HarborOne Bancorp, Inc. Announces 2021 Third Quarter Earnings | Financial Buzz

HarborOne Bancorp, Inc. Announces 2021 Third Quarter Earnings

HarborOne Bancorp, Inc. (the “Company” or “HarborOne”) (NASDAQ:HONE), the holding company for HarborOne Bank (the “Bank”), announced net income of $12.3 million, or $0.24 per diluted share, for the third quarter of 2021, compared to $14.3 million, or $0.27 per diluted share, for the preceding quarter and $11.9 million, or $0.22 per diluted share, for the same period last year. For the nine months ended September 30, 2021, net income was $45.9 million, or $0.88 per diluted share, compared to $27.2 million, or $0.50 per diluted share, for the same period last year.

Selected Third Quarter Financial Highlights:

  • Commercial loan growth of $52.8 million, or 2.6%, excluding U.S. Small Business Administration Paycheck Protection Program (“PPP”) loans.
  • Recorded a reversal of provision of $1.6 million, reflecting continued positive pandemic and economic trends.
  • Second share repurchase program completed at an average cost of $14.09 per share, third share repurchase program approved.
  • Cost of funds continue to decline, decreasing 4 basis points.

“We continue to make steady progress against our plan despite market challenges including an ultra-competitive rate environment, tight labor market, and the ongoing impact of COVID-19. I’m incredibly proud of our team for continuing to deliver in these tough times,” said Jim Blake, CEO. “We’re very excited with our recently announced expansion into Brighton, Brookline, and Cambridge as we continue to make investments in building out our greater Boston footprint. We look forward to the opportunities this expansion will provide for our customers and the business,” added Joe Casey, President and COO.

Net Interest Income

The Company’s net interest and dividend income was $32.8 million for the quarter ended September 30, 2021, up $273,000, or 0.8%, from $32.5 million for the quarter ended June 30, 2021 and up $1.6 million, or 5.2%, from $31.2 million for the quarter ended September 30, 2020. The tax equivalent interest rate spread and net interest margin were 2.97% and 3.08%, respectively, for the quarter ended September 30, 2021, compared to 2.93% and 3.06%, respectively, for the quarter ended June 30, 2021, and 2.87% and 3.09%, respectively, for the quarter ended September 30, 2020. Net interest margin and the tax equivalent interest rate spread continue to be impacted by low interest rates, elevated loan prepayments, and the recognition of deferred fees on PPP loan forgiveness. The continued favorable repricing of deposits was partially offset by the decrease in the yield on interest-earning assets. Additionally, effective September 30, 2021, $20.0 million in Federal Home Loan Bank of Boston (“FHLB”) borrowings with an average cost of 3.5% were prepaid, with a penalty of $1.1 million included in noninterest expense. Although interest rates may begin to rise moving into 2022, the positive impact of the recognition of deferred loan fees on PPP loan forgiveness will diminish, resulting in continued margin pressure.

The quarter-over-quarter increase in net interest and dividend income included a decrease of $79,000, or 0.2%, in total interest and dividend income and a decrease of $352,000, or 10.5%, in total interest expense. The decrease in total interest and dividend income primarily reflected a $31.0 million decrease in average interest-earning assets and a 2-basis point decrease in the yield on average interest-earning assets. The yield on loans was 3.91% for the quarter ended September 30, 2021, down from 4.00% for the quarter ended June 30, 2021, as new loan originations have lower interest rates. The yield on loans continues to be impacted by the recognition of deferred fees due to PPP loan forgiveness, accretion income and prepayment penalties, although the recent uptick in rates is expected to lessen the impact from these yield adjustments in the future. The three months ended September 30, 2021 and June 30, 2021 include the recognition of deferred fees on PPP loans in the amount of $1.9 million and $1.3 million, respectively. Most of the remaining $2.1 million in deferred PPP loan fees are expected to be recognized in the fourth quarter of 2021 as the loans are forgiven. Interest on loans in the third quarter included $675,000 in accretion income from the fair value discount on loans acquired in connection with the merger with Coastway Bancorp, Inc. and $436,000 in prepayment penalties on commercial loans. Accretion income and prepayment penalties in the preceding quarter were $1.0 million and $244,000, respectively.

The quarter-over-quarter decrease in total interest expense primarily reflected a decrease in interest rates, resulting in a 4-basis point decrease in the cost of interest-bearing deposits. The mix of deposits continues to shift as customers move to more liquid options. The average balance of certificate of deposit accounts decreased quarter over quarter by $19.4 million, while the average balance of non-certificate accounts increased $49.0 million from the preceding quarter. Average FHLB advances decreased $12.4 million, and the cost of those funds decreased 17 basis points, resulting in a decrease of $100,000 in interest expense on FHLB borrowings.

The increase in net interest and dividend income from the prior year quarter reflected a decrease of $2.9 million, or 48.9%, in total interest expense, partially offset by a $1.2 million, or 3.3%, decrease in total interest and dividend income. The decreases reflect rate and volume changes in both interest-bearing assets and liabilities. The cost of interest-bearing liabilities decreased 41 basis points while the average balance increased $110.2 million. The yield on interest-earning assets decreased 31 basis points while the average balance increased $212.6 million.

Noninterest Income

Total noninterest income increased $307,000, or 1.4%, to $22.0 million for the quarter ended September 30, 2021, from $21.7 million for the quarter ended June 30, 2021. Mortgage loan demand remained strong; although refinancing activity continued to slow, purchase originations increased. Mortgage loan closings of $604.9 million resulted in a gain on loan sales of $12.8 million for the quarter ended September 30, 2021, as compared to $638.8 million in mortgage closings and $14.3 million in gain on sales for the preceding quarter. The locked residential mortgage pipeline decreased $125.9 million and negatively impacted the fair value of the derivative mortgage commitments recorded through the gain on loan sales. The change in the fair value of derivatives included in mortgage banking income was a negative $833,000 for the three months ended September 30, 2021 as compared to a negative $5.3 million for the three months ended June 30, 2021.

The net impact to mortgage servicing rights values was a decrease of $992,000 and $2.6 million for the three months ended September 30, 2021 and June 30, 2021, respectively. The change in the fair value of mortgage servicing rights positively impacted mortgage banking income; however, it was offset by the impact of residential mortgage loan payoffs. The fair value of the mortgage servicing rights increased $621,000 for the three months ended September 30, 2021, as compared to a $1.1 million decrease for the three months ended June 30, 2021. The 10-year Treasury Constant Maturity rate increased 7 basis points in the third quarter of 2021 and decreased 29 basis points in the second quarter of 2021. The change in the fair value of the mortgage servicing rights is generally consistent with the change in the 10-year Treasury Constant Maturity rate. As interest rates rise and prepayment speeds slow, mortgage servicing rights values tend to increase; conversely, as interest rates fall and prepayment speeds quicken mortgage servicing rights values tend to decrease. The negative impact on mortgage servicing rights when rates fall in the future may be muted, as mortgage servicing rights originated during the second half of 2020 were at historically low rates. Residential mortgage loan payoffs resulted in a decrease of mortgage servicing rights values in the amount of $1.6 million and $1.5 million for the three months ended September 30, 2021 and June 30, 2021, respectively.

Deposit account fees increased $112,000, or 2.5%, to $4.7 million for the quarter ended September 30, 2021, from $4.5 million for the quarter ended June 30, 2021.

Total noninterest income decreased $22.4 million, or 50.5%, as compared to the quarter ended September 30, 2020, primarily due to a $22.5 million, or 59.0%, decrease in mortgage banking income, driven by the decrease in loan closings and narrowing gain-on-sale margins in 2021. The decrease in mortgage banking income was offset by a $1.2 million increase in deposit account fees as deposit fees were reinstated in 2021.

Noninterest Expense

Total noninterest expenses were $39.3 million for the quarter ended September 30, 2021, an increase of $676,000, or 1.8%, from the quarter ended June 30, 2021, primarily driven by the $1.1 million prepayment penalty on Federal Home Loan Bank borrowings, partially offset by a $386,000 decrease in compensation and benefits and a $73,000 decrease in loan expense. Both decreases reflect the decrease in residential mortgage loan closings at HarborOne Mortgage, LLC (“HarborOne Mortgage”). During the third quarter, HarborOne Mortgage closed its New Jersey office, as management continues to respond to declining mortgage origination volume with strategic expense reduction.

