Good day, ladies and gentlemen. Thank you for your patience. You’ve joined the Bank of Hawaii Corporation Fourth Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference maybe recorded. I would now like to turn the call over to your host, Director of Investor Relations Ms. Cindy Wyrick. Ma’am you may begin.

Thank you very much. Good morning, good afternoon, everyone. Thank you for joining us today, as we review the financial results for the fourth quarter of 2017. Joining me today is Chairman, President and CEO, Peter Ho; our Chief Financial Officer, Dean Shigemura; and our Chief Risk Officer, Mary Sellers. Before we get started, let me remind you that today’s conference call will contain some forward-looking statements. And while we believe our assumptions are reasonable, there are a variety of reasons that the actual results may differ materially from those projected. And now I’d now like to turn the call over to Peter Ho.

Thanks Cindy. Good morning everyone. Happy New Year and thanks for joining us today. 2017 was another good year for Bank of Hawaii and we’re pleased with our financial results. Earnings per share increased to a record $4.33. Our net interest margin expanded, asset quality remain strong and our efficiency ratio improved to 55.7% from 57% in 2016 reflecting strong expense management. Assets, loans and deposits each grew in a measured manner with total assets finishing the year in excess of $17 billion for the first time in our history. Loan growth of 9% was led by consumer growth during the year. Deposits grew 4% in 2017 finishing it just under $14.9 billion. Deposits fell slightly on a linked basis compared to the third quarter of 2017 as solid consumer deposit growth of 2.4% was offset by slightly lower commercial activity and lower public deposit activity. The link reduction in commercial deposits results from the closing of the few large condominium projects in the fourth quarter, which reduced deposit balances for some of our escrow customers. Reduction in public deposits resulted from a $300 million decline in public time deposits resulting from our decision to not aggressively pursue this limited deposit segment. Pricing has gotten well outside of what we're seeing in other substantial deposit segments for us, and frankly we don't have the requirements to the funds on our balance sheet. All in all though, we feel good about what we achieved in 2017. We opened four new branches of tomorrow. We also made considerable progress in our driving digital activity with 40% of our consumer deposits now coming from either our ATM or mobile applications. As I mentioned previously, we were pleased with our numbers for the year. I'll now ask Dean to provide you with some additional details on our financial performance for the quarter and our outlook for 2018. Mary will then make some comments on our credit quality. Dean?

Thank you, Peter. Net income for the fourth quarter was $43 million or $1.01 per share compared to $45.9 million or $1.08 per share in the third quarter and $43.5 million or $1.02 per share in the fourth quarter of 2016. Our return on assets during the fourth quarter was 1%. The return on equity was 13.85% and our efficiency ratio was 57.49%. Included in the fourth quarter of 2017 was an additional income tax expense of $3.6 million due to the reduction in value of our net deferred tax assets impacted by the tax reform bill. Excluding this additional tax expense, net income was $46.5 million or $1.10 per share. Our net interest margin for the fourth quarter was 2.98%, up 6 basis points from the third quarter and up 15 basis points from the fourth quarter of 2016. Net interest income in the quarter increased to $118.8 million, up from $116.3 million in the previous quarter and $107.1 million in the same quarter of 2016. As a result of the tax reform bill, we expect our net interest margin this year to be negatively affected by approximately 4 basis points due to the revisions in the tax equivalent adjustment. However this will have no impact on our net interest income. As Mary will discuss later, we've recorded a credit provision of $4.3 million this quarter. Non-interest income totaled $41.9 million in the fourth quarter of 2017, compared with $42.4 million in the previous quarter and $46.5 million in the same quarter of 2016. The decline compared to the previous quarter was largely due to lower mortgage banking income. Compared with the previous year the decrease was largely due to lower mortgage banking income and lower revenue from the customer derivative program. Growth in non-interest income will continue to…

