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HarborOne Bancorp, Inc. Announces 2023 Third Quarter Earnings

HarborOne Bancorp, Inc. (the “Company” or “HarborOne”) (NASDAQ: HONE), the holding company for HarborOne Bank (the “Bank”), announced net income of $8.4 million, or $0.20 per diluted share, for the third quarter of 2023, compared to net income of $7.5 million, or $0.17 per diluted share, for the preceding quarter and net income of $13.8 million, or $0.30 per diluted share, for the same period last year.

Selected Financial Highlights:

  • Deposit growth, excluding brokered deposits, of $160.5 million, or 4.0%, on a linked-quarter basis.
  • Reduced noninterest expense 7.5% as compared to the prior year third quarter.
  • Loan growth of $24.7 million, or 0.5%, on a linked-quarter basis.
  • Commenced sixth share repurchase program.

“As many of our competitors struggled with deposit contraction, we grew the average balance of customer deposits at a 14.7% annualized pace in Q3. This strong deposit growth allowed the pay-down of over $167 million in wholesale funds during the quarter,” said Joseph F. Casey, President and CEO. “Additionally, we expect to redeem $35 million in subordinated debt on December 1, 2023, which carries a current annualized expense rate of 8.45%. And we continue to return shareholder value, commencing a sixth stock buyback plan in Q3, purchasing $6.4 million of HarborOne shares at an average cost of $9.81 per share.”

Net Interest Income

The Company’s net interest and dividend income was $31.1 million for the quarter ended September 30, 2023, compared to $32.1 million for the quarter ended June 30, 2023, and $39.3 million for the quarter ended September 30, 2022. The tax equivalent interest rate spread and net interest margin were 1.70% and 2.34%, respectively, for the quarter ended September 30, 2023, compared to 1.89% and 2.45%, respectively, for the quarter ended June 30, 2023, and 3.30% and 3.47%, respectively, for the quarter ended September 30, 2022.

On a linked-quarter basis, the decreases in net interest and dividend income, tax equivalent interest rate spread, and net interest margin primarily reflect a higher cost of funding, partially offset by increased loan balances and yields, with liability repricing outpacing assets. While the yield on interest-earning assets increased 11 basis points from the preceding quarter, the cost of interest-bearing liabilities increased 30 basis points, in a competitive deposit pricing market.

The $8.3 million decrease in net interest and dividend income from the prior year quarter reflects an increase of $26.9 million, or 514.2%, in total interest expense, partially offset by an increase of $18.6 million, or 41.8%, in total interest and dividend income. The changes reflect rate and volume changes in both interest-bearing assets and liabilities. The cost of interest-bearing liabilities increased 241 basis points, while the average balance increased $880.8 million, and the yield on interest-earning assets increased 81 basis points, while the average balance increased $808.0 million.

Noninterest Income

Total noninterest income decreased $1.1 million, or 8.4%, to $11.6 million for the quarter ended September 30, 2023, from $12.7 million for the quarter ended June 30, 2023. Persistent low inventory of for-sale residential real estate and rising mortgage interest rates continued to impact the results of HarborOne Mortgage, LLC (“HarborOne Mortgage”) with gain on loan sales of $2.7 million from mortgage loan closings of $157.6 million for the quarter ended September 30, 2023, compared to $3.3 million in gain on sales from mortgage loan closings of $172.2 million in the preceding quarter.

The increase in the fair value of mortgage servicing rights (“MSR”) for the three months ended September 30, 2023 was $770,000, as compared to an increase of $915,000 in the fair value of MSR for the three months ended June 30, 2023. The valuation was positively impacted by key benchmark mortgage rates, which were partially offset by the impact of MSR price caps used in the valuation model. The impact on the MSR of principal payments on the underlying mortgages was $645,000 and $479,000 for the quarters ended September 30, 2023 and June 30, 2023, respectively.

Total noninterest income decreased $2.6 million, or 18.6%, compared to the quarter ended September 30, 2022, primarily due to a $3.0 million, or 36.9%, decrease in mortgage banking income. The prior year quarter also reflected a $1.8 million increase in the fair value of MSR. The impact of rising interest rates on the fair value of MSR diminishes as the valuations reach multiple caps.

Noninterest Expense

Total noninterest expenses were at $31.9 million for the quarter ended September 30, 2023, as compared to $31.7 million for the quarter ended June 30, 2023. Compensation and benefits increased $479,000, primarily reflecting increased incentive accruals partially offset by decreased salary and payroll tax expense. Occupancy and equipment expense decreased $203,000, reflecting recent cost saving measures. HarborOne Mortgage continues to enact cost saving measures and executed a reduction in force in the third quarter with an annual cost savings of $564,000.

Total noninterest expenses decreased $2.6 million, or 7.5%, from the quarter ended September 30, 2022. Compensation and benefits decreased $2.3 million, primarily reflecting decreased mortgage origination commission and incentive accruals, and occupancy and equipment expense decreased $399,000. These decreases were partially offset by a $647,000 increase in deposit insurance expense.

Asset Quality and Allowance for Credit Losses

Total nonperforming assets were $18.8 million at September 30, 2023, compared to $20.2 million at June 30, 2023 and $23.4 million at September 30, 2022. Nonperforming assets as a percentage of total assets were 0.33% at September 30, 2023, 0.36% at June 30, 2023, and 0.47% at September 30, 2022.

The Company recorded a reversal of provision for credit losses of $113,000 for the quarter ended September 30, 2023, reflecting a $586,000 reversal of provision for unfunded commitments, partially offset by a $474,000 provision for loan credit losses, primarily for loan growth. Net recoveries totaled $18,000 and $799,000 for the quarters ended September 30, 2023 and 2022, respectively. Net charge-offs totaled $2.7 million, or 0.23% of average loans outstanding on an annualized basis, for the quarter ended June 30, 2023.

The allowance for credit losses (“ACL”) on loans was $48.3 million, or 1.02% of total loans, at September 30, 2023, compared to $47.8 million, or 1.02% of total loans, at June 30, 2023 and $44.6 million, or 1.06% of total loans, at September 30, 2022. The ACL on unfunded commitments, included in other liabilities on the unaudited Consolidated Balance Sheets, amounted to $4.2 million at September 30, 2023 as compared to $4.8 million at June 30, 2023 and $5.5 million at September 30, 2022.

Management continues to closely monitor the loan portfolio for signs of deterioration in light of speculation that commercial real estate values may deteriorate as the market adjusts to higher vacancies and interest rates. The commercial real estate portfolio is centered in New England, with approximately 75% of the portfolio secured by property located in Massachusetts and Rhode Island. Approximately 60% of the commercial real estate loans are fixed-rate loans with, in the opinion of management, limited near-term maturity risk.

