Eastern Bankshares, Inc. Reports Third Quarter 2022 Financial Results

Rhea-AI Summary

Eastern Bankshares, Inc. (EBC) reported a robust third quarter for 2022, showing a net income of $54.8 million, equating to $0.33 per diluted share, compared to $51.2 million the previous quarter. Operating net income rose to $55.7 million, reflecting significant loan growth of 16% on an annualized basis. The net interest margin expanded by 24 basis points, leading to a 10% increase in net interest income, reaching $152.2 million. The company has declared a quarterly cash dividend of $0.10 per share, payable on December 15, 2022. Total assets stood at $22.0 billion, with total loans increasing to $12.9 billion.

Positive

• Net income increased to $54.8 million from $51.2 million in the previous quarter.
• Operating net income rose to $55.7 million, 49% higher year-over-year.
• Loan growth reached 16% on an annualized basis.
• Net interest income improved by 10% to $152.2 million.
• Net interest margin expanded by 24 basis points to 2.87%.
• Declared a quarterly cash dividend of $0.10 per share.

Negative

• Total assets decreased by $307.9 million, or 1%, from the previous quarter.
• Total securities dropped by $698.9 million, or 9%, primarily due to market declines.
• Deposits decreased by $430.4 million, or 2%, from the prior quarter.
• Shareholders' equity fell to $2.4 billion, down $302.2 million from the prior quarter.

Company Declares Quarterly Cash Dividend

BOSTON--(BUSINESS WIRE)-- Eastern Bankshares, Inc. (the “Company,” or together with its affiliates and subsidiaries, “Eastern”) (NASDAQ Global Select Market: EBC), the stock holding company of Eastern Bank, today announced its 2022 third quarter financial results and the declaration of a quarterly cash dividend. Net income for the third quarter of 2022 was $54.8 million, or $0.33 per diluted share, compared to net income of $51.2 million, or $0.31 per diluted share, reported for the second quarter of 2022. Operating net income* for the third quarter of 2022 was $55.7 million, or $0.34 per diluted share, compared to $52.5 million, or $0.32 per diluted share, reported for the prior quarter.

“Our financial results for the third quarter were strong, led by 16 percent loan growth on an annualized basis, while maintaining our high credit quality and underwriting standards,” said Bob Rivers, Chief Executive Officer and Chair of the Board of Eastern Bankshares, Inc. and Eastern Bank. “Additionally, our net interest margin expanded by twenty-four basis points from the prior quarter, driving a ten percent increase in net interest income. We remain focused on achieving our strategic priorities while continuing to deliver for our shareholders, customers, colleagues, and the communities we serve."

HIGHLIGHTS FOR THE THIRD QUARTER OF 2022

• Operating net income* of $55.7 million, or $0.34 per diluted share, for the third quarter of 2022 was 49% higher than the comparable prior year quarter.
• Net interest income of $152.2 million for the third quarter of 2022 was 10% higher than the prior quarter.
• The net interest margin on a fully tax equivalent (“FTE”) basis* of 2.87% for the third quarter was 24 basis points higher than the prior quarter.
• The cost of total deposits was 10 basis points in the third quarter, an increase of 4 basis points from the prior quarter.
• Loan growth was 16% on an annualized basis, driven by double-digit annualized growth in commercial and residential lending.
• The Company repurchased 1,481,248 shares of its common stock during the third quarter of 2022 at a weighted average price of $19.52 excluding commissions, for an aggregate purchase price of $28.9 million.

The results for the comparable prior year quarter do not reflect the Company’s acquisition of Century Bancorp, Inc. (“Century”), which was completed on November 12, 2021.

BALANCE SHEET

Total assets were $22.0 billion at September 30, 2022, representing a decrease of $307.9 million, or 1%, from June 30, 2022.

• Total securities decreased $698.9 million, or 9%, from the prior quarter, to $7.3 billion, primarily due to a decline in the market value of available for sale securities driven by higher interest rates, net security sales, and principal runoff.
• Cash and equivalents declined $210.5 million from the prior quarter to $158.4 million.
• Total loans were $12.9 billion, representing an increase of $505.3 million, or 4%, from the prior quarter. The increase was driven by strong loan growth in all major categories. Commercial loans grew $356.6 million, residential loans grew $129.2 million and consumer loans grew $19.4 million, reflecting growth of 16%, 26%, and 6%, respectively, on an annualized basis. Residential loans at September 30, 2022 included purchased loans from Embrace Home Loans totaling $77.7 million excluding purchase premiums.
• Deposits totaled $18.7 billion, representing a decrease of $430.4 million, or 2%, from the prior quarter. On a quarterly average basis, deposits were down $24.7 million from the prior quarter.
• Borrowed funds increased $379.6 million from the prior quarter to provide funding for strong loan growth in the third quarter.
• Shareholders’ equity was $2.4 billion, representing a decrease of $302.2 million from the prior quarter driven primarily by a decrease in accumulated other comprehensive income of $317.7 million. Please refer to Appendix D to this press release for a roll forward of tangible shareholders’ equity*.
• At September 30, 2022, book value per share was $13.59 and tangible book value per share* was $9.87.

Please refer to Appendix C to this press release for a reconciliation of book value per share and tangible book value per share*.

NET INTEREST INCOME

Net interest income was $152.2 million for the third quarter of 2022, compared to $137.8 million in the prior quarter, representing an increase of $14.4 million.

• The increase in net interest income on a consecutive quarter basis was primarily due to an increase in the net interest margin, which benefited primarily from higher short-term interest rates, as well as an increase in average interest-earning asset balances of $77.5 million from the prior quarter, attributable to loan growth.
• The net interest margin on a FTE basis* was 2.87% for the third quarter, representing a 24 basis point increase from the prior quarter, as asset yields benefited from higher interest rates in the period, partially offset by lower net Paycheck Protection Program (“PPP”) fee accretion compared to the prior quarter. Interest-bearing funding costs increased 8 basis points from the prior quarter to 18 basis points, due to deposit pricing increases and an increase in borrowings during the quarter.
• Included in net interest income in the third quarter and prior quarter, respectively, was $0.5 million and $2.5 million of PPP fee accretion net of deferred cost amortization. During the third quarter, $19.3 million in PPP loans were forgiven by the U.S. Small Business Administration or otherwise paid down, compared to $98.7 million in the prior quarter.

NONINTEREST INCOME

Noninterest income was $43.4 million for the third quarter of 2022, compared to $41.9 million for the prior quarter, representing an increase of $1.5 million. Noninterest income on an operating basis* was $45.3 million for the third quarter of 2022, compared to $48.0 million for the prior quarter, a decrease of $2.7 million.

• Insurance commissions decreased $0.9 million to $23.8 million in the third quarter, compared to $24.7 million in the prior quarter. Compared to the comparable prior year quarter, insurance commissions increased $1.8 million, or 8%.
• Service charges on deposit accounts decreased $1.6 million on a consecutive quarter basis to $6.7 million primarily due to lower overdraft fees driven by a change in overdraft charging practices as well as lower account analysis fees.
• Trust and investment advisory fees decreased $0.2 million on a consecutive quarter basis to $5.8 million.
• Loan-level interest rate swap income was $1.6 million in the third quarter, in line with the prior quarter.
• Market performance drove losses on investments held in rabbi trust accounts totaling $2.2 million in the third quarter compared to losses of $7.3 million in the prior quarter.
• Realized losses on available for sale securities were $0.2 million in the third quarter compared to $0.1 million in the prior quarter.
• Other noninterest income decreased $0.8 million in the third quarter to $4.6 million.

Please refer to Appendix B to this press release for a reconciliation of operating revenues and expenses*.