Thank you, Dean. Net charge-offs for the fourth quarter totaled $3.8 million, up $313,000 on a linked quarter basis and up $775,000 year-over-year. For the full year of 2017, net charge-offs totaled $13.8 million or 15 basis points of average loans and leases. Comparatively, net charge-offs for the full year of 2016, inclusive of a full recovery of a single commercial loan previously charged off in 2013 totaled $3.4 million or 4 basis points. Adjusting for the non-recurring recovery, net charge-offs totaled $10 million or 12 basis points. At the end of the fourth quarter, non-performing assets totaled $16.1 million or 16 basis points, down $915,000 or 2 basis points from the third quarter and down $3.6 million or 6 basis points year-over-year. Loans past due of 90 days or more and still accruing interest totaled $7.1 million, up $483,000 for the linked period and up $77,000 from the same period last year. Restructured loans not included in non-accrual loans or loans past due 90 days or more totaled $55.7 million at the end of the quarter compared with $55 million at the end of the third quarter and $52.2 million at the end of '16. Residential real estate loans modified to assist our customers accounted for $20.2 million of the total at the end of ‘17. In the fourth quarter, underwriting metrics for loan originations remained strong as we continue to tighten around the margin. Accordingly, at the end of 2017, the weighted average loan-to-value for the commercial mortgage portfolio was 55% while the weighted average loan-to-value for the residential mortgage portfolio and the home equity portfolio was 57% and 63% respectively, and in the indirect portfolio the weighted average monitoring FICO score was 703. At the end of the fourth quarter, the allowance for loan and lease losses totaled $107.3 million, given net charge-offs of $3.8 million, a credit provision of $4.3 million was recorded. The ratio of the allowance to total loans and leases was 1.1% at the end of the quarter, down 2 basis points for the linked period and down 7 basis points year-over-year. The allowance reflects the continued strength in the Company's asset quality and the Hawaii economy over this period as well as the mix and quality in loan growth. The total reserve unfunded commitments were $6.8 million year end, unchanged from the prior quarter and up $250,000 from the end of 2016. I'll now turn the call back to Peter.

Great. Thank you, Mary. The Hawaiian economy continues to perform well due to healthy labor market conditions and active construction pipeline, a continuation of the strong performance of our tourism industry, and increasing home prices. The statewide seasonal adjusted unemployment rate was 2% in November compared with 4.1% nationally. Sales of single-family homes on Oahu, our primary market, increased 6.3% in 2017. Our condominium sales increased 6.9%. The medium price of single-family homes on Oahu increased 2.7% and medium price of condominiums increased 3.8%. Months of inventory in December declined to a low 2.1 months for single-family home and 2.3 months for condominium. The median number of days on the market during 2017 was 16 days for single-family home and 17 days for a condominium. Tourism in Hawaii also remains strong with visitor spending increasing 6.6% in the first 11 months of 2017 compared with the same period in 2016. The growth of spending as a result of a 4.9% increase in visitor arrivals, an increase 1.8% in average daily spending driven mostly by domestic visitor spend. Thanks again for joining us today and now we’d be happy to respond to your questions.

Thank you. [Operator Instructions] Our first question comes from the line of Casey Haire of Jeffries. Your question please.

Wanted to touch on loan growth I guess starting off. What’s the expectation for this year or are we moderating from that 9%? And I guess more specifically on the construction book, is there -- what kind of -- what magnitude of run off is still remaining?

Yes. Good question, Casey. I think that the general guidance is not too changed from what we’ve expressed previously, and we talked about how commercial activity ought to moderate in the coming periods and that would be offset somewhat by stronger consumer growth. I think that remains the case. We have a pretty big reduction in construction at this point. I think we likely will continue to see some moderation to that portfolio but probably not at the same velocity as in 2017. The leasing portfolio was a headwind and mostly because we had a pretty large early buy out in the fourth quarter of about $25 million. So, we’ll see that portfolio continue to decline as it’s -- as it’s really not a focus for us at this point, but probably not at that same velocity. So, I think that we’ve talked about mid higher single-digit growth on the loan portfolio. I think of that still holds, but one caveat that I’d put out there is, CRE is a little lighter than usual for us. And at this point, I’m not sure if that’s just a one-off periodic type of thing or a trend. But I would say that for first quarter, we have seen a bit of pause there, and that as we have been discussing it couldn’t be really as a result of uncertainty around the tax bill. So, that’s -- those are our thoughts on the lending side.