Total noninterest expenses decreased $6.4 million, or 14.1%, from the quarter ended September 30, 2020. Compensation and benefits decreased $5.1 million and loan expenses decreased $1.8 million, consistent with the decrease in residential mortgage loan closings.

Income Tax Provision

The effective tax rate was 28.6% for the quarter ended September 30, 2021, compared to 28.3% for the quarter ended June 30, 2021 and 27.7% for the quarter ended September 30, 2020.

Provision for Loan Losses and Asset Quality

The Company recorded a reversal of provision for loan losses of $1.6 million for the quarter ended September 30, 2021, compared to a reversal of provision of $4.3 million for the quarter ended June 30, 2021 and a provision for loan losses of $13.5 million for the quarter ended September 30, 2020. The allowance for loan losses was $48.0 million, or 1.39% of total loans at September 30, 2021, compared to $51.3 million, or 1.50% of total loans at June 30, 2021 and $49.2 million, or 1.40% of total loans at September 30, 2020. Changes in the provision for loan losses are based on management’s assessment of loan portfolio growth and composition changes, historical charge-off trends, and ongoing evaluation of credit quality and current economic conditions.

The provision for loan losses for the quarter ended September 30, 2021 included adjustments for our quarterly analysis of our historical and peer loss experience rates, commercial and residential loan growth, and a $5.0 million specific reserve on one commercial real estate credit. These items, combined with adjustments for positive economic and pandemic trends of $4.8 million, resulted in a $1.6 million negative provision. The provision for loan losses for the quarter ended June 30, 2021 included adjustments based on our quarterly analysis of our historical and peer loss experience rates, commercial real estate loan growth, an increase of general reserve allocation on jumbo residential mortgage loans and a $1.5 million specific reserve on one commercial credit. Positive economic and pandemic trends also resulted in a $6.4 million negative provision for COVID-19. The provision for loan losses for the quarter ended September 30, 2020 included adjustments for our quarterly analysis of our historical and peer loss experience rates, commercial real estate loan growth, and a $10.7 million provision directly related to the estimate of inherent losses resulting from the impact of the COVID-19 pandemic.

In estimating the provision for the COVID-19 pandemic, management considered economic factors, including unemployment rates and the interest rate environment, the volume and dollar amount of requests for payment deferrals, and the loan risk profile of each loan type. Positive economic trends, vaccination rates, and COVID-19 cases, low delinquency levels, and status of deferred loans resulted in management reducing the provision related to the COVID-19 pandemic in the third quarter of 2021 with a reversal of provision of $4.8 million. Similar trends resulted in management reducing provisions related to the COVID-19 pandemic in the second quarter of 2021 with a reversal of provision of $6.4 million.

Management continues to evaluate our loan portfolio, particularly the commercial loan portfolio, in light of current economic conditions, the mitigating effects of government stimulus, and loan modification efforts designed to limit the long-term impacts of the COVID-19 pandemic. Our commercial loan portfolio is diversified across many sectors and is largely secured by commercial real estate loans, which make up 73.5% of the total commercial loan portfolio. Management initially identified six sectors as the most susceptible to increased credit risk as a result of the COVID-19 pandemic: retail, office space, hotels, health and social services, restaurants, and recreation. In the second quarter of 2021, as part of ongoing monitoring of the at-risk sectors, management determined that the health and social services sector no longer presents an additional risk from the impact of the COVID-19 pandemic as borrowers in this sector have returned to pre-pandemic revenue and profitability levels. Health and social services operations supported by first-round PPP loans have a 100% forgiveness rate. Further, over the last eight quarters, the sector has experienced a positive migration in obligor risk ratings and no watch or substandard credits, and delinquency in the sector is currently zero. The total loan portfolio of the remaining five commercial sectors identified as at risk totaled $751.0 million at September 30, 2021, which represents 35.1% of the commercial loan portfolio. The five currently identified at-risk sectors include $630.4 million in commercial real estate loans, $75.8 million in commercial and industrial loans, and $44.8 million in commercial construction loans. Non-performing loans included in the at-risk sectors amounted to $18.3 million at September 30, 2021, of which $9.1 million was included in the hotels sector and $8.8 million was included in the office sector.

As of September 30, 2021, the retail sector was $266.8 million, or 12.5% of total commercial loans, and included $219.3 million in commercial real estate loans, $28.9 million in commercial and industrial loans, and $18.6 million in commercial construction loans. There are no active deferrals for loans in this sector or PPP loans. We originated $6.0 million loans during the third quarter that are within the retail sector.

As of September 30, 2021, the office space sector was $214.2 million, or 10.0% of total commercial loans, and included $199.3 million in commercial real estate loans, $14.0 million in commercial and industrial loans, and $854,000 in commercial construction loans. There are no active deferrals for loans and one expired deferral, in the amount of $515,000 is delinquent and on nonaccrual. No PPP loans were originated in this sector. We originated $1.4 million loans during the third quarter that are within the office space sector and there were $4.5 million in advances on existing loans. The Bank is the lead bank in a commercial real estate credit secured by office space that was downgraded and placed on nonaccrual during the third quarter of 2021. The Bank’s portion of this credit has a recorded net book value of $8.8 million, and a specific reserve of $5.0 million was recorded.

As of September 30, 2021, the hotel sector was $193.7 million, or 9.1% of total commercial loans, and included $182.6 million in commercial real estate loans, $2.0 million in commercial and industrial loans, and $9.0 million in commercial construction loans. PPP loans included in the sector totaled $31,000. Active deferrals for loans in this sector had outstanding principal balances of $7.7 million, and one loan with an outstanding principal balance of $242,000 had an expired deferral period and is greater than 30 days delinquent. At September 30, 2021, nonperforming loans included in the hotel sector amount to $9.1 million. The non-accrual loan amounted to $9.1 million with a deferral period that expired in the third quarter of 2021, however it was determined in the fourth quarter of 2020 that weaknesses in the borrower’s credit warranted a downgrade to substandard and nonaccrual status. A specific reserve of $1.8 million has been allocated to this loan. The Bank is receiving payments of interest only on its pro rata share of the loan in accordance with a forbearance agreement, in part through a non-revolving line of credit provided solely by the lead bank. The Bank sold a nonperforming loan that was included in the hotel sector in the third quarter of 2021. The loan had a $3.3 million net book value at the time of sale and total a charge-offs on the credit amounted to $1.3 million, $157,000 of which was taken in the third quarter of 2021.

As of September 30, 2021, the restaurant sector amounted to $57.9 million, or 2.7% of total commercial loans, including $313,000 in PPP loans. There were no active deferrals in this sector and expired deferrals are paying as expected. The recreation sector amounted to $18.5 million, or 0.9% of total commercial loans, including $3,000 in PPP loans. There are no active deferrals for loans in this sector and expired deferrals are paying as expected.

We provided access to the PPP to both our existing customers and new customers, to ensure small businesses in the communities we serve have access to this important lifeline for their businesses. No PPP loans were originated in the third quarter and forgiveness was processed on $50.9 million loans. We have processed forgiveness on approximately 98% of PPP loans executed in 2020, with a success rate above 99%, and we have processed forgiveness on approximately 50% of the PPP loans executed in 2021. As of September 30, 2021, outstanding PPP loans amounted to $54.3 million and there was $2.1 million in deferred processing fee income. We expect to complete the forgiveness process on most of the remaining PPP loans by year end.

We are also working with commercial loan customers that may need payment deferrals or other accommodations to keep their loans out of default through the COVID-19 pandemic. As of September 30, 2021, we have two active payment deferrals on commercial loans with a total principal balance of $7.7 million, or 0.4% of total commercial loans, both of which are loans included in an at-risk sector. As of September 30, 2021, 96.8% of the commercial deferrals have expired and the borrower is making payments as agreed, 0.3% of the commercial deferrals have expired and the borrower is delinquent, and 2.9% are in active deferral period. The active commercial deferrals are scheduled to expire during 2021. We are no longer providing deferrals under the Coronavirus Aid Relief and Economic Security Act but continue to consider accommodations in the normal course of business.

