Eastern Bankshares, Inc.
For the period ended Mar 31, 2026. Filed May 8, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 8, 2026
EBC$22.84+0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001628280-25-050194
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001628280-26-032760
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 289 previous paragraphs and 263 current paragraphs.
180 unchanged; 68 reworded; 15 added; 34 removed; 7 previous and 0 current paragraphs rearranged.
Tables are not compared: 31 previous and 29 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (15)
Current report
We consider our loan portfolio to be relatively diversified by borrower and industry. Our gross loans decreased $186.5 million, or 0.8%, to $23.4 billion at March 31, 2026 from $23.6 billion at December 31, 2025. The decrease was primarily due to paydowns of non-performing loans and net loan payoffs in the commercial real estate, commercial construction and business banking portfolios, partially offset by net originations of commercial and industrial loans.
Current report
Deposits decreased by $0.4 billion, or 1.4%, to $25.1 billion at March 31, 2026 from $25.5 billion at December 31, 2025. This decrease was primarily driven by regular deposit outflows during the three months ended March 31, 2026. Also contributing to this decrease was the scheduled run-off of brokered certificates of deposit during the three months ended March 31, 2026 that were acquired in our merger with HarborOne.
Current report
During the three months ended March 31, 2026, interest expense increased by $18.1 million to $94.9 million from $76.8 million during the three months ended March 31, 2025. This increase was primarily due to both an increase in deposit interest expense and an increase in borrowings interest expense.
Current report
During the three months ended March 31, 2026, interest expense on our interest-bearing deposits increased by $14.4 million to $90.4 million from $76.0 million during the three months ended March 31, 2025. This increase was due to an increase in the average balance of our interest-bearing deposits. During the three months ended March 31, 2026, average interest-bearing deposits increased by $3.8 billion, or 25.0%, to $18.9 billion from $15.1 billion during the three months ended March 31, 2025, which was primarily due to our merger with HarborOne, which added approximately $3.5 billion in interest-bearing deposits.
Current report
Interest expense related to our borrowings increased by $3.7 million to $4.5 million during the three months ended March 31, 2026 from $0.8 million during the three months ended March 31, 2025. The increase in borrowings interest expense during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily due to an increase in our total borrowings due to FHLB advances assumed in connection with our merger with HarborOne.
Current report
Noninterest Income (Loss)
Current report
Noninterest Income (Loss)
Current report
Noninterest income increased by $279.7 million, or 118.4%, to $43.6 million during the three months ended March 31, 2026 from a loss of $236.1 million during the three months ended March 31, 2025. This increase was primarily due to a $269.6 million decrease in losses on sales of securities available for sale and a $3.0 million increase in mortgage banking income.
Current report
•Mortgage banking income increased primarily due to the merger with HarborOne, which included a mortgage company subsidiary that was liquidated into the Bank during the three months ended March 31, 2026. The activities of the subsidiary, in which the Bank is now engaged, included originating residential real estate mortgage loans principally for sale on the secondary market. As a result, the merger lead to a greater volume of secondary market sales during the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Current report
Noninterest expense increased by $68.5 million, or 52.7%, to $198.6 million during the three months ended March 31, 2026 from $130.1 million during the three months ended March 31, 2025. This increase was primarily due to a $30.8 million increase in non-operating expenses, a $22.3 million increase in salaries and employee benefits expense, a $5.8 million increase in technology and data processing expense, a $3.8 million increase in amortization of intangible assets, and a $3.5 million increase in occupancy and equipment expense.
Current report
•Non-operating expenses increased primarily as a result of merger and acquisition expenses in association with our merger with HarborOne. There were no merger and acquisition expenses incurred during the three months ended March 31, 2025.
Current report
•Technology and data processing expenses increased primarily due to an increase in software expenses, which were primarily driven by an increase in cybersecurity software expenses. The increase in these expenses was driven by an increase in the number of our employees and efforts to improve our cybersecurity technology to better protect against potential cybersecurity threats. Also contributing to this increase, was an increase in core data processing expenses, which was primarily driven by an increase in the number of accounts due to our merger with HarborOne.
Current report
•Occupancy and equipment expense increased primarily due to the addition of properties resulting from our merger with HarborOne which lead to an increase in depreciation expense.
Current report
We recognized income tax expenses of $18.6 million and $33.7 million for the three months ended March 31, 2026 and 2025, respectively. The decrease in income tax expense for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was due to the treatment of the tax benefit associated with the loss of sale of securities incurred in the first quarter of 2025. We recorded net income tax expense during the three months ended March 31, 2025 despite a net pre-tax loss recognized during that same period. The loss on sale of securities recognized during the three months ended March 31, 2025 was not considered to be a discrete item for tax purposes and, therefore, the associated tax benefit was realizable ratably over the full year. We did not sell any securities during the three months ended March 31, 2026.
Current report
(1)Additional borrowing capacity has not been assessed in this category.
Removed paragraphs (34)
Previous report
HarborOne Acquisition
Previous report
Effective November 1, 2025, we completed our previously announced merger with HarborOne and HarborOne Bank, a wholly owned subsidiary of HarborOne. For further information regarding the merger refer to Note 17, “Subsequent Events”within the Notes to the Unaudited Consolidated Financial Statements included in Part I, Item 1 in this Quarterly Report on Form 10-Q.
