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Segment financial information
 12 Months Ended
Dec. 31, 2016
Segment Reporting [Abstract]  
Segment financial information
3 · Segment financial information
The electric utility and bank segments are strategic business units of the Company that offer different products and services and operate in different regulatory environments. The accounting policies of the segments are the same as those described for the Company in the summary of significant accounting policies, except as otherwise indicated and except that federal and state income taxes for each segment are calculated on a “stand-alone” basis. HEI evaluates segment performance based on net income. Each segment accounts for intersegment sales and transfers as if the sales and transfers were to third parties, that is, at current market prices. Intersegment revenues consist primarily of interest, rent and preferred stock dividends.
Electric utility
Hawaiian Electric and its wholly-owned operating subsidiaries, Hawaii Electric Light and Maui Electric, are public electric utilities in the business of generating, purchasing, transmitting, distributing and selling electric energy on all major islands in Hawaii other than Kauai, and are regulated by the PUC. The utility subsidiaries are aggregated within the electric utility segment because they: (1) are involved in the business of supplying electric energy in the same geographical location (i.e., the State of Hawaii), (2) have similar production processes that include electric generators (e.g., conventional oil-fired steam units and combustion turbines), (3) serve similar customers within their franchise territories (e.g., residential, commercial and industrial customers), (4) use similar electric grids to distribute the energy to their customers, (5) are regulated by the PUC and undergo similar rate-making processes, (6) have similar economic characteristics and (7) perform financial reporting oversight and management of the business at the consolidated level. Hawaiian Electric also owns the following nonregulated subsidiaries: Renewable Hawaii, Inc. (RHI), which was formed to invest in renewable energy projects; HECO Capital Trust III, which is a financing entity; and Uluwehiokama Biofuels Corp. (UBC), which was formed to own a new biodiesel refining plant to be built on the island of Maui, which project has been terminated.
Bank
ASB is a federally chartered savings bank providing a full range of banking services to individual and business customers through its branch system in Hawaii. ASB is subject to examination and comprehensive regulation by the Office of the Comptroller of the Currency (OCC) (previously by the Department of Treasury, Office of Thrift Supervision (OTS)) and the Federal Deposit Insurance Corporation (FDIC), and is subject to reserve requirements established by the Board of Governors of the Federal Reserve System.
Other
“Other” includes amounts for the holding companies (HEI and ASB Hawaii, Inc.), other subsidiaries not qualifying as reportable segments and intercompany eliminations.
Segment financial information was as follows:
(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


See Note 1 for the impact to prior period financial information of the adoptions of ASU No. 2015-03.
Intercompany electricity sales of the Utilities to the bank and “other” segments are not eliminated because those segments would need to purchase electricity from another source if it were not provided by the Utilities and the profit on such sales is nominal.
Bank fees that ASB charges the Utilities and “other” segments are not eliminated because those segments would pay fees to another financial institution if they were to bank with another institution and the profit on such fees is nominal.