Management also continues to monitor certain sectors within the commercial real estate segment that may be particularly susceptible to increased credit risk as a result of trends that were precipitated by the COVID-19 pandemic and may be exacerbated by current economic conditions. This includes business-oriented hotels, non-anchored retail space, and metro office space. As of September 30, 2023, business-oriented hotels loans included 13 loans with a total outstanding balance of $114.4 million, non-anchored retail space loans included 30 loans with a total outstanding balance of $40.4 million, and metro office space loans included two loans with a total outstanding balance of $12.0 million. As of September 30, 2023, there was one metro office space loan with a carrying value of $7.0 million that was rated doubtful and on nonaccrual and one business-oriented hotel credit with a carrying value of $1.7 million that was rated substandard and on nonaccrual. The other loans in these groups were performing in accordance with their terms.

Balance Sheet

Total assets were flat, at $5.66 billion as of September 30, 2023 and June 30, 2023, as an increase of $24.7 million in total loans was offset by decreases in investments and Federal Home Loan Bank (“FHLB”) stock.

Available-for-sale securities were $271.1 million and $292.0 million at September 30, 2023 and June 30, 2023, respectively. The unrealized loss on securities available for sale increased to $81.3 million as of September 30, 2023, as compared to $66.5 million of unrealized losses as of June 30, 2023. Securities held to maturity were $19.8 million, or 0.3%, of total assets, with a fair value of $18.7 million.

Loans increased $24.7 million, or 0.5%, to $4.72 billion at September 30, 2023, from $4.70 billion at June 30, 2023. The increase in loans for the three months ended September 30, 2023 was primarily due to increases in commercial real estate loans of $63.2 million and residential real estate loans of $5.2 million, partially offset by decreases in commercial construction loans of $37.7 million, commercial and industrial loans of $2.9 million, and consumer loans of $3.2 million. Management continues to seek prudent commercial lending opportunities to deepen relationships with existing customers and develop new relationships with strong borrowers.

Total deposits were $4.41 billion at September 30, 2023 and $4.29 billion at June 30, 2023. Compared to the prior quarter, non-certificate accounts increased $44.2 million and term certificate accounts increased $116.3 million, as competitive rate specials attracted deposits during the quarter. Brokered deposits decreased $38.1 million. As of September 30, 2023, FDIC-insured deposits were approximately 66% of total deposits, including Bank subsidiary deposits. Including Depositors Insurance Fund (“DIF”), excess insurance coverage that remains available until February 24, 2024, insured deposits are approximately 85% of total deposits, including Bank subsidiary deposits. Although the Bank exited the DIF as of February 24, 2023, insurance remains in place for funds on deposit as of that date for one year or until maturity for term certificates.

FHLB borrowings decreased $129.1 million to $475.5 million at September 30, 2023 from $604.6 million at June 30, 2023. As of September 30, 2023, the Bank had $1.28 billion in available borrowing capacity across multiple relationships. Additionally, on October 19, 2023, the Company notified holders of its subordinated debt that the Company had exercised its option to redeem the debt effective December 1, 2023. The current interest rate on the $35.0 million outstanding subordinated notes is 8.45%.

Total stockholders’ equity was $584.6 million at September 30, 2023, compared to $595.5 million at June 30, 2023 and $611.4 million at September 30, 2022. Stockholders’ equity decreased 1.8% when compared to the prior quarter, as earnings were offset by share repurchases. The Company commenced a sixth share repurchase program during the third quarter of 2023, repurchasing 652,523 shares at an average price of $9.93, including $0.10 per share of excise tax, during the three months ended September 30, 2023. The tangible-common-equity-to-tangible-assets ratio(1) was 9.17% at September 30, 2023, 9.38% at June 30, 2023, and 10.97% at September 30, 2022. At September 30, 2023, the Company and the Bank had strong capital positions, exceeded all regulatory capital requirements, and are considered well-capitalized.

About HarborOne Bancorp, Inc.

HarborOne Bancorp, Inc. is the holding company for HarborOne Bank, a Massachusetts-chartered trust company. HarborOne Bank serves the financial needs of consumers, businesses, and municipalities throughout Eastern Massachusetts and Rhode Island through a network of 30 full-service banking centers located in Massachusetts and Rhode Island, and commercial lending offices in Boston, Massachusetts and Providence, Rhode Island. HarborOne Bank also provides a range of educational resources through “HarborOne U,” with free digital content, webinars, and recordings for small business and personal financial education. HarborOne Mortgage, LLC, a subsidiary of HarborOne Bank, provides mortgage lending services throughout New England and other states.

(1) This non-GAAP ratio is total stockholders equity less goodwill and intangible assets to total assets less goodwill and intangible assets.

Forward Looking Statements

Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission (“SEC”), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. Such statements may be identified by words such as “believes,” “will,” “would,” “expects,” “project,” “may,” “could,” “developments,” “strategic,” “launching,” “opportunities,” “anticipates,” “estimates,” “intends,” “plans,” “targets” and similar expressions. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, changes in general business and economic conditions (including inflation and concerns about inflation) on a national basis and in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; changes in customer behavior; ongoing turbulence in the capital and debt markets and the impact of such conditions on the Company’s business activities; changes in interest rates; increases in loan default and charge-off rates; decreases in the value of securities in the Company’s investment portfolio; fluctuations in real estate values; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions, customer behavior or adverse economic developments; the adequacy of loan loss reserves; decreases in deposit levels necessitating increased borrowing to fund loans and investments; competitive pressures from other financial institutions; acquisitions may not produce results at levels or within time frames originally anticipated; cybersecurity incidents, fraud, natural disasters, war, terrorism, civil unrest, and future pandemics; changes in regulation; changes in accounting standards and practices; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; demand for loans in the Company’s market area; the Company’s ability to attract and maintain deposits; risks related to the implementation of acquisitions, dispositions, and restructurings; the risk that the Company may not be successful in the implementation of its business strategy; changes in assumptions used in making such forward-looking statements and the risk factors described in the Annual Report on Form 10‑K and Quarterly Reports on Form 10‑Q as filed with the SEC, which are available at the SEC’s website, www.sec.gov. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, HarborOne’s actual results could differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes, except as required by law.

Use of Non-GAAP Measures

In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. The Company’s management believes that the supplemental non-GAAP information, which consists of the efficiency ratio, tangible common equity to tangible assets ratio and tangible book value per share, is utilized by regulators and market analysts to evaluate a company’s financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

 

HarborOne Bancorp, Inc.

