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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 18, 2019


HarborOne Bancorp, Inc.

(Exact Name of Registrant as Specified in its Charter)


 

 

 

Massachusetts

001-38955

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. [  ]

 

 

 

Title of each Class

Trading Symbol

Name of each exchange on which registered

Common Stock, $0.01 par value

HONE

The NASDAQ Stock Market, LLC

 

 

 

 

 

Item 2.02Results of Operations and Financial Condition

 

On October 18, 2019,  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, 2019.  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 18, 2019

 

2

EXHIBIT INDEX

 

 

 

 

Number

 

Description

 

 

 

99.1

 

Press release dated October 18, 2019

 

 

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 18, 2019

 

 

 

 

4

(Back To Top)

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 2019 Third Quarter Earnings

Contact: Linda Simmons, SVP, CFO

Brockton, Massachusetts (October 18, 2019): HarborOne Bancorp, Inc. (the “Company” or “HarborOne”) (NASDAQ: HONE), the holding company for HarborOne Bank (the “Bank”), announced net income of $7.1 million, or $0.13 per basic and diluted share for the third quarter of 2019, compared to $4.8 million, or $0.08 per basic and diluted share, for the prior quarter and $5.9 million, or $0.10 per basic and diluted share, for the same period last year. For the nine months ended September 30, 2019 net income was $14.0 million, or $0.25 per basic and diluted share, compared to $11.3 million, or $0.20 per basic and diluted share, for the same period last year. On August 14, 2019, the Company completed its second step conversion from the mutual holding company to the stock holding company form of organization and related common stock offering. All historical share and per share information has been restated to reflect the 1.795431 exchange ratio.

 

Selected third quarter highlights:

 

·

Successful second-step conversion raising net proceeds of $304.1 million

·

Maintained strong commercial loan growth, increasing total commercial loans 4%  

·

Sustained residential real estate mortgage origination activity, increasing 39% on a linked quarter basis and year over year

 

“Solid performance in our core operating businesses is a reflection of our continued focus on growth and expense management,” said James Blake, CEO, HarborOne.  “We expect the continued strength in commercial lending and the rebound of the mortgage business to serve us well through year end.” Added Joseph Casey, President, HarborOne,  “The successful completion of our second step conversion has provided both the capital and flexibility necessary to pursue our growth strategy.”

 

Net Interest Income

The Company’s net interest and dividend income was $28.0 million for the quarter ended September 30,  2019,  up  $1.3 million, or 4.8%, from $26.7 million for the quarter ended June 30, 2019 and up $6.9 million, or 32.5%, from  $21.1 million for the quarter ended September 30, 2018. The tax-equivalent interest rate spread and net interest margin were 2.73% and 3.11%, respectively, for the quarter ended September 30, 2019 compared to 2.91% and 3.19%, respectively, for the quarter ended June 30, 2019 and 2.87% and 3.12%, respectively, for the quarter ended September 30, 2018.

 

The increase in net interest and dividend income from the previous quarter reflected a $1.5 million, or 3.8%, increase in total interest and dividend income offset in part by an increase of $180,000, or 1.6%, in total interest expense.  The increase in interest and dividend income primarily reflected an increase in interest income on loans due to volume increases and an increase in interest income on other interest-earning assets as proceeds from the second step conversion were invested in liquid investments.  Additionally, interest on loans in the third quarter of 2019 included $1.1 million in accretion income of the fair value discount on loans acquired from Coastway Bancorp, Inc. (“Coastway”) and $5,000 in prepayment penalties on commercial loans. Accretion income and prepayment penalties in the previous quarter were $614,000 and $421,000, respectively. The yield on loans was 4.64% for the quarter ended September 30, 2019 compared to 4.70% for the quarter ended June 30, 2019.  The increase in interest expense was primarily due to an increase in higher cost certificates of deposit accounts and an increase in the average balance and cost of savings accounts as a result of savings and CD promotions in the third quarter, which drove a  4 basis point increase in the cost of interest-bearing deposits. Average FHLB advances in the same period decreased by  $78.3 million, reducing interest expense on FHLB advances by $430,000. 

