The Company has defined contribution plans, defined benefit plans, and a postretirement benefit plan.

The Bank of Hawai‘i Retirement Savings Plan (the “Savings Plan”) has three Company contribution components in addition to employee contributions: 1) 401(k) matching, as described below; 2) a 3% fixed amount based on eligible compensation; and 3) a discretionary value-sharing contribution.

Under the 401(k) matching component, participating employees may contribute up to 50% of their eligible compensation (within federal limits) to the Savings Plan. The Company makes matching contributions on behalf of participants equal to $1.25 for each $1.00 contributed by participants, up to 2% of the participants’ eligible compensation, and $0.50 for every $1.00 contributed by participants over 2%, up to 5% of the participants’ eligible compensation. A 3% fixed contribution and a discretionary value-sharing contribution, that is linked to the Company’s financial goals, are made regardless of whether the participating employee contributes to the Savings Plan and are invested in accordance with the participant’s selection of investment options available under the Savings Plan. The Company also has a non-qualified savings plan which covers certain employees with compensation exceeding Internal Revenue Service (“IRS”) limits on pay amounts in the allocation of the Savings Plan’s benefits. Total expense for all components of the Company’s defined contribution plans was $13.2 million for the years ended December 31, 2023, and December 31, 2022, and $16.0 million for the year ended December 31, 2021.

The Company has two defined benefit plans (the “Pension Plans”). In 1995, the Company froze its non-contributory, qualified defined benefit retirement plan (the “Retirement Plan”) and the excess retirement plan (the “Excess Plan”), which covered employees of the Company and participating subsidiaries who met certain eligibility requirements. Beginning January 1, 2001, the Pension Plans no longer provided for compensation increases in the determination of benefits. The projected benefit obligation is equal to the accumulated benefit obligation due to the frozen status of the Pension Plans.

The assets of the Retirement Plan primarily consist of equity and fixed income mutual funds.

The Excess Plan is a non-qualified excess retirement benefit plan which covers certain employees of the Company and participating subsidiaries with compensation exceeding IRS limits on pay amounts applicable to the Pension Plan’s benefit formula. The Excess Plan has no plan assets. The Excess Plan’s projected benefit obligation and accumulated benefit obligation were $2.6 million and $2.7 million for December 31, 2023, and December 31, 2022, respectively.

The Company’s postretirement benefit plan provides retirees hired before January 1, 2012, with medical and dental insurance coverage. For eligible participants that retired before 2008 and met certain age requirements, the Company and retiree share in the cost of providing postretirement benefits where both the employer and retiree pay a portion of the insurance premiums. Eligible participants who retired before 2008 who did not meet certain age requirements continued on the Company’s benefit plans, but pay for their full insurance premiums. Participants who retired on or after January 1, 2008, who had medical or dental coverage under the Company’s plans immediately before retirement and meet certain age and years of service requirements as of December 31, 2008, are also eligible to participate in the Company’s benefit plans, but must pay for their full insurance premiums. Retirees age 65 and older are provided with a Medicare supplemental plan subsidy. Most employees of the Company who have met certain eligibility requirements are covered by this plan. Participants who retired on or after January 1, 2008, who met certain age and/or years of service requirements, are eligible for the Health Reimbursement Account (“HRA”) program. The HRA program provides retirees with an initial credit based on years of service. Thereafter, an annual credit up to a maximum of $1,200 is provided into the HRA. The retiree may use the HRA for medical, vision, prescription drug and dental premiums, co-payments, and medically necessary health care expenses that are not covered by any medical or dental insurance program or flexible health spending account.

The plan provides access-only coverage for employees hired on or after January 1, 2012. These retirees continue on the medical and dental plan until age 65 paying the full premium. As of December 31, 2023, and December 31, 2022, the Company had no segregated assets to provide for postretirement benefits.

The following table provides a reconciliation of changes in benefit obligation and fair value of plan assets, as well as the funded status recognized in the Company’s consolidated statements of condition for the Pension Plans and postretirement benefit plan for the years ended December 31, 2023, and December 31, 2022.