Consolidated Balance Sheet Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

(in thousands)

 

2023

 

2023

 

2023

 

2022

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

38,573

 

$

43,525

 

$

38,989

 

$

39,712

 

$

39,910

Short-term investments

 

 

208,211

 

 

209,326

 

 

210,765

 

 

58,305

 

 

46,044

Total cash and cash equivalents

 

 

246,784

 

 

252,851

 

 

249,754

 

 

98,017

 

 

85,954

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale, at fair value

 

 

271,078

 

 

292,012

 

 

303,059

 

 

301,149

 

 

304,852

Securities held to maturity, at amortized cost

 

 

19,795

 

 

19,839

 

 

19,838

 

 

19,949

 

 

15,000

Federal Home Loan Bank stock, at cost

 

 

23,378

 

 

27,123

 

 

23,589

 

 

20,071

 

 

15,973

Asset held for sale

 

 

966

 

 

966

 

 

 

 

 

 

Loans held for sale, at fair value

 

 

17,796

 

 

20,949

 

 

13,956

 

 

18,544

 

 

18,805

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

 

2,349,886

 

 

2,286,688

 

 

2,286,727

 

 

2,250,344

 

 

2,041,905

Commercial construction

 

 

191,224

 

 

228,902

 

 

212,689

 

 

199,311

 

 

185,062

Commercial and industrial

 

 

450,547

 

 

453,422

 

 

423,036

 

 

424,275

 

 

397,112

Total commercial loans

 

 

2,991,657

 

 

2,969,012

 

 

2,922,452

 

 

2,873,930

 

 

2,624,079

Residential real estate

 

 

1,706,950

 

 

1,701,766

 

 

1,667,934

 

 

1,634,319

 

 

1,520,809

Consumer

 

 

24,247

 

 

27,425

 

 

32,246

 

 

41,421

 

 

52,466

Loans

 

 

4,722,854

 

 

4,698,203

 

 

4,622,632

 

 

4,549,670

 

 

4,197,354

Less: Allowance for credit losses on loans

 

 

(48,312)

 

 

(47,821)

 

 

(46,994)

 

 

(45,236)

 

 

(44,621)

Net loans

 

 

4,674,542

 

 

4,650,382

 

 

4,575,638

 

 

4,504,434

 

 

4,152,733

Mortgage servicing rights, at fair value

 

 

49,201

 

 

48,176

 

 

47,080

 

 

48,138

 

 

49,861

Goodwill

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

Other intangible assets

 

 

1,704

 

 

1,893

 

 

2,082

 

 

2,272

 

 

2,461

Other assets

 

 

289,341

 

 

275,261

 

 

268,060

 

 

277,169

 

 

272,202

Total assets

 

$

5,664,387

 

$

5,659,254

 

$

5,572,858

 

$

5,359,545

 

$

4,987,643

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposit accounts

 

$

708,847

 

$

717,572

 

$

726,548

 

$

762,576

 

$

795,945

NOW accounts

 

 

289,141

 

 

286,956

 

 

287,376

 

 

297,692

 

 

308,191

Regular savings and club accounts

 

 

1,324,635

 

 

1,390,906

 

 

1,455,318

 

 

1,468,172

 

 

1,289,825

Money market deposit accounts

 

 

951,128

 

 

834,120

 

 

796,008

 

 

861,704

 

 

889,517

Term certificate accounts

 

 

859,266

 

 

742,931

 

 

653,553

 

 

497,975

 

 

484,936

Brokered deposits

 

 

276,941

 

 

315,003

 

 

322,927

 

 

301,380

 

 

114,696

Total deposits

 

 

4,409,958

 

 

4,287,488

 

 

4,241,730

 

 

4,189,499

 

 

3,883,110

FHLB borrowings

 

 

475,470

 

 

604,568

 

 

590,665

 

 

400,675

 

 

345,684

Subordinated debt

 

 

34,380

 

 

34,348

 

 

34,317

 

 

34,285

 

 

34,254

Other liabilities and accrued expenses

 

 

159,945

 

 

137,318

 

 

106,352

 

 

118,110

 

 

113,225

Total liabilities

 

 

5,079,753

 

 

5,063,722

 

 

4,973,064

 

 

4,742,569

 

 

4,376,273

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

597

 

 

597

 

 

597

 

 

596

 

 

593

Additional paid-in capital

 

 

485,144

 

 

484,544

 

 

483,831

 

 

483,031

 

 

480,617

Unearned compensation - ESOP

 

 

(26,245)

 

 

(26,704)

 

 

(27,164)

 

 

(27,623)

 

 

(28,083)

Retained earnings

 

 

369,930

 

 

364,709

 

 

360,454

 

 

356,438

 

 

350,049

Treasury stock

 

 

(187,803)

 

 

(181,324)

 

 

(175,514)

 

 

(148,384)

 

 

(143,125)

Accumulated other comprehensive loss

 

 

(56,989)

 

 

(46,290)

 

 

(42,410)

 

 

(47,082)

 

 

(48,681)

Total stockholders' equity

 

 

584,634

 

 

595,532

 

 

599,794

 

 

616,976

 

 

611,370

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

5,664,387

 

$

5,659,254

 

$

5,572,858

 

$

5,359,545

 

$

4,987,643

 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income - Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

(in thousands, except share data)

 

2023

 

2023

 

2023

 

2022

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

58,124

 

$

55,504

 

$

52,771

 

$

49,177

 

$

42,065

Interest on loans held for sale

 

 

370

 

 

326

 

 

286

 

 

334

 

 

377

Interest on securities

 

 

2,003

 

 

2,035

 

 

2,079

 

 

2,045

 

 

1,971

Other interest and dividend income

 

 

2,667

 

 

2,935

 

 

803

 

 

359

 

 

143

Total interest and dividend income

 

 

63,164

 

 

60,800

 

 

55,939

 

 

51,915

 

 

44,556

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

25,039

 

 

20,062

 

 

15,913

 

 

8,499

 

 

3,491

Interest on FHLB and FRB borrowings

 

 

6,439

 

 

8,114

 

 

5,105

 

 

3,703

 

 

1,209

Interest on subordinated debentures

 

 

606

 

 

524

 

 

523

 

 

524

 

 

524

Total interest expense

 

 

32,084

 

 

28,700

 

 

21,541

 

 

12,726

 

 

5,224

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

31,080

 

 

32,100

 

 

34,398

 

 

39,189

 

 

39,332

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision (benefit) for credit losses

 

 

(113)

 

 

3,283

 

 

1,866

 

 

2,108

 

 

668

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for credit losses

 

 

31,193

 

 

28,817

 

 

32,532

 

 

37,081

 

 

38,664

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

2,704

 

 

3,300

 

 

2,224

 

 

2,301

 

 

3,809

Changes in mortgage servicing rights fair value

 

 

125

 

 

436

 

 

(1,692)

 

 

(2,631)

 

 

1,816

Other

 

 

2,270

 

 

2,312

 

 

2,216

 

 

2,325

 

 

2,453

Total mortgage banking income

 

 

5,099

 

 

6,048

 

 

2,748

 

 

1,995

 

 

8,078

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

5,133

 

 

5,012

 

 

4,733

 

 

5,031

 

 

4,870

Income on retirement plan annuities

 

 

146

 

 

128

 

 

119

 

 

118

 

 

119

Bank-owned life insurance income

 

 

531

 

 

511

 

 

500

 

 

501

 

 

503

Other income

 

 

689

 

 

963

 

 

590

 

 

2,255

 

 

675

Total noninterest income

 

 

11,598

 

 

12,662

 

 

8,690

 

 

9,900

 

 

14,245

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

18,699

 

 