The residential loan and consumer loan portfolios have not experienced significant credit quality deterioration as of September 30, 2021; however, the continuing impact and uncertain nature of the COVID-19 pandemic may result in increases in delinquencies, charge-offs and loan modifications in these portfolios through the remainder of 2021. As of September 30, 2021, we had one active payment deferrals on residential mortgage loans with a total principal balance of $177, 000. As of September 30, 2021, 97.8% of the deferrals have expired and are paying as agreed, 1.8% have expired and are delinquent and 0.5% are in active deferral periods. We have no active payment deferrals on consumer loans and 98.4% of the consumer loan deferrals have expired and are paying as agreed. Requests for additional extensions on residential mortgage loans and consumer loans were not significant as of September 30, 2021.

Net charges-offs totaled $1.7 million for the quarter ended September 30, 2021, or 0.19% of average loans outstanding on an annualized basis. During the third quarter, there was a $1.5 million charge-off on a single credit previously reserved for in the second quarter of 2021. Net recoveries totaled $175,000, or 0.02% of average loans outstanding on an annualized basis, for the quarter ended June 30, 2021 and net charge-offs totaled $338,000, or 0.04% of average loans outstanding on an annualized basis, for the quarter ended September 30, 2020.

Credit quality performance has remained strong with total nonperforming assets of $36.5 million at September 30, 2021, compared to $32.7 million at June 30, 2021 and $41.0 million at September 30, 2020. Nonperforming assets as a percentage of total assets were 0.80% at September 30, 2021, 0.71% at June 30, 2021, and 0.93% at September 30, 2020. During the third quarter of 2021, a nonperforming commercial real estate loan with a $3.3 million net book value was sold and a charge-off of $157,000 was recorded. As noted above, a commercial real estate credit secured by office space was downgraded and placed on nonaccrual. The Bank’s 56% portion has a recorded net book value of $8.8 million and a specific reserve of $5.0 million was recorded in the third quarter.

Balance Sheet

Total assets decreased $49.3 million, or 1.1%, to $4.57 billion at September 30, 2021 from $4.62 billion at June 30, 2021. The decrease primarily reflects a decrease of $97.3 million in short-term investments and a $26.8 million decrease in loans held for sale, partially offset by increases of $41.3 million in net loans and $36.7 million in securities available for sale. Short-term investments were used to pay down FHLB borrowings and purchase securities available for sale.

Net loans increased $41.3 million, or 1.2%, to $3.41 billion at September 30, 2021 from $3.37 billion at June 30, 2021. The net increase in loans for the three months ended September 30, 2021 was primarily due to increases in residential mortgage loans of $64.3 million commercial construction loans of $45.1 million and commercial real estate loans of $11.4 million, partially offset by decreases in commercial and industrial loans of $52.7 million and consumer loans of $30.2 million. The decrease in commercial and industrial loans is primarily due to forgiveness of PPP loans during the quarter. Excluding the change in PPP loans, total commercial loans increased $52.8 million, primarily due to an increase in commercial construction loans. The allowance for loan losses was $48.0 million at September 30, 2021 and $51.3 million at June 30, 2021, the change primarily reflecting a negative $1.6 million provision for loan losses and $1.7 million in net loan charge-offs recorded in the third quarter.

Total deposits was $3.69 billion at September 30, 2021 and June 30, 2021. Compared to the prior quarter, non-certificate accounts increased $28.8 million and term certificate accounts decreased $22.7 million. FHLB borrowings decreased $31.8 million, or 36.3%, to $55.7 million at September 30, 2021 from $87.5 million at June 30, 2021. During the third quarter FHLB borrowings of $20.0 million were prepaid resulting in a $1.1 million prepayment penalty.

As previously announced, the Bank has agreed to acquire the leases to four East Boston Savings Bank branches being divested as part of the acquisition of East Boston Savings Bank by Rockland Trust Company. The transaction is subject to a number of contingencies and is expected to close by the end of the year. The Bank also agreed to acquire the branches’ furniture, fixtures, and equipment, and expects to add approximately 19 new employees to staff the branches. The new branches are located in Brighton, Cambridge, and Brookline, Massachusetts. The average leased space is approximately 1300 square feet and the leases generally have initial terms of 10 years with one or more year option terms. The initial terms expire in 6-10 years. The Bank also transferred a former branch property into assets held for sale at a carrying value of $881,000.

Total stockholders’ equity was $680.0 million at September 30, 2021, compared to $705.5 million at June 30, 2021 and $694.1 million at September 30, 2020. During the third quarter, the Company announced and completed a share repurchase program adopted April 16, 2021, repurchasing 2,790,903 shares of the Company’s common stock at an average cost of $14.09 per share. The Company adopted a third share repurchase program on September 17, 2021 to repurchase up to 2,668,159 shares of the Company’s common stock, or approximately 5% of the Company’s outstanding shares. The Company has not repurchased any shares under the third share repurchase program as of September 30, 2021. The tangible common equity to tangible assets ratio was 13.50% at September 30, 2021, 13.91% at June 30, 2021, and 14.23% at September 30, 2020. At September 30, 2021, the Company and the Bank had strong capital positions and exceeded all regulatory capital requirements.

About HarborOne Bancorp, Inc.

HarborOne Bancorp, Inc. is the holding company for HarborOne Bank, a Massachusetts-chartered savings bank. HarborOne Bank serves the financial needs of consumers, businesses, and municipalities throughout Eastern Massachusetts and Rhode Island through a network of 27 full-service branches located in Massachusetts and Rhode Island, and a commercial lending office in each of Boston, Massachusetts and Providence, Rhode Island. The Bank also provides a range of educational services through “HarborOne U,” with classes on small business, financial literacy and personal enrichment at two campuses located adjacent to our Brockton and Mansfield locations. HarborOne Mortgage, LLC, a subsidiary of HarborOne Bank, is a full-service mortgage lender with more than 30 offices in Massachusetts, Rhode Island, New Hampshire, and Maine, and is licensed to lend in six additional states.

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, the negative impacts and disruptions of the COVID-19 pandemic and the measures taken to contain its spread on our employees, customers, business operations, credit quality, financial position, liquidity and results of operations; changes in general business and economic conditions 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; 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; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, and future pandemics; changes in regulation; reputational risk relating to the Company’s participation in the Paycheck Protection Program and other pandemic-related legislative and regulatory initiatives and programs; 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 tax equivalent basis for yields, 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)

 

2021

 

2021

 

2021

 

2020

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

42,589

 

 

$

41,328

 

 

$

37,074

 

 

$

31,777

 

 

$

29,180

 

Short-term investments

 

 

277,050

 

 

 

374,319

 

 

 

281,451

 

 

 

174,093

 

 

 

108,338

 

Total cash and cash equivalents

 

 

319,639

 

 

 

415,647

 

 

 

318,525

 

 

 

205,870

 

 

 

137,518

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale, at fair value

 

 

390,552

 

 

 

353,848

 

 

 

304,168

 

 

 

276,498

 

 

 

280,308

 

Federal Home Loan Bank stock, at cost

 

 

6,828

 

 

 

7,241

 

 

 

7,572

 

 

 

8,738

 

 

 

11,631

 

Asset held for sale

 

 

881

 

 

 

 

 

 

 

 

 

 

 

 

 

Loans held for sale, at fair value

 

 

77,052

 

 

 

103,886

 

 

 

210,494

 

 

 

208,612

 

 

 

190,373

 

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

 

1,573,284

 

 

 

1,561,873

 

 

 

1,559,056

 

 

 

1,551,265

 

 

 

1,380,071

 

Commercial construction

 

 

152,685

 

 

 

107,585

 

 

 

112,187

 

 

 

99,331

 

 

 

211,953

 

Commercial and industrial

 

 

414,814

 

 

 

467,479

 

 

 

499,728

 

 

 

464,393

 

 

 

480,129

 

Total commercial loans

 

 

2,140,783

 

 

 

2,136,937

 

 

 

2,170,971

 

 

 

2,114,989

 

 

 

2,072,153

 

Residential real estate

 

 

1,160,689

 

 

 

1,096,370

 

 

 

1,062,229

 

 

 

1,105,823

 

 

 

1,130,935

 

Consumer

 

 

156,272

 

 

 

186,430

 

 

 

228,279

 

 

 

273,830

 

 

 

312,743

 

Loans

 

 

3,457,744

 

 

 