NONINTEREST EXPENSE

Noninterest expense was $116.8 million for the third quarter of 2022, compared to $111.1 million in the prior quarter, representing an increase of $5.7 million. Noninterest expense on an operating basis* for the third quarter of 2022 was $117.4 million, compared to $114.4 million in the prior quarter, an increase of $3.0 million.

• Salaries and employee benefits expense was $78.1 million in the third quarter, representing an increase of $5.1 million from the prior quarter, driven in part by an increase in incentive compensation expense of $3.3 million as well as an increase in benefits expense of $1.0 million primarily attributable to the lower losses on investments held in rabbi trust accounts associated with the Company’s defined contribution supplemental executive retirement plan.
• Office occupancy and equipment expense was $9.7 million in the third quarter, a decrease of $0.2 million from the prior quarter.
• Data processing expenses were $13.3 million in the third quarter, a decrease of $1.1 million from the prior quarter.
• Professional services expense was $5.8 million in the third quarter, an increase of $1.8 million from the prior quarter due primarily to an increase in legal fees and an increase in other professional fees.
• Marketing expense was $2.2 million in the third quarter, a decrease of $0.4 million from the prior quarter, primarily due to lower advertising expenses in the period.

Please refer to Appendix B to this press release for a reconciliation of operating revenues and expenses*.

ASSET QUALITY

The allowance for loan losses was $131.7 million at September 30, 2022, or 1.02% of total loans, compared to $125.5 million or 1.01% of total loans at June 30, 2022. The Company recorded a provision for the allowance for loan losses totaling $6.5 million in the third quarter of 2022 primarily due to loan growth.

Non-performing loans totaled $34.0 million at September 30, 2022 compared to $59.9 million at the end of the prior quarter. The decrease from the prior quarter was primarily attributable to the full payoff of one syndicated credit facility that migrated to nonaccrual status in the prior quarter. During the third quarter of 2022, the Company recorded total net charge-offs of $0.3 million, or 0.01% of average total loans on an annualized basis, compared to net recoveries of $0.3 million or 0.01% of average total loans in the prior quarter, respectively.

DIVIDENDS AND SHARE REPURCHASES

The Company’s Board of Directors has declared a quarterly cash dividend of $0.10 per common share. The dividend will be payable on December 15, 2022 to shareholders of record as of the close of business on December 2, 2022.

The Company repurchased 1,481,248 shares of its common stock during the third quarter of 2022 at a weighted average price of $19.52 excluding commissions, for an aggregate purchase price of $28.9 million.

As announced in September of 2022, the Company received regulatory non-objection for its second share repurchase program of up to 8,900,000 shares, representing approximately 5% of its shares of common stock then outstanding. The repurchase program, which is limited to $200 million through August 31, 2023, may be modified or terminated by the Board of Directors of the Company at any time. At September 30, 2022, there were 8,537,684 shares available for repurchase and $192.6 million in total market value remaining under the repurchase authorization.

As announced in November of 2021, the Company received regulatory non-objection for its inaugural share repurchase program, under which it was authorized to purchase up to 9,337,900 shares for up to $225 million over a 12-month period. The Company completed the program in September of 2022, having repurchased all 9,337,900 shares for an aggregate purchase price of $186.4 million, excluding commissions.

CONFERENCE CALL INFORMATION

A conference call and webcast covering Eastern’s third quarter 2022 earnings will be held on Friday, October 28, 2022 at 9:00 a.m. Eastern Time. To join by telephone, participants can call the toll-free dial-in number (888) 396-8049 from within the U.S. and reference conference ID 09796048. The conference call will be simultaneously webcast. Participants may join the webcast on the Company’s Investor Relations website at investor.easternbank.com. A replay of the webcast will be made available on demand on this site.

ABOUT EASTERN BANKSHARES, INC.

Eastern Bankshares, Inc. is the stock holding company for Eastern Bank. Founded in 1818, Boston-based Eastern Bank has more than 120 locations serving communities in eastern Massachusetts, southern and coastal New Hampshire, and Rhode Island. As of September 30, 2022, Eastern Bank had approximately $22 billion in total assets. Eastern provides banking, investment and insurance products and services for consumers and businesses of all sizes, including through its Eastern Wealth Management division and its Eastern Insurance Group LLC subsidiary. Eastern takes pride in its outspoken advocacy and community support that includes $240 million in charitable giving since 1994. An inclusive company, Eastern employs approximately 2,100 deeply committed professionals who value relationships with their customers, colleagues, and communities. For investor information, visit investor.easternbank.com.

NON-GAAP FINANCIAL MEASURES

*Denotes a non-GAAP financial measure used in this press release.

A non-GAAP financial measure is defined as a numerical measure of the Company’s historical or future financial performance, financial position or cash flows that excludes (or includes) amounts, or is subject to adjustments that have the effect of excluding (or including) amounts that are included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”) in the Company’s statement of income, balance sheet or statement of cash flows (or equivalent statements).

The Company presents non-GAAP financial measures, which management uses to evaluate the Company’s performance, and which exclude the effects of certain transactions that management believes are unrelated to its core business and are therefore not necessarily indicative of its current performance or financial position. Management believes excluding these items facilitates greater visibility for investors into the Company’s core business as well as underlying trends that may, to some extent, be obscured by inclusion of such items in the corresponding GAAP financial measures.

There are items in the Company’s financial statements that impact its financial results, but which management believes are unrelated to the Company’s core business. Accordingly, the Company presents noninterest income on an operating basis, total operating revenue, noninterest expense on an operating basis, operating net income, operating earnings per share, operating return on average assets, operating return on average shareholders’ equity, operating return on average tangible shareholders’ equity (discussed further below), the operating efficiency ratio, and the ratio of noninterest income to total revenue on an operating basis. Each of these figures excludes the impact of such applicable items because management believes such exclusion can provide greater visibility into the Company’s core business and underlying trends. Such items that management does not consider to be core to the Company’s business include (i) income and expenses from investments held in rabbi trusts, (ii) gains and losses on sales of securities available for sale, net, (iii) gains and losses on the sale of other assets, (iv) rabbi trust employee benefits, (v) impairment charges on tax credit investments and associated tax credit benefits, (vi) other real estate owned (“OREO”) gains, and (vii) merger and acquisition expenses. The Company does not provide an outlook for its total noninterest income and total noninterest expense because each contains income or expense components, as applicable, such as income associated with rabbi trust accounts and rabbi trust employee benefit expense, which are market-driven, and over which the Company cannot exercise control. Accordingly, reconciliations of the Company’s outlook for its noninterest income on an operating basis and its noninterest expense on an operating basis to an outlook for total noninterest income and total noninterest expense, respectively, cannot be made available without unreasonable effort.

Management also presents tangible assets, tangible shareholders’ equity, average tangible shareholders’ equity, tangible book value per share, the ratio of tangible shareholders’ equity to tangible assets, return on average tangible shareholders’ equity, and operating return on average shareholders’ equity (discussed further above), each of which excludes the impact of goodwill and other intangible assets, as management believes these financial measures provide investors with the ability to further assess the Company’s performance, identify trends in its core business and provide a comparison of its capital adequacy to other companies. The Company included the tangible ratios because management believes that investors may find it useful to have access to the same analytical tools used by management to assess performance and identify trends.

