0001810546FALSE00018105462024-07-252024-07-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): July 25, 2024
EASTERN BANKSHARES, INC.
(Exact Name of Registrant as Specified in Charter)
 
Massachusetts 001-39610 84-4199750
(State or Other Jurisdiction
of Incorporation or Organization)		 (Commission
File Number)		 (I.R.S. Employer
Identification No.)
125 High Street 02110
Boston, MA
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (800) 327-8376
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
☒Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class  Trading
Symbol(s)		  Name of each exchange
on which registered
Common Stock  EBC  Nasdaq Global Select Market
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company  ☐
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐


Item 2.02    Results of Operations and Financial Condition.

On July 25, 2024, Eastern Bankshares, Inc., a Massachusetts corporation (the “Company”) and the stock holding company for Eastern Bank, issued a press release in which it announced its earnings for the quarter ended June 30, 2024. A copy of the press release is furnished herewith as Exhibit 99.1.

Item 7.01    Regulation FD Disclosure.

In the press release announcing the Company's earnings for the quarter ended June 30, 2024, the Company announced the approval by its Board of Directors of a regular quarterly cash dividend of $0.11 per share payable on September 16, 2024 to shareholders of record as of the close of business on September 3, 2024.

In connection with issuing such press release, the Company posted an investor presentation in the “Presentations” section of the Company’s investor relations website at investor.easternbank.com on July 25, 2024.


Item 8.01    Other Events.

In the press release announcing the Company's earnings for the quarter ended June 30, 2024, the Company also announced that its Board of Directors has approved a new share repurchase program that authorizes the Company to purchase up to 10.8 million shares, or 5% of the Company’s outstanding shares of common stock as of July 12, 2024, not to exceed $200 million, over a 12-month period. The purchases may occur in open market or privately negotiated transactions.

On July 19, 2024, the Company received notice of non-objection from the Board of Governors of the Federal Reserve System for the share repurchase program. The Company does not anticipate that the share repurchases will begin before early August 2024.



Item 9.01    Financial Statements and Exhibits.
(d)Exhibits
ExhibitDescription
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
EASTERN BANKSHARES, INC.
DATE: July 25, 2024
By: /s/ James B. Fitzgerald
 James B. Fitzgerald
 Chief Financial Officer


Exhibit 99.1
Eastern Bankshares, Inc. Reports Second Quarter 2024 Financial Results

~ Company Announces Authorization of Share Repurchase Program ~

BOSTON, July 25, 2024 (BUSINESS WIRE) — Eastern Bankshares, Inc. (the “Company,” or together with its subsidiaries, “Eastern”) (NASDAQ Global Select Market: EBC), the stock holding company of Eastern Bank, today announced its 2024 second quarter financial results, the declaration of a quarterly cash dividend, and the authorization of a share repurchase program.

On July 12, 2024, the Company completed its merger (“the merger”) with Cambridge Bancorp (“Cambridge”) and surpassed $25 billion in assets. The merger also added approximately $4.8 billion in assets under management and administration (“AUM/A”), 11 net new branch locations, and 4 net new wealth management offices to the Company. The Company plans to provide an update on the financial impact of the merger with the third quarter earnings release.

“I’m very pleased with our second quarter financial results, which demonstrate the continued strength and stability of our franchise,” said Bob Rivers, Executive Chair and Chair of the Board of the Company and Eastern Bank. “Shortly after the close of the second quarter, we joined forces with Cambridge. The complementary strengths of each bank will allow us to better serve our customers with a full suite of commercial and consumer banking products and services, as well as wealth management offerings, supported by strong digital capabilities. This enhanced ability to serve our customers – combined with our financial strength and community focus – will continue to drive value for all our stakeholders and further solidify Eastern as Greater Boston’s leading local bank.”
Mr. Rivers continued, “Our Board’s approval of a new share repurchase program is a testament to the Company’s strong capital and liquidity position, and our commitment to creating shareholder value.”

FINANCIAL HIGHLIGHTS FOR THE SECOND QUARTER OF 2024

•Net income of $26.3 million, or $0.16 per diluted share. Operating net income* of $36.5 million, or $0.22 per diluted share.
•The net interest margin on a fully tax equivalent (“FTE”) basis* declined modestly to 2.64% as compared to 2.68% in the prior quarter.
•Total loans increased $56.8 million, or 1.6% on an annualized basis, from the prior quarter, to $14.1 billion.
•Deposits declined $129 million, or 2.9% on an annualized basis, driven by the early withdrawal of a $100 million omnibus deposit contract for which the bank received an early termination payment of $7.8 million. Excluding this early withdrawal, deposits were relatively stable from the prior quarter.
•Average deposits increased $192.9 million in the second quarter, or 1.1%.
•Eastern sold securities totaling $85 million in the quarter at a loss of $7.6 million.
•Non-performing loans (“NPLs”) reduced from $57.2 million to $39.8 million or from 0.41% to 0.28% of total loans. The reduction was driven by the resolution of two NPLs in the second quarter.
•Net recoveries of 0.02% of average total loans, compared to net charge-offs of 0.21% in the prior quarter, both on an annualized basis.

BALANCE SHEET

Total assets were $21.0 billion at June 30, 2024, representing a decrease of $130.6 million, or 0.6% from March 31, 2024.

•Cash and equivalents increased $11.8 million from the prior quarter to $750.8 million.
•Total securities decreased $196.9 million, or 4.2%, from the prior quarter, to $4.5 billion, due to the sale of approximately $85 million in available for sale securities (“AFS securities”) and principal runoff.
•Loans totaled $14.1 billion, representing an increase of $56.8 million, or 0.4%, from the prior quarter, driven primarily by consumer loan growth of $51.3 million.
•Deposits totaled $17.5 billion, representing a decrease of $128.9 million, or 0.7%, from the prior quarter, driven primarily by the early withdrawal of a $100 million omnibus deposit contract, which was inherited from Eastern’s acquisition of Century Bank and Trust Company in 2021. Average deposits increased $192.9 million in the second quarter, or 1.1%. The Company had no brokered deposits at June 30, 2024 and March 31, 2024.
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•Federal Home Loan Bank advances decreased $0.2 million from the prior quarter to $17.4 million.
•Shareholders’ equity was $3.0 billion, representing an increase of $14.6 million from the prior quarter, driven primarily by an increase in retained earnings.
•At June 30, 2024, book value per share was $16.80 and tangible book value per share* was $13.60. Please refer to Appendix D to this press release for a roll-forward of tangible shareholders’ equity*.