 

The increase in net interest and dividend income from the prior year quarter reflected  an  $11.9 million, or 42.7%, increase in total interest and dividend income offset by an increase of $5.0 million, or 74.6%, in total interest expense. The increases in total interest and dividend income which reflected an increase in the yield on loans to 4.64% from 4.30%, primarily driven by commercial loan growth due to the Coastway acquisition as well as organic commercial loan growth. This is partially offset by the increase in total interest expense primarily due to an increase in average interest-bearing deposits of $633.2 million with a 43 basis point increase in the cost of those funds, due to deposits acquired from Coastway as well as organic deposit growth in money market and term CDs.  Average FHLB borrowings decreased $42.8 million;  however, a  57 basis point increase in the cost of those funds offset any savings. Additionally, the Company issued $35.0 million in subordinated notes in the third quarter of 2018.

 

Noninterest Income

Noninterest income increased  $1.6 million, or 9.9%, to  $17.3 million for the quarter ended September 30, 2019 from $15.7 million for the quarter ended June 30, 2019. The increase was primarily due to an increase in mortgage banking income of $2.9 million, partially offset by a $1.2 million decrease in gain on sale of securities and a net decrease of $105,000 in the other noninterest income categories. 

Seasonal mortgage origination activity and mortgage rate decreases resulted in a 39% increase in mortgage production by HarborOne Mortgage, LLC (“HarborOne Mortgage”) compared to the second quarter of 2019. Continued downward pressure on the 10-year Treasury Constant Maturity rate negatively impacted the fair value of the mortgage servicing rights resulting in a $2.5 million decrease in their fair value in the third quarter as compared to a $2.2 million decrease in their fair value in the second quarter of 2019.

 

Noninterest income increased $3.6 million, or 26.6%, as compared to the quarter ended September 30, 2018. Mortgage banking income increased $2.6 million, or 29.7%, and the other noninterest income categories increased $922,000, excluding the gain on sale of securities.  Mortgage banking income increased compared to the same period last year, despite the decrease in the fair value of mortgage servicing rights of $2.5 million in 2019 as compared to a $378,000 decrease in 2018. Mortgage originations increased primarily as a result of lower residential mortgage interest rates and increased refinancing volume. The net increase in other noninterest income categories compared to prior year quarter is primarily due to an  $884,000 increase in deposit account fee income reflecting the addition of Coastway accounts and an increase of $114,000 in swap fee income.

 

Noninterest Expense

Noninterest expenses were $36.2 million for the quarter ended September 30, 2019, an increase of $1.1 million, or 3.2%, from the quarter ended June 30, 2019, driven by a $2.7 million increase in compensation and benefits, and a $370,000 increase in loan expense, partially offset by  an $814,000 decrease in deposit insurance expense, a $495,000 decrease in professional fees, a $378,000 decrease in marketing expense and a $240,000 decrease in occupancy and equipment expenses. The increase in compensation and benefits is due to an increase in commissions of $1.9 million due to the increase in mortgage loan originations at HarborOne Mortgage and an increase of $674,000 in ESOP expense in connection with the second step conversion.  The loan expense increase is due to the increase in mortgage origination volume. The decrease in deposit insurance expense reflects the Bank’s FDIC assessment credit awards recorded in the quarter ended September 30, 2019.  The decreases in the other noninterest expense categories primarily reflect timing differences.

 

Total noninterest expenses increased $8.8 million, or 32.2%, from the quarter ended September 30, 2018. Compensation and benefits increased $6.4 million, other expenses increased $1.3 million and occupancy and equipment expense increased $1.1 million. The increases were partially offset by a $765,000 decrease in deposit insurance expense as a result of the FDIC credit awards noted above. Additionally, the quarter ended September 30, 2018 included $274,000 in merger expenses. The increases primarily reflected the acquisition of Coastway and expenses related to the new Stoughton branch and the Boston commercial lending office. 

 

Income Tax Provision

The effective tax rate was 12.9% for the quarter ended September 30, 2019, compared to 14.6% for the quarter ended June 30, 2019 and 12.1% for the quarter ended September 30, 2018.  The effective tax rate for the quarter ended September 30, 2019 was impacted by the 2015 federal tax refund of $1.3 million and the 2015 Massachusetts state tax refund of $39,700 and the quarter ended June 30, 2019 was impacted by the 2013 federal tax refund of $603,000 and the 2013 Massachusetts state tax refund of $211,000 recognized in the quarter. The effective tax rate for the quarter ended September 30, 2018 was primarily impacted by an $826,000 tax refund for the tax year 2014. The refunds were a result of previously amended returns filed for those years.