	Pension Benefits						Postretirement Benefits
(dollars in thousands)	2023			2022			2023			2022
Benefit Obligation at Beginning of Year	$	84,454		$	110,585		$	21,929		$	29,270
Service Cost		—			—			376			584
Interest Cost		4,468			3,097			1,186			861
Purchase		(4,115	)		—			—			—
Actuarial Losses (Gains)		1,070			(22,049	)		1,496			(7,577	)
Employer Benefits Paid 1		(7,309	)		(7,179	)		(1,673	)		(1,209	)
Benefit Obligation at End of Year	$	78,568		$	84,454		$	23,314		$	21,929
Fair Value of Plan Assets at Beginning of Year	$	79,324		$	101,294		$	—		$	—
Actual Return on Plan Assets		9,846			(15,261	)		—			—
Employer Contributions		468			470			1,673			1,209
Purchase		(4,115	)		—			—			—
Employer Benefits Paid 1		(7,309	)		(7,179	)		(1,673	)		(1,209	)
Fair Value of Plan Assets at End of Year	$	78,214		$	79,324		$	—		$	—
Funded Status at End of Year 2	$	(354	)	$	(5,130	)	$	(23,314	)	$	(21,929	)

Participants' contributions relative to the postretirement benefit plan were offset against employer benefits paid in the table above. Participants' contributions for postretirement benefits were $0.8 million for the years ended December 31, 2023, and December 31, 2022.

Amounts are recognized in Retirement Benefits Payable in the consolidated statements of condition.

The changes in actuarial losses (gains) related to the Company’s Pension and postretirement benefit Plans are mainly due to changes in discount rates for the years ended December 31, 2023, and December 31, 2022. For the year ended December 31, 2023, the change in discount rate resulted in a $0.4 million increase to the Company’s Pension Plans liability and a $0.2 million increase to the Company’s postretirement benefit plan liability. For the year ended December 31, 2022, the change in discount rate resulted in a $21.9 million decrease to the Company’s Pension Plans liability and a $7.5 million decrease to the Company’s postretirement benefit plan liability.

The following presents the amounts recognized in the Company’s accumulated other comprehensive income for the Pension Plans and postretirement benefit plan as of December 31, 2023, and December 31, 2022.


	Pension Benefits						Postretirement Benefits
(dollars in thousands)	2023			2022			2023		2022
Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Net of Tax
Net Actuarial Gains (Losses)	$	(28,512	)	$	(31,984	)	$	4,330	$	5,803
Net Prior Service Credit		—			—			922		1,103
Total Amounts Recognized in Accumulated Other Comprehensive Income (Loss), Net of Tax	$	(28,512	)	$	(31,984	)	$	5,252	$	6,906

Components of net periodic benefit cost for the Company’s Pension Plans and the postretirement benefit plan are presented in the following table for the years ended December 31, 2023, December 31, 2022, and December 31, 2021.


	Pension Benefits									Postretirement Benefits
(dollars in thousands)	2023			2022			2021			2023			2022			2021
Service Cost	$	—		$	—		$	—		$	376		$	584		$	678
Interest Cost		4,468			3,097			2,924			1,186			861			816
Expected Return on Plan Assets		(5,238	)		(4,840	)		(4,592	)		—			—			—
Amortization of:
Prior Service Credit 1		—			—			—			(246	)		(246	)		(246	)
Net Actuarial Losses (Gains) 1		1,258			2,175			2,676			(507	)		—			—
Net Periodic Benefit Cost	$	488		$	432		$	1,008		$	809		$	1,199		$	1,248

Represents reclassification adjustments from accumulated other comprehensive income during the period.