3,419,737

 

 

 

3,461,479

 

 

 

3,494,642

 

 

 

3,515,831

 

Less: Allowance for loan losses

 

 

(47,988

)

 

 

(51,273

)

 

 

(55,384

)

 

 

(55,395

)

 

 

(49,223

)

Net loans

 

 

3,409,756

 

 

 

3,368,464

 

 

 

3,406,095

 

 

 

3,439,247

 

 

 

3,466,608

 

Mortgage servicing rights, at fair value

 

 

36,540

 

 

 

35,955

 

 

 

33,939

 

 

 

24,833

 

 

 

20,159

 

Goodwill

 

 

69,802

 

 

 

69,802

 

 

 

69,802

 

 

 

69,802

 

 

 

69,802

 

Other intangible assets

 

 

3,399

 

 

 

3,723

 

 

 

4,047

 

 

 

4,370

 

 

 

4,694

 

Other assets

 

 

252,645

 

 

 

257,856

 

 

 

251,316

 

 

 

245,645

 

 

 

247,226

 

Total assets

 

$

4,567,094

 

 

$

4,616,422

 

 

$

4,605,958

 

 

$

4,483,615

 

 

$

4,428,319

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposit accounts

 

$

756,917

 

 

$

800,118

 

 

$

777,959

 

 

$

689,672

 

 

$

650,336

 

NOW accounts

 

 

300,577

 

 

 

250,099

 

 

 

224,869

 

 

 

218,584

 

 

 

202,020

 

Regular savings and club accounts

 

 

1,144,595

 

 

 

1,123,123

 

 

 

1,113,450

 

 

 

998,994

 

 

 

912,017

 

Money market deposit accounts

 

 

832,441

 

 

 

832,006

 

 

 

861,867

 

 

 

866,661

 

 

 

815,644

 

Term certificate accounts

 

 

659,850

 

 

 

682,594

 

 

 

696,438

 

 

 

732,298

 

 

 

785,871

 

Total deposits

 

 

3,694,380

 

 

 

3,687,940

 

 

 

3,674,583

 

 

 

3,506,209

 

 

 

3,365,888

 

Short-term borrowed funds

 

 

 

 

 

 

 

 

 

 

 

35,000

 

 

 

95,000

 

Long-term borrowed funds

 

 

55,720

 

 

 

87,479

 

 

 

97,488

 

 

 

114,097

 

 

 

141,106

 

Subordinated debt

 

 

34,128

 

 

 

34,096

 

 

 

34,064

 

 

 

34,033

 

 

 

34,002

 

Other liabilities and accrued expenses

 

 

102,834

 

 

 

101,436

 

 

 

101,750

 

 

 

97,962

 

 

 

98,220

 

Total liabilities

 

 

3,887,062

 

 

 

3,910,951

 

 

 

3,907,885

 

 

 

3,787,301

 

 

 

3,734,216

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

585

 

 

 

585

 

 

 

585

 

 

 

584

 

 

 

584

 

Additional paid-in capital

 

 

468,526

 

 

 

467,194

 

 

 

465,832

 

 

 

464,176

 

 

 

463,531

 

Unearned compensation – ESOP

 

 

(29,921

)

 

 

(30,380

)

 

 

(30,840

)

 

 

(31,299

)

 

 

(31,759

)

Retained earnings

 

 

315,683

 

 

 

305,831

 

 

 

294,116

 

 

 

277,312

 

 

 

261,304

 

Treasury stock

 

 

(73,723

)

 

 

(38,588

)

 

 

(31,460

)

 

 

(16,644

)

 

 

(1,333

)

Accumulated other comprehensive income (loss)

 

 

(1,118

)

 

 

829

 

 

 

(160

)

 

 

2,185

 

 

 

1,776

 

Total stockholders’ equity

 

 

680,032

 

 

 

705,471

 

 

 

698,073

 

 

 

696,314

 

 

 

694,103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

4,567,094

 

 

$

4,616,422

 

 

$

4,605,958

 

 

$

4,483,615

 

 

$

4,428,319

 

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)

 

2021

 

2021

 

2021

 

2020

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

33,680

 

 

$

34,106

 

 

$

33,860

 

$

35,274

 

 

$

34,496

 

Interest on loans held for sale

 

 

665

 

 

 

852

 

 

 

1,324

 

 

1,267

 

 

 

1,060

 

Interest on securities

 

 

1,293

 

 

 

793

 

 

 

585

 

 

1,064

 

 

 

1,317

 

Other interest and dividend income

 

 

170

 

 

 

136

 

 

 

78

 

 

115

 

 

 

175

 

Total interest and dividend income

 

 

35,808

 

 

 

35,887

 

 

 

35,847

 

 

37,720

 

 

 

37,048

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

2,050

 

 

 

2,302

 

 

 

2,720

 

 

3,775

 

 

 

4,520

 

Interest on FHLB borrowings

 

 

431

 

 

 

531

 

 

 

552

 

 

671

 

 

 

835

 

Interest on subordinated debentures

 

 

524

 

 

 

524

 

 

 

523

 

 

524

 

 

 

524

 

Total interest expense

 

 

3,005

 

 

 

3,357

 

 

 

3,795

 

 

4,970

 

 

 

5,879

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

32,803

 

 

 

32,530

 

 

 

32,052

 

 

32,750

 

 

 

31,169

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision (credit) for loan losses

 

 

(1,627

)

 

 

(4,286

)

 

 

91

 

 

7,608

 

 

 

13,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for loan losses

 

 

34,430

 

 

 

36,816

 

 

 

31,961

 

 

25,142

 

 

 

17,715

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

12,756

 

 

 

14,262

 

 

 

24,802

 

 

28,274

 

 

 

34,055

 

Changes in mortgage servicing rights fair value

 

 

(992

)

 

 

(2,552

)

 

 

3,409

 

 

(1,041

)

 

 

(193

)

Other

 

 

3,882

 

 

 

4,075

 

 

 

4,515

 

 

4,522

 

 

 

4,259

 

Total mortgage banking income

 

 

15,646

 

 

 

15,785

 

 

 

32,726

 

 

31,755

 

 

 

38,121

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

4,658

 

 

 

4,546

 

 

 

3,852

 

 

3,667

 

 

 

3,451

 

Income on retirement plan annuities

 

 

108

 

 

 

106

 

 

 

104

 

 

106

 

 

 

104

 

Gain on sale and call of securities, net

 

 

241

 

 

 

 

 

 

 

 

 

 

 

 

Bank-owned life insurance income

 

 

515

 

 

 

508

 

 

 

493

 

 

550

 

 

 

560

 

Other income

 

 

842

 

 

 

758

 

 

 

634

 

 

949

 

 

 

2,203

 

Total noninterest income

 

 

22,010

 

 

 

21,703

 

 

 

37,809

 

 

37,027

 

 

 

44,439

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

24,760

 

 

 

25,146

 

 

 

27,454

 

 

27,122

 

 

 

29,839

 

Occupancy and equipment

 

 

4,765

 

 

 

4,702

 

 

 

5,256

 

 

4,545

 

 

 

4,581

 

Data processing

 

 

2,205

 

 

 

2,362

 

 

 

2,343

 

 

2,235

 

 

 

2,119

 

Loan expense

 

 

1,323

 

 

 

1,250

 

 

 

2,435

 

 

2,689

 

 

 

3,167

 

Marketing

 

 

880

 

 

 

831

 

 

 

813

 

 

640

 

 

 

817

 

Professional fees

 

 

1,362

 

 

 

1,487

 

 

 

1,583

 

 

1,252

 

 

 

1,458

 

Deposit insurance

 

 

341

 

 

 

332

 

 

 

320

 

 

320

 

 

 

310

 

Prepayment penalties on Federal Home Loan Bank advances

 

 

1,095

 

 

 

 

 

 

 

 

 

 

 

 

Other expenses

 

 

2,543

 

 

 

2,488

 

 

 

2,598

 

 

2,483

 

 

 

3,409

 

Total noninterest expenses

 

 

39,274

 

 

 

38,598

 

 

 

42,802

 

 

41,286

 

 

 

45,700

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

17,166

 

 

 

19,921

 

 

 

26,968

 

 

20,883

 

 

 

16,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

4,907

 

 

 

5,645

 

 

 

7,576

 

