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Section 1: 8-K (8-K)

hone_Current Folio_8k

 

 

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): October 25, 2018


HarborOne Bancorp, Inc.

(Exact Name of Registrant as Specified in its Charter)


 

 

 

Massachusetts

001-37778

81-1607465

(State or other jurisdiction

(Commission

(IRS Employer

of incorporation)

File Number)

Identification Number

 

 

 

 

770 Oak Street, Brockton, Massachusetts 02301

(Address of principal executive offices)

 

(508) 895-1000

(Registrant’s telephone number, including area code)

 


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))

 

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 [X]

 

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 2.02Results of Operations and Financial Condition

 

On October 25, 2018, HarborOne Bancorp, Inc. (the “Company”), the holding company for HarborOne Bank, issued a press release announcing its financial results for the quarter ended September 30, 2018.  The Company’s press release is included as Exhibit 99.1 to this report.

 

The information set forth in this Item 2.02 and in the attached Exhibit 99.1 is deemed to be “furnished” and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. 

 

 

Item 9.01Financial Statements and Exhibits

 

(d)Exhibits

 

 

 

 

Number

 

Description

 

 

 

99.1

 

Press release dated October 25, 2018

 

2


 

EXHIBIT INDEX

 

 

 

 

Number

 

Description

 

 

 

99.1

 

Press release dated October 25, 2018

 

 

3


 

SIGNATURE

 

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 hereunder duly authorized.

 

 

 

 

 

 

HARBORONE BANCORP, INC.

 

 

 

By:

/s/ Linda H. Simmons

 

 

Name:

Linda H. Simmons

 

Title:

Senior Vice President and 

 

 

Chief Financial Officer

 

 

 

Date:  October 25, 2018

 

 

 

 

4


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Section 2: EX-99.1 (EX-99.1)

hone_Exhibit_99.1

Exhibit 99.1

C:\Users\cviveiros\AppData\Local\Microsoft\Windows\INetCache\Content.Outlook\I4C6SES3\HarborOne Bancorp Logo.jpg

 

HarborOne Bancorp, Inc. Announces 2018 Third Quarter Earnings

Contact: Linda Simmons, SVP, CFO

Brockton, Massachusetts (October 25, 2018): HarborOne Bancorp, Inc. (the “Company” or “HarborOne”) (NASDAQ: HONE), the holding company for HarborOne Bank (the “Bank”), announced net income of $5.9 million, or $0.19  per basic and diluted share, for the third quarter of 2018, compared to $3.1 million, or $0.10 per basic and diluted share, for the prior quarter and net income of $2.8 million, or $0.09 per basic and diluted share, for the same quarter last year. For the nine months ended September 30, 2018 net income was $11.3 million, or $0.36 per basic and diluted share, as compared to $8.8 million, or $0.28 per basic and diluted share, for the same period last year.

 

Selected highlights:

 

·

Successful closing of the acquisition of Coastway Bancorp, Inc. (“Coastway”) and Coastway Community Bank into HarborOne on October 5, 2018

·

Subordinated debt issuance of $35.0 million to support growth

·

Continued shift in balance sheet mix

-

Sustained commercial loan growth 

-

$105.4 million portfolio residential mortgage loans transferred to held for sale recognizing a $472,000 gain

·

Recognition of a tax refund of $826,000 for the tax year 2014

·

Opening of our Boston commercial loan office

 

“Our commercial loan growth strategy, and the investments we’ve made to enable that growth, continue to provide solid results,” said James W. Blake, CEO.  “We’re pleased with the performance of our Boston loan office, and our recent expansion in Rhode Island, with the completed Coastway acquisition, provides tremendous new opportunities for our residential real estate, small business, and commercial lines of business.”

 

Net Income

The increase in net income from the prior quarter reflects a $226,000 increase in net interest and dividend income, a $254,000 decrease in provision for loan losses, a $1.1 million increase in noninterest income, a $1.1 million decrease in noninterest expense and a $127,000 decrease in income tax provision.

 

Net Interest Income

The Company’s net interest and dividend income was $21.1 million for the quarter ended September 30, 2018, up $226,000, or 1.1%, from $20.9 million for the quarter ended June 30, 2018 and up  $1.8 million, or 9.6%, from  $19.3 million for the quarter ended September 30, 2017. The tax-equivalent interest rate spread and net interest margin were 2.87% and 3.12%, respectively, for the quarter ended September 30, 2018 compared to 3.04% and 3.26%, respectively, for the quarter ended June 30, 2018 and 2.91% and 3.07%, respectively, for the quarter ended September 30, 2017.