NET INTEREST INCOME

Net interest income was $128.6 million for the second quarter of 2024, compared to $129.9 million for the prior quarter, representing a decrease of $1.3 million.

•The net interest margin on a FTE basis* was 2.64% for the second quarter, representing a 4 basis point decrease from the prior quarter, as higher funding costs more than offset increases in interest-earning asset yields.
•Total interest-earning assets yield increased 6 basis points from the prior quarter to 4.19%, due primarily to an increase in loan yields of 3 basis points, as well as higher other short-term investments volume.
•Total interest-bearing liabilities cost increased 12 basis points from the prior quarter to 2.44%, due primarily to higher deposit costs resulting from deposit mix shifts.

NONINTEREST INCOME

Noninterest income was $25.3 million for the second quarter of 2024, compared to $27.7 million for the prior quarter, representing a decrease of $2.3 million. Noninterest income on an operating basis* was $31.1 million for the second quarter of 2024, compared to $23.4 million for the prior quarter, representing an increase of $7.8 million.

•Service charges on deposit accounts increased $0.4 million from the prior quarter to $7.9 million.
•Trust and investment advisory fees increased $0.2 million from the prior quarter to $6.7 million.
•Debit card processing fees increased $0.3 million from the prior quarter to $3.5 million.
•Loan-level interest rate swap income decreased $0.2 million from the prior quarter to $0.4 million.
•Income from investments held in rabbi trust accounts decreased $2.6 million from the prior quarter to $1.8 million. The quarter over quarter change was driven by investment performance.
•Losses on sales of mortgage loans held for sale were $0.2 million, compared to losses of $0.1 million in the prior quarter.
•Losses on sales of AFS securities were $7.6 million due to the sale of approximately $85 million of AFS securities. There were no losses on sales of AFS securities in the prior quarter.
•Other noninterest income increased $7.2 million in the second quarter to $12.7 million. The increase was driven primarily by the early termination payment of $7.8 million received from the aforementioned omnibus deposit early withdrawal.

NONINTEREST EXPENSE

Noninterest expense was $109.9 million for the second quarter of 2024, compared to $101.2 million in the prior quarter, representing an increase of $8.7 million. Noninterest expense on an operating basis* for the second quarter of 2024 was $105.3 million, compared to $97.6 million in the prior quarter, representing an increase of $7.6 million.

•Salaries and employee benefits expense was $65.2 million, an increase of $0.7 million from the prior quarter.
•Office occupancy and equipment expense was $10.1 million, an increase of $0.9 million from the prior quarter, due primarily to the move to the Company’s new corporate headquarters.
•Data processing expense was $18.0 million, an increase of $1.5 million from the prior quarter, due primarily to an increase of $1.4 million in merger related data processing expenses from the prior quarter.
•Professional services expense was $4.3 million in the second quarter, an increase of $0.7 million from the prior quarter.
•Marketing expense was $1.9 million, an increase of $0.4 million from the prior quarter, due primarily to higher advertising expenses.
•Federal Deposit Insurance Corporation (“FDIC”) insurance expense was $4.5 million, an increase of $2.2 million from the prior quarter, primarily due to an increase of $1.9 million to the FDIC special assessment first incurred in the fourth quarter of 2023.
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•Other noninterest expense was $5.4 million, an increase of $2.2 million from the prior quarter, due primarily to a lower level of provision release for off balance sheet exposures of $1.5 million.

Please refer to Appendix E for additional detail on M&A expenses*.

ASSET QUALITY

Non-performing loans (“NPLs”) totaled $39.8 million at June 30, 2024 compared to $57.2 million at the end of the prior quarter. The reduction was driven primarily by the resolution of two NPLs in the second quarter.

During the second quarter of 2024, the Company recorded total net recoveries of $0.8 million, or 0.02% of average total loans on an annualized basis, compared to total net charge-offs of $7.3 million, or 0.21% of average total loans on an annualized basis, in the prior quarter, respectively. The net recoveries were driven by the partial recoveries of $2.0 million on the aforementioned two NPLs resolved in the second quarter.

The Company recorded a provision for loan losses totaling $6.1 million in the second quarter of 2024 driven primarily by an increase in individual loan reserves on commercial real estate loans in the second quarter. The allowance for loan losses was $156.1 million at June 30, 2024, or 1.11% of total loans, compared to $149.2 million, or 1.06% of total loans, at March 31, 2024.

DIVIDENDS AND SHARE REPURCHASES

The Company’s Board of Directors has declared a quarterly cash dividend of $0.11 per common share. The dividend will be payable on September 16, 2024 to shareholders of record as of the close of business on September 3, 2024.

The Company’s Board of Directors has authorized a share repurchase program of up to 10.8 million shares, representing 5% of the Company’s outstanding shares of common stock. The repurchase program, which is limited to $200 million through July 31, 2025, may be modified or terminated by the Board of Directors of the Company at any time.

CONFERENCE CALL AND PRESENTATION INFORMATION

A conference call and webcast covering Eastern’s second quarter 2024 earnings will be held on Friday, July 26, 2024 at 9:00 a.m. Eastern Time. To join by telephone, participants can call the toll-free dial-in number (800) 549-8228 from within the U.S. and reference conference ID 26729. The conference call will be simultaneously webcast. Participants may join the webcast on the Company’s Investor Relations website at investor.easternbank.com. A presentation providing additional information for the quarter is also available 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 is Greater Boston’s leading local bank and the largest bank-owned independent investment advisor in Massachusetts with approximately 110 locations serving communities in eastern Massachusetts, southern and coastal New Hampshire, Rhode Island and Connecticut. Eastern provides a full range of banking and wealth management solutions for consumers and businesses of all sizes including through its Cambridge Trust Wealth Management and Private Banking divisions, and takes pride in its outspoken advocacy and community support that includes more than $240 million in charitable giving since 1994. An inclusive company, Eastern is comprised of deeply committed professionals who value relationships with their customers, colleagues and communities. For investor information, visit investor.easternbank.com.

CONTACT

Investor Contact

Jillian Belliveau
Eastern Bankshares, Inc.
InvestorRelations@easternbank.com
781-598-7920
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Media Contact

Andrea Goodman
Eastern Bank
a.goodman@easternbank.com
781-598-7847

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. Except as otherwise indicated, these non-GAAP financial measures presented in this press release exclude discontinued operations.