 

Asset Quality

The Company recorded a provision for loan losses of $889,000 for the quarter ended September 30, 2019,  compared to $1.8 million for the quarter ended June 30, 2019 and $632,000 for the quarter ended September 30, 2018.  The provision for the quarter ended September 30, 2019 is primarily due to commercial real estate loan growth. The provision in the quarter ended June  30, 2019 reflected commercial loan growth and a  $738,000 commercial loan charge off. 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. 

 

Net charge-offs totaled $106,000 for the quarter ended September 30, 2019,  or 0.01%, of average loans outstanding on an annualized basis, compared to $771,000, or 0.10% of average loans outstanding on an annualized basis, for the quarter ended June 30, 2019 and $436,000, or 0.08% of average loans outstanding on an annualized basis, for the quarter ended September 30, 2018. 

 

The allowance for loan losses was $23.0 million, or 0.74%, of total loans at September 30, 2019, compared to $22.3 million, or 0.73%, of total loans at June 30, 2019 and $19.4 million, or 0.87%, of total loans at September 30,  2018. The decrease in the ratio of allowance for loan losses to total loans from September 30, 2018 reflects the loans acquired from Coastway. In accordance with generally accepted accounting principles for acquisition accounting, the loans acquired through the acquisition of Coastway were recorded at fair value; accordingly, there is no allowance for loan losses associated with the acquired loans. 

 

Total nonperforming assets were $27.9 million at September 30, 2019 compared to $17.2 million at June 30, 2019 and $17.4 million at September 30, 2018. Nonperforming assets as a percentage of total assets were 0.71% at September 30, 2019, 0.46% at June 30, 2019 and 0.61% at September 30, 2018. The increase in nonperforming assets was primarily due to two commercial construction loans to one borrower for $11.2 million for which no specific reserve is required at this time. The Company continues to minimize loan losses through diligent collection efforts, prudent workout arrangements and strong underwriting.

 

Balance Sheet

Total assets increased $211.6 million, or 5.7%, to $3.95 billion at September 30, 2019 from $3.74 billion at June 30, 2019. The increase primarily reflects approximately $128.0 million of proceeds from the second step offering that are included in short-term investments. Short-term investments increased by $159.4 million, or 309.4%, to $210.9 million at September 30, 2019 from $51.5 million at June 30, 2019.  The remainder of the second step offering proceeds were utilized to fund commercial loan growth and pay down FHLB borrowings.

 

Net loans increased $45.4 million, or 1.5%, to $3.09 billion at September 30, 2019 from $3.04 billion at June 30, 2019. The net increase in loans for the three months ended September 30, 2019 was primarily due to increases in commercial real estate loans of $60.2 million and commercial construction loans of $3.4 million, partially offset by decreases in residential real estate loans of $7.8 million, commercial loans of $2.4 million, and consumer loans of $7.6 million.    Loans held for sale increased $17.5 million, or 20.6%, to $102.1 million at September 30, 2019 from $84.7 million at June 30, 2019. 

 

Total deposits decreased $45.1 million, or 1.5%, to $2.92 billion at September 30, 2019 from $2.97  billion at June 30, 2019. Compared to the prior quarter of 2019,  non-certificate accounts increased $26.4 million, brokered deposits decreased $65.5 million and term CDs decreased $6.1 million. FHLB borrowings were $271.1 million at September 30, 2019 and $309.1 million at June 30, 2019.

 

Total stockholders’ equity was $659.6 million at September 30, 2019 compared to $371.1 million at June 30, 2019 and $353.3 million at September 30, 2018. The tangible common equity to tangible assets ratio was 15.06% at September 30, 2019,  8.04% at June 30, 2019 and 11.96% at September 30, 2018.  The increase in stockholders’ equity and ratios primarily reflects the results of the Company’s second step offering, net of the additional ESOP funding. At September 30, 2019, the Company and the Bank exceeded 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 and Rhode Island through a network of 24 full-service branches located in Massachusetts and Rhode Island,  one limited service branch and a commercial lending office in each of Boston, Massachusetts and Providence, Rhode Island. The Bank also provides a range of educational services through “HarborOne U,” with classes on small business, financial literacy and personal enrichment at two campuses located adjacent to our Brockton and Mansfield locations. HarborOne Mortgage, LLC, a subsidiary of HarborOne Bank, is a full-service mortgage lender with  more than 30 offices in Massachusetts, Rhode Island, New Hampshire, Maine, and New Jersey and is also licensed to lend in four 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, acquisitions may not produce results at levels or within time frames originally anticipated;  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,

