Commercial real estate
|
1,346
|
|
|
1,346
|
|
|
80
|
|
|
1,962
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,699
|
|
|
—
|
|
||||||||||
Home equity line of credit
|
4,658
|
|
|
4,712
|
|
|
215
|
|
|
3,765
|
|
|
137
|
|
|
2,518
|
|
|
2,579
|
|
|
442
|
|
|
1,597
|
|
|
49
|
|
||||||||||
Residential land
|
2,411
|
|
|
2,411
|
|
|
789
|
|
|
2,964
|
|
|
206
|
|
|
4,039
|
|
|
4,117
|
|
|
891
|
|
|
4,337
|
|
|
318
|
|
||||||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Commercial
|
14,240
|
|
|
14,240
|
|
|
1,641
|
|
|
16,106
|
|
|
456
|
|
|
15,448
|
|
|
16,073
|
|
|
3,527
|
|
|
12,507
|
|
|
211
|
|
||||||||||
Consumer
|
10
|
|
|
10
|
|
|
6
|
|
|
12
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
7
|
|
|
14
|
|
|
—
|
|
||||||||||
|
32,948
|
|
|
33,205
|
|
|
4,083
|
|
|
36,398
|
|
|
1,271
|
|
|
33,879
|
|
|
34,696
|
|
|
6,320
|
|
|
31,732
|
|
|
1,140
|
|
||||||||||
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential 1-4 family
|
19,854
|
|
|
20,886
|
|
|
1,352
|
|
|
21,725
|
|
|
781
|
|
|
22,457
|
|
|
23,719
|
|
|
1,453
|
|
|
22,793
|
|
|
894
|
|
||||||||||
Commercial real estate
|
1,569
|
|
|
1,574
|
|
|
80
|
|
|
3,086
|
|
|
15
|
|
|
1,188
|
|
|
1,436
|
|
|
—
|
|
|
2,069
|
|
|
74
|
|
||||||||||
Home equity line of credit
|
6,158
|
|
|
6,612
|
|
|
215
|
|
|
4,870
|
|
|
160
|
|
|
3,225
|
|
|
3,527
|
|
|
442
|
|
|
2,081
|
|
|
53
|
|
||||||||||
Residential land
|
3,629
|
|
|
4,214
|
|
|
789
|
|
|
4,482
|
|
|
272
|
|
|
5,683
|
|
|
6,529
|
|
|
891
|
|
|
6,734
|
|
|
455
|
|
||||||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Commercial
|
20,539
|
|
|
23,109
|
|
|
1,641
|
|
|
24,800
|
|
|
826
|
|
|
21,119
|
|
|
22,406
|
|
|
3,527
|
|
|
17,692
|
|
|
368
|
|
||||||||||
Consumer
|
10
|
|
|
10
|
|
|
6
|
|
|
14
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
7
|
|
|
14
|
|
|
—
|
|
||||||||||
|
$
|
51,759
|
|
|
$
|
56,405
|
|
|
$
|
4,083
|
|
|
$
|
58,977
|
|
|
$
|
2,054
|
|
|
$
|
53,685
|
|
|
$
|
57,630
|
|
|
$
|
6,320
|
|
|
$
|
51,383
|
|
|
$
|
1,844
|
|
Years ended December 31
|
2016
|
|
2015
|
||||||||||||||||||||||||||
|
Number
|
|
Outstanding recorded investment
|
|
Net increase in ALLL
|
|
Number
|
|
Outstanding recorded investment
|
|
Net increase in ALLL
|
||||||||||||||||||
(dollars in thousands)
|
of
contracts |
|
Pre-modification
|
|
Post-modification
|
|
|
of
contracts
|
|
Pre-modification
|
|
Post-modification
|
|
||||||||||||||||
Troubled debt restructurings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Residential 1-4 family
|
14
|
|
|
$
|
3,131
|
|
|
$
|
3,245
|
|
|
$
|
337
|
|
|
19
|
|
|
$
|
3,594
|
|
|
$
|
3,668
|
|
|
$
|
87
|
|
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1,500
|
|
|
1,500
|
|
|
—
|
|
||||||
Home equity line of credit
|
36
|
|
|
3,337
|
|
|
3,337
|
|
|
554
|
|
|
39
|
|
|
2,441
|
|
|
2,441
|
|
|
370
|
|
||||||
Residential land
|
2
|
|
|
203
|
|
|
204
|
|
|
—
|
|
|
1
|
|
|
218
|
|
|
218
|
|
|
—
|
|
||||||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Commercial
|
15
|
|
|
20,266
|
|
|
20,266
|
|
|
865
|
|
|
8
|
|
|
2,267
|
|
|
2,267
|
|
|
486
|
|
||||||
Consumer
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
67
|
|
|
$
|
26,937
|
|
|
$
|
27,052
|
|
|
$
|
1,756
|
|
|
68
|
|
|
$
|
10,020
|
|
|
$
|
10,094
|
|
|
$
|
943
|
|
Years ended December 31
|
2016
|
|
2015
|
||||||||||
(dollars in thousands)
|
Number of
contracts
|
|
Recorded
investment
|
|
Number of
contracts
|
|
Recorded
investment
|
||||||
Troubled debt restructurings that subsequently defaulted
|
|
|
|
|
|
|
|
|
|
||||
Real estate:
|
|
|
|
|
|
|
|
|
|
|
|
||
Residential 1-4 family
|
1
|
|
|
$
|
239
|
|
|
—
|
|
|
$
|
—
|
|
Commercial real estate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Home equity line of credit
|
—
|
|
|
—
|
|
|
1
|
|
|
6
|
|
||
Residential land
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Commercial construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Residential construction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Commercial
|
1
|
|
|
24
|
|
|
1
|
|
|
1,056
|
|
||
Consumer
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
|
2
|
|
|
$
|
263
|
|
|
2
|
|
|
$
|
1,062
|
|
(in thousands)
|
Gross
carrying amount |
|
Accumulated amortization
|
|
Valuation allowance
|
|
Net
carrying amount |
||||||||
December 31, 2016
|
$
|
17,271
|
|
|
$
|
(7,898
|
)
|
|
$
|
—
|
|
|
$
|
9,373
|
|
December 31, 2015
|
$
|
14,531
|
|
1
|
$
|
(5,647
|
)
|
1
|
$
|
—
|
|
|
$
|
8,884
|
|
(in thousands)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
Mortgage servicing rights
|
|
|
|
|
|
||||||
Balance, January 1
|
$
|
8,884
|
|
|
$
|
11,749
|
|
|
$
|
11,938
|
|
Amount capitalized
|
2,740
|
|
|
3,123
|
|
|
1,637
|
|
|||
Amortization
|
(2,251
|
)
|
|
(2,682
|
)
|
|
(1,731
|
)
|
|||
Sale of mortgage servicing rights
|
—
|
|
|
(3,302
|
)
|
|
—
|
|
|||
Other-than-temporary impairment
|
—
|
|
|
(4
|
)
|
|
(95
|
)
|
|||
Carrying amount before valuation allowance, December 31
|
9,373
|
|
|
8,884
|
|
|
11,749
|
|
|||
Valuation allowance for mortgage servicing rights
|
|
|
|
|
|
||||||
Balance, January 1
|
—
|
|
|
209
|
|
|
251
|
|
|||
Provision (recovery)
|
—
|
|
|
(205
|
)
|
|
53
|
|
|||
Other-than-temporary impairment
|
—
|
|
|
(4
|
)
|
|
(95
|
)
|
|||
Balance, December 31
|
—
|
|
|
—
|
|
|
209
|
|
|||
Net carrying value of mortgage servicing rights
|
$
|
9,373
|
|
|
$
|
8,884
|
|
|
$
|
11,540
|
|
December 31
|
2016
|
|
2015
|
||||
(dollars in thousands)
|
|
|
|
||||
Unpaid principal balance
|
$
|
1,188,380
|
|
|
$
|
1,097,314
|
|
Weighted average note rate
|
3.96
|
%
|
|
4.05
|
%
|
||
Weighted average discount rate
|
9.4
|
%
|
|
9.6
|
%
|
||
Weighted average prepayment speed
|
8.5
|
%
|
|
9.3
|
%
|
December 31
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Prepayment rate:
|
|
|
|
||||
25 basis points adverse rate change
|
$
|
(567
|
)
|
|
$
|
(561
|
)
|
50 basis points adverse rate change
|
(1,154
|
)
|
|
(1,104
|
)
|
||
Discount rate:
|
|
|
|
||||
25 basis points adverse rate change
|
(128
|
)
|
|
(111
|
)
|
||
50 basis points adverse rate change
|
(254
|
)
|
|
(220
|
)
|
December 31
|
2016
|
|
2015
|
||||||||||
(dollars in thousands)
|
Weighted-average stated rate
|
|
|
Amount
|
|
|
Weighted-average stated rate
|
|
|
Amount
|
|
||
Savings
|
0.07
|
%
|
|
$
|
2,208,594
|
|
|
0.07
|
%
|
|
$
|
2,030,644
|
|
Checking
|
|
|
|
|
|
|
|
|
|
||||
Interest-bearing
|
0.02
|
|
|
890,633
|
|
|
0.02
|
|
|
831,143
|
|
||
Noninterest-bearing
|
—
|
|
|
817,867
|
|
|
—
|
|
|
746,875
|
|
||
Commercial checking
|
—
|
|
|
821,184
|
|
|
—
|
|
|
773,499
|
|
||
Money market
|
0.12
|
|
|
153,126
|
|
|
0.13
|
|
|
167,641
|
|
||
Term certificates
|
1.00
|
|
|
657,525
|
|
|
0.93
|
|
|
475,452
|
|
||
|
0.15
|
%
|
|
$
|
5,548,929
|
|
|
0.12
|
%
|
|
$
|
5,025,254
|
|
(in thousands)
|
|
||
2017
|
$
|
322,661
|
|
2018
|
70,611
|
|
|
2019
|
105,478
|
|
|
2020
|
81,818
|
|
|
2021
|
73,686
|
|
|
Thereafter
|
3,271
|
|
|
|
$
|
657,525
|
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in thousands)
|
|
|
|
|
|
||||||
Term certificates
|
$
|
5,390
|
|
|
$
|
3,747
|
|
|
$
|
3,603
|
|
Savings
|
1,402
|
|
|
1,257
|
|
|
1,134
|
|
|||
Money market
|
202
|
|
|
205
|
|
|
214
|
|
|||
Interest-bearing checking
|
173
|
|
|
139
|
|
|
126
|
|
|||
|
$
|
7,167
|
|
|
$
|
5,348
|
|
|
$
|
5,077
|
|
(in millions)
|
|
Gross amount of
recognized liabilities
|
|
Gross amount
offset in the
Balance Sheet
|
|
Net amount of
liabilities presented
in the Balance Sheet
|
||||||
Repurchase agreements
|
|
|
|
|
|
|
|
|
|
|||
December 31, 2016
|
|
$
|
93
|
|
|
$
|
—
|
|
|
$
|
93
|
|
December 31, 2015
|
|
229
|
|
|
—
|
|
|
229
|
|
|
|
Gross amount not offset in the Balance Sheet
|
||||||||||
(in millions)
|
|
Net amount of
liabilities presented
in the Balance Sheet
|
|
Financial
instruments
|
|
Cash
collateral
pledged
|
||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|||
Financial institution
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Government entities
|
|
14
|
|
|
15
|
|
|
—
|
|
|||
Commercial account holders
|
|
79
|
|
|
101
|
|
|
—
|
|
|||
Total
|
|
$
|
93
|
|
|
$
|
116
|
|
|
$
|
—
|
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|||
Financial institution
|
|
$
|
50
|
|
|
$
|
56
|
|
|
$
|
—
|
|
Government entities
|
|
56
|
|
|
61
|
|
|
—
|
|
|||
Commercial account holders
|
|
123
|
|
|
144
|
|
|
—
|
|
|||
Total
|
|
$
|
229
|
|
|
$
|
261
|
|
|
$
|
—
|
|
(dollars in millions)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
Amount outstanding as of December 31
|
$
|
93
|
|
|
$
|
229
|
|
|
$
|
191
|
|
Average amount outstanding during the year
|
$
|
170
|
|
|
$
|
219
|
|
|
$
|
155
|
|
Maximum amount outstanding as of any month-end
|
$
|
229
|
|
|
$
|
277
|
|
|
$
|
195
|
|
Weighted-average interest rate as of December 31
|
0.23
|
%
|
|
1.24
|
%
|
|
1.45
|
%
|
|||
Weighted-average interest rate during the year
|
1.43
|
%
|
|
1.29
|
%
|
|
1.67
|
%
|
|||
Weighted-average remaining days to maturity as of December 31
|
6
|
|
|
117
|
|
|
343
|
|
December 31
|
2016
|
|
2015
|
||||||||||||||||||
Maturity
|
Repurchase liability
|
|
|
Weighted-average
interest rate
|
|
|
Collateralized by
mortgage-related
securities and federal
agency obligations at fair value plus
accrued interest
|
|
|
Repurchase liability
|
|
|
Weighted-average
interest rate |
|
|
Collateralized by
mortgage-related securities and federal agency obligations at fair value plus accrued interest |
|
||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Overnight
|
$
|
79,083
|
|
|
0.15
|
%
|
|
$
|
100,305
|
|
|
$
|
122,684
|
|
|
0.15
|
%
|
|
$
|
144,146
|
|
1 to 29 days
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
30 to 90 days
|
13,535
|
|
|
0.70
|
|
|
15,239
|
|
|
18,535
|
|
|
0.29
|
|
|
20,364
|
|
||||
Over 90 days
|
—
|
|
|
—
|
|
|
—
|
|
|
87,363
|
|
1
|
2.96
|
|
|
96,553
|
|
||||
|
$
|
92,618
|
|
|
0.23
|
%
|
|
$
|
115,544
|
|
|
$
|
228,582
|
|
|
1.24
|
%
|
|
$
|
261,063
|
|
1
|
$50.3 million
callable by the counterparties quarterly at par until maturity in 2016.
|
December 31, 2016
|
Weighted-average
stated rate
|
|
|
Amount
|
|
|
|
(dollars in thousands)
|
|
|
|
|
|
|
|
Due in
|
|
|
|
|
|
|
|
2017
|
4.28
|
%
|
|
$
|
50,000
|
|
1
|
2018
|
1.95
|
|
|
50,000
|
|
|
|
2019
|
—
|
|
|
—
|
|
|
|
2020
|
—
|
|
|
—
|
|
|
|
2021
|
—
|
|
|
—
|
|
|
|
Thereafter
|
—
|
|
|
—
|
|
|
|
|
3.12
|
%
|
|
$
|
100,000
|
|
|
1
|
Callable quarterly at par until maturity in 2017.
|
December 31
|
2016
|
|
2015
|
||||||||||||
(in thousands)
|
Notional amount
|
|
Fair value
|
|
Notional amount
|
|
Fair value
|
||||||||
Interest rate lock commitments
|
$
|
25,883
|
|
|
$
|
421
|
|
|
$
|
22,241
|
|
|
$
|
384
|
|
Forward commitments
|
30,813
|
|
|
(177
|
)
|
|
23,644
|
|
|
(29
|
)
|
Derivative Financial Instruments Not Designated
|
Location of net gains
|
|
|
|
|
|
|
||||||
as Hedging Instruments
|
(losses) recognized in
|
|
Years ended December 31
|
||||||||||
(in thousands)
|
the Statements of Income
|
|
2016
|
|
2015
|
|
2014
|
||||||
Interest rate lock commitments
|
Mortgage banking income
|
|
$
|
37
|
|
|
$
|
(6
|
)
|
|
$
|
(74
|
)
|
Forward commitments
|
Mortgage banking income
|
|
(148
|
)
|
|
77
|
|
|
(245
|
)
|
|||
|
|
|
$
|
(111
|
)
|
|
$
|
71
|
|
|
$
|
(319
|
)
|
December 31
|
2016
|
|
|
2015
|
|
||
(in thousands)
|
|
|
|
||||
Unfunded commitments to extend credit:
|
|
|
|
|
|||
Home equity line of credit
|
$
|
1,146,339
|
|
|
$
|
1,096,532
|
|
Commercial and commercial real estate
|
577,410
|
|
|
631,780
|
|
||
Consumer
|
64,762
|
|
|
60,198
|
|
||
Residential 1-4 family
|
38,271
|
|
|
24,863
|
|
||
Commercial and financial standby letters of credit
|
16,017
|
|
|
18,709
|
|
||
Total
|
$
|
1,842,799
|
|
|
$
|
1,832,082
|
|
6
·
Unconsolidated variable interest entities
|
Years ended December 31
|
|
2016
|
|
2015
|
|
2014
|
||||||
(in millions)
|
|
|
|
|
|
|
||||||
AES Hawaii
|
|
$
|
149
|
|
|
$
|
134
|
|
|
$
|
145
|
|
Kalaeloa
|
|
152
|
|
|
187
|
|
|
279
|
|
|||
HEP
|
|
29
|
|
|
44
|
|
|
51
|
|
|||
HPOWER
|
|
71
|
|
|
66
|
|
|
66
|
|
|||
Puna Geothermal Venture
|
|
28
|
|
|
29
|
|
|
45
|
|
|||
Hawaiian Commercial & Sugar (HC&S)
|
|
1
|
|
|
8
|
|
|
15
|
|
|||
Other IPPs
|
|
133
|
|
|
126
|
|
|
121
|
|
|||
Total IPPs
|
|
$
|
563
|
|
|
$
|
594
|
|
|
$
|
722
|
|
7
·
Short-term borrowings
|
8
·
Long-term debt
|
December 31
|
2016
|
|
|
2015
|
|
||
(dollars in thousands)
|
|
|
|
|
|
||
Long-term debt of Utilities
1
|
$
|
1,319,260
|
|
|
$
|
1,278,702
|
|
HEI term loan LIBOR + .75%, due 2017
|
125,000
|
|
|
125,000
|
|
||
HEI term loan LIBOR + .75%, due 2018
|
75,000
|
|
|
—
|
|
||
HEI senior note 4.41%, paid 2016
|
—
|
|
|
75,000
|
|
||
HEI senior note 5.67%, due 2021
|
50,000
|
|
|
50,000
|
|
||
HEI senior note 3.99%, due 2023
|
50,000
|
|
|
50,000
|
|
||
Less unamortized debt issuance costs
|
(241
|
)
|
|
(334
|
)
|
||
|
$
|
1,619,019
|
|
|
$
|
1,578,368
|
|
1
|
See components of “Total long-term debt” and unamortized debt issuance costs in Hawaiian Electric and subsidiaries’ Consolidated Statements of Capitalization.
|
9
·
Shareholders’ equity
|
|
HEI Consolidated
|
|
Hawaiian Electric Consolidated
|
||||||||||||||||||||||||
(in thousands)
|
Net unrealized gains (losses) on securities
|
|
Unrealized gains(losses) on derivatives
|
|
Retirement benefit plans
|
|
AOCI
|
|
Unrealized losses on derivatives
|
|
Retirement benefit plans
|
|
AOCI
|
||||||||||||||
Balance, December 31, 2013
|
$
|
(3,663
|
)
|
|
$
|
(525
|
)
|
|
$
|
(12,562
|
)
|
|
$
|
(16,750
|
)
|
|
$
|
—
|
|
|
$
|
608
|
|
|
$
|
608
|
|
Current period other comprehensive income (loss)
|
4,125
|
|
|
236
|
|
|
(14,989
|
)
|
|
(10,628
|
)
|
|
—
|
|
|
(563
|
)
|
|
(563
|
)
|
|||||||
Balance, December 31, 2014
|
462
|
|
|
(289
|
)
|
|
(27,551
|
)
|
|
(27,378
|
)
|
|
—
|
|
|
45
|
|
|
45
|
|
|||||||
Current period other comprehensive income (loss)
|
(2,334
|
)
|
|
235
|
|
|
3,215
|
|
|
1,116
|
|
|
—
|
|
|
880
|
|
|
880
|
|
|||||||
Balance, December 31, 2015
|
(1,872
|
)
|
|
(54
|
)
|
|
(24,336
|
)
|
|
(26,262
|
)
|
|
—
|
|
|
925
|
|
|
925
|
|
|||||||
Current period other comprehensive loss
|
(6,059
|
)
|
|
(400
|
)
|
|
(408
|
)
|
|
(6,867
|
)
|
|
(454
|
)
|
|
(793
|
)
|
|
(1,247
|
)
|
|||||||
Balance, December 31, 2016
|
$
|
(7,931
|
)
|
|
$
|
(454
|
)
|
|
$
|
(24,744
|
)
|
|
$
|
(33,129
|
)
|
|
$
|
(454
|
)
|
|
$
|
132
|
|
|
(322
|
)
|
|
|
Amount reclassified from AOCI
|
|
|
||||||||||
Years ended December 31
|
|
2016
|
|
2015
|
|
2014
|
|
Affected line item in the Statement of Income
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
||||||
HEI consolidated
|
|
|
|
|
|
|
|
|
||||||
Net realized gains on securities
|
|
$
|
(360
|
)
|
|
$
|
—
|
|
|
$
|
(1,715
|
)
|
|
Revenues-bank (net gains on sales of securities)
|
Derivatives qualified as cash flow hedges
|
|
|
|
|
|
|
|
|
|
|
||||
Window forward contracts
|
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
Revenues-electric utilities (gains on window forward contracts
–
see Note 4 for additional details)
|
|||
Interest rate contracts (settled in 2011)
|
|
54
|
|
|
235
|
|
|
236
|
|
|
Interest expense
|
|||
Retirement benefit plan items
|
|
|
|
|
|
|
|
|
|
|
|
|||
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost
|
|
14,518
|
|
|
22,465
|
|
|
11,344
|
|
|
See Note 10 for additional details
|
|||
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets
|
|
28,584
|
|
|
(25,139
|
)
|
|
207,833
|
|
|
See Note 10 for additional details
|
|||
Total reclassifications
|
|
$
|
42,623
|
|
|
$
|
(2,439
|
)
|
|
$
|
217,698
|
|
|
|
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
|
||||||
Derivatives qualified as cash flow hedges
|
|
|
|
|
|
|
|
|
||||||
Window forward contracts
|
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
Revenues (gains on window forward contracts
–
see Note 4 for additional details)
|
|||
Retirement benefit plan items
|
|
|
|
|
|
|
|
|
|
|
|
|||
Amortization of prior service credit and net losses recognized during the period in net periodic benefit cost
|
|
$
|
13,254
|
|
|
$
|
20,381
|
|
|
$
|
10,212
|
|
|
See Note 10 for additional details
|
Less: reclassification adjustment for impact of D&Os of the PUC included in regulatory assets
|
|
28,584
|
|
|
(25,139
|
)
|
|
207,833
|
|
|
See Note 10 for additional details
|
|||
Total reclassifications
|
|
$
|
41,665
|
|
|
$
|
(4,758
|
)
|
|
$
|
218,045
|
|
|
|
10 · Retirement benefits
|
|
|
|
|
|
|
|
|
||||||||
|
2016
|
|
2015
|
||||||||||||
(in thousands)
|
Pension
benefits
|
|
Other
benefits
|
|
Pension
benefits
|
|
Other
benefits
|
||||||||
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
||||||||
Benefit obligation, January 1
|
$
|
1,649,690
|
|
|
$
|
213,990
|
|
|
$
|
1,690,777
|
|
|
$
|
211,760
|
|
Service cost
|
58,796
|
|
|
3,284
|
|
|
64,262
|
|
|
3,870
|
|
||||
Interest cost
|
74,808
|
|
|
9,337
|
|
|
70,529
|
|
|
8,700
|
|
||||
Actuarial losses (gains)
|
63,121
|
|
|
7,545
|
|
|
(114,286
|
)
|
|
(2,860
|
)
|
||||
Participants contributions
|
—
|
|
|
1,389
|
|
|
—
|
|
|
1,260
|
|
||||
Benefits paid and expenses
|
(66,789
|
)
|
|
(9,822
|
)
|
|
(63,037
|
)
|
|
(8,858
|
)
|
||||
Transfers
|
—
|
|
|
—
|
|
|
1,445
|
|
|
118
|
|
||||
Benefit obligation, December 31
|
1,779,626
|
|
|
225,723
|
|
|
1,649,690
|
|
|
213,990
|
|
||||
Fair value of plan assets, January 1
|
1,141,833
|
|
|
167,930
|
|
|
1,129,005
|
|
|
177,256
|
|
||||
Actual (loss) return on plan assets
|
93,441
|
|
|
11,168
|
|
|
(10,646
|
)
|
|
(2,712
|
)
|
||||
Employer contributions
|
64,236
|
|
|
11
|
|
|
85,139
|
|
|
864
|
|
||||
Participants contributions
|
—
|
|
|
1,389
|
|
|
—
|
|
|
1,260
|
|
||||
Benefits paid and expenses
|
(66,326
|
)
|
|
(9,115
|
)
|
|
(62,584
|
)
|
|
(8,858
|
)
|
||||
Other
|
—
|
|
|
—
|
|
|
919
|
|
|
120
|
|
||||
Fair value of plan assets, December 31
|
1,233,184
|
|
|
171,383
|
|
|
1,141,833
|
|
|
167,930
|
|
||||
Accrued benefit asset (liability), December 31
|
$
|
(546,442
|
)
|
|
$
|
(54,340
|
)
|
|
$
|
(507,857
|
)
|
|
$
|
(46,060
|
)
|
Other liabilities (short-term)
|
(460
|
)
|
|
(596
|
)
|
|
(425
|
)
|
|
(518
|
)
|
||||
Defined benefit pension and other postretirement benefit plans liability
|
(545,982
|
)
|
|
(53,744
|
)
|
|
(507,432
|
)
|
|
(45,542
|
)
|
||||
Accrued benefit asset (liability), December 31
|
$
|
(546,442
|
)
|
|
$
|
(54,340
|
)
|
|
$
|
(507,857
|
)
|
|
$
|
(46,060
|
)
|
AOCI debit/(credit), January 1 (excluding impact of PUC D&Os)
|
$
|
541,118
|
|
|
$
|
31,485
|
|
|
$
|
595,103
|
|
|
$
|
20,090
|
|
Recognized during year – prior service credit (cost)
|
(13
|
)
|
|
1,803
|
|
|
(40
|
)
|
|
1,804
|
|
||||
Recognized during year – net actuarial losses
|
(22,693
|
)
|
|
(793
|
)
|
|
(33,371
|
)
|
|
(1,754
|
)
|
||||
Occurring during year – net actuarial losses (gains)
|
61,313
|
|
|
8,472
|
|
|
(20,574
|
)
|
|
11,345
|
|
||||
AOCI debit/(credit) before cumulative impact of PUC D&Os, December 31
|
579,725
|
|
|
40,967
|
|
|
541,118
|
|
|
31,485
|
|
||||
Cumulative impact of PUC D&Os
|
(576,933
|
)
|
|
(43,974
|
)
|
|
(538,784
|
)
|
|
(35,333
|
)
|
||||
AOCI debit/(credit), December 31
|
$
|
2,792
|
|
|
$
|
(3,007
|
)
|
|
$
|
2,334
|
|
|
$
|
(3,848
|
)
|
Net actuarial loss
|
$
|
579,691
|
|
|
$
|
51,463
|
|
|
$
|
541,071
|
|
|
$
|
43,784
|
|
Prior service cost (gain)
|
34
|
|
|
(10,496
|
)
|
|
47
|
|
|
(12,299
|
)
|
||||
AOCI debit/(credit) before cumulative impact of PUC D&Os, December 31
|
579,725
|
|
|
40,967
|
|
|
541,118
|
|
|
31,485
|
|
||||
Cumulative impact of PUC D&Os
|
(576,933
|
)
|
|
(43,974
|
)
|
|
(538,784
|
)
|
|
(35,333
|
)
|
||||
AOCI debit/(credit), December 31
|
2,792
|
|
|
(3,007
|
)
|
|
2,334
|
|
|
(3,848
|
)
|
||||
Income taxes (benefits)
|
(1,087
|
)
|
|
1,170
|
|
|
(908
|
)
|
|
1,497
|
|
||||
AOCI debit/(credit), net of taxes (benefits), December 31
|
$
|
1,705
|
|
|
$
|
(1,837
|
)
|
|
$
|
1,426
|
|
|
$
|
(2,351
|
)
|
|
Pension benefits
1
|
|
Other benefits
2
|
||||||||||||||||||
|
|
|
|
|
Investment policy
|
|
|
|
|
|
Investment policy
|
||||||||||
December 31
|
2016
|
|
|
2015
|
|
|
Target
|
|
|
Range
|
|
2016
|
|
|
2015
|
|
|
Target
|
|
|
Range
|
Assets held by category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities managers
|
71
|
%
|
|
70
|
%
|
|
70
|
%
|
|
65-75
|
|
70
|
%
|
|
70
|
%
|
|
70
|
%
|
|
65-75
|
Fixed income securities managers
|
29
|
|
|
30
|
|
|
30
|
|
|
25-35
|
|
30
|
|
|
30
|
|
|
30
|
|
|
25-35
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
1
|
Asset allocation is applicable to only HEI and the Utilities. In 2014, ASB revised its defined benefit pension plan asset allocation to a liability driven investment strategy and, as of December 31, 2016 and 2015, nearly all of its pension assets were invested in fixed income securities.