18,220

 

 

17,799

 

 

20,104

 

 

20,991

Occupancy and equipment

 

 

4,430

 

 

4,633

 

 

5,040

 

 

4,935

 

 

4,829

Data processing

 

 

2,548

 

 

2,403

 

 

2,346

 

 

2,359

 

 

2,311

Loan expense

 

 

385

 

 

417

 

 

313

 

 

169

 

 

355

Marketing

 

 

794

 

 

925

 

 

1,181

 

 

862

 

 

850

Professional fees

 

 

1,374

 

 

1,114

 

 

1,501

 

 

1,446

 

 

1,457

Deposit insurance

 

 

1,004

 

 

1,176

 

 

510

 

 

385

 

 

357

Other expenses

 

 

2,638

 

 

2,837

 

 

2,819

 

 

4,384

 

 

3,323

Total noninterest expenses

 

 

31,872

 

 

31,725

 

 

31,509

 

 

34,644

 

 

34,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

10,919

 

 

9,754

 

 

9,713

 

 

12,337

 

 

18,436

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

2,507

 

 

2,275

 

 

2,416

 

 

2,760

 

 

4,678

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

8,412

 

$

7,479

 

$

7,297

 

$

9,577

 

$

13,758

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.20

 

$

0.17

 

$

0.16

 

$

0.21

 

$

0.30

Diluted

 

$

0.20

 

$

0.17

 

$

0.16

 

$

0.21

 

$

0.30

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

42,876,893

 

 

43,063,507

 

 

44,857,224

 

 

45,321,491

 

 

45,830,737

Diluted

 

 

42,983,477

 

 

43,133,455

 

 

45,284,240

 

 

45,861,658

 

 

46,420,527

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income - Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended September 30,

 

 

 

 

 

(dollars in thousands, except share data)

 

2023

 

2022

 

$ Change

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

166,399

 

$

113,163

 

$

53,236

 

47.0

%

Interest on loans held for sale

 

 

982

 

 

972

 

 

10

 

1.0

 

Interest on securities

 

 

6,117

 

 

5,545

 

 

572

 

10.3

 

Other interest and dividend income

 

 

6,405

 

 

335

 

 

6,070

 

1811.9

 

Total interest and dividend income

 

 

179,903

 

 

120,015

 

 

59,888

 

49.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

61,014

 

 

7,131

 

 

53,883

 

755.6

 

Interest on FHLB and FRB borrowings

 

 

19,658

 

 

1,516

 

 

18,142

 

1196.7

 

Interest on subordinated debentures

 

 

1,653

 

 

1,571

 

 

82

 

5.2

 

Total interest expense

 

 

82,325

 

 

10,218

 

 

72,107

 

705.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

97,578

 

 

109,797

 

 

(12,219)

 

(11.1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for credit losses

 

 

5,036

 

 

3,552

 

 

1,484

 

41.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for credit losses

 

 

92,542

 

 

106,245

 

 

(13,703)

 

(12.9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

8,228

 

 

13,669

 

 

(5,441)

 

(39.8)

 

Changes in mortgage servicing rights fair value

 

 

(1,131)

 

 

7,963

 

 

(9,094)

 

(114.2)

 

Other

 

 

6,798

 

 

7,623

 

 

(825)

 

(10.8)

 

Total mortgage banking income

 

 

13,895

 

 

29,255

 

 

(15,360)

 

(52.5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

14,878

 

 

14,234

 

 

644

 

4.5

 

Income on retirement plan annuities

 

 

393

 

 

338

 

 

55

 

16.3

 

Bank-owned life insurance income

 

 

1,542

 

 

1,480

 

 

62

 

4.2

 

Other income

 

 

2,242

 

 

2,102

 

 

140

 

6.7

 

Total noninterest income

 

 

32,950

 

 

47,409

 

 

(14,459)

 

(30.5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

54,718

 

 

63,169

 

 

(8,451)

 

(13.4)

 

Occupancy and equipment

 

 

14,103

 

 

14,832

 

 

(729)

 

(4.9)

 

Data processing

 

 

7,297

 

 

6,811

 

 

486

 

7.1

 

Loan expense

 

 

1,115

 

 

1,218

 

 

(103)

 

(8.5)

 

Marketing

 

 

2,900

 

 

3,054

 

 

(154)

 

(5.0)

 

Professional fees

 

 

3,989

 

 

4,676

 

 

(687)

 

(14.7)

 

Deposit insurance

 

 

2,690

 

 

1,060

 

 

1,630

 

153.8

 

Other expenses

 

 

8,294

 

 

9,442

 

 

(1,148)

 

(12.2)

 

Total noninterest expenses

 

 

95,106

 

 

104,262

 

 

(9,156)

 

(8.8)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

30,386

 

 

49,392

 

 

(19,006)

 

(38.5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

7,198

 

 

13,380

 

 

(6,182)

 

(46.2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

23,188

 

$

36,012

 

$

(12,824)

 

(35.6)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.53

 

$

0.77

 

 

 

 

 

 

Diluted

 

$

0.53

 

$

0.76

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

43,591,954

 

 

46,875,312

 

 

 

 

 

 

Diluted

 

 

43,793,137

 

 

47,541,647

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HarborOne Bancorp, Inc.

Average Balances / Yields

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

September 30, 2023

 

June 30, 2023

 

September 30, 2022

 

 

 

Average

��

 

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

 

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost (8)

 

Balance

 

Interest

 

Cost (8)

 

Balance

 

Interest

 

Cost (8)

 

 

 

(dollars in thousands)

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

375,779

 

$

2,003

 

2.11

%

$

381,762

 

$

2,035

 

2.14

%

$

390,577

 

$

1,971

 

2.00

%

Other interest-earning assets

 

 

207,234

 

 

2,667

 

5.11

 

 

238,891

 

 

2,935

 

4.93

 

 

27,723

 

 

143

 

2.05

 

Loans held for sale

 

 

20,919

 

 

370

 

7.02

 

 

19,614

 

 

326

 

6.67

 

 

28,046

 

 

377

 

5.33

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)(3)

 

 

2,980,817

 

 

40,438

 

5.38

 

 

2,938,292

 

 

38,842

 

5.30

 

 

2,522,359

 

 

28,298

 

4.45

 

Residential real estate loans (3)(4)

 

 

1,700,383

 

 

17,525

 

4.09

 

 

1,682,860

 

 

16,456

 

3.92

 

 

1,470,305

 

 

12,972

 

3.50

 

Consumer loans (3)

 

 

25,126

 

 

412

 

6.51

 

 

29,025

 

 

419

 

5.79

 

 

63,220

 

 

795

 

4.99

 

Total loans

 

 

4,706,326

 

 

58,375

 

4.92

 

 

4,650,177

 

 

55,717

 

4.81

 

 

4,055,884

 

 

42,065

 

4.11

 

Total interest-earning assets

 

 

5,310,258

 

 

63,415

 

4.74

 

 

5,290,444

 

 

