Despite a sluggish local economy and turmoil in the nation's financial markets, Bank of Hawaii Corp. reported solid earnings growth in 2008.

The company said yesterday it had a profit of $192.2 million last year, a 4.6 percent increase from $183.7 million in 2007.

On a per-share basis, Bank of Hawaii netted $3.99 cents, an 8.1 percent increase from $3.69 a year ago.

The results were slightly above Wall Street's expectations. Analysts surveyed by Bloomberg News had forecasted earnings of $3.76 per share for 2008.

Shares of Bank of Hawaii closed at $33.32 on the New York Stock Exchange, down 27 cents.

"Bank of Hawaii Corp. finished 2008 with solid financial performance," said Allan Landon, the company's chairman and CEO. "We anticipate that the challenging economic environment will continue in 2009."

The bank said assets and deposits rose from a year earlier.

The company said its assets totaled $10.76 billion as of Dec. 31, 2008, up 2.7 percent from $10.47 billion in 2006. Deposits increased 4.4 percent to $8.29 billion from $7.94 billion.

Loans and leases were virtually flat at $6.53 billion.

The year had plenty of challenges for the state's second largest bank.

The bank said it increased its provision for credit losses to $60.5 million last year from $15.5 million in 2007. The company's nonaccrual loans rose to $14.5 million from $5.1 million last year.

The biggest troubled loan was to a Mainland residential developer hard hit by the downturn in the real estate market. The loan is just one of two Mainland loans in the bank's overall portfolio.

Bank of Hawaii said its remaining nonaccrual commercial loans are to two local companies affected by the local economic downturn.

For the fourth quarter 2008, the bank's net income was down 4.5 percent, to $39.3 million, compared with the previous year's $40.8 million.

On a per-share basis, the company netted 82 cents during the fourth quarter, down from 83 cents in the fourth quarter 2007.