Okay, great. And then just switching to deposit pricing, Peter. First time I’ve heard you kind of talk about some rationale pricing in market. Give us some color there and also what is the appetite -- you guys are in a great position liquidity wise for the 65% loan to deposit ratio, where -- how much appetite is there to take that even higher? Is there a ceiling? Or how are you managing liquidity? And what could be a tougher deposit pricing environment?

Yes, so, good question. Let me give you some perspective on our deposit composition, Casey. We’re pretty diversified, so 50.2% of our deposits come from our consumer book, 40.1% come from our commercial book. And our public deposit book is 9.7%. We’re also pretty diversified by category. So 52.4% of our deposits are demand, 36.2% are savings and 11.3% are time. So you can see that we’ve got a very, very solid core deposit base and really a skewing from a sector standpoint that's pretty diversified. The area that I alluded to in my opening comments really is pretty small segment for us. So, it’s in the public space which is just under 10% and specifically it’s in the time space, which is about half of that 10%. So just over 5% of our overall book and what we’re seeing there is pricing that substantially higher than what we’re seeing for like term and just about all of our other segments. We’re seeing pricing well in excess of 1% for terms that are well below a year. So you talk about our loan-to-deposit ratio. Obviously, we don’t need to turn to any funding just because we have that liquidity. So that’s the positioning that we’re taking at this point. In terms of what would be the optimal loan to deposit or liquidity position for us? We like to think that there is room for us to move up from 65%. I think we'd be comfortable in the 70%, 75% range. And frankly, I’d like to get there by growing well and then growing deposits over time.

Thanks, very comprehensive. Just one more for Dean. With the 10-year up about 260, where is the reinvestment rate in the securities book versus that 230 yield in the fourth quarter?

The reinvestment rate is of course ratchetting higher. I would say quarter-over-quarter we’re looking at about a 10 basis point increase. We’re still investing in I would say shorter duration investment. So in terms of a rate, it’s going to be below 3%, because we want to moderate our duration of our portfolio. But overall, we’re still growing the yield on the book.

Thank you. Our next question comes from the line of Ebrahim Poonawala of Bank of America. Your line is open.

So I just wanted to follow up, if you can talk about the margin outlook. So I guess, we see the margin reset about 294 because of the tax change in 1Q? Given sort of your expectation for run-off in time deposits, this should be margin accretive I would assume, and the benefit of the December rate hike being like where do you think the margin lands when you think about first quarter? And from there on, how do you view your rate sensitivity to every additional Fed rate hike?

Well, the margin we expect some modest increases, and the drivers going to be mainly balance sheet growth. But we do expect to pick up some on the rate side. The rate increase in December is going to help us to the extent that the longer end remains higher than last year, I think we’ll pick up more there. So overall, we’re going to report in our 10-K, a 3.4% sensitivity. So that’s kind of a rough guide on how you can calculate the benefit from higher rates.

Understood. And can you give any detail on -- I think Peter mentioned 10% of deposits are public funds, half of those are time deposits, so give or take $700 million. What’s the rate on those and do we expect those to run off at some this year?

Yes, the actual number Ebrahim is $838 million on public time. Based on our win loss record under the pricing environment, we could see as much as half of that 838 disappear over the course of this year would be my estimate, if pricing holds where it has the past several months. We haven't talked about pricing and I'm not sure, we're going to get into that, but I will give you guidance that the pricing in the government time space is well in excess of what we're experiencing in the consumer time space, in excess of 1% even, for less than a year.