61,013

 

4.63

 

 

4,502,230

 

 

44,556

 

3.93

 

Noninterest-earning assets

 

 

314,030

 

 

 

 

 

 

 

305,132

 

 

 

 

 

 

 

308,734

 

 

 

 

 

 

Total assets

 

$

5,624,288

 

 

 

 

 

 

$

5,595,576

 

 

 

 

 

 

$

4,810,964

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,360,728

 

 

6,787

 

1.98

 

$

1,421,622

 

 

6,165

 

1.74

 

$

1,293,598

 

 

1,211

 

0.37

 

NOW accounts

 

 

274,329

 

 

75

 

0.11

 

 

280,501

 

 

59

 

0.08

 

 

305,777

 

 

42

 

0.05

 

Money market accounts

 

 

910,694

 

 

8,355

 

3.64

 

 

802,373

 

 

6,256

 

3.13

 

 

893,452

 

 

1,382

 

0.61

 

Certificates of deposit

 

 

818,182

 

 

7,212

 

3.50

 

 

708,087

 

 

5,273

 

2.99

 

 

486,923

 

 

787

 

0.64

 

Brokered deposits

 

 

287,428

 

 

2,610

 

3.60

 

 

281,614

 

 

2,309

 

3.29

 

 

102,875

 

 

69

 

0.27

 

Total interest-bearing deposits

 

 

3,651,361

 

 

25,039

 

2.72

 

 

3,494,197

 

 

20,062

 

2.30

 

 

3,082,625

 

 

3,491

 

0.45

 

FHLB and FRB borrowings

 

 

508,001

 

 

6,439

 

5.03

 

 

666,345

 

 

8,114

 

4.88

 

 

196,036

 

 

1,209

 

2.45

 

Subordinated debentures

 

 

34,364

 

 

606

 

7.00

 

 

34,331

 

 

524

 

6.12

 

 

34,237

 

 

524

 

6.07

 

Total borrowings

 

 

542,365

 

 

7,045

 

5.15

 

 

700,676

 

 

8,638

 

4.94

 

 

230,273

 

 

1,733

 

2.99

 

Total interest-bearing liabilities

 

 

4,193,726

 

 

32,084

 

3.04

 

 

4,194,873

 

 

28,700

 

2.74

 

 

3,312,898

 

 

5,224

 

0.63

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

705,009

 

 

 

 

 

 

 

712,081

 

 

 

 

 

 

 

789,214

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

126,742

 

 

 

 

 

 

 

88,363

 

 

 

 

 

 

 

80,304

 

 

 

 

 

 

Total liabilities

 

 

5,025,477

 

 

 

 

 

 

 

4,995,317

 

 

 

 

 

 

 

4,182,416

 

 

 

 

 

 

Total stockholders' equity

 

 

598,811

 

 

 

 

 

 

 

600,259

 

 

 

 

 

 

 

628,548

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

5,624,288

 

 

 

 

 

 

$

5,595,576

 

 

 

 

 

 

$

4,810,964

 

 

 

 

 

 

Tax equivalent net interest income

 

 

 

 

 

31,331

 

 

 

 

 

 

 

32,313

 

 

 

 

 

 

 

39,332

 

 

 

Tax equivalent interest rate spread (5)

 

 

 

 

 

 

 

1.70

%

 

 

 

 

 

 

1.89

%

 

 

 

 

 

 

3.30

%

Less: tax equivalent adjustment

 

 

 

 

 

251

 

 

 

 

 

 

 

213

 

 

 

 

 

 

 

 

 

 

Net interest income as reported

 

 

 

 

$

31,080

 

 

 

 

 

 

$

32,100

 

 

 

 

 

 

$

39,332

 

 

 

Net interest-earning assets (6)

 

$

1,116,532

 

 

 

 

 

 

$

1,095,571

 

 

 

 

 

 

$

1,189,332

 

 

 

 

 

 

Net interest margin (7)

 

 

 

 

 

 

 

2.32

%

 

 

 

 

 

 

2.43

%

 

 

 

 

 

 

3.47

%

Tax equivalent effect

 

 

 

 

 

 

 

0.02

 

 

 

 

 

 

 

0.02

 

 

 

 

 

 

 

 

Net interest margin on a fully tax equivalent basis

 

 

 

 

 

 

 

2.34

%

 

 

 

 

 

 

2.45

%

 

 

 

 

 

 

3.47

%

Ratio of interest-earning assets to interest-bearing liabilities

 

 

126.62

%

 

 

 

 

 

 

126.12

%

 

 

 

 

 

 

135.90

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits, including demand deposits

 

$

4,356,370

 

$

25,039

 

 

 

$

4,206,278

 

$

20,062

 

 

 

$

3,871,839

 

$

3,491

 

 

 

Cost of total deposits

 

 

 

 

 

 

 

2.28

%

 

 

 

 

 

 

1.91

%

 

 

 

 

 

 

0.36

%

Total funding liabilities, including demand deposits

 

$

4,898,735

 

$

32,084

 

 

 

$

4,906,954

 

$

28,700

 

 

 

$

4,102,112

 

$

5,224

 

 

 

Cost of total funding liabilities

 

 

 

 

 

 

 

2.60

%

 

 

 

 

 

 

2.35

%

 

 

 

 

 

 

0.51

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes securities available for sale and securities held to maturity.

 

(2) Tax-exempt income on industrial revenue bonds is included in commercial loans on a tax-equivalent basis.

 

(3) Includes nonaccruing loan balances and interest received on such loans.

 

(4) Includes the basis adjustments of certain loans included in fair value hedging relationships.

 

(5) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.

 

(6) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

 

(7) Net interest margin represents net interest income divided by average total interest-earning assets.

 

(8) Annualized.

 

 

HarborOne Bancorp, Inc.

Average Balances / Yields

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended

 

 

 

September 30, 2023

 

September 30, 2022

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

 

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost (8)

 

Balance

 

Interest

 

Cost (8)

 

 

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

381,572

 

$

6,117

 

2.14

%

$

391,786

 

$

5,545

 

1.89

%

Other interest-earning assets

 

 

170,377

 

 

6,405

 

5.03

 

 

80,540

 

 

335

 

0.56

 

Loans held for sale

 

 

19,557

 

 

982

 

6.71

 

 

29,114

 

 

972

 

4.46

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)(3)

 

 

2,940,483

 

 

116,116

 

5.28

 

 

2,400,290

 

 

75,688

 

4.22

 

Residential real estate loans (3)(4)

 

 

1,676,979

 

 

49,598

 

3.95

 

 

1,341,508

 

 

34,296

 

3.42

 

Consumer loans (3)

 

 

30,112

 

 

1,350

 

5.99

 

 

89,934

 

 

3,179

 

4.73

 

Total loans

 

 

4,647,574

 

 

167,064

 

4.81

 

 

3,831,732

 

 

113,163

 

3.95

 

Total interest-earning assets

 

 

5,219,080

 

 

180,568

 

4.63

 