(in thousands)

    

2019

    

2019

    

2019

    

2018

    

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

  

 

 

  

    

 

  

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

27,758

 

$

27,205

 

$

25,227

 

$

27,686

 

$

18,478

Short-term investments

 

 

210,873

 

 

51,502

 

 

76,328

 

 

77,835

 

 

76,619

Total cash and cash equivalents

 

 

238,631

 

 

78,707

 

 

101,555

 

 

105,521

 

 

95,097

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Securities available for sale, at fair value

 

 

204,133

 

 

202,457

 

 

219,966

 

 

209,293

 

 

191,847

Securities held to maturity, at amortized cost

 

 

27,099

 

 

34,752

 

 

41,104

 

 

44,688

 

 

47,371

Federal Home Loan Bank stock, at cost

 

 

13,466

 

 

14,876

 

 

16,134

 

 

24,969

 

 

13,263

Loans held for sale, at fair value

 

 

102,121

 

 

84,651

 

 

32,449

 

 

42,107

 

 

155,268

Loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Residential real estate

 

 

1,113,704

 

 

1,121,335

 

 

1,115,424

 

 

1,115,456

 

 

661,755

Commercial real estate

 

 

1,088,036

 

 

1,027,884

 

 

952,404

 

 

934,420

 

 

788,561

Commercial construction

 

 

160,549

 

 

157,130

 

 

158,504

 

 

161,660

 

 

129,796

Total mortgage loans on real estate

 

 

2,362,289

 

 

2,306,349

 

 

2,226,332

 

 

2,211,536

 

 

1,580,112

Commercial

 

 

298,652

 

 

301,056

 

 

299,658

 

 

277,271

 

 

139,616

Consumer

 

 

445,531

 

 

453,159

 

 

469,346

 

 

491,445

 

 

498,417

Loans

 

 

3,106,472

 

 

3,060,564

 

 

2,995,336

 

 

2,980,252

 

 

2,218,145

Less: Allowance for loan losses

 

 

(23,044)

 

 

(22,261)

 

 

(21,282)

 

 

(20,655)

 

 

(19,440)

Net deferred loan costs

 

 

5,792

 

 

5,377

 

 

5,193

 

 

5,255

 

 

5,677

Net loans

 

 

3,089,220

 

 

3,043,680

 

 

2,979,247

 

 

2,964,852

 

 

2,204,382

Mortgage servicing rights, at fair value

 

 

16,067

 

 

18,156

 

 

20,231

 

 

22,217

 

 

23,748

Goodwill

 

 

69,635

 

 

69,635

 

 

69,635

 

 

70,088

 

 

13,660

Other intangible assets

 

 

6,482

 

 

7,100

 

 

7,739

 

 

8,379

 

 

66

Other assets

 

 

182,166

 

 

183,410

 

 

167,936

 

 

161,007

 

 

108,098

Total assets

 

$

3,949,020

 

$

3,737,424

 

$

3,655,996

 

$

3,653,121

 

$

2,852,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOW and demand deposit accounts

 

$

589,979

 

$

594,506

 

$

574,379

 

$

556,517

 

$

432,628

Regular savings and club accounts

 

 

585,327

 

 

544,401

 

 

497,697

 

 

482,088

 

 

327,030

Money market deposit accounts

 

 

875,804

 

 

885,775

 

 

842,824

 

 

758,933

 

 

674,657

Brokered deposits

 

 

66,474

 

 

131,936

 

 

117,940

 

 

77,508

 

 

66,831

Term certificate accounts

 

 

806,924

 

 

812,987

 

 

803,805

 

 

810,015

 

 

684,495

Total deposits

 

 

2,924,508

 

 

2,969,605

 

 

2,836,645

 

 

2,685,061

 

 

2,185,641

Short-term borrowed funds

 

 

60,000

 

 

98,000

 

 

126,000

 

 

290,000

 

 

25,000

Long-term borrowed funds

 

 

211,140

 

 

211,149

 

 

229,935

 

 

229,936

 

 

206,187

Subordinated debt

 

 

33,875

 

 

33,843

 

 

33,812

 

 

33,799

 

 

33,855

Other liabilities and accrued expenses

 

 

59,943

 

 

53,709

 

 

66,156

 

 

56,751

 

 

48,772

Total liabilities

 