Assumptions used to determine the benefit obligations as of December 31, 2023, and December 31, 2022, for the Company’s Pension Plans and postretirement benefit plan were as follows:


	Pension Benefits						Postretirement Benefits
	2023			2022			2023			2022
Weighted Average Assumptions as of December 31:
Discount Rate		5.44	%		5.51	%		5.51	%		5.58	%
Health Care Cost Trend Rate Assumed For Next Year		—			—			6.90	%		6.20	%

The health care cost trend rate is assumed to decrease annually, until reaching the ultimate trend rate of 4.0% in 2047.

Assumptions used to determine the net periodic benefit cost for the Company’s Pension Plans and postretirement benefit plan for the years ended December 31, 2023, December 31, 2022, and December 31, 2021, were as follows:


	Pension Benefits									Postretirement Benefits
	2023			2022			2021			2023			2022			2021
Weighted Average Assumptions as of December 31:
Discount Rate		5.51	%		2.89	%		2.55	%		5.58	%		3.00	%		2.66	%
Expected Long-Term Rate of Return on Plan Assets		6.00	%		5.25	%		5.25	%		—			—			—
Health Care Cost Trend Rate		—			—			—			6.20	%		5.70	%		5.50	%

A combination of factors is used by management in determining the expected long-term rate of return on plan assets. Historical return experience for major asset categories are evaluated and current market factors, such as inflation and interest rates, are considered in determining the expected long-term rate of return assumption.

The Company expects to contribute $0.4 million to the Pension Plans and $1.5 million to the postretirement benefit plan for the year ending December 31, 2023.

As of December 31, 2023, expected benefits to be paid in each of the next five years and in the aggregate for the five years thereafter were as follows:


(dollars in thousands)	Pension Benefits		Postretirement Benefits
2024	$	7,191	$	1,541
2025		7,126		1,590
2026		7,035		1,611
2027		6,931		1,674
2028		6,788		1,704
Years 2029-2033		31,445		9,070

The Company’s overall investment strategy is to maintain the purchasing power of the current assets and all future contributions by producing positive rates of return on plan assets; achieve capital growth towards the attainment of full funding of the Retirement Plan’s termination liability; maximize returns within reasonable and prudent levels of risk; and control costs of administering the plan and managing the investments. The long-term investment objective is to achieve an overall annualized total return, gross of fees, in line with the blended benchmark index comprised of 36% MSCI USA IMI Index, 24% MSCI ACWI ex-US IMI Index, and 40% Barclays Aggregate Bond Index.

Subject to liquidity requirements, the asset allocation targets are 60% for equity securities, 40% for fixed income securities with a 10% to 20% range permitted from the strategic targets, and zero to 20% for cash. Within the equity securities portfolio, the range for domestic securities is from 50% to 100% and the range for international securities is from 0% to 50%. All assets selected for the Retirement Plan must have a readily ascertainable market value and must be readily marketable.

Due to market fluctuations or cash flows, the allocation for each asset class may be breached by as much as 5% on a temporary basis. However, asset allocations are expected to conform to target ranges within 90 days of such an occurrence.

The fair values of the Retirement Plan assets as of December 31, 2023, and December 31, 2022, by asset category were as follows:


	Fair Value Measurements
Asset Category (dollars in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total as of Dec. 31, 2023		Total as of Dec. 31, 20221
Cash	$	6,214	$	—	$	—	$	6,214	$	589
Equity Securities – Mutual Funds:
Large-Cap		—		—		—		—		4,979
Mixed-Cap		—		—		—		—		23,632
International		—		—		—		—		18,283
Emerging Market		—		—		—		—		757
Fixed Income Securities – Mutual Funds		—		—		—		—		31,084
Total	$	6,214	$	—	$	—	$	6,214	$	79,324
Collective Investment Funds (measured at NAV of units as a practical expedient)								72,000		—
Total Investments at Fair Value							$	78,214	$	79,324

The fair value of the collective investment fund is based on net asset value ("NAV") of units as a practical expedient, and therefore the asset is not classified in the fair value hierarchy. Quoted prices for all other investments were available in active markets, and therefore were classified as Level 1 measurements in the fair value hierarchy.