 

4,333,172

 

 

120,015

 

3.70

 

Noninterest-earning assets

 

 

310,826

 

 

 

 

 

 

 

315,781

 

 

 

 

 

 

Total assets

 

$

5,529,906

 

 

 

 

 

 

$

4,648,953

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,413,553

 

 

18,397

 

1.74

 

$

1,242,533

 

 

2,203

 

0.24

 

NOW accounts

 

 

276,872

 

 

170

 

0.08

 

 

306,115

 

 

116

 

0.05

 

Money market accounts

 

 

846,235

 

 

19,849

 

3.14

 

 

879,310

 

 

2,320

 

0.35

 

Certificates of deposit

 

 

693,941

 

 

15,170

 

2.92

 

 

497,744

 

 

2,186

 

0.59

 

Brokered deposits

 

 

299,665

 

 

7,428

 

3.31

 

 

100,969

 

 

306

 

0.41

 

Total interest-bearing deposits

 

 

3,530,266

 

 

61,014

 

2.31

 

 

3,026,671

 

 

7,131

 

0.32

 

FHLB and FRB borrowings

 

 

541,034

 

 

19,658

 

4.86

 

 

96,015

 

 

1,516

 

2.11

 

Subordinated debentures

 

 

34,331

 

 

1,653

 

6.44

 

 

34,206

 

 

1,571

 

6.14

 

Total borrowings

 

 

575,365

 

 

21,311

 

4.95

 

 

130,221

 

 

3,087

 

3.17

 

Total interest-bearing liabilities

 

 

4,105,631

 

 

82,325

 

2.68

 

 

3,156,892

 

 

10,218

 

0.43

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

712,815

 

 

 

 

 

 

 

765,479

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

105,732

 

 

 

 

 

 

 

80,727

 

 

 

 

 

 

Total liabilities

 

 

4,924,178

 

 

 

 

 

 

 

4,003,098

 

 

 

 

 

 

Total stockholders' equity

 

 

605,728

 

 

 

 

 

 

 

645,855

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

5,529,906

 

 

 

 

 

 

$

4,648,953

 

 

 

 

 

 

Tax equivalent net interest income

 

 

 

 

 

98,243

 

 

 

 

 

 

 

109,797

 

 

 

Tax equivalent interest rate spread (5)

 

 

 

 

 

 

 

1.95

%

 

 

 

 

 

 

3.27

%

Less: tax equivalent adjustment

 

 

 

 

 

665

 

 

 

 

 

 

 

 

 

 

Net interest income as reported

 

 

 

 

$

97,578

 

 

 

 

 

 

$

109,797

 

 

 

Net interest-earning assets (6)

 

$

1,113,449

 

 

 

 

 

 

$

1,176,280

 

 

 

 

 

 

Net interest margin (7)

 

 

 

 

 

 

 

2.50

%

 

 

 

 

 

 

3.39

%

Tax equivalent effect

 

 

 

 

 

 

 

0.02

 

 

 

 

 

 

 

 

Net interest margin on a fully tax equivalent basis

 

 

 

 

 

 

 

2.52

%

 

 

 

 

 

 

3.39

%

Ratio of interest-earning assets to interest-bearing liabilities

 

 

127.12

%

 

 

 

 

 

 

137.26

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits, including demand deposits

 

$

4,243,081

 

$

61,014

 

 

 

$

3,792,150

 

$

7,131

 

 

 

Cost of total deposits

 

 

 

 

 

 

 

1.92

%

 

 

 

 

 

 

0.25

%

Total funding liabilities, including demand deposits

 

$

4,818,446

 

$

82,325

 

 

 

$

3,922,371

 

$

10,218

 

 

 

Cost of total funding liabilities

 

 

 

 

 

 

 

2.28

%

 

 

 

 

 

 

0.35

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes securities available for sale and securities held to maturity.

 

(2) Tax-exempt income on industrial revenue bonds is included in commercial loans on a tax-equivalent basis.

 

(3) Includes nonaccruing loan balances and interest received on such loans.

 

(4) Includes the basis adjustments of certain loans included in fair value hedging relationships.

 

(5) Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.

 

(6) Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.

 

(7) Net interest margin represents net interest income divided by average total interest-earning assets.

 

(8) Annualized.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HarborOne Bancorp, Inc.

Average Balances and Yield Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Balances - Trend - Quarters Ended

 

 

 

September 30, 2023

 

June 30, 2023

 

March 31, 2023

 

December 31, 2022

 

September 30, 2022

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

375,779

 

$

381,762

 

$

387,303

 

$

388,247

 

$

390,577

 

Other interest-earning assets

 

 

207,234

 

 

238,891

 

 

63,426

 

 

42,640

 

 

27,723

 

Loans held for sale

 

 

20,919

 

 

19,614

 

 

18,108

 

 

22,350

 

 

28,046

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)(3)

 

 

2,980,817

 

 

2,938,292

 

 

2,901,464

 

 

2,770,667

 

 

2,522,359

 

Residential real estate loans (3)(4)

 

 

1,700,383

 

 

1,682,860

 

 

1,647,109

 

 

1,566,389

 

 

1,470,305

 

Consumer loans (3)

 

 

25,126

 

 

29,025

 

 

36,310

 

 

45,629

 

 

63,220

 

Total loans

 

 

4,706,326

 

 

4,650,177

 

 

4,584,883

 

 

4,382,685

 

 

4,055,884

 

Total interest-earning assets

 

 

5,310,258

 

 

5,290,444

 

 

5,053,720

 

 

4,835,922

 

 

4,502,230

 

Noninterest-earning assets

 

 

314,030

 

 

305,132

 

 

313,309

 

 

311,372

 

 

308,734

 

Total assets

 

$

5,624,288

 

$

5,595,576

 

$

5,367,029

 

$

5,147,294

 

$

4,810,964

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,360,728

 

$

1,421,622

 

$

1,459,392

 

$

1,408,493

 

$

1,293,598

 

NOW accounts

 

 

274,329

 

 

280,501

 

 

275,801

 

 

291,890

 

 

305,777

 

Money market accounts

 

 

910,694

 

 

802,373

 

 

824,694

 

 

878,609

��

 

893,452

 

Certificates of deposit

 

 

818,182

 

 

708,087

 

 

552,636

 

 

487,121

 

 

486,923

 

Brokered deposits

 

 

287,428

 

 

281,614

 

 

330,426

 

 

148,460

 

 

102,875

 

Total interest-bearing deposits

 

 

3,651,361

 

 

3,494,197

 

 

3,442,949

 

 

3,214,573

 

 

3,082,625

 

FHLB and FRB borrowings

 

 

508,001

 

 

666,345

 

 

448,096

 

 

392,508

 

 

196,036

 

Subordinated debentures

 

 

34,364

 

 

34,331

 

 

34,298

 

 

34,268

 

 

34,237

 

Total borrowings

 

 

542,365

 

 

700,676

 

 

482,394

 

 

426,776

 

 