 

3,289,466

 

 

3,366,306

 

 

3,292,548

 

 

3,295,547

 

 

2,499,455

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

 

584

 

 

327

 

 

327

 

 

327

 

 

327

Additional paid-in capital

 

 

458,599

 

 

154,730

 

 

153,326

 

 

152,156

 

 

150,732

Unearned compensation - ESOP

 

 

(33,838)

 

 

(9,793)

 

 

(9,942)

 

 

(10,091)

 

 

(10,239)

Retained earnings

 

 

233,049

 

 

225,936

 

 

221,155

 

 

219,088

 

 

218,977

Treasury stock

 

 

(721)

 

 

(1,548)

 

 

(1,548)

 

 

(1,548)

 

 

(1,548)

Accumulated other comprehensive income (loss)

 

 

1,881

 

 

1,466

 

 

130

 

 

(2,358)

 

 

(4,904)

Total stockholders' equity

 

 

659,554

 

 

371,118

 

 

363,448

 

 

357,574

 

 

353,345

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

3,949,020

 

$

3,737,424

 

$

3,655,996

 

$

3,653,121

 

$

2,852,800

 

 

 

 

 

 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income - Trend

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarters Ended

 

 

September 30,

 

June 30,

 

   March 31,   

 

December 31,

 

September 30,

(in thousands, except share data)

    

2019

    

2019

    

2019

    

2018

    

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

36,230

 

$

35,438

 

$

34,365

 

$

33,947

 

$

25,115

Interest on loans held for sale

 

 

747

 

 

542

 

 

358

 

 

648

 

 

625

Interest on securities

 

 

1,542

 

 

1,850

 

 

1,847

 

 

1,788

 

 

1,629

Other interest and dividend income

 

 

1,211

 

 

448

 

 

483

 

 

540

 

 

480

Total interest and dividend income

 

 

39,730

 

 

38,278

 

 

37,053

 

 

36,923

 

 

27,849

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

9,972

 

 

9,362

 

 

8,243

 

 

7,181

 

 

5,409

Interest on FHLB borrowings

 

 

1,249

 

 

1,679

 

 

2,275

 

 

2,400

 

 

1,130

Interest on subordinated debentures

 

 

524

 

 

524

 

 

505

 

 

552

 

 

189

Total interest expense

 

 

11,745

 

 

11,565

 

 

11,023

 

 

10,133

 

 

6,728

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

27,985

 

 

26,713

 

 

26,030

 

 

26,790

 

 

21,121

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for loan losses

 

 

889

 

 

1,750

 

 

857

 

 

1,502

 

 

632

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for loan losses

 

 

27,096

 

 

24,963

 

 

25,173

 

 

25,288

 

 

20,489

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Changes in mortgage servicing rights fair value

 

 

(2,474)

 

 

(2,241)

 

 

(2,151)

 

 

(1,734)

 

 

(378)

Other

 

 

13,979

 

 

10,896

 

 

6,653

 

 

7,730

 

 

9,249

Total mortgage banking income

 

 

11,505

 

 

8,655

 

 

4,502

 

 

5,996

 

 

8,871

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

4,186

 

 

4,056

 

 

3,778

 

 

4,007

 

 

3,302

Income on retirement plan annuities

 

 

104

 

 

100

 

 

96

 

 

101

 

 

100

Gain on sale and call of securities, net

 

 

77

 

 

1,267

 

 

 —

 

 

 5

 

 

 —

Bank-owned life insurance income

 

 

256

 

 

253

 

 

253

 

 

1,003

 

 

243

Other income

 

 

1,145

 

 

1,387

 

 

1,213

 

 

540

 

 

1,124

Total noninterest income

 

 

17,273

 

 

15,718

 

 

9,842

 

 

11,652

 

 

13,640

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

23,238

 

 

20,585

 

 

19,245

 

 

20,062

 

 

16,809

Occupancy and equipment

 

 

4,171

 

 

4,411

 

 

4,448

 

 

3,949

 

 

3,027

Data processing

 

 

2,196

 

 

2,199

 

 

2,046

 

 

1,965

 

 

1,702

Loan expense

 

 

1,704

 

 

1,334

 

 

1,271

 

 

1,227

 

 

1,503

Marketing

 

 

799

 

 

1,177

 

 

958

 

 

611

 

 

639

Professional fees

 

 

889

 

 

1,384

 

 

946

 

 

1,237

 