 

The increase in net interest income from the previous quarter reflects a $1.6 million, or 6.1%, increase in total interest and dividend income offset by  an increase of $1.4 million, or 25.6% in total interest expense. The increase in interest and dividend income is primarily due to commercial loan growth that provided an increase in average outstanding loans of $85.2 million partially offset by decreases in the average balances of residential real estate and consumer loans. The yield on loans was 4.30%  for the quarter ended September 30, 2018 compared to 4.25% for the quarter ended June 30, 2018. The increase in interest expense is due to an increase in average interest-bearing deposits of $47.0 million with a  17 basis point increase in the cost of those funds and an increase in average FHLB advances of $38.7 million and  an 8 basis point increase in total cost of those funds. Additionally, $35.0 million of subordinated debentures were issued on August 30, 2018 with a rate of 5.625%.

 

The increase in net interest income from the prior year quarter reflects a $4.4 million, or 18.9%, increase in total interest and dividend income and an increase of $2.6 million, or 62.3%, in total interest expense. The increase in interest and dividend income is primarily due to growth in the Company’s average loan balances to $2.38 billion from $2.19 billion and an increase in the yield on loans to 4.30% from 3.95%, again primarily driven by commercial loan growth as well as higher rates on commercial loans.  This is partially offset by the increase in total interest expense primarily due to an increase in average interest-bearing deposits of $158.8 million and a 49 basis point increase in the cost of those funds.

 


 

Noninterest Income

Noninterest income increased  to  $13.6 million for the quarter ended September 30, 2018,  up  $1.1 million, or 8.6%, from the quarter ended June 30, 2018.  The increase is primarily due to an increase in mortgage banking income of $412,000 and other income of $612,000. The increase in other income is primarily due to an increase of $744,000 in swap fee income for new interest rate swap deals. There was no swap fee income in the second quarter of 2018. Other mortgage banking income increased $484,000 primarily reflecting the gain on pending sale of the portfolio residential real estate mortgage loans.  This was partially offset by a decrease in the mortgage servicing rights fair value of $378,000. Results of HarborOne Mortgage, LLC (“HarborOne Mortgage”) were flat as compared to the June 2018 quarter.  

 

Noninterest income decreased  $987,000, or 6.7%, as compared to the quarter ended September 30, 2017.  Mortgage banking income decreased $1.7 million, or 16.2%, partially offset by an increase of $626,000 in other income. Other mortgage banking income decreased $1.8 million, or 16.5% compared to the prior year quarter due to lower mortgage originations in 2018,  primarily as a result of higher residential mortgage interest rates, low housing inventories and reduced refinancing volume. The increase in other income compared to prior year quarter is primarily due to an increase of $544,000 in commercial loan interest rate swap fee income.

 

Noninterest Expense

Noninterest expenses were $27.4 million for the quarter ended September 30, 2018,  a decrease of $1.1 million, or 4.0%, from the quarter ended June 30, 2018 due to a decrease in compensation and benefits of $536,000 and a decrease in marketing expense of $445,000.

 

The decrease in compensation and benefits primarily reflects a decrease in equity compensation expense. During the quarter a clerical error in the 2017 stock option award amounts was corrected resulting in a one-time $652,000 expense reversal. Additionally, HarborOne Mortgage’s compensation and benefits expense decreased by $289,000. Partially offsetting these decreases were increased accruals related to incentive plans. The decrease in marketing expense reflects seasonality of marketing campaigns.  

 

Noninterest expenses decreased  $1.1 million, or 3.7%, from the quarter ended September 30, 2017. The decrease was primarily due to decreases in compensation and benefits of $516,000, loan expense of $381,000, marketing expenses of $497,000 and professional fees of $414,000 partially offset by an increase in other expenses of  $382,000. The compensation and benefits decrease reflects the correction noted above. Loan expense decreased as compared to the prior year consistent with the decrease in loan originations. The decrease in marketing and professional fees primarily reflects timing. The increase in other expenses reflects $274,000 in expenses related to the Coastway acquisition and $189,000 in employment agency fees that were not incurred in the third quarter of 2017.