Understood, and that's clear. And just switching very quickly on the last question on the fee revenue, I think you've mentioned that we expect growth to remain challenges based on the declining overdraft fees. How big is overdraft fee? And is it going down because of any changes you've made? Or are you just seen lower less activity because of sort of the consumer backdrop right now?

Yes. So while Dean finds out the exact number on overdraft fees, I'll tell you, we're wondering down -- we're wondering down for a couple of reasons. One, we are making certain changes to our procedures and processes and policies that reduced in lower ODs overtime. And secondly, we take a pretty conservative approach to our opt-in activity. So I know that some banks generally encourage opt-in as almost a business. We actually are trying to get a more neutral positioning out there. And so that has had on impact on people choosing not to opt-in which obviously impacts our OD revenue. So our OD revenue for '17 was $17.4 million and year-over-year it's down $800,000.

Okay alright. So, is it fair to say that incrementally that kind of the pace of decline, if we see more decline of that sort of reasonable rate in the quarter?

Yes it affecting so. Ebrahim.

And just one last one on fees and mortgage banking, $2.6 million this was much higher a few quarters ago. If I'm right there is about $2 million of servicing fee revenue in that number and the rest is origination related. Like what's your expectation on that as we go into '18?

Yes. I think we're kind of flattening out here. Your servicing income is about right. And so the difference would be due to the salable component of the business. So to the extent that we think that's going to start stabilizing next year. The income from mortgage banking should be pretty stable from the fourth quarter.

Thank you. Our next question comes from the line of Aaron Deer of Sandler O'Neill. Your question please.

Switching to expenses and curious to -- I guess even backing out the special bonus that you guys paid to employees this quarter. So it's seems like comp occupancy professional fees and the other line all just seen a little bit elevated. Just wondering if maybe there were some kind of year-end clean up in those numbers? And maybe what the -- what a good run rate might be for your overall non-interest income heading into 2018?

Yes. Aaron I'll talk about.

Sorry, non-interest expense?

Yes. I will talk about the fourth quarter and Dean will chat about our guidance for 2018. I think probably the best comp to look at for the fourth quarter is the year-on-year. We do have a fair amount of seasonality in the fourth quarter with holiday expenses and alike as well as we commission a number of studies and consulting arrangements in the fourth quarter as we close out the year. So if you look at fourth quarter ‘17 versus fourth quarter ‘16, you see the performance actually was pretty good. We backed up the holiday bonus. We backed up the Kahului gain last year. And if add back 1.3 million and RSU cost, last year which was really as a result of the run-up in the stock price last year. This negatively impacts our expense line and comp. The adjusted delta there is about 1%. So if you look at it on a seasonal basis, 4Q to 4Q, we’re probably in line with where our expense better has been all the year. And then looking forward, Dean?

Yes, so the guidance we provided was about 2.5% to 3.5% over the 2017 expense levels. The one thing I will note there is that in the first quarter we do have a seasonal bump in expenses of about 2.5 million and all of that is incorporated into the guidance we provided but that’s related to the incentive payout. Also included is the increase in our minimum wage to $15 an hour in the 2.5% to 3.5% guidance.

And then back on the deposits, just curious Peter. Last call you talked a little bit about kind of going after “Your share, market share of retail CDs”. Is it your expectation at this point given that you’re kind of letting some of the public CDs run-off to go after more continuous to go after time deposits on the retail side?

I think so. We had good performance both on the commercial as well as on the consumer time space last year. And so that would -- that we would anticipate that to continue for us. And as I mentioned that’s coming in at substantial lower pricing on the government side.

Thank you. Our next question comes from the line of Jeff Rulis of DA Davidson. Your question please.