 

712

Deposit insurance

 

 

(225)

 

 

589

 

 

666

 

 

572

 

 

540

Merger expenses

 

 

 —

 

 

 —

 

 

 —

 

 

3,808

 

 

274

Other expenses

 

 

3,431

 

 

3,402

 

 

3,012

 

 

3,162

 

 

2,177

Total noninterest expenses

 

 

36,203

 

 

35,081

 

 

32,592

 

 

36,593

 

 

27,383

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

8,166

 

 

5,600

 

 

2,423

 

 

347

 

 

6,746

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

1,053

 

 

819

 

 

356

 

 

236

 

 

818

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

7,113

 

$

4,781

 

$

2,067

 

$

111

 

$

5,928

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share (1):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.13

 

$

0.08

 

$

0.04

 

$

 —

 

$

0.10

Diluted

 

$

0.13

 

$

0.08

 

$

0.04

 

$

 —

 

$

0.10

Weighted average shares outstanding (1):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

55,638,734

 

 

56,704,297

 

 

56,666,979

 

 

56,684,405

 

 

56,691,125

Diluted

 

 

55,638,734

 

 

56,704,297

 

 

56,666,979

 

 

56,684,405

 

 

56,692,204

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Share amounts related to periods prior to the date of the completion of the second step offering ("stock offering") (August 14, 2019) have been restated to give retroactive recognition to the exchange ratio applied in the stock offering (1.795431-to-one)

 

 

 

HarborOne Bancorp, Inc.

Consolidated Statements of Net Income

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended September 30,

 

 

 

 

 

(dollars in thousands, except share data)

    

2019

    

2018

    

$ Change

    

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

106,033

 

$

71,485

 

$

34,548

 

48.3

%

Interest on loans held for sale

 

 

1,647

 

 

1,557

 

 

90

 

5.8

 

Interest on securities

 

 

5,239

 

 

4,692

 

 

547

 

11.7

 

Other interest and dividend income

 

 

2,142

 

 

1,051

 

 

1,091

 

103.8

 

Total interest and dividend income

 

 

115,061

 

 

78,785

 

 

36,276

 

46.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

 

 

 

 

Interest on deposits

 

 

27,577

 

 

13,382

 

 

14,195

 

106.1

 

Interest on FHLB borrowings

 

 

5,203

 

 

3,074

 

 

2,129

 

69.3

 

Interest on subordinated debentures

 

 

1,553

 

 

189

 

 

1,364

 

721.7

 

Total interest expense

 

 

34,333

 

 

16,645

 

 

17,688

 

106.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income

 

 

80,728

 

 

62,140

 

 

18,588

 

29.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for loan losses

 

 

3,496

 

 

2,326

 

 

1,170

 

50.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest and dividend income, after provision for loan losses

 

 

77,232

 

 

59,814

 

 

17,418

 

29.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest income:

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage banking income:

 

 

 

 

 

 

 

 

 

 

 

 

Changes in mortgage servicing rights fair value

 

 

(6,866)

 

 

338

 

 

(7,204)

 

NM

 

Other

 

 

31,528

 

 

24,275

 

 

7,253

 

29.9

 

Total mortgage banking income

 

 

24,662

 

 

24,613

 

 

49

 

0.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deposit account fees

 

 

12,020

 

 

9,493

 

 

2,527

 

26.6

 

Income on retirement plan annuities

 

 

300

 

 

332

 

 

(32)

 

(9.6)

 

Gain on sale and call of securities, net

 

 

1,344

 

 

 —

 

 

1,344

 

100.0

 

Bank-owned life insurance income

 

 

762

 

 

725

 

 

37

 

5.1

 

Other income

 

 

3,745

 

 

2,383

 

 

1,362

 

57.2

 

Total noninterest income

 

 

42,833

 

 

37,546

 

 

5,287

 

14.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noninterest expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

 

63,068

 

 

50,506

 

 

12,562

 

24.9

 

Occupancy and equipment

 

 

13,030

 

 

9,263

 

 

3,767

 

40.7

 

Data processing

 

 

6,441

 

 

4,824

 

 

1,617

 

33.5

 

Loan expense

 

 

4,309

 

 

4,155

 

 

154

 

3.7

 

Marketing

 

 

2,934

 

 

2,722

 

 

212

 

7.8

 

Professional fees

 

 

3,219

 

 

2,595

 

 

624

 

24.0