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), and the operating efficiency ratio. 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, (vii) merger and acquisition expenses, (viii) the non-cash pension settlement charge recognized related to the Defined Benefit Plan, (ix) certain discrete tax items, and (x) net income from discontinued operations. 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 including the impact of mark-to-market adjustments on held-to-maturity securities, 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
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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-E 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”, “outlook” 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; 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 interest rates and resulting changes in competitor or customer behavior, mix or costs of sources of funding, and deposit amounts and composition; risks associated with the Company’s implementation of the merger with Cambridge Bancorp, including that the combined companies may not perform as expected due to transaction-related uncertainty or other factors; that revenue or expense synergies may not fully materialize for the Company in the timeframe expected or at all, or may be more costly to achieve; that following completion of the transaction, Eastern’s business may not perform as expected due to transaction-related uncertainty or other factors; that Eastern is unable to successfully implement integration strategies; that Eastern’s expansion of services or capabilities resulting from the merger may be more challenging than anticipated; reputational risks and the reaction of customers to the transaction; the inability to implement onboarding plans and other consequences associated with mergers; the diversion of management time and Company resources on merger-related issues; and disruptions arising from transitions in management personnel; adverse national or regional economic conditions or conditions within the securities markets or banking sector; legislative and regulatory changes and related compliance costs that could adversely affect the business in which the Company and its subsidiaries, including Eastern Bank, are engaged, 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 inflationary or recessionary pressures, interest rate sensitivity, liquidity constraints, increased borrowing and funding costs, and fluctuations due to actual or anticipated changes to federal tax laws; the realizability of deferred tax assets; the Company’s ability to successfully implement its risk mitigation strategies; asset and credit quality deterioration, including adverse developments in local or regional real estate markets that decrease collateral values associated with existing loans; operational risks such as cybersecurity incidents, natural disasters, and pandemics, including COVID-19 and the failure of the Company to execute 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.

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.
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EASTERN BANKSHARES, INC. AND SUBSIDIARIES
SELECTED FINANCIAL HIGHLIGHTS (1)

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)Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
Earnings data
Net interest income$128,649 $129,900 $133,307 $137,205 $141,588 
Noninterest income25,348 27,692 26,739 19,157 26,204 
Total revenue153,997 157,592 160,046 156,362 167,792 
Noninterest expense109,869 101,202 121,029 101,748 99,934 
Pre-tax, pre-provision income44,128 56,390 39,017 54,614 67,858 
Provision for allowance for loan losses6,126 7,451 5,198 7,328 7,501 
Pre-tax income38,002 48,939 33,819 47,286 60,357 
Net income from continuing operations26,331 38,647 31,509 63,464 44,419 
Net income (loss) from discontinued operations— — 286,994 (4,351)4,238 
Net income26,331 38,647 318,503 59,113 48,657 
Operating net income (non-GAAP)36,519 38,081 16,875 52,085 41,092 
Per-share data
Earnings (loss) per share, diluted$0.16 $0.24 $1.95 $0.36 $0.30 
Continuing operations$0.16 $0.24 $0.19 $0.39 $0.27 
Discontinued operations$— $— $1.76 $(0.03)$0.03 
Operating earnings per share, diluted (non-GAAP)$0.22 $0.23 $0.10 $0.32 $0.25 
Book value per share$16.80 $16.72 $16.86 $13.87 $14.33 
Tangible book value per share (non-GAAP)$13.60 $13.51 $13.65 $10.14 $10.59 
Profitability
Return on average assets (2)0.50 %0.74 %0.59 %1.18 %0.81 %
Operating return on average assets (non-GAAP) (2) 0.70 %0.72 %0.31 %0.97 %0.75 %
Return on average shareholders' equity (2)3.62 %5.23 %4.66 %9.91 %6.85 %
Operating return on average shareholders' equity (2)5.03 %5.17 %2.51 %8.14 %6.34 %
Return on average tangible shareholders' equity (non-GAAP) (2)4.48 %6.46 %5.99 %13.38 %9.19 %
Operating return on average tangible shareholders' equity (non-GAAP) (2)6.22 %6.36 %3.20 %10.99 %8.50 %
Net interest margin (FTE) (2)2.64 %2.68 %2.69 %2.77 %2.80 %
Cost of deposits (2)1.78 %1.66 %1.51 %1.33 %1.22 %
Efficiency ratio71.34 %64.22 %75.62 %65.07 %59.56 %
Operating efficiency ratio (non-GAAP) 64.04 %61.89 %73.59 %60.83 %58.47 %
Balance Sheet (end of period)
Total assets$21,044,169 $21,174,804 $21,133,278 $21,146,292 $21,583,493 
Total loans14,145,520 14,088,747 13,973,428 13,919,275 13,961,878 
Total deposits17,537,809 17,666,733 17,596,217 17,424,169 18,180,972 
Total loans / total deposits81 %80 %79 %80 %77 %
Asset quality
Allowance for loan losses ("ALLL")$156,146 $149,190 $148,993 $155,146 $147,955 
ALLL / total nonperforming loans ("NPLs")392.61 %260.94 %283.49 %326.86 %484.18 %
Total NPLs / total loans0.28 %0.41 %0.38 %0.34 %0.22 %
Net (recoveries) charge-offs ("NCOs") / average total loans (2)(0.02)%0.21 %0.32 %0.00 %0.01 %
Capital adequacy
Shareholders' equity / assets14.10 %13.95 %14.08 %11.57 %11.71 %
Tangible shareholders' equity / tangible assets (non-GAAP)11.73 %11.58 %11.71 %8.73 %8.93 %
(1) Total assets, average assets and average tangible shareholders' equity components as of and for the three months ended Dec 31, 2023 and preceding periods presented in this table include discontinued operations.
(2) Presented on an annualized basis.
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EASTERN BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
As ofJun 30, 2024 change from
(Unaudited, dollars in thousands)Jun 30, 2024Mar 31, 2024Jun 30, 2023Mar 31, 2024Jun 30, 2023
ASSETS△ $△ %△ $△ %
Cash and due from banks$72,890 $71,492 $105,066 $1,398 2 %$(32,176)(31)%
Short-term investments677,958 667,526 768,436 10,432 2 %(90,478)(12)%
Cash and cash equivalents750,848 739,018 873,502 11,830 2 %(122,654)(14)%
Available for sale ("AFS") securities4,097,842 4,287,585 4,520,293 (189,743)(4)%(422,451)(9)%
Held to maturity ("HTM") securities436,712 443,833 465,061 (7,121)(2)%(28,349)(6)%
Total securities4,534,554 4,731,418 4,985,354 (196,864)(4)%(450,800)(9)%
Loans held for sale1,308 2,204 2,835 (896)(41)%(1,527)(54)%
Loans:
Commercial and industrial3,084,186 3,084,580 3,341,976 (394)— %(257,790)(8)%
Commercial real estate5,440,411 5,519,505 5,242,290 (79,094)(1)%198,121 4 %
Commercial construction447,157 388,024 371,367 59,133 15 %75,790 20 %
Business banking1,108,163 1,100,637 1,089,548 7,526 1 %18,615 2 %
Total commercial loans10,079,917 10,092,746 10,045,181 (12,829)— %34,736 — %
Residential real estate2,562,808 2,544,462 2,510,705 18,346 1 %52,103 2 %
Consumer home equity1,254,105 1,217,141 1,198,290 36,964 3 %55,815 5 %
Other consumer248,690 234,398 207,702 14,292 6 %40,988 20 %
Total loans14,145,520 14,088,747 13,961,878 56,773 — %183,642 1 %
Allowance for loan losses(156,146)(149,190)(147,955)(6,956)5 %(8,191)6 %
Unamortized prem./disc. and def. fees(35,601)(32,947)(15,202)(2,654)8 %(20,399)134 %
Net loans13,953,773 13,906,610 13,798,721 47,163 — %155,052 1 %
Federal Home Loan Bank stock, at cost5,879 5,879 26,894 — — %(21,015)(78)%
Premises and equipment60,910 59,790 59,421 1,120 2 %1,489 3 %
Bank-owned life insurance166,710 165,734 162,718 976 1 %3,992 2 %
Goodwill and other intangibles, net565,196 565,701 567,213 (505)— %(2,017)— %
Deferred income taxes, net276,064 272,344 352,060 3,720 1 %(75,996)(22)%
Prepaid expenses183,245 187,211 157,675 (3,966)(2)%25,570 16 %
Other assets545,682 538,895 476,074 6,787 1 %69,608 15 %
Assets of discontinued operations— — 121,026 — — %(121,026)(100)%
Total assets$21,044,169 $21,174,804 $21,583,493 $(130,635)(1)%$(539,324)(2)%
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Demand$4,808,938 $4,952,487 $5,346,693 $(143,549)(3)%$(537,755)(10)%
Interest checking accounts3,532,811 3,739,631 4,173,079 (206,820)(6)%(640,268)(15)%
Savings accounts1,238,009 1,291,260 1,495,540 (53,251)(4)%(257,531)(17)%
Money market investment5,014,900 4,770,058 4,814,412 244,842 5 %200,488 4 %
Certificates of deposit2,943,151 2,913,297 2,351,248 29,854 1 %591,903 25 %
Total deposits17,537,809 17,666,733 18,180,972 (128,924)(1)%(643,163)(4)%
Borrowed funds:
Federal Home Loan Bank advances17,415 17,576 314,021 (161)(1)%(296,606)(94)%
Escrow deposits of borrowers20,155 24,368 22,980 (4,213)(17)%(2,825)(12)%
Interest rate swap collateral funds11,370 10,810 14,210 560 5 %(2,840)(20)%
Total borrowed funds48,940 52,754 351,211 (3,814)(7)%(302,271)(86)%
Other liabilities489,947 502,486 488,007 (12,539)(2)%1,940 — %
Liabilities of discontinued operations— — 36,531 — — %(36,531)(100)%
Total liabilities18,076,696 18,221,973 19,056,721 (145,277)(1)%(980,025)(5)%
Shareholders' equity:
Common shares1,770 1,769 1,766 1 — %4 — %
Additional paid-in capital 1,673,722 1,669,133 1,656,750 4,589 — %16,972 1 %
Unallocated common shares held by the employee stock ownership plan ("ESOP")(130,295)(131,512)(135,232)1,217 (1)%4,937 (4)%
Retained earnings2,076,566 2,068,315 1,704,470 8,251 — %372,096 22 %
Accumulated other comprehensive income ("AOCI"), net of tax(654,290)(654,874)(700,982)584 — %46,692 (7)%
Total shareholders' equity2,967,473 2,952,831 2,526,772 14,642 — %440,701 17 %
Total liabilities and shareholders' equity$21,044,169 $21,174,804 $21,583,493 $(130,635)(1)%$(539,324)(2)%
7