Just following up on the, Dean, you’ve outlined that capital management plan and I guess if you’ve stated it, I think there’s no reason to follow through. But I may guess given the tax benefit just rough math I guess around 25 million a year. I guess that’s -- we read that to be the percentage of dividends and share repo, it’s just a greater -- well a greater number of the higher earning level. Or is there any thoughts on changing on if fringes anything from capital deployment?

No, I think we’re going to stay with our current strategy which is ultimately 50% of net income in dividends and of course adding retaining enough for our business growth and then the remainder would be available for share repurchases. So we’re going to pretty much stick to that plan.

Yes. So just to emphasize Jeff that the increased proceeds generated by the tax change effective will get captured in our capital management plan that you’re familiar with simply because that plan is returning everything back to the shareholder with the exception of growth.

Fair enough. Thanks. And then just I wanted to make sure I’ve got that correct on the visa shares. So there what we’re seeing really Q2 on is that is basically the carrying cost of holding that. Could you break that out for me? And is that expectation is as long as you’re still holding that we’d see a drag on a quarterly basis?

Yes. So, the Q2 number and Q4 if you analyse that, that would be the expected cost to carry the shares.

Thank you. And our next question comes from the line of Brett Rabatin of Piper Jaffray. Your question please.

Wanted to just to go back to the expenses for a second. You’ve talked about 2.5% to 3.5% growth and expect the result at 358. One rate and merit increases, are there other projects that are going on? Or can you give us a flavor for anything else you got some terms of initiatives that migrates your expenses you have pretty modest growth and expenses launched here?

Yes. So, I’ll take a stab at it and Dean can clean up for my comments. The answer is yes, if you add the $15 minimum wage and what’s looking to be about a $2.5 million increase for the year and depreciation that basically gets us to plus 2%. So, basically what we’re talking about plus 2.5% to 3.5%, I think the range there effectively from we’ve already input is kind of flat to up a bit, which I think would be about in-line with what we’ve done this last couple of years.

Yes. Okay. That’s a great color. And then just wanting to hear you thoughts on the corporate tax rate and just any optimism if that may have created in Hawaii? And do you think that helps further on realized CNI is not a huge thing in Hawaii relative to the mainland, but just does this help industries in Hawaii? And do you think that you’ll see some benefit from that in your lending operations this year?

I'll tell you, I have been somewhat pleasantly surprised by how much perceived impact the tax change is creating. Clearly, we see it in the business community, people feeling like there is just excess capital being freed up here. Yet to be seen what happens on the consumer side, but not on the negative. So, overall we think it’s a modest positive for the local economy out here in the Island.

Thank you. The next question comes from the line of Ken Zerbe of Morgan Stanley. Your line is open.

Maybe just more a re-across question because I’m trying to -- I wanted to back to the public deposit pricing of 1%, I would love you talk like, who is doing this? Like, why are they doing this? What’s the value to them of being so aggressive on the public side versus trying to gather funding from other sources at cheaper costs? Because I guess I am worried about is, is this sort of like every aggressive in this area and therefore or month or two months down the road, they’re going to start getting aggressive in other area. So what it might mean for you guys? Thanks.

Yes. That’s a good question and obviously we thought about that. The answer your first question, which I don’t know. I mean, I think, my guess would be that the state public time deposit space is mostly helpful, but I think they’re probably also some national or international players in that space. On first blush, you think that pricing people would seek elsewhere. I think when you look at the loan to deposit cost structure to the four major banks in Hawaii, it doesn’t really give me parts for concern because everyone kind of well below that 80% plus, no-one. I don’t think anyone’s over a 100%. So it doesn’t, at least statistically look like people are being force in the funding side. So I really -- I can’t answer the question except to tell you that it use to be a pretty nice pull of funding for us it’s raised for closer to zero, and as rates have risen that that's just not the case anymore.

Second question in, just in terms of commercial real estate, I heard when you said and I want to clarify that you said there is a slowdown in first quarter or is it fourth quarter? And then I have a real question.