230,273

 

Total interest-bearing liabilities

 

 

4,193,726

 

 

4,194,873

 

 

3,925,343

 

 

3,641,349

 

 

3,312,898

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

705,009

 

 

712,081

 

 

721,536

 

 

788,572

 

 

789,214

 

Other noninterest-bearing liabilities

 

 

126,742

 

 

88,363

 

 

101,820

 

 

101,621

 

 

80,304

 

Total liabilities

 

 

5,025,477

 

 

4,995,317

 

 

4,748,699

 

 

4,531,542

 

 

4,182,416

 

Total stockholders' equity

 

 

598,811

 

 

600,259

 

 

618,330

 

 

615,752

 

 

628,548

 

Total liabilities and stockholders' equity

 

$

5,624,288

 

$

5,595,576

 

$

5,367,029

 

$

5,147,294

 

$

4,810,964

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annualized Yield Trend - Quarters Ended

 

 

 

September 30, 2023

 

June 30, 2023

 

March 31, 2023

 

December 31, 2022

 

September 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

 

2.11

%

 

2.14

%

 

2.18

%

 

2.09

%

 

2.00

%

Other interest-earning assets

 

 

5.11

%

 

4.93

%

 

5.13

%

 

3.34

%

 

2.05

%

Loans held for sale

 

 

7.02

%

 

6.67

%

 

6.41

%

 

5.93

%

 

5.33

%

Commercial loans (2)(3)

 

 

5.38

%

 

5.30

%

 

5.15

%

 

4.92

%

 

4.45

%

Residential real estate loans (3)(4)

 

 

4.09

%

 

3.92

%

 

3.85

%

 

3.64

%

 

3.50

%

Consumer loans (3)

 

 

6.51

%

 

5.79

%

 

5.80

%

 

5.50

%

 

4.99

%

Total loans

 

 

4.92

%

 

4.81

%

 

4.69

%

 

4.47

%

 

4.11

%

Total interest-earning assets

 

 

4.74

%

 

4.63

%

 

4.51

%

 

4.27

%

 

3.93

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

 

1.98

%

 

1.74

%

 

1.51

%

 

1.01

%

 

0.37

%

NOW accounts

 

 

0.11

%

 

0.08

%

 

0.05

%

 

0.05

%

 

0.05

%

Money market accounts

 

 

3.64

%

 

3.13

%

 

2.58

%

 

1.50

%

 

0.61

%

Certificates of deposit

 

 

3.50

%

 

2.99

%

 

1.97

%

 

0.86

%

 

0.64

%

Brokered deposits

 

 

3.60

%

 

3.29

%

 

3.08

%

 

1.32

%

 

0.27

%

Total interest-bearing deposits

 

 

2.72

%

 

2.30

%

 

1.87

%

 

1.05

%

 

0.45

%

FHLB and FRB borrowings

 

 

5.03

%

 

4.88

%

 

4.62

%

 

3.74

%

 

2.45

%

Subordinated debentures

 

 

7.00

%

 

6.12

%

 

6.18

%

 

6.07

%

 

6.07

%

Total borrowings

 

 

5.15

%

 

4.94

%

 

4.73

%

 

3.93

%

 

2.99

%

Total interest-bearing liabilities

 

 

3.04

%

 

2.74

%

 

2.23

%

 

1.39

%

 

0.63

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes securities available for sale and securities held to maturity.

 

(2) Tax-exempt income on industrial revenue bonds is included in commercial loans on a tax-equivalent basis.

 

(3) Includes nonaccruing loan balances and interest received on such loans.

 

(4) Includes the basis adjustments of certain loans included in fair value hedging relationships.

 

 

HarborOne Bancorp, Inc.

Selected Financial Highlights

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Performance Ratios (annualized):

 

2023

 

2023

 

2023

 

2022

 

2022

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (ROAA)

 

 

0.60

%

 

0.54

%

 

0.54

%

 

0.74

%

 

1.14

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average equity (ROAE)

 

 

5.62

%

 

4.98

%

 

4.72

%

 

6.22

%

 

8.76

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense

 

$

31,872

 

$

31,725

 

$

31,509

 

$

34,644

 

$

34,473

 

Less: Amortization of other intangible assets

 

 

189

 

 

189

 

 

189

 

 

189

 

 

235

 

Total adjusted noninterest expense

 

$

31,683

 

$

31,536

 

$

31,320

 

$

34,455

 

$

34,238

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

31,080

 

$

32,100

 

$

34,398

 

$

39,189

 

$

39,332

 

Total noninterest income

 

 

11,598

 

 

12,662

 

 

8,690

 

 

9,900

 

 

14,245

 

Total revenue

 

$

42,678

 

$

44,762

 

$

43,088

 

$

49,089

 

$

53,577

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (1)

 

 

74.24

%

 

70.45

%

 

72.69

%

 

70.19

%

 

63.90

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) This non-GAAP measure represents adjusted noninterest expense divided by total revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At or for the Quarters Ended

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Asset Quality

 

2023

 

2023

 

2023

 

2022

 

2022

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total nonperforming assets

 

$

18,795

 

$

20,234

 

$

12,300

 

$

14,840

 

$

23,367

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming assets to total assets

 

 

0.33

%

 

0.36

%

 

0.22

%

 

0.28

%

 

0.47

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses on loans to total loans

 

 

1.02

%

 

1.02

%

 

1.02

%

 

0.99

%

 

1.06

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net charge-offs (recoveries)

 

$

(18)

 

$

2,671

 

$

(11)

 

$

2,067

 

$

(799)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annualized net charge-offs (recoveries)/average loans

 

 

%

 

0.23

%

 

%

 

0.19

%

 

(0.08)

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for credit losses on loans to nonperforming loans

 

 

257.21

%

 

236.62

%

 

383.50

%

 

305.93

%

 

191.60

%

HarborOne Bancorp, Inc.

Selected Financial Highlights

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Capital and Share Related

 

2023

 

2023

 

2023

 

2022

 

2022

 

(dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock outstanding

 

 

45,915,364

 

 

46,575,478

 

 

47,063,087

 

 

48,961,452

 

 

49,202,660

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per share

 

$

12.73

 

$

12.79

 

$

12.74

 

$

12.60

 

$

12.43

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders' equity

 

$

584,634

 

$

595,532

 

$

599,794

 

$

616,976

 

$

611,370

 

Less: Goodwill

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

Less: Other intangible assets (1)

 

 

1,704

 

 

1,893

 

 

2,082

 

 

2,272

 

 

2,461

 

Tangible common equity

 

$

513,128

 

$

523,837

 

$

527,910

 

$

544,902

 

$

539,107

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible book value per share (2)

 

$

11.18

 

$

11.25

 

$

11.22

 

$

11.13

 

$

10.96

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

5,664,387

 

$

5,659,254

 

$

5,572,858

 

$

5,359,545

 

$

4,987,643

 

Less: Goodwill

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

Less: Other intangible assets

 

 

1,704

 

 

1,893

 

 

2,082

 

 

2,272

 

 

2,461

 

Tangible assets

 

$

5,592,881

 

$

5,587,559

 

$

5,500,974

 

$

5,287,471

 

$

4,915,380

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity / tangible assets (3)

 

 

9.17

%

 

9.38

%

 

9.60

%

 

10.31

%

 

10.97

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Other intangible assets are core deposit intangibles.