|
2
|
Asset allocation is applicable to only HEI and the Utilities. ASB does not fund its other benefits.
|
|
Pension benefits
|
|
Other benefits
|
||||||||||||||||||||||||||||
|
|
|
Fair value measurements using
|
|
|
|
Fair value measurements using
|
||||||||||||||||||||||||
(in millions)
|
December 31
|
|
Quoted prices in active markets for identical assets
(Level 1) |
|
Significant other observable inputs
(Level 2) |
|
Significant unobservable inputs
(Level 3) |
|
December 31
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
692
|
|
|
$
|
692
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
94
|
|
|
$
|
94
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity index funds
|
129
|
|
|
129
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|
—
|
|
|
—
|
|
||||||||
Equity investments at net asset value (NAV)
|
56
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total equity investments
|
877
|
|
|
821
|
|
|
—
|
|
|
—
|
|
|
120
|
|
|
111
|
|
|
—
|
|
|
—
|
|
||||||||
Fixed income securities and public mutual funds
|
276
|
|
|
84
|
|
|
192
|
|
|
—
|
|
|
44
|
|
|
42
|
|
|
2
|
|
|
—
|
|
||||||||
Fixed income investments at NAV
|
180
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total fixed income investments
|
456
|
|
|
84
|
|
|
192
|
|
|
—
|
|
|
48
|
|
|
42
|
|
|
2
|
|
|
—
|
|
||||||||
Cash equivalents at NAV
|
33
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
$
|
1,366
|
|
|
$
|
905
|
|
|
$
|
192
|
|
|
$
|
—
|
|
|
$
|
174
|
|
|
$
|
153
|
|
|
$
|
2
|
|
|
$
|
—
|
|
Cash, receivables and payables, net
|
4
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets
|
$
|
1,370
|
|
|
|
|
|
|
|
|
|
|
|
$
|
174
|
|
|
|
|
|
|
|
|
|
|
||||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Equity securities
|
$
|
640
|
|
|
$
|
640
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
92
|
|
|
$
|
92
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity index funds
|
119
|
|
|
119
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
17
|
|
|
—
|
|
|
—
|
|
||||||||
Equity investments at NAV
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total equity investments
|
805
|
|
|
759
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
109
|
|
|
—
|
|
|
—
|
|
||||||||
Fixed income securities and public mutual funds
|
260
|
|
|
85
|
|
|
175
|
|
|
—
|
|
|
44
|
|
|
42
|
|
|
2
|
|
|
—
|
|
||||||||
Fixed income investments at NAV
|
165
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total fixed income investments
|
425
|
|
|
85
|
|
|
175
|
|
|
—
|
|
|
48
|
|
|
42
|
|
|
2
|
|
|
—
|
|
||||||||
Cash equivalents at NAV
|
38
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
1,268
|
|
|
$
|
844
|
|
|
$
|
175
|
|
|
$
|
—
|
|
|
171
|
|
|
$
|
151
|
|
|
$
|
2
|
|
|
$
|
—
|
|
||
Cash, receivables and payables, net
|
3
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets
|
$
|
1,271
|
|
|
|
|
|
|
|
|
|
|
|
$
|
171
|
|
|
|
|
|
|
|
|
|
|
|
Pension benefits
|
|
Other benefits
|
||||||||||||
Measured at net asset value
|
December 31
|
|
|
Redemption frequency
|
|
Redemption notice period
|
|
December 31
|
|
|
Redemption frequency
|
|
Redemption notice period
|
||
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
||||
Non U.S. equity funds (a)
|
56
|
|
|
Daily - Quarterly
|
|
0 - 30 days
|
|
9
|
|
|
Monthly -Quarterly
|
|
10-30 days
|
||
Fixed income investments (b)
|
180
|
|
|
Monthly
|
|
10 days
|
|
4
|
|
|
Monthly
|
|
10 days
|
||
Cash equivalents (c)
|
33
|
|
|
Daily
|
|
0-1 day
|
|
6
|
|
|
Daily
|
|
0-1 day
|
||
|
$
|
269
|
|
|
|
|
|
|
$
|
19
|
|
|
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
||||
Non U.S. equity funds (a)
|
46
|
|
|
Daily - Quarterly
|
|
0 - 30 days
|
|
9
|
|
|
Monthly - Quarterly
|
|
10-30 days
|
||
Fixed income investments (b)
|
165
|
|
|
Monthly
|
|
10 days
|
|
4
|
|
|
Monthly
|
|
10 days
|
||
Cash equivalents (c)
|
38
|
|
|
Daily
|
|
0-1 day
|
|
5
|
|
|
Daily
|
|
0-1 day
|
||
|
$
|
249
|
|
|
|
|
|
|
$
|
18
|
|
|
|
|
|
(a)
|
Represents investments in funds that primarily invest in non-U.S., emerging markets equities. Redemption frequency for pension benefits assets as of December 31, 2016 and 2015 were: daily,
31%
and
24%
; monthly,
31%
and
29%
; and quarterly,
38%
and
47%
, respectively. Redemption frequency for other benefits assets as of December 31, 2016 and 2015 were: monthly,
57%
and
54%
; and quarterly,
42%
and
46%
, respectively.
|
(b )
|
Represents investments in fixed income securities invested in a US-dollar denominated fund that seeks to exceed the Barclays Capital Long Corporate A or better Index through investments in US-dollar denominated fixed income securities and commingled vehicles.
|
(c)
|
Represents investments in cash equivalent funds. This class includes funds that invest primarily in securities issued or guaranteed by the U.S. government or its agencies or instrumentalities. For pension benefits, the fund may also invest in fixed income securities of investment grade issuers; the fund has an average rating of AA1.
|
|
Pension benefits
|
|
Other benefits
|
||||||||||||||
December 31
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||
Benefit obligation
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.26
|
%
|
|
4.60
|
%
|
|
4.22
|
%
|
|
4.22
|
%
|
|
4.57
|
%
|
|
4.17
|
%
|
Rate of compensation increase
|
3.5
|
|
|
3.5
|
|
|
3.5
|
|
|
NA
|
|
|
NA
|
|
|
NA
|
|
Net periodic pension/benefit cost (years ended)
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
4.60
|
|
|
4.22
|
|
|
5.09
|
|
|
4.57
|
|
|
4.17
|
|
|
5.03
|
|
Expected return on plan assets
1
|
7.75
|
|
|
7.75
|
|
|
7.75
|
|
|
7.75
|
|
|
7.75
|
|
|
7.75
|
|
Rate of compensation increase
|
3.5
|
|
|
3.5
|
|
|
3.5
|
|
|
NA
|
|
|
NA
|
|
|
NA
|
|
|
Pension benefits
|
|
Other benefits
|
||||||||||||||||||||
(in thousands)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
60,555
|
|
|
$
|
66,260
|
|
|
$
|
49,264
|
|
|
$
|
3,331
|
|
|
$
|
3,927
|
|
|
$
|
3,490
|
|
Interest cost
|
81,549
|
|
|
76,960
|
|
|
72,202
|
|
|
9,670
|
|
|
9,011
|
|
|
8,550
|
|
||||||
Expected return on plan assets
|
(98,559
|
)
|
|
(88,554
|
)
|
|
(81,355
|
)
|
|
(12,273
|
)
|
|
(11,664
|
)
|
|
(10,902
|
)
|
||||||
Amortization of net prior service (gain) cost
|
(57
|
)
|
|
4
|
|
|
88
|
|
|
(1,793
|
)
|
|
(1,793
|
)
|
|
(1,793
|
)
|
||||||
Amortization of net actuarial losses (gains)
|
24,832
|
|
|
36,800
|
|
|
20,304
|
|
|
804
|
|
|
1,796
|
|
|
(11
|
)
|
||||||
Net periodic pension/benefit cost
|
68,320
|
|
|
91,470
|
|
|
60,503
|
|
|
(261
|
)
|
|
1,277
|
|
|
(666
|
)
|
||||||
Impact of PUC D&Os
|
(18,117
|
)
|
|
(40,011
|
)
|
|
(13,324
|
)
|
|
1,343
|
|
|
(240
|
)
|
|
1,976
|
|
||||||
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)
|
50,203
|
|
|
51,459
|
|
|
47,179
|
|
|
1,082
|
|
|
1,037
|
|
|
1,310
|
|
||||||
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
58,796
|
|
|
$
|
64,262
|
|
|
$
|
47,597
|
|
|
$
|
3,284
|
|
|
$
|
3,870
|
|
|
$
|
3,392
|
|
Interest cost
|
74,808
|
|
|
70,529
|
|
|
65,979
|
|
|
9,337
|
|
|
8,700
|
|
|
8,234
|
|
||||||
Expected return on plan assets
|
(91,633
|
)
|
|
(82,541
|
)
|
|
(72,661
|
)
|
|
(12,096
|
)
|
|
(11,495
|
)
|
|
(10,739
|
)
|
||||||
Amortization of net prior service (gain) cost
|
13
|
|
|
40
|
|
|
62
|
|
|
(1,803
|
)
|
|
(1,804
|
)
|
|
(1,804
|
)
|
||||||
Amortization of net actuarial losses
|
22,693
|
|
|
33,371
|
|
|
18,459
|
|
|
793
|
|
|
1,754
|
|
|
—
|
|
||||||
Net periodic pension/benefit cost
|
64,677
|
|
|
85,661
|
|
|
59,436
|
|
|
(485
|
)
|
|
1,025
|
|
|
(917
|
)
|
||||||
Impact of PUC D&Os
|
(18,117
|
)
|
|
(40,011
|
)
|
|
(13,324
|
)
|
|
1,343
|
|
|
(240
|
)
|
|
1,976
|
|
||||||
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)
|
$
|
46,560
|
|
|
$
|
45,650
|
|
|
$
|
46,112
|
|
|
$
|
858
|
|
|
$
|
785
|
|
|
$
|
1,059
|
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||
(in millions)
|
Pension benefits
|
|
Other benefits
|
|
Pension benefits
|
|
Other benefits
|
||||||||
Estimated prior service credit
|
$
|
(0.1
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
—
|
|
|
$
|
(1.8
|
)
|
Net actuarial loss
|
26.1
|
|
|
1.5
|
|
|
24.0
|
|
|
1.4
|
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||
December 31
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
(in billions)
|
|
|
|
|
|
|
|
||||||||
Defined benefit plans -
ABOs
|
$
|
1.7
|
|
|
$
|
1.6
|
|
|
$
|
1.5
|
|
|
$
|
1.4
|
|
Defined benefit plans with ABO in excess of plan assets
|
|
|
|
|
|
|
|
||||||||
ABOs
|
1.6
|
|
|
1.5
|
|
|
1.5
|
|
|
1.4
|
|
||||
Plan assets
|
1.3
|
|
|
1.2
|
|
|
1.2
|
|
|
1.1
|
|
||||
Defined benefit plans with PBOs in excess of plan assets
|
|
|
|
|
|
|
|
||||||||
PBOs
|
1.8
|
|
|
1.7
|
|
|
1.8
|
|
|
1.6
|
|
||||
Plan assets
|
1.3
|
|
|
1.2
|
|
|
1.2
|
|
|
1.1
|
|
11
·
Share-based compensation
|
(in millions)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
HEI consolidated
|
|
|
|
|
|
||||||
Share-based compensation expense
1
|
$
|
4.8
|
|
|
$
|
6.5
|
|
|
$
|
9.3
|
|
Income tax benefit
|
1.6
|
|
|
2.3
|
|
|
3.4
|
|
|||
Hawaiian Electric consolidated
|
|
|
|
|
|
||||||
Share-based compensation expense
1
|
1.4
|
|
|
1.9
|
|
|
3.1
|
|
|||
Income tax benefit
|
0.5
|
|
|
0.7
|
|
|
1.2
|
|
1
|
For 2016, the Company has not capitalized any share-based compensation.
$0.15 million
and
$0.16 million
of this share-based compensation expense was capitalized in
2015
and
2014
, respectively.
|
(dollars in millions)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
Shares granted
|
19,846
|
|
|
28,246
|
|
|
33,170
|
|
|||
Fair value
|
$
|
0.6
|
|
|
$
|
0.8
|
|
|
$
|
0.8
|
|
Income tax benefit
|
0.2
|
|
|
0.3
|
|
|
0.3
|
|
|
2015
|
|
2014
|
||||||||||
|
Shares
|
|
(1)
|
|
Shares
|
|
(1)
|
||||||
Outstanding, January 1
|
80,000
|
|
|
$
|
26.18
|
|
|
164,000
|
|
|
$
|
26.12
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Exercised
|
(80,000
|
)
|
|
26.18
|
|
|
(22,000
|
)
|
|
26.18
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
(62,000
|
)
|
|
26.02
|
|
||
Expired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Outstanding, December 31
|
—
|
|
|
$
|
—
|
|
|
80,000
|
|
|
$
|
26.18
|
|
Exercisable, December 31
|
—
|
|
|
$
|
—
|
|
|
80,000
|
|
|
$
|
26.18
|
|
(1)
|
Weighted-average exercise price
|
(in thousands)
|
2015
|
|
|
2014
|
|
||
Intrinsic value of shares exercised
1
|
$
|
502
|
|
|
$
|
29
|
|
Tax benefit realized for the deduction of exercises
|
82
|
|
|
11
|
|
1
|
Intrinsic value is the amount by which the fair market value of the underlying stock and the related dividend equivalent rights exceeds the exercise price of the right.
|
|
|
2014
|
|||||
|
|
Shares
|
(1)
|
||||
Outstanding, January 1
|
|
4,503
|
|
|
$
|
22.21
|
|
Granted
|
|
—
|
|
|
—
|
|
|
Vested
|
|
(4,503
|
)
|
|
22.21
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Outstanding, December 31
|
|
—
|
|
|
$
|
—
|
|
(1)
|
Weighted-average grant-date fair value per share based on the closing or average price of HEI common stock on the date of grant.
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|||||||||
Outstanding, January 1
|
210,634
|
|
|
$
|
28.82
|
|
|
261,235
|
|
|
$
|
25.77
|
|
|
288,151
|
|
|
$
|
25.17
|
|
|||
Granted
|
114,431
|
|
|
29.70
|
|
|
85,772
|
|
|
33.69
|
|
|
117,786
|
|
|
25.17
|
|
||||||
Vested
|
(85,003
|
)
|
|
27.84
|
|
|
(102,173
|
)
|
|
25.67
|
|
|
(144,702
|
)
|
|
24.09
|
|
||||||
Forfeited
|
(19,379
|
)
|
|
29.82
|
|
|
(34,200
|
)
|
|
27.09
|
|
|
—
|
|
|
—
|
|
||||||
Outstanding, December 31
|
220,683
|
|
|
$
|
29.57
|
|
|
210,634
|
|
|
$
|
28.82
|
|
|
261,235
|
|
|
$
|
25.77
|
|
|||
Total weighted-average grant-date fair value of shares granted ($ millions)
|
$
|
3.4
|
|
|
|
|
$
|
2.9
|
|
|
|
|
$
|
3.0
|
|
|
|
(1)
|
Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|||||||||
Outstanding, January 1
|
162,500
|
|
|
$
|
27.66
|
|
|
257,956
|
|
|
$
|
28.45
|
|
|
232,127
|
|
|
$
|
32.88
|
|
|||
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
97,524
|
|
|
22.95
|
|
||||||
Vested (lapsed because goal not met)
|
(78,553
|
)
|
|
32.69
|
|
|
(75,915
|
)
|
|
30.71
|
|
|
(70,189
|
)
|
|
35.46
|
|
||||||
Forfeited
|
(841
|
)
|
|
22.95
|
|
|
(19,541
|
)
|
|
26.25
|
|
|
(1,506
|
)
|
|
28.32
|
|
||||||
Outstanding, December 31
|
83,106
|
|
|
$
|
22.95
|
|
|
162,500
|
|
|
$
|
27.66
|
|
|
257,956
|
|
|
$
|
28.45
|
|
|||
Total weighted-average grant-date fair value of shares granted ($ millions)
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
2.2
|
|
|
|
(1)
|
Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model.
|
|
|
2014
|
|
|
Risk-free interest rate
|
|
0.66
|
%
|
|
Expected life in years
|
|
3
|
|
|
Expected volatility
|
|
17.8
|
%
|
|
Range of expected volatility for Peer Group
|
|
12.4% to 23.3%
|
|
|
Grant date fair value (per share)
|
|
$
|
22.95
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|
Shares
|
|
|
(1)
|
|||||||||
Outstanding, January 1
|
222,647
|
|
|
$
|
26.02
|
|
|
364,731
|
|
|
$
|
26.01
|
|
|
296,843
|
|
|
$
|
26.14
|
|
|||
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
129,603
|
|
|
25.18
|
|
||||||
Vested and settled
|
(109,097
|
)
|
|
26.89
|
|
|
(121,249
|
)
|
|
26.05
|
|
|
(65,089
|
)
|
|
24.95
|
|
||||||
Increase above target (cancelled)
|
(1,989
|
)
|
|
25.26
|
|
|
3,412
|
|
|
26.89
|
|
|
4,949
|
|
|
26.70
|
|
||||||
Forfeited
|
(1,745
|
)
|
|
25.19
|
|
|
(24,247
|
)
|
|
25.82
|
|
|
(1,575
|
)
|
|
26.07
|
|
||||||
Outstanding, December 31
|
109,816
|
|
|
$
|
25.18
|
|
|
222,647
|
|
|
$
|
26.02
|
|
|
364,731
|
|
|
$
|
26.01
|
|
|||
Total weighted-average grant-date fair value of shares granted (at target performance levels) ($ millions)
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
3.3
|
|
|
|
(1)
|
Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
|
12
·
Income taxes
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||||||||||
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Federal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Current
|
$
|
59,873
|
|
|
$
|
44,343
|
|
|
$
|
(8,959
|
)
|
|
$
|
952
|
|
|
$
|
—
|
|
|
$
|
1,108
|
|
Deferred
|
43,666
|
|
|
36,664
|
|
|
91,412
|
|
|
70,513
|
|
|
68,757
|
|
|
68,775
|
|
||||||
Deferred tax credits, net
|
268
|
|
|
318
|
|
|
—
|
|
|
268
|
|
|
318
|
|
|
—
|
|
||||||
|
103,807
|
|
|
81,325
|
|
|
82,453
|
|
|
71,733
|
|
|
69,075
|
|
|
69,883
|
|
||||||
State
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Current
|
16,473
|
|
|
2,402
|
|
|
(5,793
|
)
|
|
9,232
|
|
|
(1,048
|
)
|
|
(9,436
|
)
|
||||||
Deferred
|
3,452
|
|
|
4,768
|
|
|
12,813
|
|
|
3,873
|
|
|
6,869
|
|
|
14,172
|
|
||||||
Deferred tax credits, net
|
(37
|
)
|
|
4,526
|
|
|
6,106
|
|
|
(37
|
)
|
|
4,526
|
|
|
6,106
|
|
||||||
|
19,888
|
|
|
11,696
|
|
|
13,126
|
|
|
13,068
|
|
|
10,347
|
|
|
10,842
|
|
||||||
Total
|
$
|
123,695
|
|
|
$
|
93,021
|
|
|
$
|
95,579
|
|
|
$
|
84,801
|
|
|
$
|
79,422
|
|
|
$
|
80,725
|
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||||||||||
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Amount at the federal statutory income tax rate
|
$
|
130,844
|
|
|
$
|
89,176
|
|
|
$
|
92,959
|
|
|
$
|
80,190
|
|
|
$
|
75,996
|
|
|
$
|
77,126
|
|
Increase (decrease) resulting from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
State income taxes, net of federal income tax benefit
|
13,915
|
|
|
8,097
|
|
|
9,073
|
|
|
8,494
|
|
|
6,726
|
|
|
7,047
|
|
||||||
Other, net
|
(21,064
|
)
|
|
(4,252
|
)
|
|
(6,453
|
)
|
|
(3,883
|
)
|
|
(3,300
|
)
|
|
(3,448
|
)
|
||||||
Total
|
$
|
123,695
|
|
|
$
|
93,021
|
|
|
$
|
95,579
|
|
|
$
|
84,801
|
|
|
$
|
79,422
|
|
|
$
|
80,725
|
|
Effective income tax rate
|
33.1
|
%
|
|
36.5
|
%
|
|
36.0
|
%
|
|
37.0
|
%
|
|
36.6
|
%
|
|
36.6
|
%
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||
December 31
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
||||||
Deferred tax assets
|
|
|
|
|
|
|
|
|
|
||||||
Net operating loss
1
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,158
|
|
|
$
|
37,283
|
|
Allowance for bad debts
|
24,500
|
|
|
21,781
|
|
|
2,364
|
|
|
1,852
|
|
||||
Other
|
47,201
|
|
|
43,089
|
|
|
18,720
|
|
|
18,386
|
|
||||
Total deferred tax assets
|
71,701
|
|
|
64,870
|
|
|
30,242
|
|
|
57,521
|
|
||||
Deferred tax liabilities
|
|
|
|
|
|
|
|
|
|
||||||
Property, plant and equipment related
|
538,484
|
|
|
492,441
|
|
|
536,885
|
|
|
489,884
|
|
||||
Repairs deduction
|
103,782
|
|
|
104,081
|
|
|
103,782
|
|
|
104,081
|
|
||||
Regulatory assets, excluding amounts attributable to property, plant and equipment
|
35,107
|
|
|
34,261
|
|
|
35,107
|
|
|
34,261
|
|
||||
Deferred RAM and RBA revenues
|
26,053
|
|
|
26,400
|
|
|
26,053
|
|
|
26,400
|
|
||||
Retirement benefits
|
48,400
|
|
|
42,006
|
|
|
51,445
|
|
|
44,991
|
|
||||
Other
|
48,681
|
|
|
46,558
|
|
|
10,629
|
|
|
12,710
|
|
||||
Total deferred tax liabilities
|
800,507
|
|
|
745,747
|
|
|
763,901
|
|
|
712,327
|
|
||||
Net deferred income tax liability
|
$
|
728,806
|
|
|
$
|
680,877
|
|
|
$
|
733,659
|
|
|
$
|
654,806
|
|
1
|
The Hawaiian Electric deferred tax asset includes the tax effect of federal net operating loss carryforwards of
$9 million
expiring in 2034 and federal general business credit carryforwards of
$3 million
expiring in 2032 through 2036, net of unrecognized federal tax benefits of
$3 million
due to uncertain tax positions.