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Three months endedThree months ended Jun 30, 2024 change from three months ended
(Unaudited, dollars in thousands, except per-share data)Jun 30, 2024Mar 31, 2024Jun 30, 2023Mar 31, 2024Jun 30, 2023
Interest and dividend income:△ $△ %△ $△ %
Interest and fees on loans$172,514 $169,981 $160,862 $2,533 1 %$11,652 7 %
Taxable interest and dividends on securities22,724 23,373 24,618 (649)(3)%(1,894)(8)%
Non-taxable interest and dividends on securities1,439 1,437 1,434 2 — %5 — %
Interest on federal funds sold and other short-term investments10,699 7,820 14,851 2,879 37 %(4,152)(28)%
Total interest and dividend income207,376 202,611 201,765 4,765 2 %5,611 3 %
Interest expense:
Interest on deposits78,473 72,458 56,146 6,015 8 %22,327 40 %
Interest on borrowings254 253 4,031 1 — %(3,777)(94)%
Total interest expense78,727 72,711 60,177 6,016 8 %18,550 31 %
Net interest income128,649 129,900 141,588 (1,251)(1)%(12,939)(9)%
Provision for allowance for loan losses6,126 7,451 7,501 (1,325)(18)%(1,375)(18)%
Net interest income after provision for allowance for loan losses122,523 122,449 134,087 74 — %(11,564)(9)%
Noninterest income:
Service charges on deposit accounts7,930 7,508 7,242 422 6 %688 10 %
Trust and investment advisory fees6,711 6,544 6,131 167 3 %580 9 %
Debit card processing fees3,522 3,247 3,513 275 8 %9 — %
Interest rate swap income418 667 825 (249)(37)%(407)(49)%
Income from investments held in rabbi trusts1,761 4,318 3,002 (2,557)(59)%(1,241)(41)%
Losses on sales of mortgage loans held for sale, net(152)(58)(50)(94)162 %(102)204 %
Losses on sales of securities available for sale, net(7,557)— — (7,557)— %(7,557)— %
Other12,715 5,466 5,541 7,249 133 %7,174 129 %
Total noninterest income 25,348 27,692 26,204 (2,344)(8)%(856)(3)%
Noninterest expense:
Salaries and employee benefits65,218 64,471 62,183 747 1 %3,035 5 %
Office occupancy and equipment10,109 9,184 9,067 925 10 %1,042 11 %
Data processing17,990 16,509 12,814 1,481 9 %5,176 40 %
Professional services4,250 3,512 3,025 738 21 %1,225 40 %
Marketing expenses1,910 1,515 2,111 395 26 %(201)(10)%
Federal Deposit Insurance Corporation ("FDIC") insurance4,508 2,285 3,034 2,223 97 %1,474 49 %
Amortization of intangible assets504 504 504 — — %— — %
Other5,380 3,222 7,196 2,158 67 %(1,816)(25)%
Total noninterest expense109,869 101,202 99,934 8,667 9 %9,935 10 %
Income before income tax expense 38,002 48,939 60,357 (10,937)(22)%(22,355)(37)%
Income tax expense11,671 10,292 15,938 1,379 13 %(4,267)(27)%
Net income from continuing operations$26,331 $38,647 $44,419 $(12,316)(32)%$(18,088)(41)%
Net income from discontinued operations$— $— $4,238 $— — %$(4,238)(100)%
Net income$26,331 $38,647 $48,657 $(12,316)(32)%$(22,326)(46)%
Share data:
Weighted average common shares outstanding, basic163,145,255162,863,540162,232,236281,715 0 %913,019 1 %
Weighted average common shares outstanding, diluted163,499,296163,188,410162,246,675310,886 0 %1,252,621 1 %
Earnings per share, basic:
Continuing operations$0.16 $0.24 $0.27 $(0.08)(33)%$(0.11)(41)%
Discontinued operations$— $— $0.03 $— 0 %$(0.03)(100)%
Earnings per share, basic$0.16 $0.24 $0.30 $(0.08)(33)%$(0.14)(47)%
Earnings per share, diluted:
Continuing operations$0.16 $0.24 $0.27 $(0.08)(33)%$(0.11)(41)%
Discontinued operations$— $— $0.03 $— 0 %$(0.03)(100)%
Earnings per share, diluted$0.16 $0.24 $0.30 $(0.08)(33)%$(0.14)(47)%
8