 

Income Tax Provision

The effective tax rate was 12.1% for the quarter ended September 30, 2018,  23.3% for the quarter ended June 30, 2018 and 37.4% for the quarter ended September 30, 2017.  The effective tax rate for the nine months ended September 30, 2018 and 2017 was 18.6% and 36.9%, respectively. The effective tax rate for the quarter and year to date ended September 30, 2018 is primarily being impacted by the $826,000 tax refund for the tax year 2014 that was recognized this quarter. In 2017 the Company filed amended returns that reflected a change in tax basis of certain assets. Additionally, the enactment of the Tax Cuts and Jobs Act of 2017 resulted in significant changes to the U.S. tax code, including a reduction in the top corporate income tax rate from 35% to 21% effective January 1, 2018.

 

Asset Quality

The Company recorded  a provision for loan losses of  $632,000 for the quarter ended September 30, 2018, $886,000 for the quarter ended June 30, 2018 and $921,000 for the quarter ended September 30, 2017. The decrease in the provision for the quarter ended September 30, 2018 reflects a $262,000 negative provision in conjunction with the sale of $105.4 million residential real estate mortgage loans from portfolio. There were also charge offs of $255,000 and $390,000 for the quarters ended September 30, 2018 and June 30, 2018, respectively, related to one commercial credit. Generally loan loss provisions each quarter are due to growth in the commercial loan portfolio. Changes in the provision for loan losses are based on management’s assessment of loan portfolio growth and composition changes, historical charge-off trends, and ongoing evaluation of credit quality and current economic conditions. The allowance for loan losses was $19.4 million, or 0.87%, of total loans at September 30, 2018, compared to $19.2 million, or 0.84%, of total loans at June 30, 2018 and $17.9 million, or 0.84%, of total loans at September 30, 2017. Net charge-offs totaled $436,000 for the quarter ended September 30, 2018, or 0.08%, of average loans outstanding on an annualized basis, compared to $505,000, or 0.09% of average loans outstanding on an annualized basis, for the quarter ended June 30, 2018 and $169,000, or 0.03% of average loans outstanding on an annualized basis , for the quarter ended September 30, 2017.

 

Nonperforming assets were $17.4 million at  September 30, 2018 compared to $17.4 million at June 30, 2018 and $20.6 million at September 30, 2017. Nonperforming assets as a percentage of total assets were 0.61% at September 30, 2018,  0.60% at June 30, 2018 and 0.78% at September 30, 2017. The Company’s continues to minimize nonperforming assets through diligent collection efforts, prudent workout arrangements and strong underwriting.

 

Balance Sheet

Total assets decreased  $26.9 million, or 0.9%, to $2.85 billion at September  30, 2018 from $2.88 billion at June 30, 2018. Net loans decreased  $77.1 million, or 3.4%, to $2.20 billion at September 30, 2018 from $2.28 billion at June 30, 2018.  The net decrease in loans


 

for the three months ended September 30, 2018 was primarily due to decreases of $103.1 million in residential real estate, $24.6 million in construction loans and $18.5 million in consumer loans partially offset by increases of $62.3 million in commercial real estate loans and $7.3 million in commercial loans. Loans held for sale increased $84.3 million, or 118.6%, to $155.3 million at  September 30, 2018 from $71.0 million at June 30,  2018 due to the transfer of a $105.4 million residential real estate loan portfolio to held for sale. Management proactively assesses the balance sheet mix to enhance margins. The decrease in consumer loans partially reflects the reallocation of funds into commercial lending.

 

Total deposits decreased  $16.9 million, or 0.8%, to $2.19 billion at September 30, 2018 from $2.20 billion at June 30, 2018.  Compared to the prior quarter, non-certificate accounts decreased  $80.3 million, term certificate accounts increased $76.0 million and brokered deposits decreased  $12.6 million.  Term certificate growth reflects special promotions offered during the quarter for 11 and 14 month term certificates. Borrowings were $265.0 million at September 30, 2018 and $287.4 million at June 30, 2018. We also issued $35.0 million of fixed-to-floating rate subordinated debentures on August 30, 2018 with a rate of 5.625%. Issuance costs of $1.2 million were deferred and are being amortized over the term of the debentures.

