Territorial Bancorp Inc. (TBNK): BCG Matrix [Dec-2025 Updated]

You're looking at the Territorial Bancorp Inc. (TBNK) business units, now integrated into Bank of Hope after the April 2025 merger, and wondering where the value sits strategically. Honestly, the picture is clear: the legacy business is heavy on reliable Cash Cows-that established $1.72$ billion deposit base and pristine mortgage book-but it's starved for Stars in this mature Hawaii market. We've got some interesting Question Marks like the recent $81.06$ million jump in government deposits, but the core retail operations and small ancillary services are definitely sitting in the Dogs quadrant based on their pre-merger performance and low market share. Let's break down exactly where Bank of Hope needs to invest or divest these inherited assets.

Background of Territorial Bancorp Inc. (TBNK)

Territorial Bancorp Inc. (TBNK) served as the holding company for Territorial Savings Bank, which you know has been a community banking partner in the State of Hawaii since it was founded in 1921. The company's headquarters were in Honolulu, Hawaii.

The primary business of Territorial Savings Bank consisted of accepting deposits from the public and investing those funds, along with borrowings, mainly into one- to four-family residential mortgage loans and investment securities. You could find a full line of banking products offered across its approximately 29 full-service branches located throughout Hawaii.

Operationally, Territorial Bancorp Inc. provided a range of deposit accounts, including passbook and statement savings, money market, commercial and regular checking, and Super NOW accounts, as well as certificates of deposit. On the lending side, beyond residential mortgages, they offered home equity loans, consumer loans, and various commercial and nonresidential real estate loans, plus lines of credit. Additionally, the company was involved in insurance agency activities and offered non-deposit investments like annuities and mutual funds through a third-party broker-dealer.

As of the fiscal year end December 31, 2024, reported in its March 31, 2025, 10-K filing, Territorial Bancorp Inc. reported total assets of $2.17 billion, which represented a decrease from the end of 2023, primarily due to reductions in investment securities, loans, and cash equivalents. The company had 238 employees, though other reports list 169 employees.

A significant event defining Territorial Bancorp Inc.'s status as of late 2025 is its acquisition. Hope Bancorp, Inc. completed its merger with Territorial Bancorp Inc. in April 2025. Following this, the merged entity began operating in Hawaii under the trade name 'Territorial Savings, a division of Bank of Hope.'

Territorial Bancorp Inc. (TBNK) - BCG Matrix: Stars

You're looking at the Stars quadrant, but honestly, for the former Territorial Bancorp Inc. as of 2025, this section is defined by absence. The entity was acquired, which immediately removes it from independent Star consideration. Even before the April 2, 2025, merger with Hope Bancorp, Inc., the business units didn't fit the high-growth, high-share profile.

The core business model, centered on residential mortgage lending, was operating in a segment facing headwinds. High interest rates in 2025 definitely kept the volume segment mature and low-growth, which is the opposite of what a Star requires. The company's final reported total assets as an independent entity, $2.17 billion at December 31, 2024, were simply not large enough to command a Star position against the larger Hawaii competitors, especially when compared to the acquirer, Hope Bancorp, which held $17.05 billion in total assets as of December 31, 2024.

Here's a quick look at the market position that confirms the low relative market share:

• Ranked fifth in FDIC-insured deposit market share in Hawaii (out of 13 institutions) as of June 30, 2024.
• Statewide deposit market share was only 2.9% as of June 30, 2024.
• Largest share was in the County of Hawaii at 4.4%, ranking fifth (out of eight).

No single product line, even the primary residential mortgage lending, demonstrated the necessary high market growth combined with a dominant share in the highly competitive Hawaii market to qualify as a Star. The company's final loan portfolio stood at $1.29 billion in loans receivable as of December 31, 2024, which, while substantial for the institution, was insufficient for market leadership in a growing category.

The following table illustrates the scale difference that prevented a Star designation based on market share and asset size relative to the market environment leading up to the merger:

To be fair, the business was well-capitalized, with a tier one leverage capital ratio of 11.68% at the end of 2024, and it maintained solid asset quality with a non-performing assets ratio of 0.09%. Still, these are stability metrics, not growth metrics required for the Star quadrant. The merger itself, valued at approximately $78.6 million in stock, was intended to move the former Territorial Savings Bank operations into a larger entity, where they might contribute to Hope Bancorp's growth, but TBNK itself, as a standalone business unit, was not a Star.

The strategic reality for the former Territorial Bancorp Inc. units was:

• Core lending focus: Low-growth volume segment in 2025.
• Market share: Insufficient to dominate the regional market.
• Cash flow: Neutralized by high investment needs for growth.
• Outcome: Acquired by a larger player, Hope Bancorp.

The focus for the former Territorial Savings Bank franchise, now a unit of Bank of Hope, shifts from independent investment to integration, which is a different strategic posture entirely. Finance: draft post-merger integration synergy report by end of Q3 2025.

Territorial Bancorp Inc. (TBNK) - BCG Matrix: Cash Cows

The Cash Cow quadrant represents the established, long-term $1.72 billion deposit base of Territorial Bancorp Inc. (TBNK).

These are the stable, low-cost retail deposits, which became a critical, high-share resource for the new parent, Hope Bancorp, following the merger completion on April 2, 2025.

The core asset base is represented by the legacy portfolio of one-to-four-family residential mortgage loans, which constituted 96.9% of the loan portfolio at December 31, 2024.