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||||||||||
(in millions)
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
||||||
Unrecognized tax benefits, January 1
|
$
|
3.6
|
|
|
$
|
—
|
|
|
$
|
0.9
|
|
|
$
|
3.6
|
|
|
$
|
—
|
|
|
0.5
|
|
|
Reductions based on tax positions taken during the year
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
||||||
Additions for tax positions of prior years
|
0.3
|
|
|
3.6
|
|
|
0.1
|
|
|
0.3
|
|
|
3.6
|
|
|
0.1
|
|
||||||
Settlements
|
|
|
|
|
|
|
(1.0
|
)
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
||||||
Unrecognized tax benefits, December 31
|
$
|
3.8
|
|
|
$
|
3.6
|
|
|
$
|
—
|
|
|
$
|
3.8
|
|
|
$
|
3.6
|
|
|
$
|
—
|
|
13
·
Cash flows
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|||
(in millions)
|
|
|
|
|
|
||||||
Supplemental disclosures of cash flow information
|
|
|
|
|
|
|
|
|
|||
HEI consolidated
|
|
|
|
|
|
||||||
Interest paid to non-affiliates
|
$
|
84
|
|
|
$
|
83
|
|
|
$
|
84
|
|
Income taxes paid
|
55
|
|
|
75
|
|
|
47
|
|
|||
Income taxes refunded
|
45
|
|
|
55
|
|
|
24
|
|
|||
Hawaiian Electric consolidated
|
|
|
|
|
|
||||||
Interest paid to non-affiliates
|
62
|
|
|
61
|
|
|
61
|
|
|||
Income taxes paid
|
1
|
|
|
13
|
|
|
6
|
|
|||
Income taxes refunded
|
20
|
|
|
12
|
|
|
8
|
|
|||
Supplemental disclosures of noncash activities
|
|
|
|
|
|
|
|
|
|||
HEI consolidated
|
|
|
|
|
|
||||||
Property, plant and equipment
–
change in unpaid invoices and accruals (investing)
|
14
|
|
|
5
|
|
|
43
|
|
|||
Common stock dividends reinvested in HEI common stock (financing)
1
|
17
|
|
|
—
|
|
|
—
|
|
|||
Loans transferred from held for investment to held for sale (investing)
|
24
|
|
|
—
|
|
|
—
|
|
|||
Real estate acquired in settlement of loans (investing)
|
1
|
|
|
1
|
|
|
3
|
|
|||
Real estate transferred from property, plant and equipment to other assets held-for-sale (investing)
|
1
|
|
|
5
|
|
|
—
|
|
|||
Obligations to fund low income housing investments, net (operating)
|
14
|
|
|
4
|
|
|
14
|
|
|||
Hawaiian Electric consolidated
|
|
|
|
|
|
||||||
Electric utility property, plant and equipment
|
|
|
|
|
|
|
|
|
|||
AFUDC-equity (operating)
|
8
|
|
|
7
|
|
|
7
|
|
|||
Estimated fair value of noncash contributions in aid of construction (investing)
|
28
|
|
|
3
|
|
|
3
|
|
|||
Change in unpaid invoices and accruals (investing)
|
14
|
|
|
5
|
|
|
40
|
|
|||
Refinancing of long-term debt (financing)
|
—
|
|
|
47
|
|
|
—
|
|
1
|
The amounts shown represents common stock dividends reinvested in HEI common stock under the HEI DRIP in noncash transactions.
|
14
·
Regulatory restrictions on net assets
|
15
·
Significant group concentrations of credit risk
|
16
·
Fair value measurements
|
Level 1:
|
Inputs to the valuation methodology are quoted prices, unadjusted, for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and is used to measure fair value whenever available.
|
Level 2:
|
Inputs to the valuation methodology include quoted prices for similar assets or liabilities in active markets; inputs to the valuation methodology include quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs to the valuation methodology that are derived principally from or can be corroborated by observable market data by correlation or other means.
|
Level 3:
|
Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Level 3 assets and liabilities include financial instruments whose value is determined using discounted cash flow methodologies, as well as instruments for which the determination of fair value requires significant management judgment or estimation.
|
|
|
|
Estimated fair value
|
||||||||||||||||
(in thousands)
|
Carrying or notional
amount
|
|
Quoted prices in active markets for identical assets
(Level 1)
|
|
Significant other observable inputs
(Level 2)
|
|
Significant unobservable inputs
(Level 3) |
|
Total
|
||||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Money market funds
|
$
|
13,085
|
|
|
$
|
—
|
|
|
$
|
13,085
|
|
|
$
|
—
|
|
|
$
|
13,085
|
|
Available-for-sale investment securities
|
1,105,182
|
|
|
—
|
|
|
1,089,755
|
|
|
15,427
|
|
|
1,105,182
|
|
|||||
Stock in Federal Home Loan Bank
|
11,218
|
|
|
—
|
|
|
11,218
|
|
|
—
|
|
|
11,218
|
|
|||||
Loans receivable, net
|
4,701,977
|
|
|
—
|
|
|
13,333
|
|
|
4,839,493
|
|
|
4,852,826
|
|
|||||
Mortgage servicing rights
|
9,373
|
|
|
—
|
|
|
—
|
|
|
13,216
|
|
|
13,216
|
|
|||||
Bank-owned life insurance
|
143,197
|
|
|
—
|
|
|
143,197
|
|
|
—
|
|
|
143,197
|
|
|||||
Derivative assets
|
23,578
|
|
|
—
|
|
|
453
|
|
|
—
|
|
|
453
|
|
|||||
Financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposit liabilities
|
5,548,929
|
|
|
—
|
|
|
5,546,644
|
|
|
—
|
|
|
5,546,644
|
|
|||||
Other bank borrowings
|
192,618
|
|
|
—
|
|
|
193,991
|
|
|
—
|
|
|
193,991
|
|
|||||
Long-term debt, net—other than bank
|
1,619,019
|
|
|
—
|
|
|
1,704,717
|
|
|
—
|
|
|
1,704,717
|
|
|||||
Derivative liabilities
|
53,852
|
|
|
129
|
|
|
823
|
|
|
—
|
|
|
952
|
|
|||||
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt, net
|
1,319,260
|
|
|
—
|
|
|
1,399,490
|
|
|
—
|
|
|
1,399,490
|
|
|||||
Derivative liabilities
|
20,734
|
|
|
—
|
|
|
743
|
|
|
—
|
|
|
743
|
|
|||||
December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Money market funds
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
10
|
|
Available-for-sale investment securities
|
820,648
|
|
|
—
|
|
|
820,648
|
|
|
—
|
|
|
820,648
|
|
|||||
Stock in Federal Home Loan Bank
|
10,678
|
|
|
—
|
|
|
10,678
|
|
|
—
|
|
|
10,678
|
|
|||||
Loans receivable, net
|
4,570,412
|
|
|
—
|
|
|
4,639
|
|
|
4,744,886
|
|
|
4,749,525
|
|
|||||
Mortgage servicing rights
|
8,884
|
|
|
—
|
|
|
—
|
|
|
11,790
|
|
|
11,790
|
|
|||||
Bank-owned life insurance
|
138,139
|
|
|
—
|
|
|
138,139
|
|
|
—
|
|
|
138,139
|
|
|||||
Derivative assets
|
22,616
|
|
|
—
|
|
|
385
|
|
|
—
|
|
|
385
|
|
|||||
Financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Deposit liabilities
|
5,025,254
|
|
|
—
|
|
|
5,024,500
|
|
|
—
|
|
|
5,024,500
|
|
|||||
Short-term borrowings—other than bank
|
103,063
|
|
|
—
|
|
|
103,063
|
|
|
—
|
|
|
103,063
|
|
|||||
Other bank borrowings
|
328,582
|
|
|
—
|
|
|
333,392
|
|
|
—
|
|
|
333,392
|
|
|||||
Long-term debt, net—other than bank*
|
1,578,368
|
|
|
—
|
|
|
1,669,087
|
|
|
—
|
|
|
1,669,087
|
|
|||||
Derivative liabilities
|
23,269
|
|
|
15
|
|
|
15
|
|
|
—
|
|
|
30
|
|
|||||
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt, net*
|
1,278,702
|
|
|
—
|
|
|
1,363,766
|
|
|
—
|
|
|
1,363,766
|
|
December 31
|
2016
|
|
2015
|
||||||||||||||||||||
|
Fair value measurements using
|
|
Fair value measurements using
|
||||||||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||
Money market funds (“other” segment)
|
$
|
—
|
|
|
$
|
13,085
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10
|
|
|
$
|
—
|
|
Available-for-sale investment securities (bank segment)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Mortgage-related securities-FNMA, FHLMC and GNMA
|
$
|
—
|
|
|
$
|
897,474
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
607,689
|
|
|
$
|
—
|
|
U.S. Treasury and federal agency obligations
|
—
|
|
|
192,281
|
|
|
—
|
|
|
—
|
|
|
212,959
|
|
|
—
|
|
||||||
Mortgage revenue bond
|
—
|
|
|
—
|
|
|
15,427
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
$
|
—
|
|
|
$
|
1,089,755
|
|
|
$
|
15,427
|
|
|
$
|
—
|
|
|
$
|
820,648
|
|
|
$
|
—
|
|
Derivative assets (bank segment)
1
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate lock commitments
|
$
|
—
|
|
|
$
|
445
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
384
|
|
|
$
|
—
|
|
Forward commitments
|
—
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
|
$
|
—
|
|
|
$
|
453
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
385
|
|
|
$
|
—
|
|
Derivative liabilities
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate lock commitments (bank segment)
1
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Forward commitments (bank segment)
1
|
129
|
|
|
56
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|
—
|
|
||||||
Window forward contracts (electric utility segment)
2
|
—
|
|
|
743
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
|
$
|
129
|
|
|
$
|
823
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
15
|
|
|
$
|
—
|
|
1
|
Derivatives are carried at fair value with changes in value reflected in the balance sheet in other assets or other liabilities and included in mortgage banking income.
|
2
|
Liability derivatives are included in other current liabilities in the balance sheets.
|
(in thousands)
|
Mortgage revenue bond
|
|
|
Balance at December 31, 2015
|
$
|
—
|
|
Principal payments received
|
—
|
|
|
Purchases
|
15,427
|
|
|
Unrealized gain (loss) included in other comprehensive income
|
—
|
|
|
Balance at December 31, 2016
|
$
|
15,427
|
|
|
|
|
Fair value measurements using
|
||||||||||||
(in thousands)
|
Balance
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
||||
Loans
|
$
|
2,767
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,767
|
|
Real estate acquired in settlement of loans
|
1,189
|
|
|
—
|
|
|
—
|
|
|
1,189
|
|
||||
December 31, 2015
|
|
|
|
|
|
|
|
||||||||
Loans
|
178
|
|
|
—
|
|
|
—
|
|
|
178
|
|
||||
Real estate acquired in settlement of loans
|
1,030
|
|
|
—
|
|
|
—
|
|
|
1,030
|
|
|
|
|
|
|
|
|
Significant unobservable
input value (1)
|
||||
(dollars in thousands)
|
Fair value
|
|
Valuation technique
|
|
Significant unobservable input
|
|
Range
|
|
Weighted
Average |
||
December 31, 2016
|
|
|
|
|
|
|
|
|
|
||
Residential loans
|
$
|
2,468
|
|
|
Sales price
|
|
Sales price
|
|
95-100%
|
|
97%
|
Residential loans
|
287
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
42-65%
|
|
61%
|
|
Home equity lines of credit
|
12
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
|
|
N/A (2)
|
|
Total loans
|
$
|
2,767
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Real estate acquired in settlement of loans
|
$
|
1,189
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
100%
|
|
100%
|
December 31, 2015
|
|
|
|
|
|
|
|
|
|
||
Residential loans
|
$
|
50
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
|
|
N/A (2)
|
Home equity lines of credit
|
128
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
|
|
N/A (2)
|
|
Total loans
|
$
|
178
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Real estate acquired in settlement of loans
|
$
|
1,030
|
|
|
Fair value of property or collateral
|
|
Appraised value less 7% selling cost
|
|
100%
|
|
100%
|
(1)
|
Represent percent of outstanding principal balance.
|
(2)
|
N/A - Not applicable. There is one loan in each fair value measurement type.
|
17
·
Other related-party transactions
|
|
HEI consolidated
|
|
Hawaiian Electric consolidated
|
||||||||||||||||||||
(in millions)
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||
HMSA costs
|
$
|
28
|
|
|
$
|
30
|
|
|
$
|
25
|
|
|
$
|
22
|
|
|
$
|
23
|
|
|
$
|
20
|
|
HMSA expense*
|
20
|
|
|
21
|
|
|
18
|
|
|
14
|
|
|
14
|
|
|
13
|
|
||||||
HDS costs
|
3
|
|
|
3
|
|
|
3
|
|
|
2
|
|
|
2
|
|
|
2
|
|
||||||
HDS expense*
|
2
|
|
|
2
|
|
|
2
|
|
|
1
|
|
|
1
|
|
|
1
|
|
18
·
Quarterly information (unaudited)
|
|
Quarters ended
|
|
Years ended
|
||||||||||||||||
(in thousands, except per share amounts)
|
March 31
|
|
June 30
|
|
Sept. 30
|
|
Dec. 31
|
|
December 31
|
||||||||||
HEI consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
550,960
|
|
|
$
|
566,244
|
|
|
$
|
646,055
|
|
|
$
|
617,395
|
|
|
$
|
2,380,654
|
|
Operating income
|
68,851
|
|
|
85,455
|
|
|
105,442
|
|
|
88,427
|
|
|
348,175
|
|
|||||
Net income
|
32,825
|
|
|
44,601
|
|
|
127,613
|
|
|
45,107
|
|
|
250,146
|
|
|||||
Net income for common stock
|
32,352
|
|
|
44,128
|
|
|
127,142
|
|
|
44,634
|
|
|
248,256
|
|
|||||
Basic earnings per common share
2
|
0.30
|
|
|
0.41
|
|
|
1.17
|
|
|
0.41
|
|
|
2.30
|
|
|||||
Diluted earnings per common share
3
|
0.30
|
|
|
0.41
|
|
|
1.17
|
|
|
0.41
|
|
|
2.29
|
|
|||||
Dividends per common share
|
0.31
|
|
|
0.31
|
|
|
0.31
|
|
|
0.31
|
|
|
1.24
|
|
|||||
Market price per common share
4
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
32.69
|
|
|
34.98
|
|
|
33.57
|
|
|
34.08
|
|
|
34.98
|
|
|||||
Low
|
27.30
|
|
|
31.35
|
|
|
29.14
|
|
|
28.31
|
|
|
27.30
|
|
|||||
2015
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
637,862
|
|
|
$
|
623,912
|
|
|
$
|
717,176
|
|
|
$
|
624,032
|
|
|
$
|
2,602,982
|
|
Operating income
|
69,506
|
|
|
72,730
|
|
|
97,095
|
|
|
83,222
|
|
|
322,553
|
|
|||||
Net income
|
32,339
|
|
|
35,491
|
|
|
51,144
|
|
|
42,793
|
|
|
161,767
|
|
|||||
Net income for common stock
|
31,866
|
|
|
35,018
|
|
|
50,673
|
|
|
42,320
|
|
|
159,877
|
|
|||||
Basic earnings per common share
2
|
0.31
|
|
|
0.33
|
|
|
0.47
|
|
|
0.39
|
|
|
1.50
|
|
|||||
Diluted earnings per common share
3
|
0.31
|
|
|
0.33
|
|
|
0.47
|
|
|
0.39
|
|
|
1.50
|
|
|||||
Dividends per common share
|
0.31
|
|
|
0.31
|
|
|
0.31
|
|
|
0.31
|
|
|
1.24
|
|
|||||
Market price per common share
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
High
|
34.86
|
|
|
32.58
|
|
|
31.28
|
|
|
30.29
|
|
|
34.86
|
|
|||||
Low
|
31.75
|
|
|
29.62
|
|
|
27.02
|
|
|
27.45
|
|
|
27.02
|
|
|||||
Hawaiian Electric consolidated
|
|
|
|
|
|
|
|
|
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
482,052
|
|
|
$
|
495,395
|
|
|
$
|
572,253
|
|
|
$
|
544,668
|
|
|
$
|
2,094,368
|
|
Operating income
|
55,326
|
|
|
70,686
|
|
|
89,812
|
|
|
68,644
|
|
|
284,468
|
|
|||||
Net income
|
25,866
|
|
|
36,356
|
|
|
47,472
|
|
|
34,618
|
|
|
144,312
|
|
|||||
Net income for common stock
|
25,367
|
|
|
35,857
|
|
|
46,974
|
|
|
34,119
|
|
|
142,317
|
|
|||||
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
573,442
|
|
|
558,163
|
|
|
648,127
|
|
|
555,434
|
|
|
2,335,166
|
|
|||||
Operating income
|
57,636
|
|
|
66,161
|
|
|
82,657
|
|
|
67,662
|
|
|
274,116
|
|
|||||
Net income
|
27,373
|
|
|
33,340
|
|
|
43,504
|
|
|
33,492
|
|
|
137,709
|
|
|||||
Net income for common stock
|
26,874
|
|
|
32,841
|
|
|
43,006
|
|
|
32,993
|
|
|
135,714
|
|
1
|
In the third quarter of 2016, HEI received a
$90 million
termination fee from NEE and in 2016 and 2015 received and incurred other merger and spin-off-related amounts (see Note 2 to the Consolidated Financial Statements). For the first quarter of 2015, second quarter of 2015, third quarter of 2015, fourth quarter of 2015, first quarter of 2016, second quarter of 2016 and third quarter of 2016, the Company recorded merger- and spin-off-related income/(expenses), net of tax impacts of
$(5) million
,
$(7) million
,
$(2) million
,
$(2) million
,
$(2) million
,
$(2) million
and
$64 million
, respectively.
|
2
|
The quarterly basic earnings per common share are based upon the weighted-average number of shares of common stock outstanding in each quarter.
|
3
|
The quarterly diluted earnings per common share are based upon the weighted-average number of shares of common stock outstanding in each quarter plus the dilutive incremental shares at quarter end.
|
4
|
Market prices of HEI common stock (symbol HE) shown are as reported on the NYSE Composite Tape.
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
(1)
|
is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and
|
(2)
|
is accumulated and communicated to HEI management, including HEI’s CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
|
(1)
|
is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and
|
(2)
|
is accumulated and communicated to Hawaiian Electric management, including Hawaiian Electric’s CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
•
|
“Nominees for Class III directors whose terms expire at the 2020 Annual Meeting”
|
•
|
“Nominee for Class I director whose term expires at the 2018 Annual Meeting”
|
•
|
“Continuing Class I directors whose terms expire at the 2018 Annual Meeting”
|
•
|
“Continuing Class II directors whose terms expire at the 2019 Annual Meeting”
|
•
|
“Committees of the Board” (portions regarding whether HEI has an audit committee and identifying its members; no other portion of the Committees of the Board section is incorporated herein by reference)
|
•
|
“Audit Committee Report” (portion identifying audit committee financial experts who serve on the HEI Audit Committee only; no other portion of the Audit Committee Report is incorporated herein by reference)
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
•
|
Pages 8 to 29 of Hawaiian Electric Exhibit 99.1 to this Form 10-K;
|
•
|
The discussion of “2015-17 Long-Term Incentive Plan” at pages 15-16 of Hawaiian Electric’s Exhibit 99.1 to Annual Report on Form 10-K for the year ended December 31, 2015; and
|
•
|
Information concerning compensation paid to directors of Hawaiian Electric who are also directors of HEI under the section of HEI's 2017 Proxy Statement entitled, “Director Compensation.”
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
Plan category
|
(a)
Number of
securities
to be issued upon
exercise of
outstanding
options, warrants
and rights (1)
|
|
(b)
Weighted-average
exercise price of
outstanding
options,
warrants and
rights
|
|
(c)
Number of securities
remaining available for
future issuance
under equity
compensation plans
(excluding securities
reflected in column (a)) (2)
|
||||
Equity compensation plans approved by shareholders
|
266,754
|
|
|
$
|
—
|
|
|
3,278,383
|
|
Equity compensation plans not approved by shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
266,754
|
|
|
$
|
—
|
|
|
3,278,383
|
|
EIP
|
|
|
161,145
|
|
Restricted stock units plus estimated compounded dividend equivalents (if applicable) *
|
105,609
|
|
Shares issued in February 2017 under the 2014-2016 LTIP plus compounded dividend equivalents
|
266,754
|
|
|
*
|
Under the amended EIP as of
December 31, 2016
, RSUs count as one share against shares available for issuance less estimated shares withheld for taxes under net share settlement which again become available for the issuance of new shares on a one-to-one basis.
|
(2)
|
This represents the number of shares available as of
December 31, 2016
for future awards, including 3,157,185 shares available for future awards under the amended EIP and 121,198 shares available for future awards under the 2011 Nonemployee Director Plan.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
|
Page/s in Form 10-K
|
|||
|
HEI
|
|
Hawaiian Electric
|
|
Schedule I
|
Condensed Financial Information of Registrant, Hawaiian Electric Industries, Inc. (Parent Company) at December 31, 2016 and 2015 and for the years ended December 31, 2016, 2015 and 2014
|
|
NA
|
|
Schedule II
|
Valuation and Qualifying Accounts, Hawaiian Electric Industries, Inc. and subsidiaries and Hawaiian Electric Company, Inc. and subsidiaries for the years ended December 31, 2016, 2015 and 2014
|
|
||
NA Not applicable.