These non-GAAP financial measures presented in this press release should not be considered an alternative or substitute for financial results or measures determined in accordance with GAAP or as an indication of the Company’s cash flows from operating activities, a measure of its liquidity position or an indication of funds available for its cash needs. An item which management considers to be non-core and excludes when computing these non-GAAP measures can be of substantial importance to the Company’s results for any particular period. In addition, management’s methodology for calculating non-GAAP financial measures may differ from the methodologies employed by other banking companies to calculate the same or similar performance measures, and accordingly, the Company’s reported non-GAAP financial measures may not be comparable to the same or similar performance measures reported by other banking companies. Please refer to Appendices A-D for reconciliations of the Company's GAAP financial measures to the non-GAAP financial measures in this press release.

FORWARD-LOOKING STATEMENTS

This press release contains “forward-looking statements” within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. You can identify these statements from the use of the words “may,” “will,” “should,” “could,” “would,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target” and similar expressions. Forward-looking statements, by their nature, are subject to risks and uncertainties. There are many factors that could cause actual results to differ materially from expected results described in the forward-looking statements.

Certain factors that could cause actual results to differ materially from expected results include developments in the Company’s market relating to the COVID-19 pandemic, including the severity and duration of the associated economic slowdown; adverse developments in the level and direction of loan delinquencies and charge-offs and changes in estimates of the adequacy of the allowance for loan losses; increased competitive pressures; changes in the interest rate environment; risks that revenue or expense synergies or the other expected benefits of the Company’s merger with Century (“Transaction”) may not fully materialize for the Company in the timeframe expected or at all, or may be more costly to achieve; risks that the Company is unable to successfully implement integration strategies for the Transaction; reputational risks and the reaction of customers to the Transaction; and diversion of management time on Transaction-related issues; as well as general economic conditions or conditions within the securities markets; and legislative and regulatory changes and related compliance costs that could adversely affect the business in which the Company and its subsidiary Eastern Bank are engaged, including inflation, interest rates, interest rate sensitivity and liquidity, including the effect of, and changes in, monetary and fiscal policies and laws, such as the interest rate policies of the Board of Governors of the Federal Reserve System; market and monetary fluctuations, including fluctuations due to actual or anticipated changes to federal tax laws; credit quality, including adverse developments in local or regional real estate markets that decrease collateral values associated with existing loans; and the failure of the Company to execute all of its planned share repurchases. For further discussion of such factors, please see the Company’s most recent Annual Report on Form 10-K and subsequent filings with the U.S. Securities and Exchange Commission (the “SEC”), which are available on the SEC’s website at www.sec.gov.

Further, given the ongoing and dynamic nature of the COVID-19 pandemic, it is difficult to predict what continued effects the COVID-19 pandemic will have on the Company's business and results of operations. The COVID-19 pandemic and the related local and national economic disruption may result in a continued decline in demand for the Company's products and services; increased levels of loan delinquencies, problem assets and foreclosures; an increase in the Company's allowance for loan losses; a decline in the value of loan collateral, including real estate; reduced demand for office space in the Company’s markets due to remote and/or hybrid work arrangements; a greater decline in the yield on the Company's interest-earning assets than the decline in the cost of the Company's interest-bearing liabilities; and increased cybersecurity risks, as employees continue to work remotely.

You should not place undue reliance on forward-looking statements, which reflect the Company's expectations only as of the date of this press release. The Company does not undertake any obligation to update forward-looking statements.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS

Certain information in this press release is presented as reviewed by the Company’s management and includes information derived from the Company’s Consolidated Statements of Income, non-GAAP financial measures, and operational and performance metrics. For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

		As of and for the three months ended
(Unaudited, dollars in thousands, except per-share data)		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
Earnings data
Net interest income		$	152,179			$	137,757			$	128,124			$	122,437			$	102,691
Noninterest income			43,353				41,877				46,415				49,001				43,209
Total revenue			195,532				179,634				174,539				171,438				145,900
Noninterest expense			116,840				111,139				108,866				143,602				98,970
Pre-tax, pre-provision income			78,692				68,495				65,673				27,836				46,930
Provision for (release of) allowance for loan losses			6,480				1,050				(485	)			(4,318	)			(1,488	)
Pre-tax income			72,212				67,445				66,158				32,154				48,418
Net income			54,777				51,172				51,516				35,087				37,106
Operating net income (non-GAAP)			55,742				52,518				55,107				44,860				37,391
Per-share data
Earnings per share, basic		$	0.33			$	0.31			$	0.30			$	0.20			$	0.22
Earnings per share, diluted		$	0.33			$	0.31			$	0.30			$	0.20			$	0.22
Operating earnings per share, basic (non-GAAP)		$	0.34			$	0.32			$	0.32			$	0.26			$	0.22
Operating earnings per share, diluted (non-GAAP)		$	0.34			$	0.32			$	0.32			$	0.26			$	0.22
Book value per share		$	13.59			$	15.17			$	16.40			$	18.28			$	18.36
Tangible book value per share (non-GAAP)		$	9.87			$	11.52			$	12.83			$	14.80			$	16.33
Profitability
Return on average assets (1)			0.97	%			0.92	%			0.90	%			0.67	%			0.84	%
Operating return on average assets (non-GAAP) (1)			0.97	%			0.94	%			0.96	%			0.86	%			0.86	%
Return on average shareholders' equity (1)			7.83	%			7.16	%			6.38	%			4.07	%			4.27	%
Operating return on average shareholders' equity (1)			7.98	%			7.34	%			6.82	%			5.19	%			4.30	%
Return on average tangible shareholders' equity (non-GAAP) (1)			10.25	%			9.28	%			7.96	%			4.80	%			4.79	%
Operating return on average tangible shareholders' equity (non-GAAP) (1)			10.44	%			9.53	%			8.53	%			6.14	%			4.84	%
Net interest margin (FTE) (1)			2.87	%			2.63	%			2.42	%			2.54	%			2.53	%
Cost of deposits (1)			0.10	%			0.06	%			0.07	%			0.06	%			0.02	%
Fee income ratio			22.17	%			23.31	%			26.59	%			28.58	%			29.62	%
Efficiency ratio			59.75	%			61.87	%			62.37	%			83.76	%			67.83	%
Operating efficiency ratio (non-GAAP)			58.38	%			60.61	%			60.39	%			65.21	%			66.14	%
Balance Sheet (end of period)
Total assets		$	22,042,933			$	22,350,848			$	22,836,072			$	23,512,128			$	17,461,223
Total loans			12,903,954				12,398,694				12,182,203				12,281,510				9,504,562
Total deposits			18,733,381				19,163,801				19,392,816				19,628,311				13,649,964
Total loans / total deposits			69	%			65	%			63	%			63	%			70	%
PPP loans		$	23,142			$	42,463			$	141,166			$	331,385			$	533,965
Asset quality
Allowance for loan losses ("ALLL") (2)		$	131,663			$	125,531			$	124,166			$	97,787			$	103,398
ALLL / total nonperforming loans ("NPLs")			387.77	%			209.64	%			367.13	%			279.53	%			245.77	%
Total NPLs / total loans			0.26	%			0.48	%			0.28	%			0.29	%			0.44	%
Net charge-offs (recoveries) ("NCOs") / average total loans (1)			0.01	%			(0.01	)%			0.01	%			0.05	%			0.03	%
Remaining COVID-19 loan modifications		$	17,682			$	19,914			$	49,033			$	106,657			$	110,596
Capital adequacy
Shareholders' equity / assets			10.96	%			12.16	%			13.17	%			14.49	%			19.64	%
Tangible shareholders' equity / tangible assets (non-GAAP)			8.20	%			9.52	%			10.61	%			12.06	%			17.85	%
(1) Presented on an annualized basis.
(2) The Company adopted ASU 2016-13 on January 1, 2022 using the modified retrospective approach. Accordingly, at March 31, 2022 and thereafter, the allowance for loan losses was determined in accordance with ASC 326, “Financial Instruments-Credit Losses” and ASC 310, “Receivables,” as amended. At December 31, 2021 and prior, the allowance for loan losses was determined in accordance with ASC 450, “Contingencies” and ASC 310, “Receivables.”