 

3,283

 

 

 

4,561

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

12,259

 

 

$

14,276

 

 

$

19,392

 

$

17,600

 

 

$

11,893

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.25

 

 

$

0.28

 

 

$

0.37

 

$

0.33

 

 

$

0.22

 

Diluted

 

$

0.24

 

 

$

0.27

 

 

$

0.37

 

$

0.33

 

 

$

0.22

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

49,801,123

 

 

 

51,778,293

 

 

 

52,537,409

 

 

53,947,868

 

 

 

54,465,339

 

Diluted

 

 

50,663,415

 

 

 

52,650,071

 

 

 

53,000,830

 

 

53,973,737

 

 

 

54,465,339

 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income

(Unaudited)

 

 

 

For the Nine Months Ended September 30,

 

 

 

 

(dollars in thousands, except share data)

 

2021

 

2020

 

$ Change

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

101,646

 

 

$

102,491

 

 

$

(845

)

 

(0.8

)%

Interest on loans held for sale

 

 

2,841

 

 

 

2,625

 

 

 

216

 

 

8.2

 

Interest on securities

 

 

2,671

 

 

 

4,549

 

 

 

(1,878

)

 

(41.3

)

Other interest and dividend income

 

 

384

 

 

 

1,173

 

 

 

(789

)

 

(67.3

)

Total interest and dividend income

 

 

107,542

 

 

 

110,838

 

 

 

(3,296

)

 

(3.0

)

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

7,072

 

 

 

19,018

 

 

 

(11,946

)

 

(62.8

)

Interest on FHLB borrowings

 

 

1,514

 

 

 

2,933

 

 

 

(1,419

)

 

(48.4

)

Interest on subordinated debentures

 

 

1,571

 

 

 

1,571

 

 

 

 

 

0.0

 

Total interest expense

 

 

10,157

 

 

 

23,522

 

 

 

(13,365

)

 

(56.8

)

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

97,385

 

 

 

87,316

 

 

 

10,069

 

 

11.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision (credit) for loan losses

 

 

(5,822

)

 

 

27,207

 

 

 

(33,029

)

 

(121.4

)

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for loan losses

 

 

103,207

 

 

 

60,109

 

 

 

43,098

 

 

71.7

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

51,820

 

 

 

77,195

 

 

 

(25,375

)

 

(32.9

)

Changes in mortgage servicing rights fair value

 

 

(135

)

 

 

(5,691

)

 

 

5,556

 

 

97.6

 

Other

 

 

12,472

 

 

 

10,962

 

 

 

1,510

 

 

13.8

 

Total mortgage banking income

 

 

64,157

 

 

 

82,466

 

 

 

(18,309

)

 

(22.2

)

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

13,056

 

 

 

10,351

 

 

 

2,705

 

 

26.1

 

Income on retirement plan annuities

 

 

318

 

 

 

308

 

 

 

10

 

 

3.2

 

Gain on sale and call of securities, net

 

 

241

 

 

 

2,533

 

 

 

(2,292

)

 

(90.5

)

Bank-owned life insurance income

 

 

1,516

 

 

 

1,665

 

 

 

(149

)

 

(8.9

)

Other income

 

 

2,234

 

 

 

4,642

 

 

 

(2,408

)

 

(51.9

)

Total noninterest income

 

 

81,522

 

 

 

101,965

 

 

 

(20,443

)

 

(20.0

)

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

77,360

 

 

 

78,493

 

 

 

(1,133

)

 

(1.4

)

Occupancy and equipment

 

 

14,723

 

 

 

13,296

 

 

 

1,427

 

 

10.7

 

Data processing

 

 

6,910

 

 

 

6,576

 

 

 

334

 

 

5.1

 

Loan expense

 

 

5,008

 

 

 

7,433

 

 

 

(2,425

)

 

(32.6

)

Marketing

 

 

2,524

 

 

 

2,750

 

 

 

(226

)

 

(8.2

)

Professional fees

 

 

4,432

 

 

 

4,204

 

 

 

228

 

 

5.4

 

Deposit insurance

 

 

993

 

 

 

860

 

 

 

133

 

 

15.5

 

Prepayment penalties on Federal Home Loan Bank advances

 

 

1,095

 

 

 

 

 

 

1,095

 

 

100.0

 

Other expenses

 

 

7,629

 

 

 

11,336

 

 

 

(3,707

)

 

(32.7

)

Total noninterest expenses

 

 

120,674

 

 

 

124,948

 

 

 

(4,274

)

 

(3.4

)

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

64,055

 

 

 

37,126

 

 

 

26,929

 

 

72.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

18,128

 

 

 

9,934

 

 

 

8,194

 

 

82.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

45,927

 

 

$

27,192

 

 

$

18,735

 

 

68.9

%

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.89

 

 

$

0.50

 

 

 

 

 

 

Diluted

 

$

0.88

 

 

$

0.50

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

51,362,252

 

 

 

54,436,090

 

 

 

 

 

 

Diluted

 

 

52,094,749

 

 

 

54,436,090

 

 

 

 

 

 

HarborOne Bancorp, Inc.

 

Average Balances / Yields

(Unaudited)

 

 

 

Quarters Ended

 

 

 

September 30, 2021

 

June 30, 2021

 

September 30, 2020

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

 

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost (6)

 

Balance

 

Interest

 

Cost (6)

 

Balance

 

Interest

 

Cost (6)

 

 

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

358,927

 

$

1,293

 

1.43

%

$

325,205

 

$

793

 

0.98

%

$

269,477

 

$

1,319

 

1.95

%

Other interest-earning assets

 

 

372,892

 

 

170

 

0.18

 

 

397,979

 

 

136

 

0.14

 

 

121,384

 

 

175

 

0.57

 

Loans held for sale

 

 

84,399

 

 

665

 

3.13

 

 

115,240

 

 

852

 

2.97

 

 

139,418

 

 

1,060

 

3.02

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)

 

 

2,121,432

 

 

22,394

 

4.19

 

 

2,152,105

 

 

22,079

 

4.11

 

 

2,017,492

 

 

19,066

 

3.76

 

Residential real estate loans (2)

 

 

1,121,898

 

 

9,352

 

3.31

 

 

1,064,481

 

 

9,747

 

3.67

 

 

1,135,947

 

 

11,833

 

4.14

 

Consumer loans (2)

 

 

170,366

 

 

1,934

 

4.50

 

 

205,856

 

 

2,280

 

4.44

 

 

333,623

 

 

3,597

 

4.29

 

Total loans

 

 

3,413,696

 

 

33,680

 

3.91

 

 

3,422,442

 

 

34,106

 

4.00

 

 

3,487,062

 

 

34,496

 

3.94

 

Total interest-earning assets

 

 

4,229,914

 

 

35,808

 

3.36

 

 

4,260,866

 

 

35,887

 

3.38

 

 

4,017,341

 

 

37,050

 

3.67

 

Noninterest-earning assets

 

 

347,060

 

 

 

 

 

 

 

339,438

 

 

 

 

 

 

 

333,444

 

 

 

 

 

 

Total assets

 

$

4,576,974

 

 

 

 

 

 

$

4,600,304

 

 

 

 

 

 

$

4,350,785

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,136,131

 

 

365

 

0.13

 

$

1,118,494

 

 

461

 

0.17

 

$

897,751

 

 

589

 

0.26

 

NOW accounts

 

 

283,725

 

 

45

 

0.06

 

 

231,075

 

 

41

 

0.07

 

 

199,982

 

 

39

 

0.08

 

Money market accounts

 

 

832,340

 

 

392

 

0.19

 

 

853,586

 

 

417

 

0.20

 

 

825,732

 

 

745

 

0.36

 

Certificates of deposit

 

 

570,570

 

 

1,087

 

0.76

 

 

589,964

 

 

1,229

 

0.84

 

 

684,002

 

 

2,895

 

1.68

 

Brokered deposits

 

 

100,000

 

 

161

 

0.64

 

 

100,000

 

 

154

 

0.62

 

 

139,887

 

 

252

 

0.72

 

Total interest-bearing deposits

 

 

2,922,766

 

 

2,050

 

0.28

 

 

2,893,119

 

 

2,302

 

0.32

 

 

2,747,354

 

 

4,520

 

0.65

 

FHLB advances

 