|
|
|
|
|
December 31
|
2016
|
|
2015
|
||||
(dollars in thousands)
|
|
|
|
|
|
||
Assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
14,924
|
|
|
$
|
55,116
|
|
Accounts receivable
|
3,788
|
|
|
5,459
|
|
||
Property, plant and equipment, net
|
4,143
|
|
|
4,514
|
|
||
Deferred income tax assets
|
17,280
|
|
|
16,715
|
|
||
Other assets
|
9,858
|
|
|
11,650
|
|
||
Investments in subsidiaries, at equity
|
2,383,405
|
|
|
2,293,679
|
|
||
Total assets
|
$
|
2,433,398
|
|
|
$
|
2,387,133
|
|
Liabilities and shareholders’ equity
|
|
|
|
|
|
||
Liabilities
|
|
|
|
|
|
||
Accounts payable
|
$
|
379
|
|
|
$
|
1,254
|
|
Interest payable
|
1,735
|
|
|
2,450
|
|
||
Notes payable to subsidiaries
|
5,373
|
|
|
5,946
|
|
||
Commercial paper
|
—
|
|
|
103,063
|
|
||
Long-term debt, net
|
299,759
|
|
|
299,666
|
|
||
Retirement benefits liability
|
33,939
|
|
|
31,704
|
|
||
Other
|
25,460
|
|
|
15,410
|
|
||
Total liabilities
|
366,645
|
|
|
459,493
|
|
||
Shareholders’ equity
|
|
|
|
|
|
||
Preferred stock, no par value, authorized 10,000,000 shares; issued: none
|
—
|
|
|
—
|
|
||
Common stock, no par value, authorized 200,000,000 shares; issued and outstanding: 108,583,413
shares and 107,460,406 shares at December 31, 2016 and 2015, respectively |
1,660,910
|
|
|
1,629,136
|
|
||
Retained earnings
|
438,972
|
|
|
324,766
|
|
||
Accumulated other comprehensive loss
|
(33,129
|
)
|
|
(26,262
|
)
|
||
Total shareholders' equity
|
2,066,753
|
|
|
1,927,640
|
|
||
Total liabilities and shareholders' equity
|
$
|
2,433,398
|
|
|
$
|
2,387,133
|
|
Years ended December 31
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|||
Revenues
|
$
|
647
|
|
|
$
|
327
|
|
|
$
|
303
|
|
Equity in net income of subsidiaries
|
199,485
|
|
|
190,033
|
|
|
188,727
|
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|||
Operating, administrative and general
|
18,701
|
|
|
34,350
|
|
|
20,921
|
|
|||
Depreciation of property, plant and equipment
|
566
|
|
|
576
|
|
|
575
|
|
|||
Taxes, other than income taxes
|
4,726
|
|
|
440
|
|
|
469
|
|
|||
Total expenses
|
23,993
|
|
|
35,366
|
|
|
21,965
|
|
|||
Income before merger termination fee, interest expense and income (taxes) benefits
|
176,139
|
|
|
154,994
|
|
|
167,065
|
|
|||
Merger termination fee
|
90,000
|
|
|
—
|
|
|
—
|
|
|||
Income before interest expense and income (taxes) benefits
|
266,139
|
|
|
154,994
|
|
|
167,065
|
|
|||
Interest expense
|
9,037
|
|
|
10,788
|
|
|
11,599
|
|
|||
Income before income (taxes) benefits
|
257,102
|
|
|
144,206
|
|
|
155,466
|
|
|||
Income (taxes) benefits
|
(8,846
|
)
|
|
15,671
|
|
|
13,047
|
|
|||
Net income
|
$
|
248,256
|
|
|
$
|
159,877
|
|
|
$
|
168,513
|
|
Years ended December 31
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Net cash provided by operating activities
|
$
|
191,306
|
|
|
$
|
97,141
|
|
|
$
|
100,794
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
(212
|
)
|
|
(173
|
)
|
|
(74
|
)
|
|||
Investments in subsidiaries
|
(24,000
|
)
|
|
—
|
|
|
(40,000
|
)
|
|||
Other
|
1
|
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
(24,211
|
)
|
|
(173
|
)
|
|
(40,074
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|||
Net increase (decrease) in notes payable to subsidiaries with original maturities of three months or less
|
(618
|
)
|
|
87
|
|
|
(222
|
)
|
|||
Net increase (decrease) in short-term borrowings with original maturities of three months or less
|
(103,063
|
)
|
|
(15,909
|
)
|
|
13,490
|
|
|||
Proceeds from issuance of long-term debt
|
75,000
|
|
|
—
|
|
|
125,000
|
|
|||
Repayment of long-term debt
|
(75,000
|
)
|
|
—
|
|
|
(100,000
|
)
|
|||
Excess tax benefits from share-based payment arrangements
|
404
|
|
|
978
|
|
|
277
|
|
|||
Net proceeds from issuance of common stock
|
13,220
|
|
|
104,435
|
|
|
26,898
|
|
|||
Common stock dividends
|
(117,274
|
)
|
|
(131,765
|
)
|
|
(126,458
|
)
|
|||
Other
|
44
|
|
|
46
|
|
|
—
|
|
|||
Net cash used in financing activities
|
(207,287
|
)
|
|
(42,128
|
)
|
|
(61,015
|
)
|
|||
Net increase (decrease) in cash and equivalents
|
(40,192
|
)
|
|
54,840
|
|
|
(295
|
)
|
|||
Cash and cash equivalents, January 1
|
55,116
|
|
|
276
|
|
|
571
|
|
|||
Cash and cash equivalents, December 31
|
$
|
14,924
|
|
|
$
|
55,116
|
|
|
$
|
276
|
|
December 31
|
2016
|
|
2015
|
||||
(dollars in thousands)
|
|
|
|
|
|
||
HEI Term loan LIBOR + .75%, due 2017
|
$
|
125,000
|
|
|
$
|
125,000
|
|
HEI Term loan LIBOR + .75%, due 2018
|
75,000
|
|
|
—
|
|
||
HEI senior note 4.41%, paid in 2016
|
—
|
|
|
75,000
|
|
||
HEI senior note 5.67%, due 2021
|
50,000
|
|
|
50,000
|
|
||
HEI senior note 3.99%, due 2023
|
50,000
|
|
|
50,000
|
|
||
Less unamortized debt issuance costs
|
(241
|
)
|
|
(334
|
)
|
||
Long-term debt, net
|
$
|
299,759
|
|
|
$
|
299,666
|
|
Col. A
|
Col. B
|
|
Col. C
|
|
|
Col. D
|
|
|
Col. E
|
||||||||||||
(in thousands)
|
|
|
Additions
|
|
|
|
|
|
|
||||||||||||
Description
|
Balance
at begin-
ning of
period
|
|
Charged to
costs and
expenses
|
|
Charged
to other
accounts
|
|
|
Deductions
|
|
|
Balance at
end of
period
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for uncollectible accounts – electric utility
|
$
|
1,699
|
|
|
$
|
2,383
|
|
|
$
|
877
|
|
(a)
|
|
$
|
3,838
|
|
(b),(c)
|
|
$
|
1,121
|
|
Allowance for uncollectible interest – bank
|
$
|
1,679
|
|
|
$
|
—
|
|
|
$
|
155
|
|
|
|
$
|
—
|
|
|
|
$
|
1,834
|
|
Allowance for losses for loans receivable – bank
|
$
|
50,038
|
|
|
$
|
16,763
|
|
(d)
|
$
|
2,977
|
|
(a)
|
|
$
|
14,245
|
|
(b)
|
|
$
|
55,533
|
|
Deferred tax valuation allowance – HEI
|
$
|
54
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
16
|
|
|
|
$
|
38
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for uncollectible accounts – electric utility
|
$
|
1,959
|
|
|
$
|
3,653
|
|
|
$
|
977
|
|
(a)
|
|
$
|
4,890
|
|
(b)
|
|
$
|
1,699
|
|
Allowance for uncollectible interest – bank
|
$
|
1,514
|
|
|
$
|
—
|
|
|
$
|
165
|
|
|
|
$
|
—
|
|
|
|
$
|
1,679
|
|
Allowance for losses for loans receivable – bank
|
$
|
45,618
|
|
|
$
|
6,275
|
|
(d)
|
$
|
4,571
|
|
(a)
|
|
$
|
6,426
|
|
(b)
|
|
$
|
50,038
|
|
Allowance for mortgage-servicing assets – bank
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
(205
|
)
|
|
|
$
|
4
|
|
|
|
$
|
—
|
|
Deferred tax valuation allowance – HEI
|
$
|
45
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
|
$
|
54
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for uncollectible accounts – electric utility
|
$
|
2,329
|
|
|
$
|
1,384
|
|
|
$
|
1,613
|
|
(a)
|
|
$
|
3,367
|
|
(b)
|
|
$
|
1,959
|
|
Allowance for uncollectible interest – bank
|
$
|
1,661
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
$
|
147
|
|
|
|
$
|
1,514
|
|
Allowance for losses for loans receivable – bank
|
$
|
40,116
|
|
|
$
|
6,126
|
|
(d)
|
$
|
4,926
|
|
(a)
|
|
$
|
5,550
|
|
(b)
|
|
$
|
45,618
|
|
Allowance for mortgage-servicing assets – bank
|
$
|
251
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
|
$
|
95
|
|
|
|
$
|
209
|
|
Deferred tax valuation allowance – HEI
|
$
|
278
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
|
$
|
250
|
|
|
|
$
|
45
|
|
(a)
|
Primarily recoveries.
|
(b)
|
Bad debts charged off.
|
(c)
|
Reclass of allowance for one customer account into other long term assets.
|
(d)
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Represents provision for loan loss
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HAWAIIAN ELECTRIC INDUSTRIES, INC.
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HAWAIIAN ELECTRIC COMPANY, INC.
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(Registrant)
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(Registrant)
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By
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/s/ James A. Ajello
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By
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/s/ Tayne S. Y. Sekimura
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James A. Ajello
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Tayne S. Y. Sekimura
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Executive Vice President and Chief Financial Officer
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Senior Vice President and Chief Financial Officer
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(Principal Financial and Accounting Officer of HEI)
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(Principal Financial Officer of Hawaiian Electric)
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Date:
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February 24, 2017
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Date:
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February 24, 2017
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Signature
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Title
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/s/ Constance H. Lau
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President of HEI and Director of HEI
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Constance H. Lau
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Chairman of the Board of Directors of Hawaiian Electric
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(Chief Executive Officer of HEI)
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/s/ Alan M. Oshima
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President and Director of Hawaiian Electric
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Alan M. Oshima
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(Chief Executive Officer of Hawaiian Electric)
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/s/ James A. Ajello
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Executive Vice President and Chief Financial Officer of HEI
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James A. Ajello
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(Principal Financial and Accounting Officer of HEI)
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/s/ Tayne S. Y. Sekimura
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Senior Vice President and
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Tayne S. Y. Sekimura
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Chief Financial Officer of Hawaiian Electric
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(Principal Financial Officer of Hawaiian Electric)
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/s/ Patsy H. Nanbu
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Controller of Hawaiian Electric
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Patsy H. Nanbu
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(Principal Accounting Officer of Hawaiian Electric)
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Signature
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Title
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/s/ Don E. Carroll
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Director of Hawaiian Electric
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Don E. Carroll
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/s/ Richard J. Dahl
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Director of HEI and Hawaiian Electric
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Richard J. Dahl
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/s/ Thomas B. Fargo
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Director of HEI
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Thomas B. Fargo
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/s/ Peggy Y. Fowler
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Director of HEI
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Peggy Y. Fowler
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/s/ Timothy E. Johns
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Director of Hawaiian Electric
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Timothy E. Johns
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/s/ Micah A. Kane
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Director of Hawaiian Electric
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Micah A. Kane
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/s/ Bert A. Kobayashi, Jr.
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Director of Hawaiian Electric
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Bert A. Kobayashi, Jr.
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/s/ Keith P. Russell
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Director of HEI
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Keith P. Russell
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/s/ James K. Scott
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Director of HEI
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James K. Scott
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/s/ Kelvin H. Taketa
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Director of HEI and Hawaiian Electric
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Kelvin H. Taketa
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/s/ Barry K. Taniguchi
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Director of HEI
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Barry K. Taniguchi
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/s/ Jeffrey N. Watanabe
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Chairman of the Board of Directors of HEI and director of Hawaiian Electric
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Jeffrey N. Watanabe
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Exhibit no.
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Description
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HEI:
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2
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Agreement and Plan of Merger, dated as of December 3, 2014, by and among NextEra Energy, Inc., NEE Acquisition Sub I, LLC, NEE Acquisition Sub II, Inc. and HEI (Exhibit 2.1 to HEI’s Current Report on Form 8-K December 3, 2014, File No. 1-8503).
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3(i)
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HEI’s Amended and Restated Articles of Incorporation (Exhibit 3(i) to HEI’s Current Report on Form 8-K, dated May 5, 2009, File No. 1-8503).
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3(ii)
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Amended and Restated Bylaws of HEI as last amended May 9, 2011 (Exhibit 3(ii) to HEI’s Current Report on Form 8-K May 9, 2011, File No. 1-8503).
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4.1
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Agreement to provide the SEC with instruments which define the rights of holders of certain long-term debt of HEI and its subsidiaries (Exhibit 4.1 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 1992, File No. 1-8503).
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4.2
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Master Note Purchase Agreement among HEI and the Purchasers thereto, dated March 24, 2011 (Exhibit 4(a) to HEI’s Current Report on Form 8-K dated March 24, 2011, File No. 1-8503).
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4.2(a)
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First Supplement to Note Purchase Agreement among HEI and the Purchasers thereto, dated March 6, 2013 (Exhibit 4(a) to HEI’s Current Report on Form 8-K dated March 6, 2013, File No. 1-8503).
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4.3(a)
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Loan Agreement dated as of May 2, 2014 among HEI, as Borrower, the Lenders Party Thereto and Royal Bank of Canada, as Syndication Agent, and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as Administrative Agent, and The Bank of Tokyo-Mitsubishi UFJ, Ltd. and RBC Capital Markets, as Joint Lead Arrangers and Joint Book Runners (Exhibit 4 to HEI’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, File No. 1-8503).
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4.3(b)
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Amendment No. 1 dated as of October 8, 2015 by and among HEI, The Bank of Tokyo-Mitsubishi UFJ, Ltd., as lender and Administrative Agent, and U.S. Bank, National Association, as lender, to Loan Agreement dated as of May 2, 2014 (Exhibit 4 to HEI’s Current Report on Form 8-K dated October 8, 2015, File No. 1-8503).
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4.4
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Loan Agreement dated as of March 21, 2016 between Hawaiian Electric Industries, Inc., as Borrower and Bank of America, N.A. as Lender (Exhibit 4 to HEI’s Current Report on Form 8-K dated March 21, 2016, File No. 1-8503).
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4.5
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Hawaiian Electric Industries Retirement Savings Plan, restatement effective January 1, 2013 (Exhibit 4.5 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, File No. 1-8503).
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4.6
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Master Trust Agreement dated as of September 4, 2012 between HEI and ASB and Fidelity Management Trust Company, as Trustee (Exhibit 4 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, File No. 1-8503).
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4.6(a)
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Letter Amendment effective November 28, 2012 to Master Trust Agreement dated as of September 4, 2012 between HEI and ASB and Fidelity Management Trust Company (Exhibit 4.6(a) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, File No. 1-8503).
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4.6(b)
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Letter Amendment effective October 1, 2014 to Master Trust Agreement dated as of September 4, 2012 between HEI and ASB and Fidelity Management Trust Company (Exhibit 4 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2014, File No. 1-8503).
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4.6(c)
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First Amendment to Master Trust Agreement (dated as of September 4, 2012) effective March 1, 2015 between HEI and ASB and Fidelity Management Trust Company (Exhibit 4 to HEI’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, File No. 1-8503).
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4.6(d)
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Letter Amendment effective August 3, 2015 to Master Trust Agreement (dated as of September 4, 2012) between HEI and ASB and Fidelity Management Trust Company (Exhibit 4 to HEI’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, File No. 1-8503).
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4.7
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Hawaiian Electric Industries, Inc. Dividend Reinvestment and Stock Purchase Plan, as amended and restated effective October 6, 2014 (Exhibit 4(a) to Registration Statement on Form S-3, Registration No. 333-199183).
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Exhibit no.
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Description
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10.10(b)
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Amendment No. 1 dated December 13, 2010 to January 1, 2009 Restatement of HEI Excess Pay Plan (Exhibit 10.10(c) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, File No. 1-8503).
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10.11
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Form of Change in Control Agreement (Exhibit 10.11 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, File No. 1-8503).
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10.12
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Nonemployee Director Retirement Plan, effective as of October 1, 1989 (Exhibit 10.15 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 1989, File No. 1-8503).
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10.13
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HEI 2011 Nonemployee Director Stock Plan (Appendix A to HEI’s Proxy Statement for 2011 Annual Meeting of Shareholders filed on March 21, 2011, File No. 1-8503).
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*
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10.14
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Nonemployee Director’s Compensation Schedule effective January 1, 2017.
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10.15
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HEI Non-Employee Directors’ Deferred Compensation Plan (Exhibit 10.5 to Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, File No. 1-8503).
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10.16
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Executive Death Benefit Plan of HEI and Participating Subsidiaries restatement effective as of January 1, 2009 (Exhibit 10.6 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, File No. 1-8503).
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10.16(a)
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Resolution of the Compensation Committee of the Board of Directors of Hawaiian Electric Industries, Inc. Re: Adoption of Amendment No. 1 to January 1, 2009 Restatement of the Executive Death Benefit Plan (Exhibit 10.1 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2009, File No. 1-8503).
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10.17
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Severance Pay Plan for Merit Employees of HEI and affiliates, restatement effective as of January 1, 2009 (Exhibit 10.17 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, File No. 1-8503).
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10.18
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Hawaiian Electric Industries Deferred Compensation Plan adopted on December 13, 2010 (Exhibit 10.18 to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010, File No. 1-8503).
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10.19
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Form of Indemnity Agreement (HEI, Hawaiian Electric and ASB with their respective directors and HEI with certain of its senior officers) (Exhibit 10.1 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012, File No. 1-8503).
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10.20
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American Savings Bank Select Deferred Compensation Plan (Restatement Effective January 1, 2009) (Exhibit 10.7 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, File No. 1-8503).
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10.20(a)
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Amendment No. 1 to January 1, 2009 Restatement of American Savings Bank Select Deferred Compensation Plan dated December 30, 2009. (Exhibit 10.20(a) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015, File No. 1-8503).
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10.20(b)
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Amendment No. 2 to January 1, 2009 Restatement of American Savings Bank Select Deferred Compensation Plan dated December 29, 2010. (Exhibit 10.20(b) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015, File No. 1-8503).
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10.20(c)
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Amendment No. 3 to January 1, 2009 Restatement of American Savings Bank Select Deferred Compensation Plan dated December 3, 2014. (Exhibit 10.20(c) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015, File No. 1-8503).
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10.21
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American Savings Bank Supplemental Executive Retirement, Disability, and Death Benefit Plan, effective January 1, 2009 (Exhibit 10.8 to HEI’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, File No. 1-8503).
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10.21(a)
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Amendments to the American Savings Bank Supplemental Executive Retirement, Disability, and Death Benefit Plan Freezing Benefit Accruals Effective December 31, 2008 (Exhibit 10.19(b) to HEI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008, File No. 1-8503).
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10.22
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Amended and Restated Credit Agreement, dated as of April 2, 2014, among HEI, as Borrower, the Lenders Party Thereto and Wells Fargo Bank, National Association, as Syndication Agent, and Bank of America, N.A., Bank of Hawaii, Royal Bank of Canada, Union Bank, N.A. and U.S. Bank National Association as Co-Documentation Agents, and JPMorgan Chase Bank, N.A., as Administrative Agent, Swingline Lender and Issuing Bank, and J.P. Morgan Securities LLC and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Joint Book Runners (Exhibit 10.1 to HEI’s Current Report on Form 8-K dated April 2, 2014, File No. 1-8503).
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Exhibit no.
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Description
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4.5
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6.500% Quarterly Income Trust Preferred Security issued by HECO Capital Trust III, dated March 18, 2004 (Exhibit 4(d) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.6
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6.500% Junior Subordinated Deferrable Interest Debenture, Series 2004 issued by Hawaiian Electric, dated March 18, 2004 (Exhibit 4(g) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.7
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Trust Guarantee Agreement between The Bank of New York, as Trust Guarantee Trustee, and Hawaiian Electric dated as of March 1, 2004 (Exhibit 4(l) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.8
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Maui Electric Junior Indenture with The Bank of New York, as Trustee, including Hawaiian Electric Subsidiary Guarantee, dated as of March 1, 2004 (Exhibit 4(h) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.9
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Hawaii Electric Light Junior Indenture with The Bank of New York, as Trustee, including Hawaiian Electric Subsidiary Guarantee, dated as of March 1, 2004 (Exhibit 4(j) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.10
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6.500% Junior Subordinated Deferrable Interest Debenture, Series 2004 issued by Maui Electric, dated March 18, 2004 (Exhibit 4(i) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.11
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6.500% Junior Subordinated Deferrable Interest Debenture, Series 2004 issued by Hawaii Electric Light, dated March 18, 2004 (Exhibit 4(k) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.12
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Expense Agreement, dated March 1, 2004, among HECO Capital Trust III, Hawaiian Electric, Maui Electric and Hawaii Electric Light (Exhibit 4(m) to Hawaiian Electric’s Current Report on Form 8-K dated March 16, 2004, File No. 1-4955).
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4.13
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Note Purchase Agreement among Hawaiian Electric and the Purchasers that are parties thereto, dated April 19, 2012 (Exhibit 4(a) to Hawaiian Electric’s Current Report on Form 8-K dated April 19, 2012, File No. 1-4955).
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4.14
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Maui Electric and the Purchasers that are parties thereto, dated April 19, 2012 (Exhibit 4(b) to Hawaiian Electric’s Current Report on Form 8-K dated April 19, 2012, File No. 1-4955).
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4.15
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Hawaii Electric Light and the Purchasers that are parties thereto, dated April 19, 2012 (Exhibit 4(c) to Hawaiian Electric’s Current Report on Form 8-K dated April 19, 2012, File No. 1-4955).
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4.16
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Note Purchase Agreement among Hawaiian Electric and the Purchasers that are parties thereto, dated September 13, 2012 (Exhibit 4 to Hawaiian Electric’s Current Report on Form 8-K dated September 13, 2012, File No. 1-4955).
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4.17
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Note Purchase Agreement among Hawaiian Electric Company, Inc. and the Purchasers that are parties thereto, dated as of October 3, 2013. (Exhibit 4(a) to Hawaiian Electric’s Current Report on Form 8-K dated October 3, 2013, File No. 1-4955).
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4.18
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Maui Electric Company, Limited and the Purchasers that are parties thereto, dated as of October 3, 2013. (Exhibit 4(b) to Hawaiian Electric’s Current Report on Form 8-K dated October 3, 2013, File No. 1-4955).
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4.19
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Hawaii Electric Light Company, Inc. and the Purchasers that are parties thereto, dated as of October 3, 2013. (Exhibit 4 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013, 2013, File No. 1-4955).
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4.20
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Note Purchase Agreement among Hawaiian Electric Company, Inc. and the Purchasers that are parties thereto, dated as of October 15, 2015. (Exhibit 4(a) to Hawaiian Electric’s Current Report on Form 8-K dated October 15, 2015, File No. 1-4955).
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4.21
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Maui Electric Company, Limited and the Purchasers that are parties thereto, dated as of October 15, 2015. (Exhibit 4(b) to Hawaiian Electric’s Current Report on Form 8-K dated October 15, 2015, File No. 1-4955).
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Exhibit no.
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Description
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4.22
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Note Purchase and Guaranty Agreement among Hawaiian Electric, Hawaii Electric Light Company, Inc. and the Purchasers that are parties thereto, dated as of October 15, 2015. (Exhibit 4(c) to Hawaiian Electric’s Current Report on Form 8-K dated October 15, 2015, File No. 1-4955).
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4.23
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Note Purchase Agreement among Hawaiian Electric Company, Inc. and the Purchasers that are parties thereto, dated as of December 15, 2016. (Exhibit 4 to Hawaiian Electric’s Current Report on Form 8-K dated December 15, 2016, File No. 1-4955).
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10.1(a)
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Power Purchase Agreement between Kalaeloa Partners, L.P., and Hawaiian Electric dated October 14, 1988 (Exhibit 10(a) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1988, File No. 1-4955).
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10.1(b)
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Amendment No. 1 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated June 15, 1989 (Exhibit 10(c) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1989, File No. 1-4955).
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10.1(c)
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Lease Agreement between Kalaeloa Partners, L.P., as Lessor, and Hawaiian Electric, as Lessee, dated February 27, 1989 (Exhibit 10(d) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1989, File No. 1-4955).
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10.1(d)
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Restated and Amended Amendment No. 2 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated February 9, 1990 (Exhibit 10.2(c) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1989, File No. 1-4955).
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10.1(e)
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Amendment No. 3 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated December 10, 1991 (Exhibit 10.2(e) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1991, File No. 1-4955).
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10.1(f)
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Amendment No. 4 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated October 1, 1999 (Exhibit 10.1 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2000, File No. 1-4955).
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10.1(g)
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Confirmation Agreement Concerning Section 5.2B(2) of Power Purchase Agreement and Amendment No. 5 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated October 12, 2004 (Exhibit 10.3 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, File No. 1-4955).
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10.1(h)
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Agreement for Increment Two Capacity and Amendment No. 6 to Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated October 12, 2004 (Exhibit 10.4 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004, File No. 1-4955).
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10.1(i)
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Letter agreement dated July 28, 2016 and executed August 1, 2016 extending the term of the Power Purchase Agreement between Hawaiian Electric and Kalaeloa Partners, L.P., dated October 14, 1988 (as amended) (Exhibit 10 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016, File No. 1-4955).
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10.2(a)
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Power Purchase Agreement between AES Barbers Point, Inc. and Hawaiian Electric, entered into on March 25, 1988 (Exhibit 10(a) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended March 31, 1988, File No. 1-4955).
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10.2(b)
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Agreement between Hawaiian Electric and AES Barbers Point, Inc., pursuant to letters dated May 10, 1988 and April 20, 1988 (Exhibit 10.4 to Hawaiian Electric’s Annual Report on Form 10-K for fiscal year ended December 31, 1988, File No. 1-4955).
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10.2(c)
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Amendment No. 1, entered into as of August 28, 1988, to Power Purchase Agreement between AES Barbers Point, Inc. and Hawaiian Electric (Exhibit 10 to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended September 30, 1989, File No. 1-4955).
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10.2(d)
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Hawaiian Electric’s Conditional Notice of Acceptance to AES Barbers Point, Inc. dated January 15, 1990 (Exhibit 10.3(c) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1989, File No. 1-4955).
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10.2(e)
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Amendment No. 2, entered into as of May 8, 2003, to Power Purchase Agreement between AES Hawaii, Inc. and Hawaiian Electric (Exhibit 10.2(e) to Hawaiian Electric’s Annual Report on Form 10-K for fiscal year ended December 31, 2003, File No. 1-4955).
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10.3(a)
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Purchase Power Contract between Hawaii Electric Light and Thermal Power Company dated March 24, 1986 (Exhibit 10(a) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1989, File No. 1-4955).