EASTERN BANKSHARES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
		As of												Sep 30, 2022 change from
(Unaudited, dollars in thousands)		Sep 30, 2022				Jun 30, 2022				Sep 30, 2021				Jun 30, 2022							Sep 30, 2021
ASSETS														△ $				△ %			△ $				△ %
Cash and due from banks		$	102,776			$	100,309			$	78,805			$	2,467			2	%		$	23,971			30	%
Short-term investments			55,661				268,605				1,172,956				(212,944	)		(79	)%			(1,117,295	)		(95	)%
Cash and cash equivalents			158,437				368,914				1,251,761				(210,477	)		(57	)%			(1,093,324	)		(87	)%
Available for sale ("AFS") securities (1)			6,844,615				7,536,921				5,689,312				(692,306	)		(9	)%			1,155,303			20	%
Held to maturity ("HTM") securities (1)			481,963				488,581				—				(6,618	)		(1	)%			481,963			—	%
Total securities			7,326,578				8,025,502				5,689,312				(698,924	)		(9	)%			1,637,266			29	%
Loans held for sale			951				764				1,757				187			24	%			(806	)		(46	)%
Loans:
Commercial and industrial			3,023,729				2,840,734				1,652,447				182,995			6	%			1,371,282			83	%
Commercial real estate			4,985,654				4,792,345				3,825,186				193,309			4	%			1,160,468			30	%
Commercial construction			314,193				303,463				243,146				10,730			4	%			71,047			29	%
Business banking			1,096,436				1,126,853				1,225,538				(30,417	)		(3	)%			(129,102	)		(11	)%
Total commercial loans			9,420,012				9,063,395				6,946,317				356,617			4	%			2,473,695			36	%
Residential real estate			2,118,852				1,989,621				1,491,269				129,231			6	%			627,583			42	%
Consumer home equity			1,168,476				1,147,425				848,570				21,051			2	%			319,906			38	%
Other consumer			196,614				198,253				218,406				(1,639	)		(1	)%			(21,792	)		(10	)%
Total loans			12,903,954				12,398,694				9,504,562				505,260			4	%			3,399,392			36	%
Allowance for loan losses			(131,663	)			(125,531	)			(103,398	)			(6,132	)		5	%			(28,265	)		27	%
Unamortized prem./disc. and def. fees			(19,349	)			(20,988	)			(23,104	)			1,639			(8	)%			3,755			(16	)%
Net loans			12,752,942				12,252,175				9,378,060				500,767			4	%			3,374,882			36	%
Federal Home Loan Bank stock, at cost			18,714				5,714				10,601				13,000			228	%			8,113			77	%
Premises and equipment			63,261				69,019				44,048				(5,758	)		(8	)%			19,213			44	%
Bank-owned life insurance			159,838				158,890				79,259				948			1	%			80,579			102	%
Goodwill and other intangibles, net			662,222				653,853				379,772				8,369			1	%			282,450			74	%
Deferred income taxes, net			342,550				244,153				34,135				98,397			40	%			308,415			904	%
Prepaid expenses			180,742				188,115				148,180				(7,373	)		(4	)%			32,562			22	%
Other assets			376,698				383,749				444,338				(7,051	)		(2	)%			(67,640	)		(15	)%
Total assets		$	22,042,933			$	22,350,848			$	17,461,223			$	(307,915	)		(1	)%		$	4,581,710			26	%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand		$	6,582,122			$	6,604,154			$	5,484,126			$	(22,032	)		—	%		$	1,097,996			20	%
Interest checking accounts			5,047,018				5,348,181				2,693,276				(301,163	)		(6	)%			2,353,742			87	%
Savings accounts			1,990,188				2,015,865				1,444,928				(25,677	)		(1	)%			545,260			38	%
Money market investment			4,757,477				4,787,603				3,802,319				(30,126	)		(1	)%			955,158			25	%
Certificates of deposit			356,576				407,998				225,315				(51,422	)		(13	)%			131,261			58	%
Total deposits			18,733,381				19,163,801				13,649,964				(430,420	)		(2	)%			5,083,417			37	%
Borrowed funds:
Federal Home Loan Bank advances			384,215				13,560				14,172				370,655			2733	%			370,043			2611	%
Escrow deposits of borrowers			21,853				19,456				15,900				2,397			12	%			5,953			37	%
Interest rate swap collateral funds			16,650				10,100				—				6,550			65	%			16,650			—	%
Total borrowed funds			422,718				43,116				30,072				379,602			880	%			392,646			1306	%
Other liabilities			470,671				425,535				351,895				45,136			11	%			118,776			34	%
Total liabilities			19,626,770				19,632,452				14,031,931				(5,682	)		—	%			5,594,839			40	%
Shareholders' equity:
Common shares			1,778				1,793				1,868				(15	)		(1	)%			(90	)		(5	)%
Additional paid-in capital			1,676,396				1,700,495				1,857,165				(24,099	)		(1	)%			(180,769	)		(10	)%
Unallocated common shares held by the employee stock ownership plan ("ESOP")			(138,950	)			(140,203	)			(143,966	)			1,253			(1	)%			5,016			(3	)%
Retained earnings			1,855,757				1,817,474				1,747,300				38,283			2	%			108,457			6	%
Accumulated other comprehensive income ("AOCI"), net of tax			(978,818	)			(661,163	)			(33,075	)			(317,655	)		48	%			(945,743	)		2859	%
Total shareholders' equity			2,416,163				2,718,396				3,429,292				(302,233	)		(11	)%			(1,013,129	)		(30	)%
Total liabilities and shareholders' equity		$	22,042,933			$	22,350,848			$	17,461,223			$	(307,915	)		(1	)%		$	4,581,710			26	%
(1) AFS and HTM securities represented at fair value and amortized cost, respectively.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
		Three months ended												Three months ended Sep 30, 2022 change from three months ended
(Unaudited, dollars in thousands, except per-share data)		Sep 30, 2022				Jun 30, 2022				Sep 30, 2021				Jun 30, 2022							Sep 30, 2021
Interest and dividend income:														△ $				△ %			△ $				△ %
Interest and fees on loans		$	124,992			$	107,236			$	86,735			$	17,756			17	%		$	38,257			44	%
Taxable interest and dividends on securities			29,280				31,121				14,314				(1,841	)		(6	)%			14,966			105	%
Non-taxable interest and dividends on securities			1,917				1,862				1,848				55			3	%			69			4	%
Interest on federal funds sold and other short-term investments			1,638				652				571				986			151	%			1,067			187	%
Total interest and dividend income			157,827				140,871				103,468				16,956			12	%			54,359			53	%
Interest expense:
Interest on deposits			4,781				3,061				736				1,720			56	%			4,045			550	%
Interest on borrowings			867				53				41				814			1536	%			826			2015	%
Total interest expense			5,648				3,114				777				2,534			81	%			4,871			627	%
Net interest income			152,179				137,757				102,691				14,422			10	%			49,488			48	%
Provision for (release of) allowance for loan losses			6,480				1,050				(1,488	)			5,430			517	%			7,968			(535	)%
Net interest income after provision for (release of) allowance for loan losses			145,699				136,707				104,179				8,992			7	%			41,520			40	%
Noninterest income:
Insurance commissions			23,788				24,682				21,956				(894	)		(4	)%			1,832			8	%
Service charges on deposit accounts			6,708				8,313				5,935				(1,605	)		(19	)%			773			13	%
Trust and investment advisory fees			5,832				5,994				6,310				(162	)		(3	)%			(478	)		(8	)%
Debit card processing fees			3,249				3,223				3,030				26			1	%			219			7	%
Interest rate swap income			1,562				1,593				881				(31	)		(2	)%			681			77	%
Losses from investments held in rabbi trusts			(2,248	)			(7,316	)			(289	)			5,068			(69	)%			(1,959	)		678	%
Gains on sales of mortgage loans held for sale, net			22				49				717				(27	)		(55	)%			(695	)		(97	)%
(Losses) gains on sales of securities available for sale, net			(198	)			(104	)			1				(94	)		90	%			(199	)		(19900	)%
Other			4,638				5,443				4,668				(805	)		(15	)%			(30	)		(1	)%
Total noninterest income			43,353				41,877				43,209				1,476			4	%			144			—	%
Noninterest expense:
Salaries and employee benefits			78,060				72,996				66,238				5,064			7	%			11,822			18	%
Office occupancy and equipment			9,703				9,888				7,960				(185	)		(2	)%			1,743			22	%
Data processing			13,294				14,345				12,191				(1,051	)		(7	)%			1,103			9	%
Professional services			5,826				4,034				4,024				1,792			44	%			1,802			45	%
Marketing			2,219				2,651				1,598				(432	)		(16	)%			621			39	%
Loan expenses			1,152				1,124				1,586				28			2	%			(434	)		(27	)%
Federal Deposit Insurance Corporation ("FDIC") insurance			1,578				1,720				1,056				(142	)		(8	)%			522			49	%
Amortization of intangible assets			1,033				907				629				126			14	%			404			64	%
Other			3,975				3,474				3,688				501			14	%			287			8	%
Total noninterest expense			116,840				111,139				98,970				5,701			5	%			17,870			18	%
Income before income tax expense			72,212				67,445				48,418				4,767			7	%			23,794			49	%
Income tax expense			17,435				16,273				11,312				1,162			7	%			6,123			54	%
Net income		$	54,777			$	51,172			$	37,106			$	3,605			7	%		$	17,671			48	%
Share data:
Earnings per share, basic		$	0.33			$	0.31			$	0.22
Earnings per share, diluted		$	0.33			$	0.31			$	0.22