Yes. Fourth quarter was actually okay. And then just it looks like our pipe is overall looking pretty strong for the year 2018, but the first quarter is looking little weak. And actually it was just new is to whether or not uncertainty around the tax legislation or not, but not exactly for what the reasoning is there.

And from a fundamental standpoint, obviously banks, just in general and tightening underwriting standards for probably year, two years. Are you seeing any kind of, I would say demand changes based on that or type of borrower changes? Really just trying to get that decent sense for the fundamental to the series market, still seen really, really good, but obviously banks have been tightening and you guys been tightening, I’m sure everyone has just trying to prove guard against loss some future period?

Yes. So it’s, I think that the market dynamics out here, Ken, are -- the economy is still chugging along just fine. There are fair amount of projects coming out and fair amount of serial opportunities. But there is no denying with that, we are definitely later in the cycle here. And so, I think bank employee and probably a lot of other institutions are tightening around the margins. We are seeing more activity in the non-bank fund space, which is what we hadn't seen in fact we’ve been talking for the past year or so that usually about this time, you start to see that form of competitor. And I’d say in the last six months, we've seen the marked increase in that space. So that would our thoughts in CRE.

In the non-banks space?

For the non-bank space, right.

Our next question comes from Jackie Bohlen of KBW. Your line is open.

I just a quick follow-up on expenses and a question on severance. In the past, I thought, we had discussed that there could more of that going forward and we didn’t see any in the fourth quarter. So just your outlook on what that might be in 2018, if any?

I think we’re going to see some severance cost flowing through in 2018 and there likely to be episodic. So, I can't tell you exactly which quarters, but you'll probably see a few quarters with that kind of activity.

And how understanding that this may not be a known quantity, but how do you think it will compare 2017's level?

Really tough to tell, but if I were to venture, I'd say comparable to a little bit higher.

Thank you. Our next question comes from the line of Matthew Keating of Barclays. Your question please.

I'd also like to ask about the impact of corporate tax reform specifically on the residential mortgage portfolio. And in particular I'm interested in any impact you might perceive from cap on mortgage interest deductibility on the growth of that portfolio this year?

Yes. So, we've actually try to as best as we can lay that out reflecting the input would be lower tax for a mid-segment on the mass affluent segment, and the outflow would be reduction in the benefit on the mortgage side. And at least what we have analyzed out is that, the net impact to the broader market isn't that rate as not clear that that's going to have a meaningful impact on the residential mortgage side. Maybe a little bit more impact on the home equity side. And then what you do see an impact is the deductibility versus the benefit in tax rates is really in the affluent segment. And there we'll see how that turns out, but also remember that there is $1 million cap on mortgage deductibility in any event and that really hasn't changed much from the prior tax build. So it's something to think about we'll keep trying to analyze and figure it out. But I guess our positioning for now is we're not terribly concerned about it.

Maybe could you quantify the impact in the quarter of the release of the valuation allowance on the sale of the low income housing tax credits?

In total it was about $3.4 million.

And then finally, as it relates to trust and asset management line item, it's been a pretty strong quarter or pretty strong year rather for the market and the fee income there really didn't grow all that much. So what initiatives do you have in place to show better progress in that area in 2018?

Yes. So we're about $9.5 billion in AUM, that's actually grown in the second half of the year. You're right. We seem to be effectively equally trading off market gain for trust run off. So, we have a pretty big irrevocable book. And as those mature out, often time people choose to take our assets elsewhere. Our experience on the institutional side of late has been pretty strong. So, we've had some good success in garnering business there that's going to continue to be an area of emphasis for us. And then we've also had a fair amount of success, not so much on the trust side, but on the broker dealer side with our managed account business. And so, we're to look at both of those businesses, we're going to really put a conservative effort into 2018 to provide customers with both options either come in to the trust side or to the broker dealer side, and obviously catering towards best of them, by bottom line garnering business one way or the other.

