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Fair value measurements (Tables)

12 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Schedule of estimated fair values of certain of the Company's financial instruments

The following table presents the carrying or notional amount, fair value, and placement in the fair value hierarchy of the Company’s financial instruments. For stock in Federal Home Loan Bank, the carrying amount is a reasonable estimate of fair value because it can only be redeemed at par. For financial liabilities such as noninterest-bearing demand, interest-bearing demand, and savings and money market deposits, the carrying amount is a reasonable estimate of fair value as these liabilities have no stated maturity.

					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, 2017
Financial assets
HEI consolidated
Available-for-sale investment securities	$	1,401,198			$	—			$	1,385,771			$	15,427			$	1,401,198
Held-to-maturity investment securities	44,515				—				44,412				—				44,412
Stock in Federal Home Loan Bank	9,706				—				9,706				—				9,706
Loans receivable, net	4,628,381				—				11,254				4,770,497				4,781,751
Mortgage servicing rights	8,639				—				—				12,052				12,052
Derivative assets	17,812				—				393				—				393
Hawaiian Electric consolidated
Derivative assets-window forward contracts	3,240				—				256				—				256
Financial liabilities
HEI consolidated
Deposit liabilities	5,890,597				—				5,884,071				—				5,884,071
Short-term borrowings—other than bank	117,945				—				117,945				—				117,945
Other bank borrowings	190,859				—				190,829				—				190,829
Long-term debt, net—other than bank	1,683,797				—				1,813,295				—				1,813,295
Derivative liabilities	13,562				20				10				—				30
Hawaiian Electric consolidated
Short-term borrowings	4,999				—				4,999				—				4,999
Long-term debt, net	1,368,479				—				1,497,079				—				1,497,079
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
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—window forward contracts	20,734				—				743				—				743

Schedule of assets and liabilities measured at fair value on a recurring basis

Assets and liabilities measured at fair value on a recurring basis were as follows:

December 31	2017												2016
	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			$	—
Available-for-sale investment securities (bank segment)
Mortgage-related securities-FNMA, FHLMC and GNMA	$	—			$	1,201,473			$	—			$	—			$	897,474			$	—
U.S. Treasury and federal agency obligations	—				184,298				—				—				192,281				—
Mortgage revenue bond	—				—				15,427				—				—				15,427
	$	—			$	1,385,771			$	15,427			$	—			$	1,089,755			$	15,427
Derivative assets
Interest rate lock commitments (bank segment)1	$	—			$	133			$	—			$	—			$	445			$	—
Forward commitments (bank segment)1	—				4				—				—				8				—
Window forward contracts (electric utility segment)2	—				256				—				—				—				—
	$	—			$	393			$	—			$	—			$	453			$	—
Derivative liabilities
Interest rate lock commitments (bank segment)1	$	—			$	2			$	—			$	—			$	24			$	—
Forward commitments (bank segment)1	20				8				—				129				56				—
Window forward contracts (electric utility segment)2	—				—				—				—				743				—
	$	20			$	10			$	—			$	129			$	823			$	—

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  Derivatives are included in regulatory assets and/or liabilities in the balance sheets.

Schedule of Level 3 assets and liabilities measured at fair value on a recurring basis

The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:

(in thousands)	2017			2016
Mortgage revenue bond
Balance, January 1	$	15,427		$	—
Principal payments received	—			—
Purchases	—			15,427
Unrealized gain (loss) included in other comprehensive income	—			—
Balance, December 31	$	15,427		$	15,427

Schedule of assets measured at fair value on a nonrecurring basis

The carrying value of assets measured at fair value on a nonrecurring basis were as follows:

					Fair value measurements using
(in thousands)	Balance				Level 1				Level 2				Level 3
December 31, 2017
Loans	$	2,621			$	—			$	—			$	2,621
December 31, 2016
Loans	2,767				—				—				2,767
Real estate acquired in settlement of loans	1,189				—				—				1,189

Schedule of significant unobservable inputs used in the fair value measurement

Key assumptions used in estimating the fair value of ASB’s mortgage servicing rights used in the impairment analysis were as follows:

December 31	2017				2016
(dollars in thousands)
Unpaid principal balance	$	1,195,454			$	1,188,380
Weighted average note rate	3.94		%		3.96		%
Weighted average discount rate	10.0		%		9.4		%
Weighted average prepayment speed	9.0		%		8.5		%

The following table presents quantitative information about Level 3 fair value measurements for financial instruments measured at fair value on a nonrecurring basis:

									Significant unobservable  input value (1)
(dollars in thousands)	Fair value				Valuation technique		Significant unobservable input		Range		Weighted Average
December 31, 2017
Residential loans	$	613			Fair value of collateral		Appraised value less 7% selling cost		71-92%		84%
Commercial loans	2,008				Fair value of collateral		Appraised value		71-76%		75%
Total loans	$	2,621
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%

(1) Represent percent of outstanding principal balance.

(2) N/A - Not applicable. There is one loan in each fair value measurement type.

X

- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

+ References

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
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Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

+ References

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Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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Tabular disclosure of quantitative information about the inputs used in the fair value measurement of assets. This disclosure may include, but is not limited to, the fair value of the asset, valuation technique used to measure fair value, the inputs used to measure fair value, the ranges of the inputs, and the weighted averages of the inputs.

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Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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