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|
Exhibit no.
|
|
Description
|
|
|
10.3(b)
|
|
Firm Capacity Amendment between Hawaii Electric Light and Puna Geothermal Venture (assignee of AMOR VIII, who is the assignee of Thermal Power Company) dated July 28, 1989 to Purchase Power Contract between Hawaii Electric Light and Thermal Power Company dated March 24, 1986 (Exhibit 10(b) to Hawaiian Electric’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1989, File No. 1-4955).
|
|
|
|
|
|
10.3(c)
|
|
Amendment made in October 1993 to Purchase Power Contract between Hawaii Electric Light and Puna Geothermal Venture dated March 24, 1986, as amended (Exhibit 10.5(b) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1997, File No. 1-4955).
|
|
|
|
|
|
10.3(d)
|
|
Third Amendment dated March 7, 1995 to the Purchase Power Contract between Hawaii Electric Light and Puna Geothermal Venture dated March 24, 1986, as amended (Exhibit 10.5(c) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1997, File No. 1-4955).
|
|
|
|
|
|
10.3(e)
|
|
Performance Agreement and Fourth Amendment dated February 12, 1996 to the Purchase Power Contract between Hawaii Electric Light and Puna Geothermal Venture dated March 24, 1986, as amended (Exhibit 10.5(b) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1995, File No. 1-4955).
|
|
|
|
|
|
10.3(f)
|
|
Fifth Amendment dated February 7, 2011 to the Purchase Power Contract between Hawaii Electric Light and Puna Geothermal Venture dated March 24, 1986, as amended (Exhibit 10.4(f) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, File No. 1-4955).
|
|
|
|
|
|
10.3(g)
|
|
Power Purchase Agreement between Puna Geothermal Venture and Hawaii Electric Light dated February 7, 2011 (Exhibit 10.4(g) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, File No. 1-4955).
|
|
|
|
|
|
10.4(a)
|
|
Power Purchase Agreement between Encogen Hawaii, L.P. and Hawaii Electric Light dated October 22, 1997 (but with the following attachments omitted: Attachment C, “Selected portions of the North American Electric Reliability Council Generating Availability Data System Data Reporting Instructions dated October 1996” and Attachment E, “Form of the Interconnection Agreement between Encogen Hawaii, L.P. and Hawaii Electric Light,” which is provided in final form as Exhibit 10.6(b)) (Exhibit 10.7 to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1997, File No. 1-4955).
|
|
|
|
|
|
10.4(b)
|
|
Interconnection Agreement between Encogen Hawaii, L.P. and Hawaii Electric Light dated October 22, 1997 (Exhibit 10.7(a) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1997, File No. 1-4955).
|
|
|
|
|
|
10.4(c)
|
|
Amendment No. 1, executed on January 14, 1999, to Power Purchase Agreement between Encogen Hawaii, L.P. and Hawaii Electric Light dated October 22, 1997 (Exhibit 10.7(b) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 1998, File No. 1-4955).
|
|
|
|
|
|
10.4(d)
|
|
Power Purchase Agreement Novation dated November 8, 1999 by and among Encogen Hawaii, L.P., Hamakua Energy Partners and Hawaii Electric Light (Exhibit 10.7(c) to Hawaiian Electric’s Annual Report on Form 10-K for fiscal year ended December 31, 2001, File No. 1-4955).
|
|
|
|
|
|
10.4(e)
|
|
Consent and Agreement Concerning Certain Assets of Black River Energy, LLC By and Among Great Point Power Hamakua Holdings, LLC, Hamakua Energy Partners, L.P. and Hawaii Electric Light dated April 19, 2010 (Exhibit 10.6(e) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010, File No. 1-4955).
|
|
|
|
|
|
10.4(f)
|
|
Guarantee Agreement between Great Point Power Hamakua Holdings, LLC and Hawaii Electric Light dated June 4, 2010 (Exhibit 10.6(f) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010, File No. 1-4955).
|
|
|
|
|
|
10.5
|
|
Inter-Island Supply Contract for Petroleum Fuels by and between Chevron Products Company and Hawaiian Electric, Hawaii Electric Light and Maui Electric dated as of February 18, 2016 (confidential treatment has been granted for portions of this exhibit through December 31, 2019) (Exhibit 10.1 to Hawaiian Electric’s Amendment No. 1 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, File No. 1-4955).
|
|
|
|
|
|
10.6
|
|
Supply Contract for LSFO, Diesel and MATS Fuel by and between Hawaiian Electric and Chevron Products Company dated February 18, 2016 (confidential treatment has been granted for portions of this exhibit through December 31, 2019) (Exhibit 10.2 to Hawaiian Electric’s Amendment No. 1 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, File No. 1-4955).
|
|
|
|
|
Exhibit no.
|
|
Description
|
|
|
10.7
|
|
Fuels Terminalling Agreement by and between Chevron Products Company and Hawaii Electric Light dated February 18, 2016 (confidential treatment has been granted for portions of this exhibit through December 31, 2019) (Exhibit 10.2 to Hawaiian Electric’s Amendment No. 1 to Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, File No. 1-4955).
|
|
|
|
|
|
10.8(a)
|
|
Contract of private carriage by and between HITI and Hawaii Electric Light dated December 4, 2000 (Exhibit 10.13 to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000, File No. 1-4955).
|
|
|
|
|
|
10.8(b)
|
|
Consent to Change of Ownership/Control of Carrier by and between K-Sea Operating Partnership, L.P., and Hawaii Electric Light, dated July 1, 2011 (Exhibit 10.13(b) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, File No. 1-4955).
|
|
|
|
|
|
10.9(a)
|
|
Contract of private carriage by and between HITI and Maui Electric dated December 4, 2000 (Exhibit 10.14 to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000, File No. 1-4955).
|
|
|
|
|
|
10.9(b)
|
|
Consent to Change of Ownership/Control of Carrier by and between K-Sea Operating Partnership, L.P., and Maui Electric, dated July 1, 2011 (Exhibit 10.14(b) to Hawaiian Electric’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, File No. 1-4955).
|
|
|
|
|
|
10.10
|
|
Amended and Restated Credit Agreement, dated as of April 2, 2014, among Hawaiian Electric, as Borrower, the Lenders Party Thereto and Wells Fargo Bank, National Association, as Syndication Agent, and Bank of America, N.A., Bank of Hawaii, Royal Bank of Canada, Union Bank, N.A. and U.S. Bank National Association as Co-Documentation Agents, and JPMorgan Chase Bank, N.A., as Administrative Agent, Swingline Lender and Issuing Bank, and J.P. Morgan Securities LLC and Wells Fargo Securities, LLC, as Joint Lead Arrangers and Joint Book Runners (Exhibit 10.2 to Hawaiian Electric’s Current Report on Form 8-K dated April 2, 2014, File No. 1-4955).
|
|
|
|
|
|
11
|
|
Computation of Earnings Per Share of Common Stock (See note on Hawaiian Electric’s Item 6. Selected Financial Data).
|
|
|
|
|
|
*12.2
|
|
Hawaiian Electric - Computation of Ratio of Earnings to Fixed Charges.
|
|
|
|
|
|
*21.2
|
|
Hawaiian Electric - Subsidiaries of the Registrant.
|
|
|
|
|
|
*31.3
|
|
Certification Pursuant to Section 13a-14 of the Securities Exchange Act of 1934 of Alan M. Oshima (Hawaiian Electric Chief Executive Officer).
|
|
|
|
|
|
*31.4
|
|
Certification Pursuant to Section 13a-14 of the Securities Exchange Act of 1934 of Tayne S. Y. Sekimura (Hawaiian Electric Chief Financial Officer).
|
|
|
|
|
|
*32.2
|
|
Hawaiian Electric Certification Pursuant to 18 U.S.C. Section 1350.
|
|
|
|
|
|
*99.1
|
|
Hawaiian Electric’s Directors, Executive Officers and Corporate Governance; Hawaiian Electric’s Executive Compensation; Hawaiian Electric’s Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters; Hawaiian Electric’s Certain Relationships and Related Transactions, and Director Independence; and Hawaiian Electric’s Principal Accounting Fees and Services.
|
Nonemployee Directors Compensation Schedule
|
|
||
Effective January 1, 2017
|
|
||
|
|
|
|
HEI Board - Annual Cash Retainers (paid quarterly)
|
|
|
|
HEI Chairman of the Board
|
|
$250,000
|
|
HEI Director
|
|
$75,000
|
|
HEI Audit Committee Chair
|
|
$15,000
|
|
HEI Audit Committee Member
|
|
$6,000
|
|
HEI Compensation Committee Chair
|
|
$15,000
|
|
HEI Compensation Committee Member
|
|
$6,000
|
|
HEI NCG Committee Chair
|
|
$10,000
|
|
HEI NCG Committee Member
|
|
$4,000
|
|
ASB Board - Annual Cash Retainers (paid quarterly) *
|
|
|
|
ASB Directors who are not also HEI Directors
|
|
$45,000
|
|
ASB Audit Committee Chair
|
|
$10,000
|
|
ASB Audit Committee Member
|
|
$4,000
|
|
ASB Risk Committee Chair
|
|
$10,000
|
|
ASB Risk Committee Member
|
|
$4,000
|
|
HECO Board - Annual Cash Retainers (paid quarterly) *
|
|
|
|
HECO Directors who are not also HEI Directors
|
|
$45,000
|
|
HECO Audit Committee Chair
|
|
$10,000
|
|
HECO Audit Committee Member
|
|
$4,000
|
|
Extra Meeting Fees (per additional meeting)
|
|
||
HEI Board Member
|
|
$1,500
|
(A)
|
HEI Audit Committee Member
|
|
$1,500
|
(B)
|
HEI Compensation Committee Member
|
|
$1,500
|
(C)
|
HEI NCG Committee Member
|
|
$1,500
|
(C)
|
HECO/ASB Board Member
|
|
$1,000
|
(A)
|
ASB Audit Committee Member
|
|
$1,000
|
(B)
|
HECO Audit Committee Member
|
|
$1,000
|
(C)
|
ASB Risk Committee Member
|
|
$1,000
|
(C)
|
(A) Earned per extra meeting, after attending 8 meetings during the calendar year
|
|
|
|
(B) Earned per extra meeting, after attending 10 meetings during the calendar year
|
|
|
|
(C) Earned per extra meeting, after attending 6 meetings during the calendar year
|
|
||
|
|
|
|
HEI, ASB and HECO Boards - Equity Compensation *
|
|
||
HEI Director - annual grant (paid on last business day of June)
|
shares valued at $100K
|
|
|
HECO and ASB only Directors - annual grant (last business day of June)
|
shares valued at $55K
|
|
|
New Directors (one-time grant during first year of service -- prorated)
|
portion of annual grant, prorated on start date
|
|
|
|
|
|
|
* For ASB and HECO directors who are also HEI directors, ASB and HECO pay
|
|
|
|
a pro rata portion of each such director's total compensation (cash and equity value).
|
|
|
(in thousands,
except per share amounts)
|
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
Net income for common stock
|
|
$
|
248,256
|
|
|
$
|
159,877
|
|
|
$
|
168,129
|
|
|
$
|
161,709
|
|
|
$
|
138,705
|
|
Weighted-average number of common shares outstanding
|
|
108,102
|
|
|
106,418
|
|
|
101,968
|
|
|
98,968
|
|
|
96,908
|
|
|||||
Adjusted weighted-average number of common shares outstanding
|
|
108,309
|
|
|
106,721
|
|
|
102,937
|
|
|
99,623
|
|
|
97,338
|
|
|||||
Basic earnings per common share
|
|
$
|
2.30
|
|
|
$
|
1.50
|
|
|
$
|
1.65
|
|
|
$
|
1.63
|
|
|
$
|
1.43
|
|
Diluted earnings per common share
|
|
$
|
2.29
|
|
|
$
|
1.50
|
|
|
$
|
1.63
|
|
|
$
|
1.62
|
|
|
$
|
1.42
|
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Years ended December 31
|
(1)
|
|
(2)
|
|
(1)
|
|
(2)
|
|
(1)
|
|
(2)
|
||||||||||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Fixed charges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total interest charges
|
$
|
81,974
|
|
|
$
|
89,141
|
|
|
$
|
83,936
|
|
|
$
|
89,284
|
|
|
$
|
83,458
|
|
|
$
|
88,535
|
|
Interest component of rentals
|
6,200
|
|
|
6,200
|
|
|
6,065
|
|
|
6,065
|
|
|
6,366
|
|
|
6,366
|
|
||||||
Pretax preferred stock dividend requirements of subsidiaries
|
2,825
|
|
|
2,825
|
|
|
2,977
|
|
|
2,977
|
|
|
2,952
|
|
|
2,952
|
|
||||||
Total fixed charges
|
$
|
90,999
|
|
|
$
|
98,166
|
|
|
$
|
92,978
|
|
|
$
|
98,326
|
|
|
$
|
92,776
|
|
|
$
|
97,853
|
|
Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Pretax income from continuing operations
|
$
|
371,951
|
|
|
$
|
371,951
|
|
|
$
|
252,898
|
|
|
$
|
252,898
|
|
|
$
|
263,708
|
|
|
$
|
263,708
|
|
Fixed charges, as shown
|
90,999
|
|
|
98,166
|
|
|
92,978
|
|
|
98,326
|
|
|
92,776
|
|
|
97,853
|
|
||||||
Interest capitalized
|
(3,727
|
)
|
|
(3,727
|
)
|
|
(3,265
|
)
|
|
(3,265
|
)
|
|
(3,954
|
)
|
|
(3,954
|
)
|
||||||
Earnings available for fixed charges
|
$
|
459,223
|
|
|
$
|
466,390
|
|
|
$
|
342,611
|
|
|
$
|
347,959
|
|
|
$
|
352,530
|
|
|
$
|
357,607
|
|
Ratio of earnings to
fixed charges
|
5.05
|
|
|
4.75
|
|
|
3.68
|
|
|
3.54
|
|
|
3.80
|
|
|
3.65
|
|
|
2013
|
|
2012
|
||||||||||||
Years ended December 31
|
(1)
|
|
(2)
|
|
(1)
|
|
(2)
|
||||||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed charges
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total interest charges
|
$
|
85,315
|
|
|
$
|
90,407
|
|
|
$
|
83,020
|
|
|
$
|
89,443
|
|
Interest component of rentals
|
6,345
|
|
|
6,345
|
|
|
6,493
|
|
|
6,493
|
|
||||
Pretax preferred stock dividend requirements of subsidiaries
|
2,886
|
|
|
2,886
|
|
|
2,943
|
|
|
2,943
|
|
||||
Total fixed charges
|
$
|
94,546
|
|
|
$
|
99,638
|
|
|
$
|
92,456
|
|
|
$
|
98,879
|
|
Earnings
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax income from continuing operations
|
$
|
247,946
|
|
|
$
|
247,946
|
|
|
$
|
217,064
|
|
|
$
|
217,064
|
|
Fixed charges, as shown
|
94,546
|
|
|
99,638
|
|
|
92,456
|
|
|
98,879
|
|
||||
Interest capitalized
|
(7,097
|
)
|
|
(7,097
|
)
|
|
(4,355
|
)
|
|
(4,355
|
)
|
||||
Earnings available for fixed charges
|
$
|
335,395
|
|
|
$
|
340,487
|
|
|
$
|
305,165
|
|
|
$
|
311,588
|
|
Ratio of earnings to fixed charges
|
3.55
|
|
|
3.42
|
|
|
3.30
|
|
|
3.15
|
|
(1)
|
Excluding interest on ASB deposits.
|
(2)
|
Including interest on ASB deposits.
|
Years ended December 31
|
2016
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|||||
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed charges
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total interest charges
|
$
|
67,407
|
|
|
$
|
67,178
|
|
|
$
|
66,132
|
|
|
$
|
64,130
|
|
|
$
|
62,056
|
|
Interest component of rentals
|
3,249
|
|
|
3,060
|
|
|
3,244
|
|
|
2,793
|
|
|
2,690
|
|
|||||
Pretax preferred stock dividend requirements of subsidiaries
|
1,453
|
|
|
1,443
|
|
|
1,444
|
|
|
1,421
|
|
|
1,467
|
|
|||||
Total fixed charges
|
$
|
72,109
|
|
|
$
|
71,681
|
|
|
$
|
70,820
|
|
|
$
|
68,344
|
|
|
$
|
66,213
|
|
Earnings
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net income attributable to Hawaiian Electric
|
$
|
143,397
|
|
|
$
|
136,794
|
|
|
$
|
138,721
|
|
|
$
|
124,009
|
|
|
$
|
100,356
|
|
Fixed charges, as shown
|
72,109
|
|
|
71,681
|
|
|
70,820
|
|
|
68,344
|
|
|
66,213
|
|
|||||
Income taxes
|
84,801
|
|
|
79,422
|
|
|
80,725
|
|
|
69,117
|
|
|
61,048
|
|
|||||
Interest capitalized
|
(3,727
|
)
|
|
(3,265
|
)
|
|
(3,954
|
)
|
|
(7,097
|
)
|
|
(4,355
|
)
|
|||||
Earnings available for fixed charges
|
$
|
296,580
|
|
|
$
|
284,632
|
|
|
$
|
286,312
|
|
|
$
|
254,373
|
|
|
$
|
223,262
|
|
Ratio of earnings to fixed charges
|
4.11
|
|
|
3.97
|
|
|
4.04
|
|
|
3.72
|
|
|
3.37
|
|
(1)
|
I have reviewed this report on Form 10-K for the year ended December 31, 2016 of Hawaiian Electric Industries, Inc. (“registrant”);
|
(2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
(3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
(4)
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(5)
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 24, 2017
|
|
|
/s/ Constance H. Lau
|
|
Constance H. Lau
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-K for the year ended December 31, 2016 of Hawaiian Electric Industries, Inc. (“registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 24, 2017
|
|
|
/s/ James A. Ajello
|
|
James A. Ajello
|
|
Executive Vice President and Chief Financial Officer
|
|
|
1.
|
I have reviewed this report on Form 10-K for the year ended December 31, 2016 of Hawaiian Electric Company, Inc. (“registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 24, 2017
|
|
|
/s/ Alan M. Oshima
|
|
Alan M. Oshima
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this report on Form 10-K for the year ended December 31, 2016 of Hawaiian Electric Company, Inc. (“registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: February 24, 2017
|
|
|
/s/ Tayne S. Y. Sekimura
|
|
Tayne S. Y. Sekimura
|
|
Senior Vice President and Chief Financial Officer
|
(1)
|
The Report complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; as amended, and
|
(2)
|
The consolidated information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of HEI and its subsidiaries as of, and for, the periods presented in this report.
|
/s/ Constance H. Lau
|
|
Constance H. Lau
|
|
President and Chief Executive Officer
|
|
/s/ James A. Ajello
|
|
James A. Ajello
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(1)
|
The Hawaiian Electric Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; as amended, and
|
(2)
|
The Hawaiian Electric information contained in the Hawaiian Electric Report fairly presents, in all material respects, the financial condition and results of operations of Hawaiian Electric and its subsidiaries as of, and for, the periods presented in this report.
|
/s/ Alan M. Oshima
|
|
Alan M. Oshima
|
|
President and Chief Executive Officer
|
|
/s/ Tayne S. Y. Sekimura
|
|
Tayne S. Y. Sekimura
|
|
Senior Vice President and Chief Financial Officer
|
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
Name
|
Age
|
Business experience for last 5 years and prior positions
with Hawaiian Electric and its affiliates |
Alan M. Oshima
|
69
|
Hawaiian Electric President and Chief Executive Officer since 10/14
Hawaiian Electric Director, 2008 to 10/11 and since 10/14
HEI Charitable Foundation President since 10/11
· Hawaiian Electric Senior Executive Officer on loan from HEI, 5/14 to 9/14
· HEI Executive Vice President, Corporate and Community Advancement, 10/11 to 5/14
|
Jimmy D. Alberts
|
56
|
Hawaiian Electric Senior Vice President, Customer Service since 8/12
· Prior to joining the Company: Kansas City Power & Light, Vice President – Customer Service, 2007-12
|
Colton K. Ching
|
49
|
Hawaiian Electric Senior Vice President, Planning & Technology since 1/17
· Hawaiian Electric Vice President, Energy Delivery, 1/13 to 1/17
· Hawaiian Electric Vice President, Systems Operation & Planning, 8/10 to 12/12
· Hawaiian Electric Manager, Corporate Planning Department, 8/08 to 8/10
· Hawaiian Electric Director, Strategic Initiatives, 12/06 to 8/08
· Hawaiian Electric Director, Transmission Planning Division, 2/05 to 12/06
· Hawaiian Electric Senior Planning Engineer, 4/00 to 2/05
· Hawaiian Electric Electric Engineer II, 9/96 to 4/00
· Hawaiian Electric Designer II, 1/94 to 9/96
· Hawaiian Electric Designer I, 1/91 to 1/94
|
Ronald R. Cox
|
60
|
Hawaiian Electric Senior Vice President, Operations since 1/17
· Hawaiian Electric Vice President, Power Supply, 8/11 to 1/17
· Hawaiian Electric Vice President, Generation & Fuels, 8/10 to 7/11
· Hawaiian Electric Manager, Energy Solutions, 3/09 to 8/10
· Hawaiian Electric Manager, Power Supply Services Department, 1/07 to 3/09
· Hawaiian Electric Manager, Operations Strategic Planning, 11/05 to 1/07
|
Shelee M. T. Kimura
|
43
|
Hawaiian Electric Senior Vice President, Business Development & Strategic Planning since 1/17
· Hawaiian Electric Vice President, Corporate Planning & Business Development, 5/14 to 1/17
· HEI Manager, Investor Relations & Strategic Planning, 11/09 to 5/14
· HEI Director, Corporate Finance and Investments, 8/04 to 10/09
|
Susan A. Li
|
59
|
Hawaiian Electric Senior Vice President, General Counsel, Chief Compliance and Administrative Officer and Corporate Secretary since 12/15
· Hawaiian Electric Senior Vice President, General Counsel, Chief Compliance Officer and Secretary, 12/13 to 12/15 · Hawaiian Electric Vice President, General Counsel, 10/07 to 12/13 · Hawaiian Electric Manager, Legal, 5/98 to 10/07
· Hawaiian Electric Associate General Counsel, 3/90 to 5/98
|
Name
|
Age
|
Business experience for last 5 years and prior positions
with Hawaiian Electric and its affiliates |
Stephen M. McMenamin
|
61
|
Hawaiian Electric Senior Vice President and Chief Information Officer since 9/09
· Prior to being appointed to his current officer position at Hawaiian Electric, served as a full-time consultant to Hawaiian Electric in an acting chief information officer capacity from 6/09 to 9/09 and as a part-time information services consultant to Hawaiian Electric from 3/09 to 5/09
|
Tayne S. Y. Sekimura
|
54
|
Hawaiian Electric Senior Vice President and Chief Financial Officer since 9/09
· Hawaiian Electric Senior Vice President, Finance and Administration, 2/08 to 9/09 · Hawaiian Electric Financial Vice President, 10/04 to 2/08 · Hawaiian Electric Assistant Financial Vice President, 8/04 to 10/04 · Hawaiian Electric Director, Corporate & Property Accounting, 2/01 to 8/04 · Hawaiian Electric Director, Internal Audit, 7/97 to 2/01 · Hawaiian Electric Capital Budgets Administrator, 5/93 to 7/97 · Hawaiian Electric Capital Budgets Supervisor, 10/92 to 5/93 · Hawaiian Electric Auditor (internal), 5/91 to 10/92 |
Scott W. H. Seu
|
51
|
Hawaiian Electric Senior Vice President, Public Affairs since 1/17
· Hawaiian Electric Vice President, System Operation, 5/14 to 1/17
· Hawaiian Electric Vice President, Energy Resources and Operations, 1/13 to 5/14
· Hawaiian Electric Vice President, Energy Resources, 8/10 to 12/12
· Hawaiian Electric Manager, Resource Acquisition Department, 3/09 to 8/10
· Hawaiian Electric Manager, Energy Projects Department, 5/04 to 3/09
· Hawaiian Electric Manager, Customer Installations Department, 1/03 to 5/04
· Hawaiian Electric Manager, Environmental Department, 4/98 to 12/02
· Hawaiian Electric Principal Environmental Scientist, 1/97 to 4/98
· Hawaiian Electric Senior Environmental Scientist, 5/96 to 12/96
· Hawaiian Electric Environmental Scientist, 8/93 to 5/96
|
Jay M. Ignacio
|
57
|
Hawaii Electric Light President and Senior Operations Advisor to the Hawaiian Electric President and Chief Executive Officer since 8/15
· Hawaii Electric Light President, 3/08 to 8/15
· Hawaii Electric Light Manager, Distribution and Transmission, 11/96 to 3/08 · Hawaii Electric Light Superintendent, Construction & Maintenance, 4/94 to 11/96 · Hawaii Electric Light Electrical Engineer, 4/90 to 4/94 |
Sharon M. Suzuki
|
58
|
Maui Electric President since 5/12
· Maui Electric CIS Project Resource Manager, 8/11 to 5/12 · Maui Electric Manager, Renewable Energy Services, 3/08 to 5/12 · Maui Electric Manager, Customer Service, 5/04 to 3/08 · Hawaiian Electric Director, Customer Account Services, 8/02 to 5/04 · Hawaiian Electric Residential Energy Efficiency Program Manager, 5/00 to 8/02 · Hawaiian Electric Commercial and Industrial Energy Efficiency Program
Manager, 6/96 to 5/00
· Hawaiian Electric Demand-Side Management Analyst, 7/92 to 6/96 |
•
|
Retired Chairman, Oceanic Time Warner Cable Advisory Board, since 2004
|
•
|
Director, HEI (parent company of Hawaiian Electric), 1996-2011
|
•
|
Director, American Savings Bank, F.S.B. (ASB) (Hawaiian Electric affiliate), 2004-11
|
•
|
38 years of executive and finance management experience, including service as President and Vice President, Finance of Oceanic Cable.
|
•
|
Experience with oversight of executive compensation, compensation programs and finance matters from current or past service as Chair of the Compensation Committee for Island Insurance Company, Ltd., as a member of the Compensation Committees of HEI and Pacific Guardian Life, and as a member of the ASB Audit Committee.