 

84,438

 

 

431

 

2.03

 

 

96,823

 

 

531

 

2.20

 

 

149,750

 

 

835

 

2.22

 

Subordinated debentures

 

 

34,111

 

 

524

 

6.09

 

 

34,080

 

 

524

 

6.17

 

 

33,983

 

 

524

 

6.13

 

Total borrowings

 

 

118,549

 

 

955

 

3.20

 

 

130,903

 

 

1,055

 

3.23

 

 

183,733

 

 

1,359

 

2.94

 

Total interest-bearing liabilities

 

 

3,041,315

 

 

3,005

 

0.39

 

 

3,024,022

 

 

3,357

 

0.45

 

 

2,931,087

 

 

5,879

 

0.80

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

756,927

 

 

 

 

 

 

 

784,521

 

 

 

 

 

 

 

641,353

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

90,366

 

 

 

 

 

 

 

88,577

 

 

 

 

 

 

 

89,319

 

 

 

 

 

 

Total liabilities

 

 

3,888,608

 

 

 

 

 

 

 

3,897,120

 

 

 

 

 

 

 

3,661,759

 

 

 

 

 

 

Total stockholders’ equity

 

 

688,366

 

 

 

 

 

 

 

703,184

 

 

 

 

 

 

 

689,026

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

4,576,974

 

 

 

 

 

 

$

4,600,304

 

 

 

 

 

 

$

4,350,785

 

 

 

 

 

 

Tax equivalent net interest income

 

 

 

 

 

32,803

 

 

 

 

 

 

 

32,530

 

 

 

 

 

 

 

31,171

 

 

 

Tax equivalent interest rate spread (3)

 

 

 

 

 

 

 

2.97

%

 

 

 

 

 

 

2.93

%

 

 

 

 

 

 

2.87

%

Less: tax equivalent adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

Net interest income as reported

 

 

 

 

$

32,803

 

 

 

 

 

 

$

32,530

 

 

 

 

 

 

$

31,169

 

 

 

Net interest-earning assets (4)

 

$

1,188,599

 

 

 

 

 

 

$

1,236,844

 

 

 

 

 

 

$

1,086,254

 

 

 

 

 

 

Net interest margin (5)

 

 

 

 

 

 

 

3.08

%

 

 

 

 

 

 

3.06

%

 

 

 

 

 

 

3.09

%

Tax equivalent effect

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin on a fully tax equivalent basis

 

 

 

 

 

 

 

3.08

%

 

 

 

 

 

 

3.06

%

 

 

 

 

 

 

3.09

%

Average interest-earning assets to average interest-bearing liabilities

 

 

139.08

%

 

 

 

 

 

 

140.90

%

 

 

 

 

 

 

137.06

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits, including demand deposits

 

$

3,679,693

 

$

2,050

 

 

 

$

3,677,640

 

$

2,302

 

 

 

$

3,388,707

 

$

4,520

 

 

 

Cost of total deposits

 

 

 

 

 

 

 

0.22

%

 

 

 

 

 

 

0.25

%

 

 

 

 

 

 

0.53

%

Total funding liabilities, including demand deposits

 

$

3,798,242

 

$

3,005

 

 

 

$

3,808,543

 

$

3,357

 

 

 

$

3,572,440

 

$

5,879

 

 

 

Cost of total funding liabilities

 

 

 

 

 

 

 

0.31

%

 

 

 

 

 

 

0.35

%

 

 

 

 

 

 

0.65

%

(1) Includes securities available for sale.  Interest income from tax exempt securities is computed on a taxable equivalent basis using a tax rate of 21% for the quarters presented.  The yield on investments before tax equivalent adjustments for the quarter ended September 30, 2020 was 1.95%.

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

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

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

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

(6) Annualized.

HarborOne Bancorp, Inc.

 

Average Balances / Yields

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended

 

 

 

September 30, 2021

 

September 30, 2020

 

 

 

Average

 

 

 

 

 

Average

 

 

 

 

 

 

 

Outstanding

 

 

 

Yield/

 

Outstanding

 

 

 

Yield/

 

 

 

Balance

 

Interest

 

Cost

 

Balance

 

Interest

 

Cost

 

 

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

318,817

 

$

2,671

 

1.12

%

$

261,740

 

$

4,571

 

2.33

%

Other interest-earning assets

 

 

317,837

 

 

384

 

0.16

 

 

176,745

 

 

1,173

 

0.89

 

Loans held for sale

 

 

130,622

 

 

2,841

 

2.91

 

 

106,790

 

 

2,625

 

3.28

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)

 

 

2,144,726

 

 

65,253

 

4.07

 

 

1,846,462

 

 

55,385

 

4.01

 

Residential real estate loans (2)

 

 

1,090,361

 

 

29,439

 

3.61

 

 

1,120,065

 

 

35,188

 

4.20

 

Consumer loans (2)

 

 

209,443

 

 

6,954

 

4.44

 

 

373,809

 

 

11,918

 

4.26

 

Total loans

 

 

3,444,530

 

 

101,646

 

3.95

 

 

3,340,336

 

 

102,491

 

4.10

 

Total interest-earning assets

 

 

4,211,806

 

 

107,542

 

3.41

 

 

3,885,611

 

 

110,860

 

3.81

 

Noninterest-earning assets

 

 

338,980

 

 

 

 

 

 

 

327,385

 

 

 

 

 

 

Total assets

 

$

4,550,786

 

 

 

 

 

 

$

4,212,996

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,104,765

 

 

1,363

 

0.16

 

$

809,106

 

 

2,721

 

0.45

 

NOW accounts

 

 

242,623

 

 

123

 

0.07

 

 

182,146

 

 

103

 

0.08

 

Money market accounts

 

 

849,041

 

 

1,369

 

0.22

 

 

829,263

 

 

4,535

 

0.73

 

Certificates of deposit

 

 

589,404

 

 

3,760

 

0.85

 

 

736,355

 

 

10,724

 

1.95

 

Brokered deposits

 

 

100,000

 

 

457

 

0.61

 

 

99,739

 

 

935

 

1.25

 

Total interest-bearing deposits

 

 

2,885,833

 

 

7,072

 

0.33

 

 

2,656,609

 

 

19,018

 

0.96

 

FHLB advances

 

 

94,482

 

 

1,514

 

2.14

 

 

216,333

 

 

2,933

 

1.81

 

Subordinated debentures

 

 

34,080

 

 

1,571

 

6.16

 

 

33,951

 

 

1,571

 

6.18

 

Total borrowings

 

 

128,562

 

 

3,085

 

3.21

 

 

250,284

 

 

4,504

 

2.40

 

Total interest-bearing liabilities

 

 

3,014,395

 

 

10,157

 

0.45

 

 

2,906,893

 

 

23,522

 

1.08

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

749,426

 

 

 

 

 

 

 

549,233

 

 

 

 

 

 

Other noninterest-bearing liabilities

 

 

90,763

 

 

 

 

 

 

 

76,660

 

 

 

 

 

 

Total liabilities

 

 

3,854,584

 

 

 

 

 

 

 

3,532,786

 

 

 

 

 

 

Total stockholders’ equity

 

 

696,202

 

 

 

 

 

 

 

680,210

 

 

 

 

 

 

Total liabilities and stockholders’ equity

 

$

4,550,786

 

 

 

 

 

 

$

4,212,996

 

 

 

 

 

 

Tax equivalent net interest income

 

 

 

 

 

97,385

 

 

 

 

 

 

 

87,338

 

 

 

Tax equivalent interest rate spread (3)

 

 

 

 

 

 

 

2.96

%

 

 

 

 

 

 

2.73

%

Less: tax equivalent adjustment

 

 

 

 

 

 

 

 

 

 

 

 

22

 

 

 

Net interest income as reported

 

 

 

 

$

97,385

 

 

 

 

 

 

$

87,316

 

 

 

Net interest-earning assets (4)

 

$

1,197,411

 

 

 

 

 

 

$

978,718

 

 

 

 

 

 

Net interest margin (5)

 

 

 

 

 

 

 

3.09

%

 

 

 

 

 

 

3.00

%

Tax equivalent effect

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin on a fully tax equivalent basis

 

 

 

 

 

 

 

3.09

%

 

 

 

 

 

 

3.00

%

Average interest-earning assets to average interest-bearing liabilities

 

 

139.72

%

 

 

 

 

 

 

133.67

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total deposits, including demand deposits

 

$

3,635,259

 

$

7,072

 

 

 

$

3,205,842

 

$

19,018

 

 

 

Cost of total deposits

 

 

 

 

 

 

 

0.26

%

 

 

 

 

 

 

0.79

%

Total funding liabilities, including demand deposits

 

$

3,763,821

 

$

10,157

 

 

 

$

3,456,126

 

$

23,522

 

 

 

Cost of total funding liabilities

 

 

 

 

 

 

 

0.36

%

 

 

 

 

 

 

0.91

%

(1) Interest income from tax exempt securities is computed on a tax equivalent basis using a tax rate of 21%.  The yield on investments before tax equivalent adjustments was 2.32% for the six months ended September 30, 2020.