EASTERN BANKSHARES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
		Nine months ended
(Unaudited, dollars in thousands, except per-share data)		Sep 30, 2022				Sep 30, 2021				Change
Interest and dividend income:										△ $				△ %
Interest and fees on loans		$	333,595			$	266,310			$	67,285			25	%
Taxable interest and dividends on securities			88,277				36,977				51,300			139	%
Non-taxable interest and dividends on securities			5,585				5,561				24			—	%
Interest on federal funds sold and other short-term investments			2,726				1,434				1,292			90	%
Total interest and dividend income			430,183				310,282				119,901			39	%
Interest expense:
Interest on deposits			11,164				2,769				8,395			303	%
Interest on borrowings			959				123				836			680	%
Total interest expense			12,123				2,892				9,231			319	%
Net interest income			418,060				307,390				110,670			36	%
Provision for (release of) allowance for loan losses			7,045				(5,368	)			12,413			(231	)%
Net interest income after provision for (release of) release of allowance for loan losses			411,015				312,758				98,257			31	%
Noninterest income:
Insurance commissions			77,183				73,767				3,416			5	%
Service charges on deposit accounts			23,558				17,010				6,548			38	%
Trust and investment advisory fees			17,967				18,047				(80	)		—	%
Debit card processing fees			9,417				8,949				468			5	%
Interest rate swap income			6,087				5,122				965			19	%
(Losses) income from investments held in rabbi trusts			(13,997	)			5,773				(19,770	)		(342	)%
Gains on sales of mortgage loans held for sale, net			240				3,044				(2,804	)		(92	)%
(Losses) gains on sales of securities available for sale, net			(2,474	)			1,166				(3,640	)		(312	)%
Other			13,664				11,276				2,388			21	%
Total noninterest income			131,645				144,154				(12,509	)		(9	)%
Noninterest expense:
Salaries and employee benefits			220,582				199,554				21,028			11	%
Office occupancy and equipment			31,205				24,271				6,934			29	%
Data processing			42,959				37,892				5,067			13	%
Professional services			14,561				14,611				(50	)		—	%
Marketing			6,444				6,786				(342	)		(5	)%
Loan expenses			3,444				5,287				(1,843	)		(35	)%
Federal Deposit Insurance Corporation ("FDIC") insurance			4,710				2,989				1,721			58	%
Amortization of intangible assets			2,767				1,786				981			55	%
Other			10,173				7,178				2,995			42	%
Total noninterest expense			336,845				300,354				36,491			12	%
Income before income tax expense			205,815				156,558				49,257			31	%
Income tax expense			48,350				36,980				11,370			31	%
Net income		$	157,465			$	119,578			$	37,887			32	%
Share data:
Weighted average common shares outstanding, basic (1)			166,682,222				172,174,469				(5,492,247	)		(3	)%
Weighted average common shares outstanding, diluted (1)			166,867,643				172,174,469				(5,306,826	)		(3	)%
Earnings per share, basic		$	0.94			$	0.69			$	0.25			36	%
Earnings per share, diluted		$	0.94			$	0.69			$	0.25			36	%
(1) Shares held by the Company’s ESOP that have not been allocated to employees in accordance with the terms of the ESOP are not deemed outstanding for earnings per share calculations.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES AVERAGE BALANCES, INTEREST EARNED/PAID, & AVERAGE YIELDS
		As of and for the three months ended
		Sep 30, 2022									Jun 30, 2022									Sep 30, 2021
(Unaudited, dollars in thousands)		Avg. Balance			Interest			Yield / Cost (5)			Avg. Balance			Interest			Yield / Cost (5)			Avg. Balance			Interest			Yield / Cost (5)
Interest-earning assets:
Loans (1):
Commercial		$	9,138,029		$	96,270		4.18	%		$	8,944,652		$	83,586		3.75	%		$	6,995,556		$	67,276		3.82	%
Residential			2,043,219			15,811		3.07	%			1,960,014			14,683		3.00	%			1,477,891			11,479		3.08	%
Consumer			1,341,528			16,072		4.75	%			1,309,864			11,494		3.52	%			1,055,075			8,803		3.31	%
Total loans			12,522,776			128,153		4.06	%			12,214,530			109,763		3.60	%			9,528,522			87,558		3.65	%
Investment securities			8,716,105			31,708		1.44	%			8,883,710			33,479		1.51	%			5,249,742			16,655		1.26	%
Federal funds sold and other short-term investments			282,629			1,638		2.30	%			345,731			652		0.76	%			1,503,919			571		0.15	%
Total interest-earning assets			21,521,510			161,499		2.98	%			21,443,971			143,894		2.69	%			16,282,183			104,784		2.55	%
Non-interest-earning assets			911,025									962,734									1,141,168
Total assets		$	22,432,535								$	22,406,705								$	17,423,351
Interest-bearing liabilities:
Deposits:
Savings		$	2,021,125		$	51		0.01	%		$	2,041,495		$	51		0.01	%		$	1,441,385		$	36		0.01	%
Interest checking			5,211,914			2,686		0.20	%			4,877,256			2,061		0.17	%			2,687,196			244		0.04	%
Money market			4,824,452			1,893		0.16	%			5,069,609			745		0.06	%			3,762,855			360		0.04	%
Time deposits			380,560			151		0.16	%			426,923			204		0.19	%			233,145			96		0.16	%
Total interest-bearing deposits			12,438,051			4,781		0.15	%			12,415,283			3,061		0.10	%			8,124,581			736		0.04	%
Borrowings			157,686			867		2.18	%			35,330			53		0.60	%			26,074			41		0.62	%
Total interest-bearing liabilities			12,595,737			5,648		0.18	%			12,450,613			3,114		0.10	%			8,150,655			777		0.04	%
Demand deposit accounts			6,614,467									6,661,920									5,471,906
Other noninterest-bearing liabilities			445,640									428,373									350,111
Total liabilities			19,655,844									19,540,906									13,972,672
Shareholders' equity			2,776,691									2,865,799									3,450,679
Total liabilities and shareholders' equity		$	22,432,535								$	22,406,705								$	17,423,351
Net interest income - FTE					$	155,851								$	140,780								$	104,007
Net interest rate spread (2)								2.80	%								2.59	%								2.51	%
Net interest-earning assets (3)		$	8,925,773								$	8,993,358								$	8,131,528
Net interest margin - FTE (4)								2.87	%								2.63	%								2.53	%
(1) Includes non-accrual loans.
(2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(3) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average total interest-earning assets.
(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES AVERAGE BALANCES, INTEREST EARNED/PAID, & AVERAGE YIELDS
		As of and for the nine months ended
		Sep 30, 2022									Sep 30, 2021
(Unaudited, dollars in thousands)		Avg. Balance			Interest			Yield / Cost (5)			Avg. Balance			Interest			Yield / Cost (5)
Interest-earning assets:
Loans (1):
Commercial		$	9,019,196		$	258,082		3.83	%		$	7,203,903		$	208,228		3.86	%
Residential			1,980,630			44,966		3.04	%			1,435,006			34,150		3.18	%
Consumer			1,315,136			38,016		3.86	%			1,074,039			26,337		3.28	%
Total loans			12,314,962			341,064		3.70	%			9,712,948			268,715		3.70	%
Total investment securities			8,749,257			95,349		1.46	%			4,414,582			44,015		1.33	%
Federal funds sold and other short-term investments			541,285			2,726		0.67	%			1,619,873			1,434		0.12	%
Total interest-earning assets			21,605,504			439,139		2.72	%			15,747,403			314,164		2.67	%
Non-interest-earning assets			1,099,406									1,106,967
Total assets		$	22,704,910								$	16,854,370
Interest-bearing liabilities:
Deposits:
Savings		$	2,046,254		$	153		0.01	%		$	1,376,243		$	169		0.02	%
Interest checking			4,897,321			6,778		0.19	%			2,541,113			730		0.04	%
Money market			5,151,384			3,559		0.09	%			3,576,648			1,553		0.06	%
Time deposits			429,401			674		0.21	%			243,621			317		0.17	%
Total interest-bearing deposits			12,524,360			11,164		0.12	%			7,737,625			2,769		0.05	%
Borrowings			75,027			959		1.71	%			25,582			123		0.64	%
Total interest-bearing liabilities			12,599,387			12,123		0.13	%			7,763,207			2,892		0.05	%
Demand deposit accounts			6,698,640									5,318,903
Other noninterest-bearing liabilities			436,724									347,237
Total liabilities			19,734,751									13,429,347
Shareholders' equity			2,970,159									3,425,023
Total liabilities and shareholders' equity		$	22,704,910								$	16,854,370
Net interest income - FTE					$	427,016								$	311,272
Net interest rate spread (2)								2.59	%								2.62	%
Net interest-earning assets (3)		$	9,006,117								$	7,984,196
Net interest margin - FTE (4)								2.64	%								2.64	%
(1) Includes non-accrual loans.
(2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(3) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(4) Net interest margin represents net interest income divided by average total interest-earning assets.
(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES ASSET QUALITY - NON-PERFORMING ASSETS (1)
		As of
		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
(Unaudited, dollars in thousands)
Non-accrual loans:
Commercial		$	19,886			$	43,628			$	17,919			$	20,630			$	29,166
Residential			8,513				9,486				8,256				6,681				7,185
Consumer			5,555				6,766				7,646				5,682				4,262
Total non-accrual loans			33,954				59,880				33,821				32,993				40,613
Total accruing loans past due 90 days or more (2):			—				—				—				1,990				1,458
Total non-performing loans			33,954				59,880				33,821				34,983				42,071
Other real estate owned			—				—				—				—				—
Other non-performing assets:			—				—				—				—				—
Total non-performing assets		$	33,954			$	59,880			$	33,821			$	34,983			$	42,071
Total accruing troubled debt restructured loans		$	36,275			$	33,518			$	32,016			$	33,336			$	34,723
Total non-performing loans to total loans			0.26	%			0.48	%			0.28	%			0.29	%			0.44	%
Total non-performing assets to total assets			0.15	%			0.27	%			0.15	%			0.15	%			0.24	%
(1) Non-performing assets are comprised of NPLs, other real estate owned ("OREO"), and non-performing securities. NPLs consist of non-accrual loans and loans that are more than 90 days past due but still accruing interest. OREO consists of real estate properties, which primarily serve as collateral to secure the Company’s loans, that it controls due to foreclosure or acceptance of a deed in lieu of foreclosure.
(2) Loans that were past due 90 days or more and still accruing in prior quarters were comprised solely of purchased credit impaired ("PCI") loans. PCI loans were not subject to classification as nonaccrual in the same manner as originated loans as their interest income related to the accretable yield recognized and not to contractual interest payments at the loan level. In connection with the Company’s adoption on January 1, 2022 of the loan loss methodology commonly referred to as the "current expected credit losses methodology" ("CECL"), the Company's PCI loans are now considered purchased credit deteriorated ("PCD") loans. Interest income recognition for PCD loans is consistent with originated loans and, therefore, PCD loans cease accruing interest at 90 days past due unless management believes that collateral held by the Company is clearly sufficient and in full satisfaction of both principal and interest. There were no PCD or originated loans at September 30, 2022, June 30, 2022 or March 31, 2022 that were past due 90 days or more and still accruing.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES ASSET QUALITY - PROVISION, ALLOWANCE, AND NET CHARGE-OFFS (RECOVERIES)
		Three months ended
		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
(Unaudited, dollars in thousands)
Average total loans		$	12,521,426			$	12,213,706			$	12,203,212			$	10,944,091			$	9,526,766
Allowance for loan losses, beginning of the period			125,531				124,166				97,787				103,398				105,637
Total cumulative effect of change in accounting principle (1):			—				—				27,086				—				—
Charged-off loans:
Commercial and industrial			11				1				1				1,008				—
Commercial real estate			—				—				—				5				8
Commercial construction			—				—				—				—				—
Business banking			369				608				945				1,002				867
Residential real estate			—				—				—				35				—
Consumer home equity			—				—				—				24				—
Other consumer			603				490				661				666				742
Total charged-off loans			983				1,099				1,607				2,740				1,617
Recoveries on loans previously charged-off:
Commercial and industrial			126				698				250				873				40
Commercial real estate			3				36				14				—				—
Commercial construction			—				—				—				—				—
Business banking			286				464				928				399				469
Residential real estate			56				14				10				7				88
Consumer home equity			6				6				4				48				63
Other consumer			158				196				179				120				206
Total recoveries			635				1,414				1,385				1,447				866
Net loans charged-off (recoveries):
Commercial and industrial			(115	)			(697	)			(249	)			135				(40	)
Commercial real estate			(3	)			(36	)			(14	)			5				8
Commercial construction			—				—				—				—				—
Business banking			83				144				17				603				398
Residential real estate			(56	)			(14	)			(10	)			28				(88	)
Consumer home equity			(6	)			(6	)			(4	)			(24	)			(63	)
Other consumer			445				294				482				546				536
Total net loans charged-off (recoveries)			348				(315	)			222				1,293				751
Provision for (release of) allowance for loan losses			6,480				1,050				(485	)			(4,318	)			(1,488	)
Total allowance for loan losses, end of period		$	131,663			$	125,531			$	124,166			$	97,787			$	103,398
Net charge-offs (recoveries) to average total loans outstanding during this period (2)			0.01	%			(0.01	)%			0.01	%			0.05	%			0.03	%
Allowance for loan losses as a percent of total loans			1.02	%			1.01	%			1.02	%			0.80	%			1.09	%
Allowance for loan losses as a percent of nonperforming loans			387.77	%			209.64	%			367.13	%			279.53	%			245.77	%
(1) Represents the adjustment needed to reflect the cumulative day one impact pursuant to the Company’s adoption of ASU 2016-13 (i.e., cumulative effect adjustment related the adoption of ASU 2016-13 as of January 1, 2022). The adjustment represents a $27.1 million increase to the allowance for loan losses attributable to the change in accounting methodology which requires the estimation of the allowance for credit losses resulting from the Company’s adoption of the standard. The adjustment also includes the adjustment needed to reflect the day one reclassification of the Company’s financial assets that were previously classified as PCI financial assets as PCD financial assets and the associated gross-up of $0.1 million, pursuant to the Company’s adoption of ASU 2016-13.
(2) Presented on an annualized basis.