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

Six months ended
(Unaudited, dollars in thousands, except per-share data)Jun 30, 2024Jun 30, 2023Change
Interest and dividend income:△ $△ %
Interest and fees on loans$342,495 $314,402 $28,093 9 %
Taxable interest and dividends on securities46,097 53,260 (7,163)(13)%
Non-taxable interest and dividends on securities2,876 2,868 8 — %
Interest on federal funds sold and other short-term investments18,519 20,115 (1,596)(8)%
Total interest and dividend income409,987 390,645 19,342 5 %
Interest expense:
Interest on deposits150,931 99,079 51,852 52 %
Interest on borrowings507 11,669 (11,162)(96)%
Total interest expense151,438 110,748 40,690 37 %
Net interest income258,549 279,897 (21,348)(8)%
Provision for allowance for loan losses13,577 7,526 6,051 80 %
Net interest income after provision for allowance for loan losses244,972 272,371 (27,399)(10)%
Noninterest income:
Service charges on deposit accounts15,438 13,714 1,724 13 %
Trust and investment advisory fees13,255 11,901 1,354 11 %
Debit card processing fees6,769 6,683 86 1 %
Interest rate swap income1,085 417 668 160 %
Income from investments held in rabbi trusts6,079 5,859 220 4 %
Losses on sales of mortgage loans held for sale, net(210)(124)(86)69 %
Losses on sales of securities available for sale, net(7,557)(333,170)325,613 (98)%
Other18,181 11,071 7,110 64 %
Total noninterest income (loss)53,040 (283,649)336,689 (119)%
Noninterest expense:
Salaries and employee benefits129,689 124,366 5,323 4 %
Office occupancy and equipment19,293 18,156 1,137 6 %
Data processing34,499 25,112 9,387 37 %
Professional services7,762 6,152 1,610 26 %
Marketing expenses3,425 3,134 291 9 %
Federal Deposit Insurance Corporation ("FDIC") insurance6,793 5,580 1,213 22 %
Amortization of intangible assets1,008 795 213 27 %
Other8,602 12,530 (3,928)(31)%
Total noninterest expense211,071 195,825 15,246 8 %
Income (loss) before income tax expense86,941 (207,103)294,044 (142)%
Income tax expense (benefit) 21,963 (49,441)71,404 (144)%
Net income (loss) from continuing operations64,978 (157,662)222,640 (141)%
Net income from discontinued operations— 12,223 (12,223)(100)%
Net income (loss)$64,978 $(145,439)$210,417 (145)%
Share data:
Weighted average common shares outstanding, basic163,004,093 162,112,223 891,870 1 %
Weighted average common shares outstanding, diluted163,390,421 162,136,984 1,253,437 1 %
Earnings (loss) per share, basic:
Continuing operations$0.40 $(0.98)$1.38 (141)%
Discontinued operations$— $0.08 $(0.08)(100)%
Earnings (loss) per share, basic$0.40 $(0.90)$1.30 (144)%
Earnings (loss) per share, diluted:
Continuing operations$0.40 $(0.98)$1.38 (141)%
Discontinued operations$— $0.08 $(0.08)(100)%
Earnings (loss) per share, diluted$0.40 $(0.90)$1.30 (144)%
9