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

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

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

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

HarborOne Bancorp, Inc.

 

Average Balances and Yield Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Balances – Trend – Quarters Ended

 

 

 

September 30, 2021

 

June 30, 2021

 

March 31, 2021

 

December 31, 2020

 

September 30, 2020

 

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

$

358,927

 

$

325,205

 

$

271,357

 

$

271,511

 

$

269,477

 

Other interest-earning assets

 

 

372,892

 

 

397,979

 

 

180,526

 

 

84,969

 

 

121,384

 

Loans held for sale

 

 

84,399

 

 

115,240

 

 

193,426

 

 

178,980

 

 

139,418

 

Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (2)

 

 

2,121,432

 

 

2,152,105

 

 

2,161,076

 

 

2,112,377

 

 

2,017,492

 

Residential real estate loans (2)

 

 

1,121,898

 

 

1,064,481

 

 

1,084,292

 

 

1,106,286

 

 

1,135,947

 

Consumer loans (2)

 

 

170,366

 

 

205,856

 

 

253,014

 

 

292,665

 

 

333,623

 

Total loans

 

 

3,413,696

 

 

3,422,442

 

 

3,498,382

 

 

3,511,328

 

 

3,487,062

 

Total interest-earning assets

 

 

4,229,914

 

 

4,260,866

 

 

4,143,691

 

 

4,046,788

 

 

4,017,341

 

Noninterest-earning assets

 

 

347,060

 

 

339,438

 

 

330,257

 

 

317,663

 

 

333,444

 

Total assets

 

$

4,576,974

 

$

4,600,304

 

$

4,473,948

 

$

4,364,451

 

$

4,350,785

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

$

1,136,131

 

$

1,118,494

 

$

1,058,820

 

$

968,766

 

$

897,751

 

NOW accounts

 

 

283,725

 

 

231,075

 

 

212,282

 

 

205,845

 

 

199,982

 

Money market accounts

 

 

832,340

 

 

853,586

 

 

861,518

 

 

840,674

 

 

825,732

 

Certificates of deposit

 

 

570,570

 

 

589,964

 

 

608,089

 

 

649,919

 

 

684,002

 

Brokered deposits

 

 

100,000

 

 

100,000

 

 

100,000

 

 

109,788

 

 

139,887

 

Total interest-bearing deposits

 

 

2,922,766

 

 

2,893,119

 

 

2,840,709

 

 

2,774,992

 

 

2,747,354

 

FHLB advances

 

 

84,438

 

 

96,823

 

 

102,383

 

 

119,763

 

 

149,750

 

Subordinated debentures

 

 

34,111

 

 

34,080

 

 

34,048

 

 

34,015

 

 

33,983

 

Total borrowings

 

 

118,549

 

 

130,903

 

 

136,431

 

 

153,778

 

 

183,733

 

Total interest-bearing liabilities

 

 

3,041,315

 

 

3,024,022

 

 

2,977,140

 

 

2,928,770

 

 

2,931,087

 

Noninterest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest-bearing deposits

 

 

756,927

 

 

784,521

 

 

706,274

 

 

656,227

 

 

641,353

 

Other noninterest-bearing liabilities

 

 

90,366

 

 

88,577

 

 

93,380

 

 

84,387

 

 

89,319

 

Total liabilities

 

 

3,888,608

 

 

3,897,120

 

 

3,776,794

 

 

3,669,384

 

 

3,661,759

 

Total stockholders’ equity

 

 

688,366

 

 

703,184

 

 

697,154

 

 

695,067

 

 

689,026

 

Total liabilities and stockholders’ equity

 

$

4,576,974

 

$

4,600,304

 

$

4,473,948

 

$

4,364,451

 

$

4,350,785

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annualized Yield Trend – Quarters Ended

 

 

 

September 30, 2021

 

June 30, 2021

 

March 31, 2021

 

December 31, 2020

 

September 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment securities (1)

 

 

1.43

%

 

0.98

%

 

0.87

%

 

1.56

%

 

1.95

%

Other interest-earning assets

 

 

0.18

%

 

0.14

%

 

0.18

%

 

0.54

%

 

0.57

%

Loans held for sale

 

 

3.13

%

 

2.97

%

 

2.78

%

 

2.82

%

 

3.02

%

Commercial loans (2)

 

 

4.19

%

 

4.11

%

 

3.90

%

 

3.92

%

 

3.76

%

Residential real estate loans (2)

 

 

3.31

%

 

3.67

%

 

3.87

%

 

4.04

%

 

4.14

%

Consumer loans (2)

 

 

4.50

%

 

4.44

%

 

4.39

%

 

4.36

%

 

4.29

%

Total loans

 

 

3.91

%

 

4.00

%

 

3.93

%

 

4.00

%

 

3.94

%

Total interest-earning assets

 

 

3.36

%

 

3.38

%

 

3.51

%

 

3.71

%

 

3.67

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Savings accounts

 

 

0.13

%

 

0.17

%

 

0.21

%

 

0.26

%

 

0.26

%

NOW accounts

 

 

0.06

%

 

0.07

%

 

0.07

%

 

0.08

%

 

0.08

%

Money market accounts

 

 

0.19

%

 

0.20

%

 

0.26

%

 

0.34

%

 

0.36

%

Certificates of deposit

 

 

0.76

%

 

0.84

%

 

0.96

%

 

1.35

%

 

1.68

%

Brokered deposits

 

 

0.64

%

 

0.62

%

 

0.58

%

 

0.72

%

 

0.72

%

Total interest-bearing deposits

 

 

0.28

%

 

0.32

%

 

0.39

%

 

0.54

%

 

0.65

%

FHLB advances

 

 

2.03

%

 

2.20

%

 

2.19

%

 

2.23

%

 

2.22

%

Subordinated debentures

 

 

6.09

%

 

6.17

%

 

6.23

%

 

6.13

%

 

6.13

%

Total borrowings

 

 

3.20

%

 

3.23

%

 

3.20

%

 

3.09

%

 

2.94

%

Total interest-bearing liabilities

 

 

0.39

%

 

0.45

%

 

0.52

%

 

0.68

%

 

0.80

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

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

 

HarborOne Bancorp, Inc.

 

Selected Financial Highlights

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Performance Ratios (annualized):

 

2021

 

2021

 

2021

 

2020

 

2020

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (ROAA)

 

 

1.07

%

 

1.24

%

 

1.73

%

 

1.61

%

 

1.09

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average equity (ROAE)

 

 

7.12

%

 

8.12

%

 

11.13

%

 

10.13

%

 

6.90

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total noninterest expense

 

$

39,274

 

$

38,598

 

$

42,802

 

$

41,286

 

$

45,700

 

Less: Amortization of other intangible assets

 

 

324

 

 

324

 

 

324

 

 

324

 

 

447

 

Total adjusted noninterest expense

 

$

38,950

 

$

38,274

 

$

42,478

 

$

40,962

 

$

45,253

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

32,803

 

$

32,530

 

$

32,052

 

$

32,750

 

$

31,169

 

Total noninterest income

 

 

22,010

 

 

21,703

 

 

37,809

 

 

37,027

 

 

44,439

 

Total revenue

 

$

54,813

 

$

54,233

 

$

69,861

 

$

69,777

 

$

75,608

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Efficiency ratio (1)

 

 

71.06

%

 

70.57

%

 

60.80

%

 

58.70

%

 

59.85

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(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

 

2021

 

2021

 

2021

 

2020

 

2020

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total nonperforming assets

 

$

36,514

 

$

32,732

 

$

32,886

 

$

34,696

 

$

40,925

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonperforming assets to total assets

 

 

0.80

%

 

0.71

%

 

0.71

%

 

0.77

%

 

0.93

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to total loans

 

 

1.39

%

 

1.50

%

 

1.60

%

 

1.59

%

 

1.40

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net charge-offs

 

$

1,658

 

$

(175

)

$

102

 

$

1,436

 

$

338

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Annualized net charge-offs/average loans

 

 

0.19

%

 

(0.02

)%

 

0.01

%

 

0.16

%

 

0.04

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for loan losses to nonperforming loans

 

 

131.50

%

 

158.10

%

 

171.20

%

 

162.40

%

 

122.86

%

HarborOne Bancorp, Inc.