APPENDIX A: Reconciliation of Non-GAAP Earnings Metrics For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."
		As of and for the three Months Ended
(Unaudited, dollars in thousands, except per-share data)		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
Net income (GAAP)		$	54,777			$	51,172			$	51,516			$	35,087			$	37,106
Add:
Noninterest income components:
Losses (income) from investments held in rabbi trusts			2,248				7,316				4,433				(4,444	)			289
Losses (gains) on sales of securities available for sale, net			198				104				2,172				—				(1	)
(Gains) losses on sales of other assets			(501	)			(1,251	)			274				(34	)			(490	)
Noninterest expense components:
Rabbi trust employee benefit (income) expense			(867	)			(3,310	)			(2,087	)			2,519				(53	)
Impairment charge on tax credit investments			—				—				—				116				1,133
Gain on sale of OREO			—				—				—				—				(87	)
Merger and acquisition expenses			271				—				34				30,652				740
Total impact of non-GAAP adjustments			1,349				2,859				4,826				28,809				1,531
Less net tax benefit associated with non-GAAP adjustments (1)			384				1,513				1,235				19,036				1,246
Non-GAAP adjustments, net of tax		$	965			$	1,346			$	3,591			$	9,773			$	285
Operating net income (non-GAAP)		$	55,742			$	52,518			$	55,107			$	44,860			$	37,391
Weighted average common shares outstanding during the period (2):
Basic			163,718,962				166,533,920				169,857,950				172,246,799				172,298,615
Diluted			164,029,649				166,573,627				169,968,156				172,481,829				172,298,615
Earnings per share, basic		$	0.33			$	0.31			$	0.30			$	0.20			$	0.22
Earnings per share, diluted		$	0.33			$	0.31			$	0.30			$	0.20			$	0.22
Operating earnings per share, basic (non-GAAP)		$	0.34			$	0.32			$	0.32			$	0.26			$	0.22
Operating earnings per share, diluted (non-GAAP)		$	0.34			$	0.32			$	0.32			$	0.26			$	0.22
Return on average assets (3)			0.97	%			0.92	%			0.90	%			0.67	%			0.84	%
Add:
Losses (income) from investments held in rabbi trusts (3)			0.04	%			0.13	%			0.08	%			(0.08	)%			0.01	%
Losses (gains) on sales of securities available for sale, net (3)			0.00	%			0.00	%			0.04	%			0.00	%			0.00	%
(Gains) losses on sales of other assets (3)			(0.01	)%			(0.02	)%			0.00	%			0.00	%			(0.01	)%
Rabbi trust employee benefit (income) expense (3)			(0.02	)%			(0.06	)%			(0.04	)%			0.05	%			0.00	%
Impairment charge on tax credit investments (3)			0.00	%			0.00	%			0.00	%			0.00	%			0.03	%
Gain on sale of OREO (3)			0.00	%			0.00	%			0.00	%			0.00	%			0.00	%
Merger and acquisition expenses (3)			0.00	%			0.00	%			0.00	%			0.58	%			0.02	%
Less net tax benefit associated with non-GAAP adjustments (1) (3)			0.01	%			0.03	%			0.02	%			0.36	%			0.03	%
Operating return on average assets (non-GAAP) (3)			0.97	%			0.94	%			0.96	%			0.86	%			0.86	%
Return on average shareholders' equity (3)			7.83	%			7.16	%			6.38	%			4.07	%			4.27	%
Add:
Losses (income) from investments held in rabbi trusts (3)			0.32	%			1.02	%			0.55	%			(0.52	)%			0.03	%
Losses (gains) on sales of securities available for sale, net (3)			0.03	%			0.01	%			0.27	%			0.00	%			0.00	%
(Gains) losses on sales of other assets (3)			(0.07	)%			(0.18	)%			0.03	%			0.00	%			(0.06	)%
Rabbi trust employee benefit (income) expense (3)			(0.12	)%			(0.46	)%			(0.26	)%			0.29	%			(0.01	)%
Impairment charge on tax credit investments (3)			0.00	%			0.00	%			0.00	%			0.01	%			0.13	%
Gain on sale of OREO (3)			0.00	%			0.00	%			0.00	%			0.00	%			(0.01	)%
Merger and acquisition expenses (3)			0.04	%			0.00	%			0.00	%			3.55	%			0.09	%
Less net tax benefit associated with non-GAAP adjustments (1) (3)			0.05	%			0.21	%			0.15	%			2.21	%			0.14	%
Operating return on average shareholders' equity (non-GAAP) (3)			7.98	%			7.34	%			6.82	%			5.19	%			4.30	%
Average tangible shareholders' equity:
Average total shareholders' equity (GAAP)		$	2,776,691			$	2,865,799			$	3,273,447			$	3,423,231			$	3,450,679
Less: Average goodwill and other intangibles			656,684				654,444				649,497				520,988				380,185
Average tangible shareholders' equity (non-GAAP)		$	2,120,007			$	2,211,355			$	2,623,950			$	2,902,243			$	3,070,494
Return on average tangible shareholders' equity (non-GAAP) (3)			10.25	%			9.28	%			7.96	%			4.80	%			4.79	%
Add:
Losses (income) from investments held in rabbi trusts (3)			0.42	%			1.33	%			0.69	%			(0.61	)%			0.04	%
Losses (gains) on sales of securities available for sale, net (3)			0.04	%			0.02	%			0.34	%			0.00	%			0.00	%
(Gains) losses on sales of other assets (3)			(0.09	)%			(0.23	)%			0.04	%			0.00	%			(0.06	)%
Rabbi trust employee benefit (income) expense (3)			(0.16	)%			(0.60	)%			(0.32	)%			0.34	%			(0.01	)%
Impairment charge on tax credit investments (3)			0.00	%			0.00	%			0.00	%			0.02	%			0.15	%
Gain on sale of OREO (3)			0.00	%			0.00	%			0.00	%			0.00	%			(0.01	)%
Merger and acquisition expenses (3)			0.05	%			0.00	%			0.01	%			4.19	%			0.10	%
Less net tax benefit associated with non-GAAP adjustments (1) (3)			0.07	%			0.27	%			0.19	%			2.60	%			0.16	%
Operating return on average tangible shareholders' equity (non-GAAP) (3)			10.44	%			9.53	%			8.53	%			6.14	%			4.84	%
(1) The net tax benefit associated with these items is determined by assessing whether each item is included or excluded from net taxable income and applying our combined statutory tax rate only to those items included in net taxable income. The net tax benefit amount for the quarters ended December 31, 2021 and June 30, 2022 reflect the impact of the release of $11.3 million and $0.7 million, respectively, of the $12.0 million valuation allowance associated with the Company's stock donation to the Eastern Bank Foundation made in the quarter ended December 31, 2020. There was no such release in other quarters.
(2) Shares held by the Company’s ESOP that have not been allocated to employees in accordance with the terms of the ESOP are not deemed outstanding for earnings per share calculations.
(3) Presented on an annualized basis.