 

Total stockholders’ equity was $353.3 million at September 30, 2018 compared to $348.6 million at June 30, 2018 and $336.6 million at September 30, 2017.   The tangible common equity to tangible assets ratio was 11.96% at September 30, 2018, 11.68% at June 30, 2018 and 12.36% at September 30, 2017.  At September 30, 2018, the Company and the Bank exceed all regulatory capital requirements.

 

About HarborOne Bancorp, Inc.

HarborOne Bancorp, Inc. is the holding company for HarborOne Bank, the largest co-operative bank in New England. HarborOne Bank serves the financial needs of consumers, businesses, and municipalities throughout Eastern Massachusetts through a network of 23 full-service branches, two limited service branches, two commercial loan offices in Boston, Massachusetts and Providence, Rhode Island, and 16 free-standing ATMs. The Bank also provides a range of educational services through “HarborOne U,” with classes on small business, financial literacy and personal enrichment at two campuses located adjacent to our Brockton and Mansfield locations. HarborOne Mortgage, LLC, a subsidiary of HarborOne Bank, is a full-service mortgage lender with 40 offices in Massachusetts, Rhode Island, New Hampshire, Maine, and New Jersey and also does business in five additional states.

 

Forward Looking Statements

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

 

Use of Non-GAAP Measures

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

 


 

HarborOne Bancorp, Inc.

Consolidated Balance Sheet Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September  30,

 

      June 30,      

 

    March 31,    

 

December 31,

 

September  30,

(Dollars in thousands)

    

2018

    

2018

    

2018

    

2017

    

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

  

 

 

  

    

 

  

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

18,478

 

$

20,232

 

$

15,205

 

$

16,348

 

$

15,393

Short-term investments

 

 

76,619

 

 

112,264

 

 

92,105

 

 

64,443

 

 

79,412

Total cash and cash equivalents

 

 

95,097

 

 

132,496

 

 

107,310

 

 

80,791

 

 

94,805

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale, at fair value

 

 

191,847

 

 

185,702

 

 

182,173

 

 

170,853

 

 

166,122

Securities held to maturity, at amortized cost

 

 

47,371

 

 

48,251

 

 

46,095

 

 

46,869

 

 

47,752

Federal Home Loan Bank stock, at cost

 

 

13,263

 

 

15,310

 

 

13,538

 

 

15,532

 

 

16,356

Loans held for sale, at fair value

 

 

155,268

 

 

71,017

 

 

34,129

 

 

59,460

 

 

96,201

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential real estate

 

 

652,909

 

 

756,007

 

 

762,361

 

 

766,917

 

 

769,418

Commercial real estate

 

 

788,561

 

 

726,276

 

 

687,121

 

 

655,419

 

 

623,054

Construction

 

 

138,642

 

 

163,240

 

 

144,949

 

 

128,643

 

 

76,668

Total mortgage loans on real estate

 

 

1,580,112

 

 

1,645,523

 

 

1,594,431

 

 

1,550,979

 

 

1,469,140

Commercial

 

 

139,616

 

 

132,293

 

 

111,013

 

 

109,523

 

 

111,627

Consumer

 

 

498,417

 

 

516,897

 

 

521,634

 

 

527,820

 

 

533,707

Loans

 

 

2,218,145

 

 

2,294,713

 

 

2,227,078

 

 

2,188,322

 

 

2,114,474

Less: Allowance for loan losses

 

 

(19,440)

 

 

(19,244)

 

 

(18,863)

 

 

(18,489)

 

 

(17,933)

Net deferred loan costs

 

 

5,677

 

 

5,982

 

 

6,075

 

 

6,645

 

 

8,035

Net loans

 

 

2,204,382

 

 

2,281,451

 

 

2,214,290

 

 

2,176,478

 

 

2,104,576

Mortgage servicing rights, at fair value

 

 

23,748

 

 

22,832

 

 

22,696

 

 

21,092

 

 

20,376

Goodwill and other intangible assets

 

 

13,726

 

 

13,717

 

 

13,675

 

 

13,497

 

 

13,519

Other assets

 

 

108,098

 

 

108,938

 

 

101,671

 

 

100,348

 

 

99,752

Total assets

 

$

2,852,800

 

$

2,879,714

 

$

2,735,577

 

$

2,684,920

 

$

2,659,459

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and demand deposit accounts

 

