Hawaiian Electric Industries Inc.'s second-quarter earnings fell more than 70 percent after the company's bank subsidiary took a one-time $35.6 million charge.

But minus the charge, the company exceeded analysts' expectations.

HEI earned $5.1 million, or 6 cents a share, during the three months ending June 30, 2008, which was down from $17.5 million, or 21 cents per share, in the year-earlier period.

In June, HEI's American Savings Bank subsidiary said it took a one-time $35.6 million, or 42 cents per share, charge as part of a balance sheet restructuring plan. The restructuring included the sale of $1 billion in government-backed mortgage securities.

Excluding the charge, HEI said it would have earned $40.7 million, or 48 cents per share.

Analysts had been forecasting a gain of 41 cents per share for the quarter, excluding the charge, according to Bloomberg News Service.

"They're keeping on track to post better results for the rest of the year," said David Parker, analyst with Tampa, Fla.-based Robert W. Baird & Co.

Shares of HEI fell 2 cents to $24.20 on the New York Stock Exchange yesterday.

Constance Lau, HEI's chief executive officer, said Hawaiian Electric Co. and the company's Neighbor Island utilities benefited from interim rate increases approved by the state Public Utilities Commission last year.

The higher rates, which included a 4.96 percent rate hike for HECO, boosted the utilities' income to $27.4 million from $10.7 million in the year-earlier period, the company said.

Despite warmer weather, the utilities' kilowatt hour sales were down slightly during the quarter due in part to conservation, the company said.

"Hawai'i customers have been diligently seeking ways to conserve energy in response to the dramatic rise in the cost of fuel, which impacts the price of nearly all goods and services here in Hawai'i, Lau said.

American Savings posted a net loss of $18 million due to the $35.6 million charge. The loss compares with a net income of $12.6 million in second quarter 2007.

Net interest income was $52.6 million, up slightly from the year-earlier's $51.1 million.