Thank you. [Operator Instructions] Our next question comes from the line of Laurie Hunsicker of Compass Point. Your line is open.

Just wanted to circle back on public funds. The 1.4 billion that you stand out at December 31st, do you have a total cost on that?

The 1.4 billion, our public funds are…

Or do you have an exact number, yes?

Sure. Our public deposits are 1.4 billion, of which just over 800 million are time.

Right. Do you have -- do you actually -- do you have cost of those pieces? In other words, what was the cost on your…

Yes, yes.

What was the cost on that sticky portion?

Yes. So the -- obviously the 838 is going to be the most expensive. And Laurie as I mentioned earlier, we don't -- we haven’t disclosed pricing in the past and we’re just not going to do that in the future. But I will tell you that the pricing on that public time book is pretty high. So that got higher.

Okay. And you mentioned that drop of 300 million up at 1.1 billion. I am just trying to understand how much of it? Or may be ask a different way, how much of a margin improvement can we just see on that book being cut in half this year, the public book? I mean I look at where the three months which is where a lot of the public money benches do and so, you're already at 143 on the three months, right. So it’s certainly up to 1% that’s gone up sharply.

Yes. It will hard to -- I would have to go back and sit down and calculate that. But if you look at what happened in the fourth quarter, essentially what happened was our cash balances, so the money as we hold at fed came down almost the same amount as the public time deposits ran up, didn’t really impact our income but it did impact our margin.

And do you have just the September balance on your total public funds?

September balance, our total public funds was 1.653 billion.

1.653 billion. Okay basically 1.1 billion with your time case.

Correct.

Okay, okay. And then just to go back to the expenses, I just want to make sure that I understand this here. If I am looking here at this other, other line within non-interest expense of 16.3 million, how much of that is seasonal holiday expense related I mean close to 2 million?

No, no, not that much. I would have to ballpark it at about less than 1 million.

Less than 1 million.

Yes.

Okay. And then when I think about 2018 in terms of tax windfall investment, what’s the actual dollar amount on that, that’s going to impact your non-interest expense line? Obviously, you’ve got wage inflation, other initiatives you’re doing. What sort of actual dollar amount?

Let me try to understand that again Laurie, can you rephrase that for me?

Sure. In other words, as we think about the tax windfall that, again not totally dropping to bottom line…

Yes.

Because you’re doing infrastructure reinvestment, you’ve given bump ups. Asides in the one-tenth bonuses in the fourth quarter, this raise your minimum wage say $15 a share. Do you have an actual dollar amount because I don’t know how many are of your employees are now $15? Do you -- can you just help us understand an actual dollar amount?

Sure.

Or are we just going to see in full your 2018 from the noninterest expense line?

Sure. Yes, so it’s a good question. The impact will be not much from a capital spending standpoint directly attributable to the change in the tax law. I mentioned earlier that our depreciation is slightly to grow about $2.5 million this year and that is mostly reinvesting into positive MTD [ph] deals. So, we’ll see on the revenue line. But that really wasn’t -- that was already on the world prior to President Trump signing the bills. So, I wanted to include that, what I really include is the $15 minimum wage and that’s $2.2 million. And then we are accruing our value share for our broad employee base at the new tax number. So, the impact of that is probably $700,000. So, all-in-all, that’s call it $3 million that’s coming about as a result of the tax change. And that’s effectively what you’ve net out the benefit. Just as an asterisk, on the executive compensation plans, we have not made any adjustments to those plan as a result of the tax change.

Thank you. At this time, I’d like to turn the call back over to Ms. Wyrick for any closing remarks. Ma’am?

I’d like to thank everyone for joining us today and for your continued interest in Bank of Hawaii. As always feel free to contact me, if you have additional questions or need any further clarification on any of the topics discussed today. Thanks everyone again and have a great day.

Thank you, ma’am. And ladies and gentlemen, that does conclude today’s conference. Thank you for your participation. And have a wonderful day.