$

432,628

 

$

429,397

 

$

419,776

 

$

395,153

 

$

395,728

Regular savings and club accounts

 

 

327,030

 

 

403,732

 

 

378,818

 

 

356,300

 

 

404,465

Money market deposit accounts

 

 

674,657

 

 

681,524

 

 

701,360

 

 

721,021

 

 

666,613

Brokered deposits

 

 

66,831

 

 

79,396

 

 

70,176

 

 

73,490

 

 

73,127

Term certificate accounts

 

 

684,495

 

 

608,453

 

 

557,082

 

 

467,774

 

 

463,612

Total deposits

 

 

2,185,641

 

 

2,202,502

 

 

2,127,212

 

 

2,013,738

 

 

2,003,545

Short-term borrowed funds

 

 

25,000

 

 

70,000

 

 

 —

 

 

44,000

 

 

10,000

Long-term borrowed funds

 

 

206,187

 

 

217,438

 

 

226,364

 

 

246,365

 

 

266,366

Subordinated debt

 

 

33,855

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Other liabilities and accrued expenses

 

 

48,772

 

 

41,198

 

 

37,144

 

 

37,333

 

 

38,947

Total liabilities

 

 

2,499,455

 

 

2,531,138

 

 

2,390,720

 

 

2,341,436

 

 

2,318,858

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

327

 

 

327

 

 

327

 

 

327

 

 

327

Additional paid-in capital

 

 

150,732

 

 

150,063

 

 

148,559

 

 

147,060

 

 

145,525

Unearned compensation - ESOP

 

 

(10,239)

 

 

(10,388)

 

 

(10,536)

 

 

(10,685)

 

 

(10,833)

Retained earnings

 

 

218,977

 

 

213,049

 

 

209,946

 

 

207,590

 

 

205,997

Treasury stock

 

 

(1,548)

 

 

(742)

 

 

(742)

 

 

(280)

 

 

 —

Accumulated other comprehensive loss

 

 

(4,904)

 

 

(3,733)

 

 

(2,697)

 

 

(528)

 

 

(415)

Total stockholders' equity

 

 

353,345

 

 

348,576

 

 

344,857

 

 

343,484

 

 

340,601

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

2,852,800

 

$

2,879,714

 

$

2,735,577

 

$

2,684,920

 

$

2,659,459

 

 

 

 


 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income - Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

September 30,

 

June 30,

 

March 31,

 

December 31,

 

September 30,

(Dollars in thousands, except per share amounts)

    

2018

    

2018

    

2018

    

2017

    

2017

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

25,115

 

$

23,866

 

$

22,504

 

$

21,349

 

$

20,990

Interest on loans held for sale

 

 

625

 

 

521

 

 

411

 

 

777

 

 

796

Interest on securities

 

 

1,629

 

 

1,567

 

 

1,496

 

 

1,389

 

 

1,334

Other interest and dividend income

 

 

480

 

 

297

 

 

274

 

 

294

 

 

294

Total interest and dividend income

 

 

27,849

 

 

26,251

 

 

24,685

 

 

23,809

 

 

23,414

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

5,409

 

 

4,450

 

 

3,523

 

 

3,151

 

 

2,812

Interest on FHLB borrowings

 

 

1,130

 

 

906

 

 

1,038

 

 

1,226

 

 

1,333

Interest on subordinated debentures

 

 

189

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Total interest expense

 

 

6,728

 

 

5,356

 

 

4,561

 

 

4,377

 

 

4,145

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

21,121

 

 

20,895

 

 

20,124

 

 

19,432

 

 

19,269

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for loan losses

 

 

632

 

 

886

 

 

808

 

 

760

 

 

921

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income, after provision for loan losses

 

 

20,489

 

 

20,009

 

 

19,316

 

 

18,672

 

 

18,348

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Changes in mortgage servicing rights fair value

 

 

(378)

 

 

(306)

 

 

1,022

 

 

(74)

 

 

(488)

Other

 

 

9,249

 

 

8,765

 

 

6,261

 

 

9,134

 

 

11,071

Total mortgage banking income

 

 

8,871

 

 

8,459

 

 

7,283

 

 

9,060

 

 

10,583

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

3,302

 

 

3,224

 

 

2,967

 

 

3,223

 

 

3,172

Income on retirement plan annuities

 

 

100

 