|
•
|
In-depth knowledge of issues facing Hawaiian Electric gained from 15 years as a director for Hawaiian Electric’s parent company, HEI.
|
•
|
Strong understanding of concerns of the communities Hawaiian Electric serves from his lengthy career with Oceanic Cable, which serves the same communities.
|
•
|
Chairman & Interim CEO, DineEquity, Inc., effective March 2017
|
•
|
Chairman, James Campbell Company LLC (privately held real estate investment and development company), since 2010
|
•
|
Chairman, President and CEO, James Campbell Company LLC, 2010-16
|
•
|
Director and Audit Committee Member, HEI (parent company of Hawaiian Electric), since 2017
|
•
|
Director since 2008, Audit Committee Chair and Executive Committee Member, IDACORP, Inc./Idaho Power Company
|
•
|
Lead Independent Director 2010-17, former Audit Committee Chair, and Director since 2004, DineEquity, Inc.
|
•
|
Chairman, International Rectifier Corporation, 2008-15
|
•
|
Broad leadership and strategic and operational management experience from serving as a senior executive for private and publicly traded companies, including as Chairman, President and CEO of James Campbell Company LLC, President, Chief Operating Officer and Director of Dole Food Company, Inc., and President, Chief Operating Officer and Director of Bank of Hawaii Corporation.
|
•
|
In-depth understanding of electric utility industry from his current service as a director of IDACORP, Inc. and its principal subsidiary, Idaho Power Company.
|
•
|
Audit, risk management and financial expertise from his chairmanship of the IDACORP, Inc. audit committee, prior chairmanship of the DineEquity, Inc. audit committee, previous work experience with accounting firm Ernst & Young, and prior licensure as a Certified Public Accountant and Certified Bank Auditor.
|
•
|
Substantial governance and board leadership experience from his public company board service, including through his prior role as Lead Independent Director of DineEquity, Inc. and through leading the International Rectifier, Inc. board through a successful corporate turnaround.
|
•
|
Chief Consumer Officer, Hawaii Medical Service Association (leading health insurer in Hawaii), since 2011
|
•
|
President and CEO, Bishop Museum (largest museum in the Pacific), 2007-11
|
•
|
Executive management, leadership and strategic planning skills developed over three decades as a businessperson and lawyer and currently as Chief Consumer Officer of Hawaii Medical Service Association (HMSA).
|
•
|
Business, regulatory, financial stewardship and legal experience from his prior roles as President and CEO of the Bishop Museum, Chief Operating Officer for the Estate of Samuel Mills Damon (former private trust with assets valued at over $900 million prior to its dissolution), Chairperson of the Hawaii State Board of Land and Natural Resources, Director of the Hawaii State Department of Land and Natural Resources and Vice President and General Counsel at Amfac Property Development Corp.
|
•
|
Corporate governance knowledge and familiarity with financial oversight and fiduciary responsibilities from overseeing the HMSA Internal Audit department, from his prior service as a director for The Gas Company LLC (now
|
•
|
President and Chief Operating Officer, Hawaii Community Foundation (statewide charitable foundation), since 2016
|
•
|
Chief Operating Officer, Pacific Links Hawaii LLC (golf course owner, developer and operator), 2011-15
|
•
|
Principal, The KANE Group LLC (Hawaii-based company focused on land and financing matters for planned community infrastructure and general business development), since 2010
|
•
|
Trustee, Kamehameha Schools ($10 billion Native Hawaiian trust with more than 397,000 acres of land holdings in Hawaii), since 2009
|
•
|
Executive management, leadership and strategic planning skills from prior service as Chief Operating Officer of Pacific Links Hawaii and Trustee of Kamehameha Schools and from prior role as Chairman/Director of the Department of Hawaiian Home Lands.
|
•
|
Finance and investment expertise gained through oversight of $10 billion asset portfolio as trustee of Kamehameha Schools and through spearheading bond transactions as Chairman/Director of Department of Hawaiian Home Lands.
|
•
|
Experience managing complex capital expenditure projects from overseeing development of master planned communities and from managing annual $150 million capital improvement budget for the Department of Hawaiian Home Lands.
|
•
|
Skilled in government affairs, policy development, public relations and crisis management from prior service as Chairman/Executive Director of the Hawaii Republican Party.
|
•
|
Managing Partner, BlackSand Capital, LLC (real estate investment firm), since 2010
|
•
|
President and CEO, Kobayashi Group, LLC, 2001-10, and Partner, since 2001
|
•
|
From his leadership of BlackSand Capital, LLC and Kobayashi Group, LLC, Hawaii-based real estate investment and development firms he co-founded, he has extensive experience in private equity investment, real estate acquisitions, project origination, procurement of construction and permanent debt facilities and subordinate/mezzanine financing, in addition to planning, financing and leading large real estate development projects and experience with executive management, marketing and government relations.
|
•
|
Organizational governance and financial oversight experience from his current service as a trustee for mutual funds (Hawaiian Tax Free Trusts, from the Aquila Group of Funds) and as a current or past director of several non-profit organizations, including the Shane Victorino Foundation, Inspire the Keiki Foundation, East-West Center Foundation and GIFT Foundation of Hawaii, which he co-founded.
|
•
|
President and CEO and Director, HEI (parent company of Hawaiian Electric), since 2006
|
•
|
Director, ASB Hawaii (affiliate of Hawaiian Electric), since 2006
|
•
|
Chairman of the Board since 2006, Risk Committee member since 2012 and Director since 1999, ASB (affiliate of Hawaiian Electric)
|
•
|
CEO, 2001-10, President, 2001-08, and Senior Executive Vice President and Chief Operating Officer, 1999-2001, ASB
|
•
|
Financial Vice President & Treasurer, 1997-99, HEI Power Corp. (former affiliate of Hawaiian Electric)
|
•
|
Treasurer, 1989-99, and Assistant Treasurer,1987-89, HEI
|
•
|
Treasurer, 1987-89, and Assistant Corporate Counsel, 1984-87, Hawaiian Electric
|
•
|
Director, HEI, 2001-04 and since 2006
|
•
|
Director, Audit Committee Chair and Nominating and Corporate Governance Committee Member, Matson, Inc., since 2012
|
•
|
Director, Alexander & Baldwin, Inc., 2004-12
|
•
|
Intimate understanding of the Company from serving in various chief executive, chief operating and other executive, finance and legal positions at HEI and its operating subsidiaries for more than 30 years.
|
•
|
Familiarity with current management and corporate governance practices from her current service as a director, Audit Committee Chair and Nominating and Corporate Governance Committee member for Matson, Inc. and as a director and Underwriting Committee chair for AEGIS Insurance Services, Inc.
|
•
|
Experience with financial oversight and expansive knowledge of the Hawaii business community and the local communities that comprise the Company’s customer bases from serving as a director for various local industry, business development, educational and nonprofit organizations.
|
•
|
Utility industry knowledge from serving as a director or task force member of the Edison Electric Institute, Electric Power Research Institute and federal Electricity Subsector Coordinating Council.
|
•
|
Nationally recognized leader in the fields of critical infrastructure, resilience and physical and cyber security, and energy, demonstrated by her appointment by President Obama to chair the National Infrastructure Advisory Council, membership on the federal Electricity Subsector Coordinating Council, and her naming as a C3E Energy Ambassador by the U.S. Department of Energy.
|
•
|
President and CEO, Hawaiian Electric, since October 2014
|
•
|
President, HEI Charitable Foundation (affiliate of Hawaiian Electric), since 2011
|
•
|
Senior Executive Officer on loan from HEI (parent company of Hawaiian Electric) to Hawaiian Electric, May-September 2014
|
•
|
Executive Vice President, Corporate and Community Advancement, HEI, 2011-May 2014
|
•
|
Deep understanding of Hawaiian Electric from his prior service on the Company's board and from his roles as HEI Executive Vice President, Corporate and Community Advancement and President, HEI Charitable Foundation, and from his service as a loaned executive to Hawaiian Electric from May to October 2014.
|
•
|
More than three decades of public utilities regulatory experience in Hawaii, including through overseeing regulatory matters for Hawaiian Telcom, and from his years of private law practice, in which he specialized in public utility regulation and was named one of America’s Best Lawyers in public utility law.
|
•
|
Longstanding involvement in and knowledge of the communities Hawaiian Electric and its subsidiaries serve, having served on the boards of several community organizations and having worked for many years to strengthen public education in Hawaii, including through his service as Chairman of Hawaii 3Rs, a director of The Learning Coalition, a director of Hawaii Institute of Public Affairs, and a Hawaii commissioner on the Education Commission of the States.
|
•
|
Experienced in executive management from his service on the boards of Hawaiian Electric and Hawaiian Telcom and from his executive roles at Hawaiian Telcom and HEI, and skilled in complex change management, having served as Senior Advisor to Hawaiian Telcom and a member of the Hawaiian Telcom special independent board committee that oversaw the company’s plan of reorganization and successful emergence from reorganization proceedings in 2010.
|
•
|
CEO, Hawaii Community Foundation (statewide charitable foundation), since 2016
|
•
|
President and CEO, Hawaii Community Foundation, 1998-2015
|
•
|
Director since 1993 and Nominating and Corporate Governance Committee Chair, HEI (parent company of Hawaiian Electric)
|
•
|
Executive management experience with responsibility for overseeing more than $500 million in charitable assets through his leadership of the Hawaii Community Foundation.
|
•
|
Proficiency in risk assessment, strategic planning and organizational leadership as well as marketing and public relations from his current position at the Hawaii Community Foundation and his prior experience as Vice President and Executive Director of the Asia/Pacific Region for The Nature Conservancy and as Founder, Managing Partner and Director of Sunrise Capital Inc.
|
•
|
Knowledge of corporate and nonprofit governance issues gained from his prior service as a director for Grove Farm Company, Inc. and the Independent Sector, his current service on the boards of Feeding America, the Stupski Foundation and the Hawaii Leadership Forum, and through publishing articles and lecturing on governance of tax-exempt organizations.
|
•
|
Managing Partner, Watanabe Ing & Komeiji LLP, 1972-2007 (retired)
|
•
|
Director, Nominating and Corporate Governance Committee Chair and Compensation Committee Member, Matson, Inc., since 2012
|
•
|
Director since 1988 and Executive and Risk Committee Member, ASB (affiliate of Hawaiian Electric)
|
•
|
Lead Independent Director, 2012-15 and director 2003-15, Alexander & Baldwin, Inc. (A&B)
|
•
|
Director since 1987, Chairman of the Board since 2006, Executive Committee Chair and Compensation Committee member, HEI (parent company of Hawaiian Electric)
|
•
|
Broad business, legal, corporate governance and leadership experience from serving as Managing Partner of the law firm he helped found, advising clients on a variety of business and legal matters for 35 years and from serving on more than a dozen public and private company and nonprofit boards and committees, including his current service on the Matson Nominating and Corporate Governance and Compensation Committees and past service on the A&B Nominating & Corporate Governance Committee.
|
•
|
Specific experience with strategic planning from providing strategic counsel to local business clients and prospective investors from the continental United States and the Asia Pacific region for 25 years of his law practice.
|
•
|
Recognized by a number of organizations for his accomplishments, including by the Financial Times-Outstanding Directors Exchange, which selected him as a 2013 Outstanding Director.
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
•
|
Pay should reflect Company performance, particularly over the long-term,
|
•
|
Compensation programs should align executives' interests with those of our shareholders, customers and employees,
|
•
|
Programs should be designed to attract, motivate and retain talented executives who can drive the Company’s success, and
|
•
|
The cost of programs should be reasonable while maintaining their purpose and benefit.
|
•
|
For 2016 annual incentive performance the following metrics applied to all Hawaiian Electric named executive officers: Hawaiian Electric core net income, operation and maintenance expense, reliability, customer satisfaction and safety, each on a consolidated basis. The 2016 performance of Hawaiian Electric named executive officers other than Mr. Oshima also included metrics regarding achievement of utility transformation goals.
|
•
|
Long-term incentives comprise a significant portion of each Hawaiian Electric named executive officer’s pay opportunity. For the three-year period that ended December 31, 2016, other than for Mr. Oshima, the Hawaiian Electric named executive officer performance metrics were HEI total shareholder return (TSR) relative to the Edison Electric Institute Index (HEI Relative TSR) and Hawaiian Electric three-year return on average common equity (ROACE) as a percentage of the ROACE allowed by the Hawaii Public Utilities Commission (PUC) for the period. Mr. Oshima was an HEI employee and not a Hawaiian Electric executive when his 2014-16 Long-Term Incentive Plan (LTIP) opportunity was determined. Accordingly, HEI's metrics and goals were applied to Mr. Oshima for the 2014-16 LTIP. For Mr. Oshima's performance metrics, see the table under "2014-16 Performance Metrics, Goals and Results" under "Long-Term Incentives -- 2014-16 Long-Term Incentive Plan" below.
|
•
|
Engages in extensive deliberations in meetings held over several months
|
•
|
Consults with its independent compensation consultant during and outside of meetings
|
•
|
Focuses on Hawaiian Electric’s long-term strategy and nearer-term goals to achieve that strategy in setting performance metrics and goals
|
•
|
Reviews tally sheets for each named executive officer to understand how the elements of compensation relate to each other and to the compensation package as a whole (the tally sheets include fixed and variable compensation, minimal perquisites and change in pension value for current and past periods)
|
•
|
Examines data and analyses prepared by its independent compensation consultant concerning peer group selection, comparative compensation data and evolving best practices
|
•
|
Reviews Hawaiian Electric performance and discusses assessments of the individual performance of senior members of management
|
•
|
Analyzes the reasonableness of incentive payouts in light of the long-term benefits to all stakeholders
|
•
|
Considers trends in payouts to determine whether incentive programs are working effectively
|
•
|
Reviews risk assessments conducted by the HEI and Hawaiian Electric Enterprise Risk Management functions to determine whether compensation programs and practices carry undue risk
|
•
|
Financial performance objectives for the annual incentive program are linked to Board-approved budget guidelines, and nonfinancial measures (such as customer satisfaction, reliability and safety) are aligned with the interests of all Hawaiian Electric stakeholders.
|
•
|
An executive compensation recovery policy (“clawback policy”) permits recoupment of performance-based compensation paid to executives found personally responsible for fraud, gross negligence or intentional misconduct that causes a significant restatement of Hawaiian Electric’s financial statements.
|
•
|
Financial opportunities under long-term incentives are greater than those under annual incentives, emphasizing the importance of long-term outcomes.
|
•
|
Share ownership and retention guidelines requiring Mr. Oshima to hold certain amounts of HEI Common Stock ensure that Hawaiian Electric’s chief executive has a substantial personal stake in the long-term performance of Hawaiian Electric and HEI. The guidelines specific to Mr. Oshima are discussed in "Share ownership and retention are required throughout employment with the Company" in HEI's 2017 Proxy Statement.
|
•
|
In typical circumstances, long-term incentive plan payouts have been 100% equity-based, so executives share in the same upside potential and downside risk as all HEI shareholders. In light of the then pending merger with NextEra Energy, Inc. (NextEra Energy), however, the HEI Compensation Committee decided to provide for the 2015-17 and 2016-18 LTIP to be settled in cash in lieu of equity. The Committee determined that HEI's stock price might be affected at least in part by merger considerations unrelated to HEI's true operating performance and that, as a result, the compensatory goals of the LTIP would be better served by a cash settlement. Since the merger did not occur and the merger agreement between HEI and NextEra Energy was terminated in July 2016, the Committee determined that the 2017-19 LTIP would be settled 100% in equity.
|
•
|
Annual grants of RSUs and long-term incentives vest over a period of years to encourage sustained performance and executive retention.
|
•
|
Performance-based plans use a variety of financial metrics (e.g., net income, return on average common equity) and nonfinancial performance metrics (e.g., customer satisfaction, reliability and safety) that correlate with long-term value creation for all stakeholders and are impacted by management decisions.
|
•
|
The Hawaiian Electric Board and HEI Compensation Committee continuously monitor risks faced by the enterprise, including through management presentations at quarterly meetings and through periodic written reports from management.
|
Compensation Element
|
Summary
|
Objectives
|
Base Salary
|
Fixed level of cash compensation set in reference to peer group median (may vary based on performance, experience, responsibilities and other factors).
|
Attract and retain talented executives by providing competitive fixed cash compensation.
|
Annual Performance-Based Incentives
|
Variable cash award based on achievement of pre-set performance goals for the year. Award opportunity is a percentage of base salary. Performance below threshold levels yields no incentive payment.
|
Drive achievement of key business results linked to long-term strategy and reward executives for their contributions to such results. Balance compensation cost and return by paying awards based on performance.
|
Long-Term Performance-Based Incentives
|
Variable equity* award based on meeting pre-set performance objectives over a 3-year period. Award opportunity is a percentage of base salary. Performance below threshold levels yields no incentive payment.
|
Motivate executives and align their interests with those of all stakeholders by promoting long-term value growth and by paying awards in the form of equity.*
Balance compensation cost and return by paying awards based on performance.
|
Annual Restricted Stock Unit (RSU) Grant
|
Annual equity grants in the form of RSUs that vest in equal installments over 4 years. Amount of grant is a percentage of base salary.
|
Promote alignment of executive and shareholder interests by ensuring executives have significant ownership of HEI stock.
Retain talented leaders through multi-year vesting.
|
Benefits
|
Includes defined benefit pension plans and retirement savings plan, deferred compensation plans, minimal perquisites and an executive death benefit plan (frozen since 2009).
|
Enhance total compensation with meaningful and competitive benefits that promote peace of mind and contribute to financial security.
|
1
|
The threshold and maximum opportunities are 0.5 times target and 2 times target, respectively.
|
2
|
Mr. Oshima's target long-term incentive opportunity was increased from 90% to 95% for 2016 to increase the proportion of his long-term incentive opportunities tied to performance and to be closer to the median long-term incentive opportunity for similar positions at comparable companies. In addition, his RSU grant was increased from 50% to 65% of base salary to be closer to the median equity grant for similar positions at comparable companies.
|
3
|
For each of Ms. Sekimura and Mr. Ignacio the target long-term incentive opportunity was increased to increase the proportion of their long-term incentive opportunities tied to performance and to be closer to the median long-term incentive opportunity for similar positions at comparable companies.
|
2016 Annual Incentive Performance Metrics & Why We Use Them
|
|
Goals
|
|
||||
Weight-ing
|
Threshold
|
Target
|
Maximum
|
Result
|
|||
Consolidated Core Net Income
1
focuses on fundamental earnings
|
45%
|
$122.4M
|
$144.0M
|
$158.4M
|
$144.5M
|
||
Consolidated Operation and Maintenance Expense
2
measures operational efficiency
|
15%
|
$400M
|
$386M
|
N/A
|
$396M
|
||
Consolidated System Average Interruption Duration Index (SAIDI)
3
promotes system reliability for customers
|
10%
|
118 minutes
|
116 minutes
|
114 minutes
|
113 minutes
|
||
Consolidated Customer Satisfaction
4
focuses on improving the customer experience through all points of contact with the utility
|
5%
|
Consolidated score of 62 in 2 of 4 quarters
|
Consolidated score of 62 in 3 of 4 quarters
|
Consolidated score of 62 in 4 of 4 quarters
|
Consolidated score of 62 in 3 of 4 quarters
|
||
Consolidated Safety/TCIR
5
rewards improvements in workplace safety, promoting employee well-being and reducing expense
|
5%
|
1.28 TCIR
|
1.16 TCIR
|
1.05 TCIR
|
1.67 TCIR
|
||
Transformation Metrics
6
promote achievement of utility transformation initiatives
|
20%
|
Threshold
|
Target
|
Maximum
|
Target
|
1
|
Consolidated Core Net Income represents Hawaiian Electric’s consolidated non-GAAP adjusted net income for 2016. This Core Net Income metric is a non-GAAP metric because when it was established the HEI Compensation Committee determined that costs associated with the NextEra Energy merger should not be included. See further discussion below. For a reconciliation of the GAAP and non-GAAP results, see "Reconciliation of GAAP to Non-GAAP Measures" in Appendix B. The weighting for Mr. Oshima is 65%.
|
2
|
Consolidated Operation and Maintenance Expense represents non-fuel expenses of the consolidated utilities excluding expenses covered by surcharges or that are otherwise neutral to net income.
|
3
|
Consolidated SAIDI is measured by the average outage duration for each customer served, exclusive of catastrophic events and outages caused by independent power producers, over whose plant maintenance and reliability the utility has limited real-time control.
|
4
|
Consolidated Customer Satisfaction is based on quarterly results of customer surveys conducted by an outside vendor.
|
5
|
Consolidated Safety is measured by Total Cases Incident Rate (TCIR), a standard measure of employee safety. TCIR equals the number of Occupational Safety and Health Administration recordable cases as of 12/31/16 × 200,000 productive hours divided by productive hours for the year. The lower the TCIR the better.
|
6
|
Transformation Metrics focus on achievement of the utility’s transformation goals. Mr. Oshima approves the Transformation milestones under this metric and determines the aggregate performance at the end of the performance period; therefore, his weighting for this metric is 0%. For 2016, the milestones focused on the areas of culture transformation, customer experience, distribution circuit reliability, electrification of transportation and communication. Achievement at target indicates that all milestones were achieved.
|
Name
|
2016 Annual Incentive Payout ($)
|
||
Alan M. Oshima
|
$
|
445,939
|
|
Tayne S. Y. Sekimura
|
173,061
|
|
|
Stephen M. McMenamin
|
143,095
|
|
|
Jimmy D. Alberts
|
119,640
|
|
|
Jay M. Ignacio
|
126,654
|
|
2016-18 Long-Term Incentive Performance Metrics & Why We Use Them
|
|
Goals
|
||
Weighting*
|
Threshold
|
Target
|
Maximum
|
|
HEI 3-year Average Annual EPS Growth
1
promotes shareholder value by focusing on EPS growth over a three-year period.
|
50%
|
3%
|
4%
|
6%
|
3-year ROACE as a %
of Allowed Return
2
measures Hawaiian Electric’s performance in attaining the level of ROACE it is permitted to earn by its regulator. The focus on ROACE encourages improved return compared to the cost of capital.
|
50%
|
74%
|
84%
|
94%
|
*
|
The same weightings apply to all named executive officers.
|
1
|
HEI 3-year Average Annual EPS Growth is calculated by taking the sum of each full calendar year's (2016, 2017 and 2018, respectively) EPS percentage growth over the EPS of the prior year and dividing that sum by 3.
|
2
|
3-year ROACE as a % of Allowed Return is Hawaiian Electric's consolidated average ROACE for the performance period compared to the weighted average of the allowed ROACE for Hawaiian Electric, Maui Electric and Hawaii Electric Light as determined by the PUC for the same period.
|
Name
|
2014-16 Target Opportunity
**
(as % of Base Salary)
|
Alan M. Oshima*
|
55%
|
Tayne S. Y. Sekimura
|
45%
|
Stephen M. McMenamin
|
45%
|
Jimmy D. Alberts
|
45%
|
Jay M. Ignacio
|
45%
|
*
|
Mr. Oshima became Hawaiian Electric President and CEO in October 2014. His 2014-16 LTIP award opportunity shown above was established in February 2014 when he was an HEI employee.
|
**
|
The threshold and maximum opportunities were 0.5 times target and 2 times target, respectively.
|
2014-16 Long-Term Incentive
|
|
Goals**
|
|
||
Performance Metrics** & Why We Use Them
|
Weighting
|
Threshold
|
Target
|
Maximum
|
Result
|
All named executive officers
|
|
|
|
|
|
HEI Relative TSR
1
compares the value created for HEI
shareholders to that created by other investor-owned electric companies (EEI Index).
|
50%
|
30
th
percentile
|
60
th
percentile
|
90
th
percentile
|
35
th
percentile
|
Mr. Oshima only*
|
|
|
|
|
|
Weighted Composite of Utility (2/3) and ASB (1/3) 3-year ROACE
2
measures profitability based on net income returned as a % of average common equity.
|
50%
|
8.0%
|
8.9%
|
9.8%
|
9.0%
|
All named executive officers other than Mr. Oshima
|
|
|
|
|
|
3-year ROACE as a % of Allowed Return
3
measures Hawaiian Electric’s performance in attaining the level of ROACE it is permitted to earn by its regulator.
|
50%
|
75%
|
85%
|
95%
|
86%
|
*
|
Mr. Oshima was an HEI employee and not a Hawaiian Electric executive when his 2014-16 LTIP award was determined. Accordingly, HEI's metrics and goals were applied to Mr. Oshima for the 2014-16 LTIP.
|
1
|
HEI Relative TSR compares HEI’s TSR to that of the companies in the Edison Electric Institute (EEI) Index (see "Performance Peers" in Appendix A for the companies that comprised the EEI Index for 2014-16). For LTIP purposes, TSR is the sum of the growth in price per share of HEI Common Stock based on the December month-average share price at the beginning of the performance period to the December month-average share price at the end of the performance period, plus dividends during the period, assuming reinvestment, divided by the beginning December month-average share price.
|
2
|
Weighted Composite of Utility and ASB 3‑year ROACE is calculated as average net income divided by average common equity for the period, for the utility and ASB, respectively, with net income of Hawaiian Electric and ASB adjusted for exclusions the Committee allows for utility and ASB results. For purposes of this metric, the utility is weighted two‑thirds (2/3) and ASB is weighted one‑third (1/3). For a reconciliation of the GAAP and non-GAAP results, see "Reconciliation of GAAP to Non-GAAP Measures" attached as Appendix B.