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
AVERAGE BALANCES, INTEREST EARNED/PAID, & AVERAGE YIELDS

As of and for the three months ended
Jun 30, 2024Mar 31, 2024Jun 30, 2023
(Unaudited, dollars in thousands)Avg. BalanceInterestYield / Cost (5)Avg. BalanceInterestYield / Cost (5)Avg. BalanceInterestYield / Cost (5)
Interest-earning assets:
Loans (1):
Commercial$10,103,674 $128,402 5.11 %$10,024,299 $126,842 5.09 %$9,920,608 $121,319 4.91 %
Residential2,563,646 24,313 3.81 %2,570,803 23,994 3.75 %2,513,941 21,992 3.51 %
Consumer1,446,543 23,960 6.66 %1,420,091 23,237 6.58 %1,370,011 21,045 6.16 %
Total loans14,113,863 176,675 5.03 %14,015,193 174,073 5.00 %13,804,560 164,356 4.78 %
   Total investment securities5,428,583 24,555 1.82 %5,574,568 25,201 1.82 %5,885,545 26,435 1.80 %
Federal funds sold and other short-term investments787,387 10,699 5.47 %576,537 7,820 5.46 %1,174,964 14,851 5.07 %
Total interest-earning assets20,329,833 211,929 4.19 %20,166,298 207,094 4.13 %20,865,069 205,642 3.95 %
Non-interest-earning assets912,302 950,893 1,084,413 
Total assets$21,242,135 $21,117,191 $21,949,482 
Interest-bearing liabilities:
Deposits:
Savings$1,259,573 $42 0.01 %$1,297,360 $41 0.01 %$1,552,702 $47 0.01 %
Interest checking3,739,590 8,827 0.95 %3,744,912 8,187 0.88 %4,270,945 6,141 0.58 %
Money market4,975,843 34,022 2.75 %4,741,990 30,495 2.59 %5,064,469 26,611 2.11 %
Time deposits2,933,160 35,582 4.88 %2,785,130 33,735 4.87 %2,275,844 23,347 4.11 %
Total interest-bearing deposits12,908,166 78,473 2.45 %12,569,392 72,458 2.32 %13,163,960 56,146 1.71 %
Borrowings49,536 254 2.06 %50,781 253 2.00 %348,597 4,031 4.64 %
Total interest-bearing liabilities12,957,702 78,727 2.44 %12,620,173 72,711 2.32 %13,512,557 60,177 1.79 %
Demand deposit accounts4,843,336 4,989,245 5,332,045 
Other noninterest-bearing liabilities512,996 537,014 505,555 
Total liabilities18,314,034 18,146,432 19,350,157 
Shareholders' equity2,928,101 2,970,759 2,599,325 
Total liabilities and shareholders' equity$21,242,135 $21,117,191 $21,949,482 
Net interest income - FTE$133,202 $134,383 $145,465 
Net interest rate spread (2)1.75 %1.81 %2.16 %
Net interest-earning assets (3)$7,372,131 $7,546,125 $7,352,512 
Net interest margin - FTE (4)2.64 %2.68 %2.80 %
(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 - FTE represents fully-taxable equivalent net interest income* divided by average total interest-earning assets. Please refer to Appendix B to this press release for a reconciliation of fully-taxable equivalent net interest income.
(5) Presented on an annualized basis.
10

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
AVERAGE BALANCES, INTEREST EARNED/PAID, & AVERAGE YIELDS

As of and for the six months ended
Jun 30, 2024Jun 30, 2023
(Unaudited, dollars in thousands)Avg. BalanceInterestYield / CostAvg. BalanceInterestYield / Cost
Interest-earning assets:
Loans (1):
Commercial$10,063,985 $255,243 5.10 %$9,843,351 $237,248 4.86 %
Residential2,567,225 48,307 3.78 %2,513,679 43,605 3.50 %
Consumer1,433,317 47,198 6.62 %1,364,345 41,105 6.08 %
Total loans14,064,527 350,748 5.02 %13,721,375 321,958 4.73 %
Total investment securities5,501,575 49,756 1.82 %6,780,135 56,894 1.69 %
Federal funds sold and other short-term investments681,963 18,519 5.46 %814,257 20,115 4.98 %
Total interest-earning assets20,248,065 419,023 4.16 %21,315,767 398,967 3.77 %
Non-interest-earning assets931,849 912,120 
Total assets$21,179,914 $22,227,887 
Interest-bearing liabilities:
Deposits:
Savings$1,278,466 $83 0.01 %$1,636,457 $129 0.02 %
Interest checking3,742,251 17,014 0.91 %4,316,981 10,853 0.51 %
Money market4,858,917 64,517 2.67 %5,052,467 46,916 1.87 %
Time deposits2,859,145 69,317 4.88 %2,104,802 41,181 3.95 %
Total interest-bearing deposits12,738,779 150,931 2.38 %13,110,707 99,079 1.52 %
Borrowings50,159 507 2.03 %510,925 11,669 4.61 %
Total interest-bearing liabilities12,788,938 151,438 2.38 %13,621,632 110,748 1.64 %
Demand deposit accounts4,916,290 5,577,294 
Other noninterest-bearing liabilities525,256 498,829 
Total liabilities18,230,484 19,697,755 
Shareholders' equity2,949,430 2,530,132 
Total liabilities and shareholders' equity$21,179,914 $22,227,887 
Net interest income - FTE$267,585 $288,219 
Net interest rate spread (2)1.78 %2.13 %
Net interest-earning assets (3)$7,459,127 $7,694,135 
Net interest margin - FTE (4)2.66 %2.73 %
(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 - FTE represents fully-taxable equivalent net interest income* divided by average total interest-earning assets. Please refer to Appendix B to this press release for a reconciliation of fully-taxable equivalent net interest income.
11

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
ASSET QUALITY - NON-PERFORMING ASSETS (1)

As of
Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
(Unaudited, dollars in thousands)
Non-accrual loans:
Commercial$26,139 $40,986 $35,107 $31,703 $14,178 
Residential6,789 6,697 8,725 8,075 8,796 
Consumer6,843 9,490 8,725 7,687 7,584 
Total non-accrual loans39,771 57,173 52,557 47,465 30,558 
Total accruing loans past due 90 days or more:— — — — — 
Total non-performing loans39,771 57,173 52,557 47,465 30,558 
Other real estate owned— — — — — 
Other non-performing assets:— — — — — 
Total non-performing assets (1)$39,771 $57,173 $52,557 $47,465 $30,558 
Total non-performing loans to total loans0.28 %0.41 %0.38 %0.34 %0.22 %
Total non-performing assets to total assets0.19 %0.27 %0.25 %0.22 %0.14 %
(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.
12

EASTERN BANKSHARES, INC. AND SUBSIDIARIES
ASSET QUALITY - PROVISION, ALLOWANCE, AND NET CHARGE-OFFS (RECOVERIES)

