Bank of Hawaii Corp. boosted its dividend 8 cents a share on the heels of a new tax law that benefited the company and helped produce higher first-quarter earnings.

The state’s second-largest bank said Monday its net income rose 5.6 percent to $54 million, or $1.28 a share, from $51.2 million, or $1.20 a share, in the year-earlier period. With the higher earnings, Bankoh raised its dividend to 60 cents a share from 52 cents a share. It will be payable June 14 to shareholders of record at the close of business May 31.

“Our dividend policy is 50 percent of net income, so if the earnings go up because the taxes are lower, that’s going to increase shareholder value,” said Peter Ho, chairman, president and CEO of Bankoh.

The Tax Cuts and Jobs Act that went into effect Jan. 1 reduced the federal corporate tax rate to 21 percent from 35 percent. In the first quarter, Bankoh’s effective tax rate was 16.19 percent, compared with 29.72 percent in the first quarter of 2017. Bankoh typically would have had a tax rate of 30 to 32 percent prior to the tax change, according to Ho.

The bank’s tax rate during the first quarter was further lowered because of a $2 million adjustment to the company’s low-income housing investments.

During the quarter, Bankoh’s loans increased 8.8 percent to $9.92 billion, deposits rose 3.3 percent to $14.96 billion and assets gained 2.8 percent to $17.14 billion.

“It was a very solid quarter,” Ho said. “Obviously, there was good growth in earnings, expansion in net interest margin, credit quality remains very strong and there was growth in both loans and deposits.”

The bank’s net interest margin — the spread between interest received on loans and paid out on deposits — improved to 3.00 percent in the first quarter from 2.89 percent in the year-earlier period as loan interest rates continued to rise. Net interest income rose 8.3 percent to $119 million.

Noninterest income, which includes service charges and fees, fell 21.2 percent to $44 million in the quarter. The noninterest income was aided by $2.8 million from a low-income housing investment sale and distribution. But the bank did not sell any Visa stock last quarter as it did in the year-earlier period when it had a gain of $12.5 million from the sale of the credit card company’s shares.

Bank of Hawaii’s stock rose 16 cents to $84.52. The financial results were released before the market opened.