(2) This non-GAAP ratio is total stockholders' equity less goodwill and intangible assets divided by common stock outstanding.

(3) This non-GAAP ratio is total stockholders' equity less goodwill and intangible assets to total assets less goodwill and intangible assets.

 

HarborOne Bancorp, Inc.

Segments Key Financial Data

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

 

Statements of Net Income for HarborOne Bank Segment:

 

2023

 

2023

 

2023

 

2022

 

2022

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

31,468

 

$

32,490

 

$

34,562

 

$

39,258

 

$

39,373

 

 

Provision (benefit) for credit losses

 

 

(113)

 

 

3,283

 

 

1,866

 

 

2,108

 

 

668

 

 

Net interest and dividend income, after provision for credit losses

 

 

31,581

 

 

29,207

 

 

32,696

 

 

37,150

 

 

38,705

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Intersegment loss

 

 

(198)

 

 

(358)

 

 

(348)

 

 

(997)

 

 

(904)

 

 

Changes in mortgage servicing rights fair value

 

 

18

 

 

29

 

 

(136)

 

 

(263)

 

 

164

 

 

Other

 

 

188

 

 

195

 

 

201

 

 

203

 

 

218

 

 

Total mortgage banking income (loss)

 

 

8

 

 

(134)

 

 

(283)

 

 

(1,057)

 

 

(522)

 

 

Other noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

5,132

 

 

5,013

 

 

4,733

 

 

5,031

 

 

4,870

 

 

Income on retirement plan annuities

 

 

146

 

 

128

 

 

119

 

 

118

 

 

119

 

 

Bank-owned life insurance income

 

 

531

 

 

511

 

 

500

 

 

501

 

 

503

 

 

Other income

 

 

694

 

 

962

 

 

590

 

 

2,129

 

 

688

 

 

Total noninterest income

 

 

6,511

 

 

6,480

 

 

5,659

 

 

6,722

 

 

5,658

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

15,238

 

 

15,067

 

 

14,764

 

 

16,531

 

 

16,455

 

 

Occupancy and equipment

 

 

3,828

 

 

3,910

 

 

4,295

 

 

4,236

 

 

4,096

 

 

Data processing

 

 

2,527

 

 

2,355

 

 

2,305

 

 

2,285

 

 

2,219

 

 

Loan expense

 

 

128

 

 

96

 

 

87

 

 

55

 

 

68

 

 

Marketing

 

 

709

 

 

787

 

 

1,063

 

 

747

 

 

728

 

 

Professional fees

 

 

914

 

 

699

 

 

996

 

 

1,027

 

 

1,258

 

 

Deposit insurance

 

 

1,004

 

 

1,176

 

 

510

 

 

385

 

 

357

 

 

Other expenses

 

 

1,924

 

 

2,103

 

 

2,170

 

 

3,478

 

 

2,526

 

 

Total noninterest expenses

 

 

26,272

 

 

26,193

 

 

26,190

 

 

28,744

 

 

27,707

 

 

Less: Amortization of other intangible assets

 

 

190

 

 

189

 

 

189

 

 

189

 

 

234

 

 

Total adjusted noninterest expense

 

 

26,082

 

 

26,004

 

 

26,001

 

 

28,555

 

 

27,473

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

11,820

 

 

9,494

 

 

12,165

 

 

15,128

 

 

16,656

 

 

Provision for income taxes

 

 

2,716

 

 

2,193

 

 

3,115

 

 

2,817

 

 

4,166

 

 

Net income

 

$

9,104

 

$

7,301

 

$

9,050

 

$

12,311

 

$

12,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (1) - QTD

 

 

68.67

%

 

66.73

%

 

64.65

%

 

62.10

%

 

61.01

%

 

Efficiency ratio (1) - YTD

 

 

66.64

%

 

65.67

%

 

64.65

%

 

64.25

%

 

65.07

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) This non-GAAP measure represents adjusted noninterest expense divided by total revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HarborOne Bancorp, Inc.

Segments Key Financial Data

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

 

Statements of Net Income for HarborOne Mortgage Segment:

 

2023

 

2023

 

2023

 

2022

 

2022

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

199

 

$

120

 

$

327

 

$

419

 

$

437

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

2,704

 

 

3,300

 

 

2,224

 

 

2,301

 

 

3,809

 

 

Intersegment gain

 

 

249

 

 

90

 

 

454

 

 

553

 

 

698

 

 

Changes in mortgage servicing rights fair value

 

 

107

 

 

407

 

 

(1,556)

 

 

(2,368)

 

 

1,652

 

 

Other

 

 

2,082

 

 

2,117

 

 

2,015

 

 

2,122

 

 

2,235

 

 

Total mortgage banking income

 

 

5,142

 

 

5,914

 

 

3,137

 

 

2,608

 

 

8,394

 

 

Other noninterest income (loss)

 

 

(4)

 

 

 

 

 

 

126

 

 

(13)

 

 

Total noninterest income

 

 

5,138

 

 

5,914

 

 

3,137

 

 

2,734

 

 

8,381

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

4,014

 

 

3,700

 

 

3,575

 

 

3,825

 

 

4,788

 

 

Occupancy and equipment

 

 

567

 

 

688

 

 

701

 

 

663

 

 

691

 

 

Data processing

 

 

21

 

 

48

 

 

41

 

 

74

 

 

92

 

 

Loan expense

 

 

258

 

 

321

 

 

226

 

 

114

 

 

287

 

 

Marketing

 

 

85

 

 

138

 

 

118

 

 

115

 

 

122

 

 

Professional fees

 

 

155

 

 

180

 

 

257

 

 

115

 

 

108

 

 

Other expenses

 

 

390

 

 

418

 

 

404

 

 

546

 

 

522

 

 

Total noninterest expenses

 

 

5,490

 

 

5,493

 

 

5,322

 

 

5,452

 

 

6,610

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

(153)

 

 

541

 

 

(1,858)

 

 

(2,299)

 

 

2,208

 

 

Income tax provision (benefit)

 

 

(15)

 

 

232

 

 

(565)

 

 

 

 

687

 

 

Net income

 

$

(138)

 

$

309

 

$

(1,293)

 

$

(2,299)

 

$

1,521

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (1) - QTD

 

 

102.87

%

 

91.03

%

 

153.64

%

 

172.91

%

 

74.96

%

 

Efficiency ratio (1) - YTD

 

 

109.91

%

 

113.87

%

 

153.64

%

 

77.92

%

 

68.42

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) This non-GAAP measure represents noninterest expense divided by total revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Category: Earnings Release

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