|
3
|
3-year ROACE as a % of Allowed Return is Hawaiian Electric's consolidated average ROACE for the performance period compared to the weighted average of the allowed ROACE for Hawaiian Electric, Maui Electric and Hawaii Electric Light as determined by the PUC for the same period. The calculation of Hawaiian Electric consolidated average ROACE included the adjustments described below in "Adjustments for unusual events - 2014-16 LTIP," both for net income and common equity. See "Reconciliation of GAAP to Non‑GAAP Measures" attached as Appendix B.
|
Name
|
Payout
(Shares)
|
|
Dividend Equivalent (DE) Shares
|
|
Total
(Payout plus DE Shares)
|
|
Alan M. Oshima*
|
5,272
|
|
717
|
|
5,989
|
|
Tayne S. Y. Sekimura
|
4,842
|
|
659
|
|
5,501
|
|
Stephen M. McMenamin
|
4,511
|
|
613
|
|
5,124
|
|
Jimmy D. Alberts
|
3,758
|
|
511
|
|
4,269
|
|
Jay M. Ignacio
|
3,473
|
|
472
|
|
3,945
|
|
*
|
Mr. Oshima was an HEI employee and not a Hawaiian Electric executive when his 2014-16 LTIP award was determined. Accordingly, HEI's metrics and goals were applied to Mr. Oshima for the 2014 -16 LTIP. The 5,989 share amount represents the pro-rated portion of Mr. Oshima's 2014-16 LTIP payout for his service to Hawaiian Electric in 2014, 2015 and 2016. That is, it includes compensation for 90% of Mr. Oshima's time from May 19, 2014 to September 30, 2014 and 100% of his time from October 1, 2014 to December 31, 2016. For Mr. Oshima's total 2014-16 LTIP payout, which also includes the portion reflecting service to HEI, see "2014-16 performance metrics, goals, results & payouts" in HEI's 2017 Proxy Statement.
|
Name and 2016
Principal Positions
|
Year
|
|
Salary
($) (1)
|
|
Stock
Awards
($) (2)
|
|
Nonequity
Incentive
Plan
Compen-
sation
($) (3)
|
|
Change in
Pension Value
and Nonqualified
Deferred
Compensation
Earnings ($) (4)
|
|
All Other
Compen-
sation
($) (5)
|
|
Total
Without
Change in
Pension
Value
($) (6)
|
|
Total ($)
|
|||||||
Alan M. Oshima*
|
2016
|
|
583,500
|
|
|
379,282
|
|
|
445,939
|
|
|
153,231
|
|
|
21,296
|
|
|
1,430,017
|
|
|
1,583,248
|
|
President and Chief Executive Officer
|
2015
|
|
566,500
|
|
|
283,247
|
|
|
427,168
|
|
|
111,620
|
|
|
23,632
|
|
|
1,300,547
|
|
|
1,412,167
|
|
|
2014
|
|
267,971
|
|
|
286,316
|
|
|
169,466
|
|
|
97,342
|
|
|
3,005
|
|
|
726,758
|
|
|
824,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Tayne S. Y. Sekimura
|
2016
|
|
342,000
|
|
|
119,690
|
|
|
173,061
|
|
|
400,247
|
|
|
—
|
|
|
634,751
|
|
|
1,034,998
|
|
Senior Vice President and Chief Financial Officer
|
2015
|
|
332,000
|
|
|
116,201
|
|
|
166,896
|
|
|
110,227
|
|
|
—
|
|
|
615,097
|
|
|
725,324
|
|
2014
|
|
322,000
|
|
|
251,150
|
|
|
169,127
|
|
|
665,954
|
|
|
—
|
|
|
742,277
|
|
|
1,408,231
|
|
|
Stephen M. McMenamin
|
2016
|
|
314,200
|
|
|
109,972
|
|
|
143,095
|
|
|
124,330
|
|
|
—
|
|
|
567,267
|
|
|
691,597
|
|
Senior Vice President and Chief Information Officer
|
2015
|
|
305,000
|
|
|
106,753
|
|
|
137,991
|
|
|
109,735
|
|
|
—
|
|
|
549,744
|
|
|
659,479
|
|
2014
|
|
300,000
|
|
|
233,984
|
|
|
124,939
|
|
|
201,601
|
|
|
—
|
|
|
658,923
|
|
|
860,524
|
|
|
Jimmy D. Alberts
|
2016
|
|
262,700
|
|
|
91,943
|
|
|
119,640
|
|
|
49,950
|
|
|
22,639
|
|
|
496,922
|
|
|
546,872
|
|
Senior Vice President, Customer Service
|
2015
|
|
255,000
|
|
|
89,242
|
|
|
115,369
|
|
|
28,616
|
|
|
24,674
|
|
|
484,285
|
|
|
512,901
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Jay M. Ignacio
|
2016
|
|
278,100
|
|
|
97,325
|
|
|
126,654
|
|
|
391,590
|
|
|
—
|
|
|
502,079
|
|
|
893,669
|
|
President, Hawaii Electric Light and Senior Operations Advisor to the Hawaiian Electric President and CEO
|
2015
|
|
255,417
|
|
|
85,733
|
|
|
115,596
|
|
|
115,118
|
|
|
—
|
|
|
456,746
|
|
|
571,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Effective October 1, 2014, Mr. Oshima was appointed Hawaiian Electric President & CEO. Prior to that, Mr. Oshima served as HEI EVP, Corporate and Community Advancement from October 10, 2011 through May 18, 2014. Effective May 19, 2014 and up to his appointment as Hawaiian Electric President & CEO, Mr. Oshima served as a senior Hawaiian Electric executive officer on loan from HEI. Mr. Oshima's 2014 compensation for Hawaiian Electric shown above includes only compensation attributable to his time working for Hawaiian Electric in 2014. This includes compensation for 90% of Mr. Oshima's time from May 19, 2014 to September 30, 2014 and 100% of his time from October 1, 2014 to December 31, 2014. Mr. Oshima's total 2014 compensation, including the portion reflecting service to HEI, is set forth in HEI's 2017 Proxy Statement. All compensation amounts presented for Mr. Oshima in 2015 and 2016 are the same amounts that are presented for him in the disclosure of HEI named executive officer compensation in HEI's 2017 Proxy Statement.
|
1.
|
Salary.
This column represents cash base salary received for the year.
|
2.
|
Stock Awards
. These amounts represent the aggregate grant date fair value of stock awards granted in the years shown computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718). For 2014, these amounts are comprised of: (i) the opportunity (based on probable outcome of performance conditions (in this case, target) as of the grant date) to earn shares of HEI Common Stock in the future pursuant to the 2014-16 LTIP if pre-established performance goals are achieved and (ii) RSUs vesting in installments over a four-year period. For 2015 and 2016, these amounts are comprised of RSUs granted in the year shown and vesting in installments over a four-year period. Since the 2015-17 and 2016-18 LTIPs are denominated in cash rather than in stock, in accordance with SEC rules the cash payout (if any) will be reported in the "Nonequity Incentive Plan
|
3.
|
Nonequity Incentive Plan Compensation
. These amounts represent cash payouts to named executive officers under the annual incentive plan, called the Executive Incentive Compensation Plan (EICP), earned for the years shown. The incentive plan payout to Mr. Oshima for 2014 represented the pro-rated portion of the award related to Hawaiian Electric service which includes 90% of Mr. Oshima's time from May 19, 2014 to September 30, 2014 and 100% of his time from October 1, 2014 to December 31, 2014.
|
4.
|
Change in Pension Value and Nonqualified Deferred Compensation Earnings
. These amounts represent the change in present value of the accrued pension and executive death benefits from beginning of year to end of year for 2014, 2015 and 2016. These amounts are not current payments; pension and executive death benefits are only paid after retirement or death, as applicable. The amounts in this column depend heavily on changes in actuarial assumptions, such as discount rates
.
The 2016 present value of pensions (and, for Ms. Sekimura and Mr. Ignacio, executive death benefits) increased from 2015 due to a lower discount rate and lower expected rates of improvement in the mortality tables based on Scale MP-2016 published by the Society of Actuaries. For a further discussion of the applicable plans, see the 2016 Pension Benefits table and related notes below. No Hawaiian Electric named executive officer had above-market or preferential earnings on nonqualified deferred compensation for the periods covered in the table above.
|
5.
|
All Other Compensation
. The following table summarizes the components of “All Other Compensation” with respect to 2016:
|
Name
|
Contributions to Defined Contribution
Plans ($)
a
|
|
Other
($)
b
|
|
Total All Other
Compensation
($)
|
|
Alan M. Oshima
|
7,950
|
|
13,346
|
|
21,296
|
|
Tayne S.Y. Sekimura*
|
—
|
|
—
|
|
—
|
|
Stephen M. McMenamin*
|
—
|
|
—
|
|
—
|
|
Jimmy D. Alberts
|
7,915
|
|
14,724
|
|
22,639
|
|
Jay M. Ignacio*
|
—
|
|
—
|
|
—
|
|
a
|
Messrs. Oshima and Alberts received matching contributions to their accounts in the HEI 401(k) Plan up to the amount permitted based on eligible compensation ($265,000 in 2016).
|
b
|
Mr. Oshima received club membership dues and had one more week of vacation than employees with similar length of service would usually receive. Mr. Alberts received club membership dues and had two more weeks of vacation than employees with similar length of service would usually receive.
|
*
|
The total value of perquisites and other personal benefits for each of Ms. Sekimura, Mr. McMenamin and Mr. Ignacio was less than $10,000 for 2016 and is therefore not included in the table above.
|
6.
|
Total Without
Change in Pension Value
. Total Without Change in Pension Value represents total compensation as determined under SEC rules, minus the change in pension value and executive death benefits amount reported in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column. We include this column because the magnitude of the change in pension value and death benefits in a given year is largely determined by actuarial assumptions, such as discount rates and mortality assumptions set by the Society of Actuaries, and does not reflect decisions made by the HEI Compensation Committee or Hawaiian Electric Board for that year or the actual benefit necessarily to be received by the recipient. The amounts reported in the Total Without Change in Pension Value column may differ substantially from the amounts reported in the Total column and are not a substitute for the Total column.
|
|
|
|
Estimated Future Payouts
Under Nonequity Incentive
Plan Awards (1)
|
|
Estimated Future Payouts
Under Equity Incentive Plan
Awards
|
|
All Other
Stock Awards: Number of Shares
of Stock
or Units
(#) (2)
|
|
Grant Date Fair Value
of Stock
Awards
($) (3)
|
||||||||||||||||
Name
|
Grant
Date
|
|
Thres-
hold ($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Thres-
hold (#)
|
|
Target
(#)
|
|
Maximum
(#)
|
|
|
||||||||||
Alan M. Oshima
|
2/5/16 EICP
|
|
218,813
|
|
|
437,625
|
|
|
875,250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 LTIP
|
|
277,163
|
|
|
554,325
|
|
|
1,108,650
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 RSU
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,685
|
|
|
379,282
|
|
Tayne S. Y. Sekimura
|
2/5/16 EICP
|
|
85,500
|
|
|
171,000
|
|
|
342,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 LTIP
|
|
85,500
|
|
|
171,000
|
|
|
342,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 RSU
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,003
|
|
|
119,690
|
|
Stephen M. McMenamin
|
2/5/16 EICP
|
|
70,695
|
|
|
141,390
|
|
|
282,780
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 LTIP
|
|
70,695
|
|
|
141,390
|
|
|
282,780
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 RSU
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,678
|
|
|
109,972
|
|
Jimmy D. Alberts
|
2/5/16 EICP
|
|
59,108
|
|
|
118,215
|
|
|
236,430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 LTIP
|
|
59,108
|
|
|
118,215
|
|
|
236,430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 RSU
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,075
|
|
|
91,943
|
|
Jay M. Ignacio
|
2/5/16 EICP
|
|
62,573
|
|
|
125,145
|
|
|
250,290
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 LTIP
|
|
69,525
|
|
|
139,050
|
|
|
278,100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2/5/16 RSU
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,255
|
|
|
97,325
|
|
EICP
|
Executive Incentive Compensation Plan (annual incentive)
|
LTIP
|
Long-Term Incentive Plan (2016-18 period)
|
RSU
|
Restricted stock units
|
1.
|
Estimated Future Payouts Under Nonequity Incentive Plan Awards
. Shows possible cash payouts under the 2016 EICP and the 2016-18 LTIP based on meeting performance goals set in February 2016 at threshold, target and maximum levels. Actual payouts for the 2016 EICP are reported in the 2016 Summary Compensation Table above. Actual payouts for the 2016-18 LTIP will be reported in the 2018 Summary Compensation Table.
|
2.
|
All Other Stock Awards: Number of Shares of Stock or Units
. Represents number of RSUs awarded in 2016 that will vest and be issued as unrestricted stock in four equal annual installments on the grant date anniversary. Unvested awards are forfeited for terminations of employment during the vesting period, except for terminations due to death, disability or retirement, which allow for pro-rata vesting up to the date of termination. Receipt of RSU awards is generally subject to continued employment and expiration of the applicable vesting period. Dividend equivalent shares, not included in the chart, compound over the period at the actual dividend rate and are paid in HEI stock on RSUs vesting in a given year.
|
3.
|
Grant Date Fair Value of Stock Awards
. Grant date fair value for RSUs is based on the closing price of HEI Common Stock on the NYSE on the date of the grant of the award.
|
|
|
Stock Awards
|
|||||||||||
|
|
|
|
|
Equity Incentive Plan Awards
|
||||||||
|
|
|
Shares or Units of Stock That Have Not Vested (1)
|
|
Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)
|
|
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
|
||||||
Name
|
Grant Year
|
|
Number (#)
|
|
Market Value ($) (2)
|
|
|
||||||
Alan M. Oshima
|
2013
|
|
1,356
|
|
|
44,843
|
|
|
—
|
|
|
—
|
|
|
2014
|
|
2,957
|
|
|
97,788
|
|
|
—
|
|
|
—
|
|
|
2015
|
|
6,296
|
|
|
208,209
|
|
|
—
|
|
|
—
|
|
|
2016
|
|
12,685
|
|
|
419,493
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
23,294
|
|
|
770,333
|
|
|
—
|
|
|
—
|
|
Tayne S. Y. Sekimura
|
2013
|
|
1,016
|
|
|
33,599
|
|
|
—
|
|
|
—
|
|
2014
|
|
2,236
|
|
|
73,945
|
|
|
—
|
|
|
—
|
|
|
|
2015
|
|
2,583
|
|
|
85,420
|
|
|
—
|
|
|
—
|
|
|
2016
|
|
4,003
|
|
|
132,379
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
9,838
|
|
|
325,343
|
|
|
—
|
|
|
—
|
|
Stephen M. McMenamin
|
2013
|
|
934
|
|
|
30,887
|
|
|
—
|
|
|
—
|
|
2014
|
|
2,084
|
|
|
68,918
|
|
|
—
|
|
|
—
|
|
|
|
2015
|
|
2,373
|
|
|
78,475
|
|
|
—
|
|
|
—
|
|
|
2016
|
|
3,678
|
|
|
121,631
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
9,069
|
|
|
299,911
|
|
|
—
|
|
|
—
|
|
Jimmy D. Alberts
|
2013
|
|
798
|
|
|
26,390
|
|
|
—
|
|
|
—
|
|
2014
|
|
1,736
|
|
|
57,410
|
|
|
—
|
|
|
—
|
|
|
|
2015
|
|
1,984
|
|
|
65,611
|
|
|
—
|
|
|
—
|
|
|
2016
|
|
3,075
|
|
|
101,690
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
7,593
|
|
|
251,101
|
|
|
—
|
|
|
—
|
|
Jay M. Ignacio
|
2013
|
|
729
|
|
|
24,108
|
|
|
—
|
|
|
—
|
|
2014
|
|
1,604
|
|
|
53,044
|
|
|
—
|
|
|
—
|
|
|
|
2015
|
|
1,906
|
|
|
63,031
|
|
|
—
|
|
|
—
|
|
|
2016
|
|
3,255
|
|
|
107,643
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
7,494
|
|
|
247,826
|
|
|
—
|
|
|
—
|
|
1.
|
Shares or Units of Stock That Have Not Vested
. The remaining installments of the 2013 RSUs vested on February 4, 2017. Of the remaining installments of the 2014 RSUs, one installment vested on February 5, 2017 and the remainder will vest on February 5, 2018. Of the remaining installments of the 2015 RSUs, one installment vested on February 6, 2017 and the remainder will vest in equal annual installments on February 6, 2018 and 2019. For the 2016 RSUs, one installment vested on February 5, 2017 and the remainder will vest in equal annual installments on February 5, 2018, 2019 and 2020.
|
2.
|
Market Value
. Market value is based upon the closing per‑share trading price of HEI Common Stock on the NYSE of $33.07 as of December 30, 2016.
|
|
|
Stock Awards
|
|
|||||
Name
|
|
Number of Shares Acquired on Vesting (#)
|
|
Value Realized on Vesting ($)
|
|
|||
Alan M. Oshima
|
|
5,361
|
|
(1)
|
|
154,665
|
|
|
|
|
5,989
|
|
(2)
|
|
198,056
|
|
(3)
|
Tayne S. Y. Sekimura
|
|
4,454
|
|
(1)
|
|
128,498
|
|
|
|
|
5,501
|
|
(2)
|
|
181,918
|
|
(3)
|
Stephen M. McMenamin
|
|
4,115
|
|
(1)
|
|
118,717
|
|
|
|
|
5,124
|
|
(2)
|
|
169,451
|
|
(3)
|
Jimmy D. Alberts
|
|
3,449
|
|
(1)
|
|
100,267
|
|
|
|
|
4,269
|
|
(2)
|
|
141,176
|
|
(3)
|
Jay M. Ignacio
|
|
3,002
|
|
(1)
|
|
86,608
|
|
|
|
|
3,945
|
|
(2)
|
|
130,461
|
|
(3)
|
1.
|
Represents the number of shares acquired (and dividend equivalents paid in stock based on number of shares vested) upon the 2016 vesting of installments of RSUs granted on February 3, 2012, November 6, 2012, February 4, 2013, February 5, 2014 and February 6, 2015. Value realized on vesting includes dividend equivalents.
|
Name
|
|
Number of Shares Acquired on Vesting
|
|
Compounded Dividend Equivalents
|
|
Total Shares Acquired on Vesting
|
|||
Alan M. Oshima
|
|
4,935
|
|
|
426
|
|
|
5,361
|
|
Tayne S. Y. Sekimura
|
|
3,969
|
|
|
485
|
|
|
4,454
|
|
Stephen M. McMenamin
|
|
3,667
|
|
|
448
|
|
|
4,115
|
|
Jimmy D. Alberts
|
|
3,077
|
|
|
372
|
|
|
3,449
|
|
Jay M. Ignacio
|
|
2,689
|
|
|
313
|
|
|
3,002
|
|
2.
|
Represents the number of shares acquired (and dividend equivalents paid in stock on earned shares) upon vesting of performance share awards under the 2014-16 LTIP, which were payable in stock at the end of the performance period. Mr. Oshima served as an HEI employee when the 2014-16 LTIP opportunity was established and participated in the 2014-16 cycle based on criteria established for him at that time with respect to his position. The shares acquired on vesting for Mr. Oshima represents the shares, dividend equivalents and value related to his service at Hawaiian Electric, which includes estimates at 90% of Mr. Oshima’s time from May 19, 2014 to September 30, 2014 and 100% of his time from October 1, 2014 to December 31, 2016. For Mr. Oshima’s total vested performance shares in 2016, including shares vested for his service to Hawaiian Electric (disclosed here) and HEI, see the 2016 Option Exercises and Stock Vested table in HEI's 2017 Proxy Statement. The HEI Compensation Committee certified the achievement of the applicable performance measures on January 31, 2017.
|
Name
|
|
Number of Shares Acquired on Vesting
|
|
Compounded Dividend Equivalents
|
|
Total Shares Acquired on Vesting
|
|||
Alan M. Oshima
|
|
5,272
|
|
|
717
|
|
|
5,989
|
|
Tayne S. Y. Sekimura
|
|
4,842
|
|
|
659
|
|
|
5,501
|
|
Stephen M. McMenamin
|
|
4,511
|
|
|
613
|
|
|
5,124
|
|
Jimmy D. Alberts
|
|
3,758
|
|
|
511
|
|
|
4,269
|
|
Jay M. Ignacio
|
|
3,473
|
|
|
472
|
|
|
3,945
|
|
3.
|
Represents vested 2014-16 LTIP shares at 2016 year-end closing price of HEI Common Stock on the NYSE of $33.07 per share on December 30, 2016. Actual settlement of the performance share awards under the 2014-16 LTIP occurred on February 10, 2017 (after certification on January 31, 2017) based on the closing price of HEI Common Stock on the NYSE of $33.78 per share. The actual settlement amounts were: Mr. Oshima $202,308; Ms. Sekimura $185,824; Mr. McMenamin $173,089; Mr. Alberts $144,207; and Mr. Ignacio $133,262.
|
Name
|
Plan Name
|
|
Number of
Years Credited
Service (#)
|
|
Present Value of
Accumulated
Benefit ($) (4)
|
|
Payments During
the Last Fiscal
Year ($)
|
||
Alan M. Oshima
|
HEI Retirement Plan (1)
|
|
5.2
|
|
|
256,830
|
|
|
—
|
|
HEI Excess Pay Plan (2)
|
|
5.2
|
|
|
248,572
|
|
|
—
|
Tayne S. Y. Sekimura
|
HEI Retirement Plan (1)
|
|
25.6
|
|
|
2,026,501
|
|
|
—
|
|
HEI Excess Pay Plan (2)
|
|
25.6
|
|
|
528,539
|
|
|
—
|
|
HEI Executive Death Benefit (3)
|
|
—
|
|
|
138,226
|
|
|
—
|
Stephen M. McMenamin
|
HEI Retirement Plan (1)
|
|
7.3
|
|
|
686,004
|
|
|
—
|
|
HEI Excess Pay Plan (2)
|
|
7.3
|
|
|
112,324
|
|
|
—
|
Jimmy D. Alberts
|
HEI Retirement Plan (1)
|
|
4.3
|
|
|
170,510
|
|
|
—
|
Jay M. Ignacio
|
HEI Retirement Plan (1)
|
|
26.8
|
|
|
2,140,600
|
|
|
—
|
|
HEI Excess Pay Plan (2)
|
|
26.8
|
|
|
42,274
|
|
|
—
|
|
HEI Executive Death Benefit (3)
|
|
—
|
|
|
133,800
|
|
|
—
|
1.
|
The HEI Retirement Plan is the standard retirement plan for HEI and Hawaiian Electric employees. Normal retirement benefits under the HEI Retirement Plan for management employees hired before May 1, 2011, including all of the named executive officers other than Messrs. Oshima and Alberts, are calculated based on a formula of 2.04% × Credited Service (maximum 67%) × Final Average Compensation (average monthly base salary for highest thirty-six consecutive months out of the last ten years). Credited service is generally the same as the years of service with HEI and other participating companies (Hawaiian Electric, Hawaii Electric Light and Maui Electric). Credited service is also provided for limited unused sick leave and for the period a vested participant is on long-term disability. The normal form of benefit is a joint and 50% survivor annuity for married participants and a single life annuity for unmarried participants. Actuarially equivalent optional forms of benefit are also available. Participants who qualify to receive benefits immediately upon termination may also elect a single sum distribution of up to $100,000 with the remaining benefit payable as an annuity. Single sum distributions are not eligible for early retirement subsidies, and so may not be as valuable as an annuity at early retirement. Retirement benefits are increased by an amount equal to approximately 1.4% of the initial benefit every twelve months following retirement. The plan provides benefits at early retirement (prior to age 65), normal retirement (age 65), deferred retirement (over age 65) and death. Subsidized early retirement benefits are available for participants who meet certain age and service requirements at ages 50-64. The accrued normal retirement benefit is reduced by an applicable percentage, which ranges from 30% for early retirement at age 50 with at least 15 years of service to 1% at age 59. Accrued benefits are not reduced for eligible employees who retire at age 60 and above. The early retirement subsidies are not available to employees who terminate employment with vested benefits but prior to satisfying the age and service requirements for the early retirement subsidies.
|
2.
|
As of December 31, 2016, all of the named executive officers, except Mr. Alberts, were participants in and eligible for retirement benefits under the HEI Excess Pay Plan. Benefits under the HEI Excess Pay Plan are determined using the same formula as the HEI Retirement Plan, but are not subject to the Internal Revenue Code limits on the amount of annual compensation that can be used for calculating benefits under qualified retirement plans ($265,000 in 2016 as indexed for inflation) and on the amount of annual benefits that can be paid from qualified retirement plans (the lesser of $210,000 in 2016 as indexed for inflation, or the participant’s highest average compensation over three consecutive calendar years). Benefits payable under the HEI Excess Pay Plan are reduced by the benefit payable from the HEI Retirement Plan. Early retirement, death benefits and vesting provisions are similar to the HEI Retirement Plan.
|
3.
|
Ms. Sekimura and Mr. Ignacio are covered by the Executive Death Benefit Plan of HEI and Participating Subsidiaries. The plan was amended effective September 9, 2009 to close participation to new participants and freeze the benefit for existing participants. Under the
|
4.