Three months ended
Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
(Unaudited, dollars in thousands)
Average total loans$14,113,343 $14,013,714 $13,961,061 $13,926,194 $13,803,292 
Allowance for loan losses, beginning of the period149,190 148,993 155,146 147,955 140,938 
Charged-off loans:
Commercial and industrial— — 2 11 — 
Commercial real estate— 7,250 8,008 — — 
Commercial construction— — — — — 
Business banking1,002 102 3,745 303 254 
Residential real estate— 10 — — — 
Consumer home equity32 2 — — — 
Other consumer658 651 536 731 591 
Total charged-off loans1,692 8,015 12,291 1,045 845 
Recoveries on loans previously charged-off:
Commercial and industrial56 25 11 120 26 
Commercial real estate2,011 132 190 2 2 
Commercial construction— — — — — 
Business banking199 410 573 609 204 
Residential real estate27 31 34 30 18 
Consumer home equity91 — 1 39 — 
Other consumer138 163 131 108 111 
Total recoveries2,522 761 940 908 361 
Net loans charged-off (recovered):
Commercial and industrial(56)(25)(9)(109)(26)
Commercial real estate(2,011)7,118 7,818 (2)(2)
Commercial construction— — — — — 
Business banking803 (308)3,172 (306)50 
Residential real estate(27)(21)(34)(30)(18)
Consumer home equity(59)2 (1)(39)— 
Other consumer520 488 405 623 480 
Total net loans (recovered) charged-off(830)7,254 11,351 137 484 
Provision for allowance for loan losses6,126 7,451 5,198 7,328 7,501 
Total allowance for loan losses, end of period$156,146 $149,190 $148,993 $155,146 $147,955 
Net (recoveries) charge-offs to average total loans outstanding during this period (1)(0.02)%0.21 %0.32 %0.00 %0.01 %
Allowance for loan losses as a percent of total loans1.11 %1.06 %1.07 %1.12 %1.06 %
Allowance for loan losses as a percent of nonperforming loans392.61 %260.94 %283.49 %326.86 %484.18 %
(1) Presented on an annualized basis.
13

APPENDIX A: Reconciliation of Non-GAAP Earnings Metrics (1)

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)Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
Net income from continuing operations (GAAP)$26,331 $38,647 $31,509 $63,464 $44,419 
Add:
Noninterest income components:
(Income) losses from investments held in rabbi trusts(1,761)(4,318)(4,969)1,523 (3,002)
Losses on sales of securities available for sale, net7,557 — — — — 
Losses (gains) on sales of other assets2 — — (2)— 
Noninterest expense components:
Rabbi trust employee benefit expense (income) 930 1,746 1,740 (586)1,314 
Merger and acquisition expenses3,684 1,816 1,865 3,630 — 
Total impact of non-GAAP adjustments10,412 (756)(1,364)4,565 (1,688)
Less: net tax benefit (expense) associated with non-GAAP adjustments (2)224 (190)13,270 15,944 1,639 
Non-GAAP adjustments, net of tax$10,188 $(566)$(14,634)$(11,379)$(3,327)
Operating net income (non-GAAP) $36,519 $38,081 $16,875 $52,085 $41,092 
Weighted average common shares outstanding during the period:
Basic163,145,255 162,863,540 162,571,066 162,370,469 162,232,236 
Diluted163,499,296 163,188,410 162,724,398 162,469,887 162,246,675 
Earnings per share from continuing operations, basic:$0.16 $0.24 $0.19 $0.39 $0.27 
Earnings per share from continuing operations, diluted:$0.16 $0.24 $0.19 $0.39 $0.27 
Operating earnings per share, basic (non-GAAP) $0.22 $0.23 $0.10 $0.32 $0.25 
Operating earnings per share, diluted (non-GAAP) $0.22 $0.23 $0.10 $0.32 $0.25 
Return on average assets (3)0.50 %0.74 %0.59 %1.18 %0.81 %
Add:
(Income) losses from investments held in rabbi trusts (3)(0.03)%(0.08)%(0.09)%0.03%(0.05)%
Losses on sales of securities available for sale, net (3)0.14%0.00%0.00%0.00%0.00%
Losses (gains) on sales of other assets (3)0.00%0.00%0.00%0.00%0.00%
Rabbi trust employee benefit expense (income) (3)0.02%0.03%0.03%(0.01)%0.02%
Merger and acquisition expenses (3)0.07%0.03%0.03%0.07%0.00%
Less: net tax benefit (expense) associated with non-GAAP adjustments (2) (3)0.00%0.00%0.25%0.30%0.03%
Operating return on average assets (non-GAAP) (3)0.70 %0.72 %0.31 %0.97 %0.75 %
Return on average shareholders' equity (3)3.62 %5.23 %4.66 %9.91 %6.85 %
Add:
(Income) losses from investments held in rabbi trusts (3)(0.24)%(0.58)%(0.73)%0.24%(0.46)%
Losses on sales of securities available for sale, net (3)1.04%0.00%0.00%0.00%0.00%
Losses (gains) on sales of other assets (3)0.00%0.00%0.00%0.00%0.00%
Rabbi trust employee benefit expense (income) (3)0.13%0.24%0.26%(0.09)%0.20%
Merger and acquisition expenses (3)0.51%0.25%0.28%0.57%0.00%
Less: net tax benefit (expense) associated with non-GAAP adjustments (2) (3)0.03%(0.03)%1.96%2.49%0.25%
Operating return on average shareholders' equity (non-GAAP) (3)5.03 %5.17 %2.51 %8.14 %6.34 %
Average tangible shareholders' equity:
Average total shareholders' equity (GAAP) $2,928,101 $2,970,759 $2,682,600 $2,539,806 $2,599,325 
Less: Average goodwill and other intangibles565,523 566,027 597,234 658,591 659,825 
Average tangible shareholders' equity (non-GAAP) $2,362,578 $2,404,732 $2,085,366 $1,881,215 $1,939,500 
Return on average tangible shareholders' equity (non-GAAP) (3)4.48 %6.46 %5.99 %13.38 %9.19 %
Add:
(Income) losses from investments held in rabbi trusts (3)(0.30)%(0.72)%(0.95)%0.32%(0.62)%
Losses on sales of securities available for sale, net (3)1.29%0.00%0.00%0.00%0.00%
Losses (gains) on sales of other assets (3)0.00%0.00%0.00%0.00%0.00%
Rabbi trust employee benefit expense (income) (3)0.16%0.29%0.33%(0.12)%0.27%
Merger and acquisition expenses (3)0.63%0.30%0.35%0.77%0.00%
Less: net tax benefit (expense) associated with non-GAAP adjustments (2) (3)0.04%(0.03)%2.52%3.36%0.34%
Operating return on average tangible shareholders' equity (non-GAAP) (3)6.22 %6.36 %3.20 %10.99 %8.50 %
(1) Average assets, average goodwill and other intangibles, and average tangible shareholders' equity components for the three months ended Dec 31, 2023 and preceding periods presented in this section include discontinued operations.
(2) The net tax benefit (expense) associated with these items is generally 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 for the three months ended December 31, 2023 was primarily due to the tax benefit from state tax strategies associated with the utilization of capital losses as a result of the sale of securities in the first quarter of 2023. Upon the sale of securities in the first quarter of 2023, we established a valuation allowance of $17.4 million, as it was determined at that time that it was not more-likely-than-not that the entirety of the deferred tax asset related to the loss on such securities would be realized. Included in that $17.4 million was $2.8 million in expected lost state tax benefits. Following the execution of the sale of our insurance agency business in October 2023 and the resulting capital gain, coupled with tax planning strategies, a state tax benefit of $13.6 million was realized on the security sale losses.
(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
Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
(Unaudited, dollars in thousands)
Net interest income (GAAP)$128,649 $129,900 $133,307 $137,205 $141,588 
Add:
Tax-equivalent adjustment (non-GAAP) (1)4,553 4,483 4,483 4,376 3,877 
Fully-taxable equivalent net interest income (non-GAAP)$133,202 $134,383 $137,790 $141,581 $145,465 
Noninterest income (GAAP) $25,348 $27,692 $26,739 $19,157 $26,204 
Less:
Income (losses) from investments held in rabbi trusts1,761 4,318 4,969 (1,523)3,002 
Losses on sales of securities available for sale, net(7,557)— — — — 
Gains (losses) on sales of other assets(2)— — 2 — 
Noninterest income on an operating basis (non-GAAP) $31,146 $23,374 $21,770 $20,678 $23,202 
Noninterest expense (GAAP) $109,869 $101,202 $121,029 $101,748 $99,934 
Less:
Rabbi trust employee benefit expense (income) 930 1,746 1,740 (586)1,314 
Merger and acquisition expenses 3,684 1,816 1,865 3,630 — 
Noninterest expense on an operating basis (non-GAAP) $105,255 $97,640 $117,424 $98,704 $98,620 
Total revenue (GAAP)$153,997 $157,592 $160,046 $156,362 $167,792 
Total operating revenue (non-GAAP)$164,348 $157,757 $159,560 $162,259 $168,667 
Efficiency ratio (GAAP)71.34 %64.22 %75.62 %65.07 %59.56 %
Operating efficiency ratio (non-GAAP) 64.04 %61.89 %73.59 %60.83 %58.47 %
(1) Interest income on tax-exempt loans and investment securities has been adjusted to a FTE basis using a marginal tax rate of 21.7%, 21.7%, 21.9%, 21.7%, and 21.8% for the three months ended June 30, 2024, March 31, 2024, December 31, 2023, September 30, 2023, and June 30, 2023, respectively.
14