 

119

 

 

113

 

 

118

 

 

114

Bank-owned life insurance income

 

 

243

 

 

243

 

 

239

 

 

246

 

 

260

Other income

 

 

1,124

 

 

512

 

 

747

 

 

1,507

 

 

498

Total noninterest income

 

 

13,640

 

 

12,557

 

 

11,349

 

 

14,154

 

 

14,627

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

16,809

 

 

17,345

 

 

16,352

 

 

17,655

 

 

17,325

Occupancy and equipment

 

 

3,027

 

 

2,961

 

 

3,275

 

 

3,047

 

 

2,954

Data processing

 

 

1,702

 

 

1,569

 

 

1,553

 

 

1,560

 

 

1,547

Loan expense

 

 

1,503

 

 

1,390

 

 

1,262

 

 

1,752

 

 

1,884

Marketing

 

 

639

 

 

1,084

 

 

999

 

 

936

 

 

1,136

Professional fees

 

 

712

 

 

915

 

 

968

 

 

1,097

 

 

1,126

Deposit insurance

 

 

540

 

 

491

 

 

494

 

 

412

 

 

397

Other expenses

 

 

2,451

 

 

2,763

 

 

2,696

 

 

3,234

 

 

2,069

Total noninterest expenses

 

 

27,383

 

 

28,518

 

 

27,599

 

 

29,693

 

 

28,438

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

6,746

 

 

4,048

 

 

3,066

 

 

3,133

 

 

4,537

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

818

 

 

945

 

 

814

 

 

1,540

 

 

1,699

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

5,928

 

$

3,103

 

$

2,252

 

$

1,593

 

$

2,838

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.19

 

$

0.10

 

$

0.07

 

$

0.05

 

$

0.09

Diluted

 

$

0.19

 

$

0.10

 

$

0.07

 

$

0.05

 

$

0.09

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

31,575,210

 

 

31,578,961

 

 

31,569,811

 

 

31,582,069

 

 

31,303,281

Diluted

 

 

31,575,811

 

 

31,578,961

 

 

31,569,811

 

 

31,582,069

 

 

31,303,281

 

 

 

 


 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30,

 

 

 

 

 

(Dollars in thousands, except per share amounts)

    

2018

    

2017

    

$ Change

    

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

71,485

 

$

59,765

 

$

11,720

 

19.6

%

Interest on loans held for sale

 

 

1,557

 

 

1,962

 

 

(405)

 

(20.6)

 

Interest on securities

 

 

4,692

 

 

3,882

 

 

810

 

20.9

 

Other interest and dividend income

 

 

1,051

 

 

866

 

 

185

 

21.4

 

Total interest and dividend income

 

 

78,785

 

 

66,475

 

 

12,310

 

18.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

13,382

 

 

7,811

 

 

5,571

 

71.3

 

Interest on FHLB borrowings

 

 

3,074

 

 

3,748

 

 

(674)

 

(18.0)

 

Interest on subordinated debentures

 

 

189

 

 

 —

 

 

189

 

100.0

 

Total interest expense

 

 

16,645

 

 

11,559

 

 

5,086

 

44.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

62,140

 

 

54,916

 

 

7,224

 

13.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for loan losses

 

 

2,326

 

 

1,656

 

 

670

 

40.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income, after provision for loan losses

 

 

59,814

 

 

53,260

 

 

6,554

 

12.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

Changes in mortgage servicing rights fair value

 

 

338

 

 

(1,982)

 

 

2,320

 

117.1

 

Other

 

 

24,275

 

 

30,117

 

 

(5,842)

 

(19.4)

 

Total mortgage banking income

 

 

24,613

 

 

28,135

 

 

(3,522)

 

(12.5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

9,493

 

 

9,088

 

 

405

 

4.5

 

Income on retirement plan annuities

 

 

332

 

 

337

 

 

(5)

 

(1.5)

 

Gain on sale of consumer loans

 

 

 —

 

 

78

 

 

(78)

 

(100.0)

 

Bank-owned life insurance income

 

 

725

 

 

778

 

 

(53)

 

(6.8)

 

Other income

 

 

2,383

 

 

1,964

 

 

419

 

21.3

 

Total noninterest income

 

 

37,546

 

 

40,380

 

 

(2,834)

 

(7.0)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

50,506

 

 

48,568