 

Selected Financial Highlights

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

 

Capital and Share Related

 

2021

 

2021

 

2021

 

2020

 

2020

 

(dollars in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock outstanding

 

 

53,232,110

 

 

55,735,623

 

 

56,228,762

 

 

57,205,458

 

 

58,342,464

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per share

 

$

12.77

 

$

12.66

 

$

12.41

 

$

12.17

 

$

11.90

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

$

680,032

 

$

705,471

 

$

698,073

 

$

696,314

 

$

694,103

 

Less: Goodwill

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

Less: Other intangible assets (1)

 

 

3,399

 

 

3,723

 

 

4,047

 

 

4,370

 

 

4,694

 

Tangible common equity

 

$

606,831

 

$

631,946

 

$

624,224

 

$

622,142

 

$

619,607

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible book value per share (2)

 

$

11.40

 

$

11.34

 

$

11.10

 

$

10.88

 

$

10.62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

4,567,094

 

$

4,616,422

 

$

4,605,958

 

$

4,483,615

 

$

4,428,319

 

Less: Goodwill

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

 

69,802

 

Less: Other intangible assets

 

 

3,399

 

 

3,723

 

 

4,047

 

 

4,370

 

 

4,694

 

Tangible assets

 

$

4,493,893

 

$

4,542,897

 

$

4,532,109

 

$

4,409,443

 

$

4,353,823

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tangible common equity / tangible assets (3)

 

 

13.50

%

 

13.91

%

 

13.77

%

 

14.11

%

 

14.23

%

(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 Statements of Net Income

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HarborOne Mortgage

 

HarborOne Bank

 

 

For the Quarter Ended

 

For the Quarter Ended

 

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

June 30,

 

September 30,

 

 

2021

 

2021

 

2020

 

2021

 

2021

 

2020

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

792

 

 

$

855

 

 

$

1,000

 

 

$

32,494

 

 

$

32,134

 

 

$

30,599

 

Provision for loan losses

 

 

 

 

 

 

 

 

 

 

 

(1,627

)

 

 

(4,286

)

 

 

13,454

 

Net interest and dividend income, after provision for loan losses

 

 

792

 

 

 

855

 

 

 

1,000

 

 

 

34,121

 

 

 

36,420

 

 

 

17,145

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

12,756

 

 

 

14,262

 

 

 

34,055

 

 

 

 

 

 

 

 

 

 

Intersegment gain (loss)

 

 

2,366

 

 

 

910

 

 

 

645

 

 

 

(1,373

)

 

 

(910

)

 

 

(645

)

Changes in mortgage servicing rights fair value

 

 

(918

)

 

 

(2,133

)

 

 

161

 

 

 

(74

)

 

 

(419

)

 

 

(354

)

Other

 

 

3,619

 

 

 

3,799

 

 

 

3,924

 

 

 

263

 

 

 

276

 

 

 

334

 

Total mortgage banking income (loss)

 

 

17,823

 

 

 

16,838

 

 

 

38,785

 

 

 

(1,184

)

 

 

(1,053

)

 

 

(665

)

Other noninterest income (loss)

 

 

25

 

 

 

20

 

 

 

(8

)

 

 

6,339

 

 

 

5,898

 

 

 

6,326

 

Total noninterest income

 

 

17,848

 

 

 

16,858

 

 

 

38,777

 

 

 

5,155

 

 

 

4,845

 

 

 

5,661

 

Noninterest expense

 

 

12,387

 

 

 

14,101

 

 

 

19,133

 

 

 

26,570

 

 

 

24,128

 

 

 

26,300

 

Income before income taxes

 

 

6,253

 

 

 

3,612

 

 

 

20,644

 

 

 

12,706

 

 

 

17,137

 

 

 

(3,494

)

Provision for income taxes

 

 

1,559

 

 

 

1,013

 

 

 

4,550

 

 

 

3,575

 

 

 

4,863

 

 

 

571

 

Net income

 

$

4,694

 

 

$

2,599

 

 

$

16,094

 

 

$

9,131

 

 

$

12,274

 

 

$

(4,065

)

 

 

HarborOne Mortgage

 

HarborOne Bank

 

 

For the Nine Months Ended

 

For the Nine Months Ended

 

 

September 30,

 

September 30,

 

September 30,

 

September 30,

 

 

2021

 

2020

 

2021

 

2020

 

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

$

2,897

 

$

2,020

 

 

$

95,876

 

 

$

86,248

 

Provision for loan losses

 

 

 

 

 

 

 

(5,822

)

 

 

27,207

 

Net interest and dividend income, after provision for loan losses

 

 

2,897

 

 

2,020

 

 

 

101,698

 

 

 

59,041

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of mortgage loans

 

 

51,820

 

 

77,195

 

 

 

 

 

 

 

Intersegment gain (loss)

 

 

3,938

 

 

2,444

 

 

 

(2,945

)

 

 

(2,444

)

Changes in mortgage servicing rights fair value

 

 

72

 

 

(3,677

)

 

 

(207

)

 

 

(2,014

)

Other

 

 

11,633

 

 

9,619

 

 

 

839

 

 

 

1,031

 

Total mortgage banking income (loss)

 

 

67,463

 

 

85,581

 

 

 

(2,313

)

 

 

(3,427

)

Other noninterest income (loss)

 

 

37

 

 

(141

)

 

 

17,328

 

 

 

19,640

 

Total noninterest income

 

 

67,500

 

 

85,440

 

 

 

15,015

 

 

 

16,213

 

Noninterest expense

 

 

44,545

 

 

47,923

 

 

 

75,161

 

 

 

75,806

 

Income before income taxes

 

 

25,852

 

 

39,537

 

 

 

41,552

 

 

 

(552

)

Provision (benefit) for income taxes

 

 

6,905

 

 

8,667

 

 

 

11,873

 

 

 

2,199

 

Net income

 

$

18,947

 

$

30,870

 

 

$

29,679

 

 

$

(2,751

)

HarborOne Bancorp, Inc.

 

COVID Loans at Risk as of September 30, 2021

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At Risk Sectors

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Percent

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

at risk

 

 

 

 

 

 

 

 

 

 

 

 

 

at risk

 

Total

 

sector

 

 

 

Retail

 

Office Space

 

Hotels

 

Restaurants

 

Recreation

 

sectors

 

loans

 

to total

 

 

 

(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial real estate

 

$

219,299

 

$

199,329

 

$

182,622

 

$

14,498

 

$

14,630

 

$

630,378

 

$

1,573,284

 

40.1

%

Commercial and industrial

 

 

28,858

 

 

14,009

 

 

2,022

 

 

27,073

 

 

3,835

 

 

75,797

 

 

414,814

 

18.3

 

Commercial construction

 

 

18,605

 

 

854

 

 

9,040

 

 

16,284

 

 

 

 

44,783

 

 

152,685

 

29.3

 

Total

 

$

266,762

 

$

214,192

 

$

193,684

 

$

57,855

 

$

18,465

 

$

750,958

 

$

2,140,783

 

35.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outstanding principal, active commercial deferrals

 

$

 

$

 

$

7,740

 

$

 

$

 

$

7,740

 

$

2,140,783

 

0.4

%

Outstanding principal, expired and delinquent commercial deferrals

 

$

 

$

515

 

$

242

 

$

 

$

 

$

757

 

$

2,140,783

 

0.0

%

PPP loans, net of fees

 

$

 

$

 

$

31

 

$

313

 

$

3

 

$

347