APPENDIX B: Reconciliation of Non-GAAP Operating Revenues and Expenses For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."
		Three Months Ended
		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
(Unaudited, dollars in thousands)
Net interest income (GAAP)		$	152,179			$	137,757			$	128,124			$	122,437			$	102,691
Add:
Tax-equivalent adjustment (non-GAAP)			3,672				3,023				2,261				2,211				1,316
Fully-taxable equivalent net interest income (non-GAAP)		$	155,851			$	140,780			$	130,385			$	124,648			$	104,007
Noninterest income (GAAP)		$	43,353			$	41,877			$	46,415			$	49,001			$	43,209
Less:
(Losses) income from investments held in rabbi trusts			(2,248	)			(7,316	)			(4,433	)			4,444				(289	)
(Losses) gains on sales of securities available for sale, net			(198	)			(104	)			(2,172	)			—				1
Gain (losses) on sales of other assets			501				1,251				(274	)			34				490
Noninterest income on an operating basis (non-GAAP)		$	45,298			$	48,046			$	53,294			$	44,523			$	43,007
Noninterest expense (GAAP)		$	116,840			$	111,139			$	108,866			$	143,602			$	98,970
Less:
Rabbi trust employee benefit (income) expense			(867	)			(3,310	)			(2,087	)			2,519				(53	)
Impairment charge on tax credit investments			—				—				—				116				1,133
Gain on sale of OREO			—				—				—				—				(87	)
Merger and acquisition expenses			271				—				34				30,652				740
Noninterest expense on an operating basis (non-GAAP)		$	117,436			$	114,449			$	110,919			$	110,315			$	97,237
Total revenue (GAAP)		$	195,532			$	179,634			$	174,539			$	171,438			$	145,900
Total operating revenue (non-GAAP)		$	201,149			$	188,826			$	183,679			$	169,171			$	147,014
Efficiency ratio (GAAP)			59.75	%			61.87	%			62.37	%			83.76	%			67.83	%
Operating efficiency ratio (non-GAAP)			58.38	%			60.61	%			60.39	%			65.21	%			66.14	%
Noninterest income / total revenue (GAAP)			22.17	%			23.31	%			26.59	%			28.58	%			29.62	%
Noninterest income / total revenue on an operating basis (non-GAAP)			22.52	%			25.44	%			29.01	%			26.32	%			29.25	%