|
The present value of accumulated benefits for the Hawaiian Electric named executive officers included in the 2016 Pension Benefits table was determined based on the following:
|
a.
|
Discount Rate – The discount rate is the interest rate used to discount future benefit payments in order to reflect the time value of money. The discount rates used in the present value calculations are 4.26% for retirement benefits and 4.22% for executive death benefits as of December 31, 2016.
|
b.
|
Mortality Table – The RP-2016 Mortality Table (separate male and female rates) with generational projection using scale MP-2016 is used to discount future pension benefit payments in order to reflect the probability of survival to any given future date. For the calculation of the executive death benefit present values, the mortality table rates are multiplied by the death benefit to capture the death benefit payments assumed to occur at all future dates. Mortality is applied post-retirement only.
|
c.
|
Retirement Age – A Hawaiian Electric named executive officer included in the table is assumed to remain in active employment until, and assumed to retire at, the later of (a) the earliest age when unreduced pension benefits would be payable or (b) attained age as of December 31, 2016.
|
d.
|
Pre-Retirement Decrements – Pre-retirement decrements refer to events that could occur between the measurement date and the retirement age (such as withdrawal, early retirement and death) that would impact the present value of benefits. No pre-retirement decrements are assumed in the calculation of pension benefit table present values. Pre-retirement decrements are assumed for financial statement purposes.
|
e.
|
Unused Sick Leave – Each Hawaiian Electric named executive officer is assumed to have accumulated 1,160 unused sick leave hours at retirement age.
|
Name
|
Executive
Contributions
in Last FY
($)
1
|
|
Registrant
Contributions
in Last FY
($)
|
|
Aggregate
Earnings/(Losses)
in Last FY
($)
|
|
Aggregate
Withdrawals/
Distributions
($)
|
|
Aggregate
Balance at
Last FYE
($)
2
|
|
Alan M. Oshima
|
213,584
|
|
—
|
|
65,160
|
|
—
|
|
633,029
|
|
Jay M. Ignacio
|
92,477
|
|
—
|
|
15,969
|
|
—
|
|
220,803
|
|
1.
|
Represents salary and incentive compensation deferrals under the HEI Deferred Compensation Plan, a contributory nonqualified deferred compensation plan implemented in 2011. The plan allows certain HEI and Hawaiian Electric executives to defer 100% of annual base salary in excess of the compensation limit set forth in Internal Revenue Code Section 401(a)(17) ($265,000 in 2016, as indexed for inflation) and up to 80% of any incentive compensation paid in cash. There are no matching or other employer contributions under the plan. The deferred amounts are credited with gains/losses of deemed investments chosen by the participant from a designated list of publicly traded mutual funds and other investment offerings. Earnings are not above-market or preferential and therefore are not included in the 2016 Summary Compensation Table above. The distribution of accounts from the plan is triggered by disability, death or separation from service (including retirement) and will be delayed for a 6-month period to the extent necessary to comply with Internal Revenue Code Section 409A. A participant may elect to receive distributions triggered by separation from service in a lump sum or in substantially equal payments spread over a period not to exceed 15 years. Lump sum benefits are payable in the event of disability or death. Messrs. Oshima and Ignacio participated in the HEI Deferred Compensation Plan in 2016. The amounts listed in the "Executive Contributions in Last FY" column for Messrs. Oshima and Ignacio are reported as compensation in the 2016 Summary Compensation Table for the year 2015.
|
2.
|
Amounts in this column include contributions reported in the Summary Compensation Table for each year in which each executive listed above was a named executive officer.
|
Name/
Benefit Plan or Program
|
Retirement on 12/31/16
($) (1)
|
|
Voluntary Termination on 12/31/16 ($) (2)
|
|
Termination for Cause on 12/31/2016 ($) (3)
|
|
Termination without Cause on 12/31/16 ($) (4)
|
|
Qualifying Termination after Change in Control on 12/31/16
($) (5)
|
|||||
Alan M. Oshima
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Incentive Compensation Plan (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-Term Incentive Plan (7)
|
524,674
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
524,674
|
|
Restricted Stock Units (8)
|
268,849
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
826,485
|
|
TOTAL
|
793,523
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,351,159
|
|
Tayne S. Y. Sekimura
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Incentive Compensation Plan (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-Term Incentive Plan (7)
|
156,599
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
156,599
|
|
Restricted Stock Units (8)
|
135,055
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
354,312
|
|
TOTAL
|
291,654
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
510,911
|
|
Stephen M. McMenamin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Incentive Compensation Plan (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-Term Incentive Plan (7)
|
138,630
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
138,630
|
|
Restricted Stock Units (8)
|
124,597
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
326,633
|
|
TOTAL
|
263,227
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
465,263
|
|
Jimmy D. Alberts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Incentive Compensation Plan (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-Term Incentive Plan (7)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
115,905
|
|
Restricted Stock Units (8)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
273,556
|
|
TOTAL
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
389,461
|
|
Jay M. Ignacio
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Incentive Compensation Plan (6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Long-Term Incentive Plan (7)
|
119,849
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
119,849
|
|
Restricted Stock Units (8)
|
100,491
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
269,257
|
|
TOTAL
|
220,340
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
389,106
|
|
1.
|
Retirement Payments & Benefits
. All named executive officers except Mr. Alberts were eligible for retirement as of December 31, 2016. Amounts in this column do not include amounts payable under the 2016 EICP and 2014-16 LTIP because those amounts would have vested without regard to retirement since December 31, 2016 was the end of the applicable performance periods. In addition to the amounts shown in this column, retired executives are entitled to receive their vested retirement plan and deferred compensation benefits under all termination scenarios. See the 2016 Pension Benefits table and the 2016 Nonqualified Deferred Compensation table above.
|
2.
|
Voluntary Termination Payments & Benefits
. If a Hawaiian Electric named executive officer voluntarily terminates employment, he or she could lose any annual or long-term incentives based upon the HEI Compensation Committee’s right to amend, suspend or terminate any incentive award or any portion of it at any time. Voluntary termination results in the forfeiture of unvested RSUs and participation in incentive plans. Amounts in this column do not include amounts payable under the 2016 EICP or the 2014-16 LTIP because those amounts would have vested without regard to voluntary termination since December 31, 2016 was the end of the applicable performance periods.
|
3.
|
Termination for Cause Payments & Benefits.
If the executive is terminated for cause, he or she could lose any annual or long-term incentives based upon the HEI Compensation Committee’s right to amend, suspend or terminate any incentive award or any portion of it at any time. “Cause” generally means a violation of the HEI Corporate Code of Conduct or, for purposes of awards under the 2010 Equity and Incentive Plan, as amended (EIP), has the meaning set forth in those plans. Termination for cause results in the forfeiture of all unvested RSUs and participation in incentive plans.
|
4.
|
Termination without Cause Payments & Benefits.
If the executive is terminated without cause, he or she could lose any annual or long-term incentives based upon the HEI Compensation Committee’s right to amend, suspend or terminate any incentive award or any portion of it at any time. Termination without cause results in the forfeiture of unvested RSUs.
|
5.
|
Qualifying Termination After Change-in-Control Payments & Benefits.
None of the Hawaiian Electric named executive officers were party to a change-in-control agreement on December 31, 2016.
|
6.
|
Executive Incentive Compensation Plan (EICP).
Upon death, disability or retirement, executives continue to participate in the EICP on a pro-rata basis if the executive has met applicable minimum service requirements, with lump sum payment to be made by Hawaiian Electric if the applicable performance goals are achieved. The EIP provides that in the event of an involuntary termination following a change in control, the EICP award would be immediately paid out at target level, pro-rated for completed months of service in the performance period. If there is no termination or a voluntary termination following a change-in-control, the EIP provides that: (i) the acquiring entity shall assume all outstanding EICP awards or substitute similar awards or (ii) to the extent the acquiring entity refuses to assume or substitute such awards, such awards shall become fully vested (with all performance goals deemed achieved at 100% of target levels).
|
7.
|
Long-Term Incentive Plan (LTIP).
Upon death, disability or retirement, executives continue to participate in each ongoing LTIP cycle on a pro-rata basis if the executive has met applicable minimum service requirements, with lump sum payment to be made by Hawaiian Electric if performance goals are achieved. The amounts shown are at target for goals deemed achievable (or at below the threshold, if deemed unachievable at the date of termination) for all applicable plan years, pro-rated based upon service through December 31, 2016; actual payouts will depend upon performance achieved at the end of the plan cycle. The EIP provides that in the event of an involuntary termination following a change in control, the LTIP award would be immediately paid out at target level, pro-rated for completed months of service in the performance period. If there is no termination or a voluntary termination following a change-in-control, the EIP provides that: (i) the acquiring entity shall assume all outstanding LTIP awards or substitute similar awards or (ii) to the extent the acquiring entity refuses to assume or substitute such awards, such awards shall become fully vested (with all performance goals deemed achieved at 100% of target levels).
|
8.
|
Restricted Stock Units (RSUs).
Termination for or without cause results in the forfeiture of unvested RSUs. Termination due to death, disability or retirement results in pro-rata vesting of RSUs. If there is a change in control, either (i) the acquiring entity shall assume all outstanding RSUs or substitute similar awards and such awards would vest in full upon a qualifying termination of employment within two years following the change in control or (ii) to the extent the acquiring entity refuses to assume or substitute such awards, such awards shall become fully vested.
|
|
2016
|
||
Hawaiian Electric Director (who is not also an HEI director)
|
$
|
40,000
|
|
Hawaiian Electric Audit Committee Chair
|
10,000
|
|
|
Hawaiian Electric Audit Committee Member
|
4,000
|
|
|
Hawaiian Electric Non-Voting Representative to HEI Compensation Committee
|
6,000
|
|
Name
|
Fees Earned or
Paid in Cash
($) (1)
|
|
Stock
Awards
($) (2)
|
|
Total
($)
|
|||
Don E. Carroll
|
65,000
|
|
|
30,000
|
|
|
95,000
|
|
Thomas B. Fargo (3)
|
—
|
|
|
—
|
|
|
—
|
|
Peggy Y. Fowler (3)
|
1,000
|
|
|
—
|
|
|
1,000
|
|
Timothy E. Johns
Chairman, Audit Committee
|
65,000
|
|
|
30,000
|
|
|
95,000
|
|
Micah A. Kane
|
55,000
|
|
|
30,000
|
|
|
85,000
|
|
Bert A. Kobayashi, Jr.
|
56,000
|
|
|
30,000
|
|
|
86,000
|
|
Kelvin H. Taketa (3)
|
—
|
|
|
—
|
|
|
—
|
|
Jeffrey N. Watanabe (3)
|
3,000
|
|
|
—
|
|
|
3,000
|
|
1.
|
Represents cash retainers for board and committee service (as detailed in the chart below) and a cash payment of $10,000 (¼ of the $40,000 value of the annual Hawaiian Electric nonemployee director stock award) recorded on June 30, 2016, as described above under “Stock Awards.”
|
2.
|
Represents an HEI stock award in the value of $30,000 (the remaining ¾ of the $40,000 value of the annual HEI nonemployee director stock award), as described above under “Stock Awards.” These equity grants were made on September 30, 2016.
|
3.
|
Messrs. Fargo, Taketa and Watanabe and Ms. Fowler also served on the HEI Board for all or part of 2016. Information concerning their compensation for such service will be set forth in HEI's 2017 Proxy Statement.
|
Name
|
Hawaiian Electric Board ($) (1)
|
|
Hawaiian Electric Audit
Committee ($) |
|
Hawaiian Electric
Nonvoting Representative
to HEI Compensation Committee ($) |
|
Extra Meeting Fees ($) (2)
|
|
Total Fees Earned
or Paid in
Cash ($)
|
|||||
Don E. Carroll
|
50,000
|
|
|
4,000
|
|
|
6,000
|
|
|
5,000
|
|
|
65,000
|
|
Thomas B. Fargo
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Peggy Y. Fowler
|
—
|
|
|
1,000
|
|
|
—
|
|
|
—
|
|
|
1,000
|
|
Timothy E. Johns
|
50,000
|
|
|
10,000
|
|
|
—
|
|
|
5,000
|
|
|
65,000
|
|
Micah A. Kane
|
50,000
|
|
|
—
|
|
|
—
|
|
|
5,000
|
|
|
55,000
|
|
Bert A. Kobayashi, Jr.
|
50,000
|
|
|
—
|
|
|
—
|
|
|
6,000
|
|
|
56,000
|
|
Kelvin H. Taketa
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Jeffrey N. Watanabe
|
—
|
|
|
3,000
|
|
|
—
|
|
|
—
|
|
|
3,000
|
|
1.
|
Represents $40,000 annual cash retainer for board service and a cash payment of $10,000 (¼ of the $40,000 value of the annual Hawaiian Electric nonemployee director stock award) recorded on June 30, 2016, as described above under “Stock Awards.”
|
2.
|
Extra meeting fees earned for attending board meetings in excess of number of meetings specified. Most extra board meetings were related to the then-pending merger transaction; as such, the extra meeting fees were paid by HEI.
|
•
|
Hawaiian Electric Chairman of the Board Constance H. Lau, who is also HEI President & CEO and an HEI director and is not compensated by Hawaiian Electric, participated in deliberations of the HEI Compensation Committee in recommending, and of the Hawaiian Electric Board in determining, compensation for Hawaiian Electric’s President & CEO and other Hawaiian Electric named executive officers.
|
•
|
Hawaiian Electric President & CEO Alan M. Oshima, also a Hawaiian Electric director, is responsible for evaluating the performance of the other Hawaiian Electric named executive officers and other Hawaiian Electric senior officers, and for proposing compensation for those officers to the HEI Compensation Committee for recommendation to the Hawaiian Electric Board. Mr. Oshima did not participate in the deliberations of the HEI Compensation Committee to recommend, or of the Hawaiian Electric Board to determine, his own compensation, but did participate in deliberations of the Hawaiian Electric Board to determine the compensation of the other Hawaiian Electric named executive officers.
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
|
Amount and Nature of Beneficial Ownership of HEI Common Stock
|
|||||||||||||
Name of Individual
or Group
|
Sole Voting or
Investment
Power
(1)
|
|
Shared Voting
or Investment
Power
(2)
|
|
Other
Beneficial
Ownership
(3)
|
|
Restricted
Stock Units
(4)
|
|
Total
(5)
|
|||||
Nonemployee directors
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Don E. Carroll
|
37,677
|
|
|
|
|
|
|
|
|
37,677
|
|
|||
Richard J. Dahl
|
902
|
|
|
|
|
|
|
|
|
902
|
|
|||
Timothy E. Johns
|
36,129
|
|
|
|
|
|
|
|
|
36,129
|
|
|||
Micah A. Kane
|
7,231
|
|
|
|
|
|
|
|
|
7,231
|
|
|||
Bert A. Kobayashi, Jr.
|
5,559
|
|
|
|
|
|
|
|
|
5,559
|
|
|||
Kelvin H. Taketa
|
35,699
|
|
|
|
|
|
|
|
|
35,699
|
|
|||
Jeffrey N. Watanabe
|
50,144
|
|
|
|
|
5
|
|
|
|
|
50,149
|
|
||
Employee director
|
|
|
|
|
|
|
|
|
|
|||||
Constance H. Lau
|
475,173
|
|
|
|
|
|
|
28,598
|
|
|
503,771
|
|
||
Employee director and Named Executive Officer
|
|
|
|
|
|
|
|
|
|
|||||
Alan M. Oshima
|
|
|
26,603
|
|
|
|
|
10,900
|
|
|
37,503
|
|
||
Other Named Executive Officers
|
|
|
|
|
|
|
|
|
|
|||||
Jimmy D. Alberts
|
8,408
|
|
|
|
|
|
|
3,455
|
|
|
11,863
|
|
||
Jay M. Ignacio
|
15,875
|
|
|
|
|
|
|
3,919
|
|
|
19,794
|
|
||
Stephen M. McMenamin
|
14,834
|
|
|
|
|
|
|
4,829
|
|
|
19,663
|
|
||
Tayne S. Y. Sekimura
|
33,247
|
|
|
|
|
|
|
5,235
|
|
|
38,482
|
|
||
All directors and executive officers as a group (19 persons)
|
743,725
|
|
|
27,662
|
|
|
362
|
|
|
64,516
|
|
|
836,265
|
|
(1)
|
Includes the following shares held as of February 6, 2017 in the form of stock units in the HEI Common Stock fund pursuant to the HEI Retirement Savings Plan: approximately 109 shares for Ms. Lau; 1,072 shares for Ms. Sekimura; 157 shares for Mr. Ignacio; and 7,897 shares for all directors and executive officers as a group. The value of a unit is measured by the closing price of HEI Common Stock on the measurement date.
|
(2)
|
Shares registered in trust with the individual and spouse serving as co-trustees.
|
(3)
|
Shares owned by spouse, children or other relatives sharing the home of the director or officer in which the director or officer disclaims beneficial interest.
|
(4)
|
Includes the number of shares that the individuals named above had a right to acquire as of or within 60 days after February 6, 2017 pursuant to restricted stock units and related dividend equivalent rights thereon, including shares which retirement eligible individuals have a right to acquire upon retirement. These shares are included for purposes of calculating the percentage ownership of each individual named above and all directors and executive officers as a group as described in footnote (5) below, but are not deemed to be outstanding as to any other person.
|
(5)
|
As of February 6, 2017, the directors and executive officers of Hawaiian Electric as a group and each individual named above beneficially owned less than one percent of the record number of outstanding shares of HEI Common Stock as of that date and no shares were pledged as security.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
1.
|
With respect to Messrs. Carroll, Johns, Kane, Kobayashi, Taketa and Watanabe, the Hawaiian Electric Board considered amounts paid during the last three fiscal years to purchase electricity from Hawaiian Electric (the sole public utility providing electricity to the island of Oahu) by entities by which the director was employed or a family member of the director was an executive officer. None of the amounts paid by these entities for electricity (excluding pass-through charges for fuel, purchased power and Hawaii state revenue taxes) within the last three fiscal years exceeded the NYSE threshold that would automatically result in a director not being independent. The Hawaiian Electric Board also considered that Hawaiian Electric is the sole source of electric power on the island of Oahu and that the rates Hawaiian Electric charges for electricity are fixed by state regulatory authority. Since purchasers of electricity from Hawaiian Electric have no choice as to supplier and no ability to negotiate rates or other terms, the Hawaiian Electric Board determined that these relationships do not impair the independence of Messrs. Carroll, Johns, Kane, Kobayashi, Taketa or Watanabe.
|
2.
|
With respect to Messrs. Kane and Taketa, the Hawaiian Electric Board considered the amount of charitable contributions during the last three fiscal years from HEI and its subsidiaries to the nonprofit organization where they each serve as an executive officer and modest fees paid during the last three fiscal years to such organization for management of grant and scholarship programs. In concluding that such charitable donations and management fees did not affect Mr. Kane's or Mr. Taketa’s independence, the Hawaiian Electric Board considered that none of the foregoing amounts within the last three fiscal years exceeded the NYSE threshold that would automatically result in a director not being independent. The Hawaiian Electric Board also considered the fact that Company policy requires that charitable contributions from HEI or its subsidiaries to entities where a director serves as an executive officer, and where the director has a direct or indirect material interest, and the aggregate amount would exceed $120,000 in any single fiscal year, be pre-approved by the HEI Nominating and Corporate Governance Committee and ratified by the Board.
|
3.
|
With respect to Messrs. Dahl, Johns, Kane and Watanabe, the Hawaiian Electric Board considered other director or officer positions held by those directors at entities for which a Hawaiian Electric officer serves or served as a director and determined that none of these relationships affected the independence of these directors. None of these relationships resulted in a compensation committee interlock or would automatically preclude independence under the NYSE standards.
|
4.
|
With respect to Mr. Johns, the Hawaiian Electric Board considered health insurance premiums paid by HEI, Hawaiian Electric and Hawaiian Electric’s subsidiaries to an entity where Mr. Johns is an executive officer as well as payments to such entity pursuant to a settlement agreement related to Hawaiian Electric's early termination of a group health plan contract with such entity. Neither the health insurance premium payments nor the contract termination payment, nor the combined value of such amounts, exceeded the NYSE threshold that would automatically result in a director not being independent in any single year in any of the last three fiscal years. In addition, the Hawaiian Electric Board considered the fact that the relationship between Hawaiian Electric and the entity by which Mr. Johns is employed was established several decades before Mr. Johns’ employment by such entity and the fact that Mr. Johns was not involved in the termination of the group health plan contract or any related negotiations.
|
5.
|
With respect to Mr. Johns, the Hawaiian Electric Board considered modest fees paid during the last three fiscal years by HEI and its subsidiaries for banking-related services to a bank where a relative of Mr. Johns is an executive. The Hawaiian Electric Board considered that none of the foregoing amounts within the last three fiscal years exceeded the NYSE threshold that would automatically result in a director not being independent.
|
6.
|
With respect to Mr. Kobayashi, the Hawaiian Electric Board determined that the service of his father as an ASB director; ordinary course of business, market term loans between ASB and certain entities in which Mr. Kobayashi or his family members have an ownership interest; and the participation in a utility electric vehicle charging station pilot project of a property in which Mr. Kobayashi has an ownership interest did not impair Mr. Kobayashi’s independence as a Hawaiian Electric director.
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
|
2016
|
2015
|
|||||
Audit fees (principally consisted of fees associated with the audit of the consolidated financial statements and internal control over financial reporting (Sarbanes-Oxley Act of 2002, Section 404), quarterly reviews, issuances of letters to underwriters, statutory audits, review of registration statements and issuance of consents)
|
$
|
1,304,000
|
|
|
$
|
1,332,450
|
|
Audit-related fees (consisted of fees associated with the audit of the financial statements of certain employee benefit plans, comfort letters, the agreed upon procedures for revenue balancing accounts and the agreed upon procedures in related to green energy market securitization service provider agreement)
|
77,775
|
|
|
193,100
|
|
||
Tax fees (consisted of review of income tax returns
,
generation repair studies and tax compliance and technical support)
|
123,404
|
|
|
209,000
|
|
||
All other fees
|
—
|
|
|
—
|
|
||
|
$
|
1,505,179
|
|
|
$
|
1,734,550
|
|
Allete, Inc.
|
MDU Resources Group Inc.
|
Alliant Energy Corp.
|
MGE Energy Inc.
|
Ameren Corp.
|
NextEra Energy Inc.
|
American Electric Power Co.
|
NiSource Inc.
|
Avista Corp.
|
Northwestern Corp.
|
Black Hills Corp.
|
OGE Energy Corp.
|
Centerpoint Energy Inc.
|
Otter Tail Corp.
|
CMS Energy Corp.
|
PG&E Corp.
|
Consolidated Edison Inc.
|
Pinnacle West Capital Corp.
|
Dominion Resources Inc.
|
PNM Resources Inc.
|
DTE Energy Co.
|
Portland General Electric
|
Duke Energy Corp.
|
PPL Corp.
|
Edison International
|
Public Service Enterprise Group Inc.
|
El Paso Electric Co.
|
SCANA Corp.
|
Empire District Electric Co.
|
Sempra Energy
|
Entergy Corp.
|
Southern Co.
|
Eversource Energy
|
Unitil Corp.
|
Exelon Corp.
|
Vectren Corp.
|
FirstEnergy Corp.
|
WEC Energy Group Inc.
|
Great Plains Energy Inc.
|
Westar Energy Inc.
|
Hawaiian Electric Industries Inc.
|
Xcel Energy Inc.
|
IDACORP Inc.
|
|
|
Years ended December 31
|
||||||||
|
2016
|
|
2015
|
|
2014
|
|
|||
UTILITY NET INCOME
|
|
|
|
||||||
GAAP (as reported)
|
$
|
142.3
|
|
$
|
135.7
|
|
$
|
137.6
|
|
Excluding special items (after‑tax) for EICP and LTIP purposes:
|
|
|
|
||||||
Costs related to the terminated merger with NextEra Energy
|
0.1
|
|
0.5
|
|
—
|
|
|||
Costs related to the terminated LNG contract
2
|
2.1
|
|
|
|
|||||
Non‑GAAP (core) net income for 2016 EICP purposes
|
144.5
|
|
|
|
|
||||
Excluding special items (after‑tax) for LTIP purposes only:
|
|
|
|
||||||
PUC decoupling order imposing changes in Hawaiian Electric's RAM
|
—
|
|
7.7
|
|
—
|
|
|||
Tropical Storm Iselle related cost
|
—
|
|
—
|
|
1.4
|
|
|||
Structural changes to decoupling mechanism
|
—
|
|
—
|
|
3.6
|
|
|||
Non‑GAAP (core) net income for 2014-16 LTIP purposes
|
$
|
144.5
|
|
$
|
143.9
|
|
$
|
142.6
|
|
|
|
|
|
||||||
ASB NET INCOME
|
|
|
|
||||||
GAAP (as reported)
|
$
|
57.3
|
|
$
|
54.7
|
|
$
|
51.3
|
|
Excluding special items (after‑tax) for LTIP purposes:
|
|
|
|
||||||
Pension defeasement
|
1.8
|
|
2.7
|
|
(0.1
|
)
|
|||
Non‑GAAP (core) net income for 2014-16 LTIP purposes
|
$
|
59.1
|
|
$
|
57.4
|
|
$
|
51.2
|
|