Central Pacific Financial Corp New

Good afternoon, ladies and gentlemen. Thank you for standing by, and welcome to the Central Pacific Financial Corp. Second Quarter 2023 Conference Call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. This call is being recorded and will be available for replay shortly after its completion on the company's website at www.cpb.bank. I'd like to turn the call over to Ms. Dana Matsumoto, Group Senior Vice President and Director of Finance and Accounting. Please go ahead.

Thank you, Sarah, and thank you all for joining us as we review the financial results of the second quarter of 2023 for Central Pacific Financial Corp. With me this morning are Arnold Martinez, President and Chief Executive Officer, David Borimoto, Senior Executive Vice President and Chief Financial Officer, and Anna Hu, Executive Vice President and Chief Credit Officer. We have prepared a supplemental slide presentation that provides additional details on our release and is available in the investor relations section of our website at cpb.bank. During the course of today's call, management may make forward-looking statements. While we believe these statements are based on reasonable assumptions, they involve risks that may cause actual results to differ materially from those projected. For a complete discussion of the risks related to our forward-looking statements, please refer to slide two of our presentation. And now, I'll turn the call over to our President and CEO, Arnold Martinez.

Thank you, Dana. Aloha, everyone. We appreciate your interest in Central Pacific Financial Corp. As we normally do, I'll start with an update on the Hawaiian market Then I'll turn it over to the team to provide additional detail and insights on our financial and credit metrics, as well as other key updates. The Hawaii tourism industry continues to be well supported by U.S. visitors, with total visitor arrivals just slightly under pre-pandemic levels. Visitor spending continues to be robust, totaling $1.69 billion in May. an increase of 19% compared to the same month in 2019. Hotels in Hawaii continue to perform well, with total statewide hotel occupancy in June at 77%, up 1% from a year ago, and an average daily rate of $389, down 2% from a year ago. Hawaii's seasonally adjusted unemployment rate continued to decline to 3% in June and is outperforming the national unemployment rate of 3.6%. Year-over-year statewide non-farm payroll increased by 17,000 jobs, or 2.7%. Labor market conditions are overall quite favorable in Hawaii. Real estate values in Hawaii remains a key strength. The O'ahu median single-family home price continues to be around $1.1 million, and the median condo sales price was $510,000 in June. While home sales volumes are down year over year, there is continued strong demand and limited inventory with properties generally staying on the market for less than 20 days. Strong construction activity in Hawaii continues to drive economic growth. Private building permits are up 8% compared to a year ago, and construction job counts are up 5%. Government contracts awarded in Hawaii total $3.2 billion in the first quarter of 2023, which included a significant $2.8 billion award to Hawaii firms for the Pearl Harbor Naval Shipyard Replacement Project. Overall, the Hawaii market continues to have healthier outlook compared to the rest of the nation and is projected to avoid a recession. The Hawaii banking industry is also differentiated from the national industry with a high-value deposit franchise that is predominantly relationship-based. CPB's deposit portfolio is diversified and long-tenured. Our business model is based on longer-term customer relationships that are sticky and less rate sensitive. CPB has $6.8 billion in relationship deposits with approximately 50% of our customers having been with CPB for more than 10 years. Additionally, 65% of our deposits are FDIC insured or collateralized. During the pandemic, we grew our deposits responsibly with about 30% growth. as compared to some of the challenged U.S. regional banks that more than doubled their deposit portfolio size with surge deposits. In the second quarter, we continued a strong focus on liquidity, and while some deposit makeshift continues, we were successful in growing total deposits. Our teams remain very focused on generating relationship-based deposits, and we see upside opportunities to continue to grow our market share. At the same time, we continue to prudently make asset growth decisions with a strong risk management focus. I'll now turn the call over to David Morimoto, our Chief Financial Officer. David. Thank you, Arnold.