APPENDIX C: Reconciliation of Non-GAAP Capital Metrics For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."
		As of
		Sep 30, 2022				Jun 30, 2022				Mar 31, 2022				Dec 31, 2021				Sep 30, 2021
(Unaudited, dollars in thousands, except per-share data)
Tangible shareholders' equity:
Total shareholders' equity (GAAP)		$	2,416,163			$	2,718,396			$	3,008,392			$	3,406,352			$	3,429,292
Less: Goodwill and other intangibles			662,222				653,853				654,759				649,703				379,772
Tangible shareholders' equity (non-GAAP)			1,753,941				2,064,543				2,353,633				2,756,649				3,049,520
Tangible assets:
Total assets (GAAP)			22,042,933				22,350,848				22,836,072				23,512,128				17,461,223
Less: Goodwill and other intangibles			662,222				653,853				654,759				649,703				379,772
Tangible assets (non-GAAP)		$	21,380,711			$	21,696,995			$	22,181,313			$	22,862,425			$	17,081,451
Shareholders' equity to assets ratio (GAAP)			10.96	%			12.16	%			13.17	%			14.49	%			19.64	%
Tangible shareholders' equity to tangible assets ratio (non-GAAP)			8.20	%			9.52	%			10.61	%			12.06	%			17.85	%
Common shares outstanding			177,772,553				179,253,801				183,438,711				186,305,332				186,758,154
Book value per share (GAAP)		$	13.59			$	15.17			$	16.40			$	18.28			$	18.36
Tangible book value per share (non-GAAP)		$	9.87			$	11.52			$	12.83			$	14.80			$	16.33

APPENDIX D: Tangible Shareholders’ Equity Roll Forward Analysis For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."
		As of								Change
		Sep 30, 2022				Jun 30, 2022				Jun 30, 2022
(Unaudited, dollars in thousands, except per-share data)
Common stock		$	1,778			$	1,793			$	(15	)
Additional paid in capital			1,676,396				1,700,495				(24,099	)
Unallocated ESOP common stock			(138,950	)			(140,203	)			1,253
Retained earnings			1,855,757				1,817,474				38,283
AOCI, net of tax - available for sale securities			(918,855	)			(657,386	)			(261,469	)
AOCI, net of tax - pension			(5,842	)			(5,718	)			(124	)
AOCI, net of tax - cash flow hedge			(54,121	)			1,941				(56,062	)
Total shareholders' equity:		$	2,416,163			$	2,718,396			$	(302,233	)
Less: Goodwill and other intangibles			662,222				653,853				8,369
Tangible shareholders' equity (non-GAAP)		$	1,753,941			$	2,064,543			$	(310,602	)
Common shares outstanding			177,772,553				179,253,801				(1,481,248	)
Per share:
Common stock		$	0.01			$	0.01			$	—
Additional paid in capital			9.43				9.49				(0.06	)
Unallocated ESOP common stock			(0.78	)			(0.78	)			—
Retained earnings			10.44				10.14				0.30
AOCI, net of tax - available for sale securities			(5.17	)			(3.67	)			(1.50	)
AOCI, net of tax - pension			(0.03	)			(0.03	)			—
AOCI, net of tax - cash flow hedge			(0.30	)			0.01				(0.32	)
Total shareholders' equity:		$	13.59			$	15.17			$	(1.57	)
Less: Goodwill and other intangibles			3.73				3.65				0.08
Tangible shareholders' equity (non-GAAP)		$	9.87			$	11.52			$	(1.65	)

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20221027005742/en/

Investor Contact

Jillian Belliveau

Eastern Bankshares, Inc.

InvestorRelations@easternbank.com

781-598-7920

Media Contact

Andrea Goodman

Eastern Bank

a.goodman@easternbank.com

781-598-7847

Source: Eastern Bank

FAQ

What are the Q3 2022 earnings results for Eastern Bankshares (EBC)?

Eastern Bankshares reported a net income of $54.8 million, or $0.33 per diluted share, for Q3 2022.

How much did Eastern Bankshares (EBC) increase its dividends in 2022?

The company declared a quarterly cash dividend of $0.10 per common share for Q3 2022.

What is the loan growth percentage for Eastern Bankshares (EBC) in Q3 2022?

Eastern Bankshares reported a loan growth of 16% on an annualized basis for Q3 2022.

What is the net interest margin reported by Eastern Bankshares (EBC) for Q3 2022?

The net interest margin for Q3 2022 was 2.87%, an increase of 24 basis points from the prior quarter.