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
Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
(Unaudited, dollars in thousands, except per-share data)
Tangible shareholders' equity:
Total shareholders' equity (GAAP)$2,967,473 $2,952,831 $2,974,855 $2,446,553 $2,526,772 
Less: Goodwill and other intangibles (1)565,196 565,701 566,205 657,824 658,993 
Tangible shareholders' equity (non-GAAP)2,402,277 2,387,130 2,408,650 1,788,729 1,867,779 
Tangible assets:
Total assets (GAAP)21,044,169 21,174,804 21,133,278 21,146,292 21,583,493 
Less: Goodwill and other intangibles (1)565,196 565,701 566,205 657,824 658,993 
Tangible assets (non-GAAP)$20,478,973 $20,609,103 $20,567,073 $20,488,468 $20,924,500 
Shareholders' equity to assets ratio (GAAP)14.10 %13.95 %14.08 %11.57 %11.71 %
Tangible shareholders' equity to tangible assets ratio (non-GAAP) 11.73 %11.58 %11.71 %8.73 %8.93 %
Common shares outstanding176,687,829 176,631,477 176,426,993 176,376,675 176,376,675 
Book value per share (GAAP)$16.80 $16.72 $16.86 $13.87 $14.33 
Tangible book value per share (non-GAAP) $13.60 $13.51 $13.65 $10.14 $10.59 
(1) Includes goodwill and other intangible assets of discontinued operations as of September 30, 2023 and June 30, 2023.

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 ofChange from
Jun 30, 2024Mar 31, 2024Mar 31, 2024
(Unaudited, dollars in thousands, except per-share data)
Common stock$1,770 $1,769 $1 
Additional paid in capital1,673,722 1,669,133 4,589 
Unallocated ESOP common stock(130,295)(131,512)1,217 
Retained earnings2,076,566 2,068,315 8,251 
AOCI, net of tax - available for sale securities(612,196)(611,802)(394)
AOCI, net of tax - pension6,430 6,946 (516)
AOCI, net of tax - cash flow hedge(48,524)(50,018)1,494 
Total shareholders' equity:$2,967,473 $2,952,831 $14,642 
Less: Goodwill and other intangibles565,196 565,701 (505)
Tangible shareholders' equity (non-GAAP) $2,402,277 $2,387,130 $15,147 
Common shares outstanding176,687,829 176,631,477 56,352 
Per share:
Common stock$0.01 $0.01 $— 
Additional paid in capital9.47 9.45 0.02 
Unallocated ESOP common stock(0.74)(0.74)0.01 
Retained earnings11.75 11.71 0.04 
AOCI, net of tax - available for sale securities(3.46)(3.46)— 
AOCI, net of tax - pension0.04 0.04 — 
AOCI, net of tax - cash flow hedge(0.27)(0.28)0.01 
Total shareholders' equity:$16.80 $16.72 $0.08 
Less: Goodwill and other intangibles3.20 3.20 — 
Tangible shareholders' equity (non-GAAP) $13.60 $13.51 $0.08 
15

APPENDIX E: M&A Expense
As of and for the Three Months Ended
(Unaudited, dollars in thousands)Jun 30, 2024Mar 31, 2024Dec 31, 2023Sep 30, 2023Jun 30, 2023
Salaries and employee benefits$383 $3 $5 $— $— 
Office occupancy and equipment11 6 2 — — 
Data processing2,249 865 1,357 — — 
Professional services944 787 450 3,630 — 
Other97 155 51 — — 
Total$3,684 $1,816 $1,865 $3,630 $— 

16
v3.24.2
Document and Entity Information Document
Jul. 25, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 25, 2024
Entity Registrant Name EASTERN BANKSHARES, INC.
Entity Incorporation, State or Country Code MA
Entity File Number 001-39610
Entity Tax Identification Number 84-4199750
Entity Address, Address Line One 125 High Street
Entity Address, City or Town Boston
Entity Address, State or Province MA
Entity Address, Postal Zip Code 02110
City Area Code 800
Local Phone Number 327-8376
Written Communications true
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock
Trading Symbol EBC
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0001810546
Amendment Flag false
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