This portfolio demonstrated exceptional asset quality, with a non-performing assets ratio of only 0.09% in Q4 2024, generating reliable, low-risk interest income.

Here's a quick look at the key financial metrics defining this strong position as of the end of 2024:

The strength of this business unit is rooted in its market leadership within Hawaii and the low cost of funding it provides.

• Adds stable, low-cost core deposit base to the combined company.
• Loan portfolio is predominately residential mortgage lending.
• Non-performing assets to total assets ratio was 0.10% at March 31, 2024.
• Allowance for credit losses represented 0.39% of total loans at March 31, 2024.

The high market share in a mature local market means promotional spending is minimal, allowing for maximum cash extraction.

Territorial Bancorp Inc. (TBNK) - BCG Matrix: Dogs

You're looking at the parts of Territorial Bancorp Inc. (TBNK) that, before the merger, were stuck in low-growth, low-market-share territory. These are the units that don't consume much cash but also don't generate much return; they are prime candidates for divestiture if not for the pending acquisition.

General retail banking operations, while the core business, show a low market share in the broader Hawaiian banking landscape. As of June 30, 2024, Territorial Bancorp Inc. ranked fifth in FDIC-insured deposit market share in the State of Hawaii, holding only a 2.9% share out of 13 banks and thrift institutions with offices there. This suggests a limited ability to capture significant growth in the deposit base within the state.

The small non-residential real estate loan portfolio exemplifies a low-share segment within the asset side of the balance sheet. This portfolio is dwarfed by the residential mortgage business. Here's the quick math comparing the two loan segments as of December 31, 2024:

This concentration shows that the nonresidential segment is a minor component, fitting the low-market-share characteristic of a Dog. Expensive turn-around plans for such a small, low-growth segment are generally not worth the effort when a strategic sale is imminent.

The overall independent corporate structure demonstrated low profitability leading up to the merger announcement, signaling cash consumption rather than generation. For the fourth quarter of 2024, Territorial Bancorp Inc. reported a significant net loss of $1.72 million, or a loss of $0.20 per diluted share. This loss included $1.53 million in pre-tax merger-related expenses, but even looking at the full year 2024, the company reported a net loss of $4.3 million. The operational efficiency suffered, with the efficiency ratio deteriorating to 137.09% in Q4 2024.

Key financial indicators reflecting this low-return status for the pre-merger entity include:

• Q4 2024 Net Loss: $1.72 million.
• Full Year 2024 Net Loss: $4.3 million.
• Q4 2024 Efficiency Ratio: 137.09%.
• Total Assets (Dec 31, 2024): $2.17 billion.

The insurance agency activities and non-deposit investment services fall into the category of small, low-share ancillary businesses. While specific revenue figures for just these segments aren't isolated in the filings, the overall noninterest income provides context for these fee-based activities. For the full year 2024, total noninterest income was only $2.611 million. This small contribution relative to total interest income, which was $72.305 million for the full year 2024, confirms their minor role. These units frequently break even, neither earning nor consuming much cash, but they tie up capital that could be better deployed elsewhere.

Finance: draft 13-week cash view by Friday.

Territorial Bancorp Inc. (TBNK) - BCG Matrix: Question Marks

You're looking at the areas of Territorial Bancorp Inc. (TBNK) that are currently consuming cash while showing high potential for future growth, which is the classic profile for a Question Mark in the Boston Consulting Group Matrix. These are new ventures or segments where buyers are still discovering the value proposition, demanding investment to quickly gain market share before they stagnate into Dogs. A prime example of this dynamic is the recent surge in government funding. Deposits from state and local governments drove a significant $81.06 million increase in total deposits from $1.64 billion at December 31, 2023, to $1.72 billion at December 31, 2024. This segment represents a high-growth pocket, but the long-term retention and cost-effectiveness of these specific deposits remain an open question, especially as the bank transitions under new ownership.

Here's a quick look at the numbers that frame these high-growth, low-share areas as of late 2024, right before the merger finalized in April 2025:

The push into commercial business and commercial real estate (CRE) loans clearly fits the Question Mark mold. While Territorial Savings Bank's core has always been one- to four-family residential mortgage loans, the expansion into CRE is into a segment where the bank currently holds a very small footprint. As of December 31, 2024, loans secured by commercial real estate totaled just $8.2 million, making up only 0.6% of the total loan portfolio. Similarly, the broader category of nonresidential real estate loans, which includes CRE, stood at $11.6 million, or 0.9% of the portfolio. These segments are typically higher-growth areas for a combined entity, but Territorial Bancorp Inc.'s share is minimal, meaning heavy investment is needed to move the needle.

Furthermore, consider the future potential tied to the merger, which was effective April 2, 2025. The potential for digital banking services in Hawaii represents a high-growth channel for the new parent, Hope Bancorp, but it is a low-share area for the traditional Territorial Savings Bank. The strategy here is to leverage the scale and enhanced technology platforms of the combined franchise to better serve customers. This digital push is a classic Question Mark play: high growth potential in the channel, but the current market share within the local Hawaiian banking landscape needs to be rapidly built up using the new parent's resources.

• Invest heavily to quickly capture share in the CRE lending space.
• Determine the long-term cost and retention profile of the $81.06 million government deposit inflow.
• Integrate technology platforms to rapidly grow digital banking adoption in Hawaii.
• Avoid letting these segments become Dogs by failing to secure market traction post-merger.