Previous report
During the three and nine months ended September 30, 2025, we incurred and recorded merger and acquisition costs related to our acquisition of HarborOne of $3.2 million and $5.8 million, respectively. The following table presents HarborOne-related merger and acquisition costs by expense category, which are included in non-operating expenses on the Consolidated Statements of Income, for the three and nine months ended September 30, 2025:
Previous report
In the first quarter of 2025, we changed our computation of operating net income to exclude, as an adjustment to net income (loss) in arriving at operating net income, income from investments held in rabbi trust and rabbi trust employee benefit expense. Management believes these changes result in a more meaningful measure of our financial performance and allow for better comparability to peer companies. Prior period results have been recast for comparability purposes.
Previous report
We consider our loan portfolio to be relatively diversified by borrower and industry. Our gross loans increased $0.7 billion, or 4.1%, to $18.8 billion at September 30, 2025 from $18.1 billion at December 31, 2024. The increase was primarily due to continued investment in resources targeted to grow our commercial and industrial loan portfolio and an increase in our commercial real estate investment loans driven by steady growth in our multifamily property type segment.
Previous report
(1)In the second quarter of 2025, we refined the presentation of CRE office risk segments resulting in the addition of the “laboratory/life science” risk segment. Loans in this risk segment were reported in other risk segments as of December 31, 2024 and were reclassified above for comparative purposes.
Previous report
Deposits decreased by $202.0 million, or 0.9%, to $21.1 billion at September 30, 2025 from $21.3 billion at December 31, 2024. This decrease was primarily driven by regular deposit outflows during the nine months ended September 30, 2025.
Previous report
(1)Includes the reclassification of the escrow deposits of borrowers to deposit savings accounts recorded in the first quarter of 2025 for comparability purposes.
Previous report
•Interest income on loans increased $13.4 million, or 5.8%, to $244.2 million during the three months ended September 30, 2025 from $230.8 million during the three months ended September 30, 2024. The increase in interest income on our loans was due to an increase in the average balance. The average balance of our loan portfolio increased $1.2 billion, or 6.8%, to $18.4 billion during the three months ended September 30, 2025 from $17.3 billion during the three months ended September 30, 2024, which was primarily due to new loan originations.
Previous report
Interest and dividend income increased by $152.1 million, or 22.5%, to $828.1 million during the nine months ended September 30, 2025 from $676.0 million during the nine months ended September 30, 2024. The increase was due to an increase in both the average balance and yields of our loan portfolio.
Previous report
During the three months ended September 30, 2025, interest expense decreased by $13.4 million to $82.8 million from $96.2 million during the three months ended September 30, 2024. This decrease was primarily due to deposit interest expense which decreased during the three months ended September 30, 2025 by $13.0 million to $82.4 million from $95.3 million during the three months ended September 30, 2024. This decrease was due to a decrease in rates paid on deposits.
Previous report
During the nine months ended September 30, 2025, interest expense decreased by $10.7 million to $236.9 million from $247.6 million during the nine months ended September 30, 2024. This decreases was primarily due to deposit interest expense which decreased during the nine months ended September 30, 2025 by $11.2 million to $235.1 million from $246.3 million during the nine months ended September 30, 2024. This decrease was due to an decrease in rates paid on deposits.
Previous report
Net interest income increased by $162.8 million, or 38.0%, to $591.2 million during the nine months ended September 30, 2025 from $428.4 million for the nine months ended September 30, 2024. Net interest income increased due to an increase in our net interest margin of 71 basis points, to 3.48%. Also contributing to the increase was an increase in the average balance of net interest-earning assets of $0.3 billion, or 3.7%, to $8.0 billion during the nine months ended September 30, 2025 from $7.7 billion during the nine months ended September 30, 2024.
Previous report
Net interest margin increased 71 basis points to 3.48% during the nine months ended September 30, 2025 from 2.77% during the nine months ended September 30, 2024. The increase in net interest margin for the nine months ended September 30, 2025 from the nine months ended September 30, 2024 was primarily due to an increase in our average balance and yield on interest-earning assets combined with a decrease in the cost of our interest-bearing liabilities.
Previous report
(6)Represents net (loss) income divided by average total assets.
Previous report
Noninterest Income
Previous report
Noninterest Income
Previous report
Noninterest income increased by $7.7 million, or 23.0%, to $41.3 million during the three months ended September 30, 2025 from $33.5 million during the three months ended September 30, 2024. This increase was primarily due to a $4.5 million increase in other non-operating income and a $2.6 million increase in investment advisory fees.
Previous report
•Other non-operating income increased primarily as a result of as a result of write-offs of certain property and equipment during the three months ended September 30, 2024 which was associated with our merger with Cambridge and which did not recur during the three months ended September 30, 2025. Also contributing to the increase was a gain on sale on of an other equity investment during the three months ended September 30, 2025.
Previous report
•Investment advisory fees increased due to an increase in our assets under management, which increased due to our merger with Cambridge, through which we acquired $5.0 billion in assets held in a fiduciary, custodial or agency capacity for customers. The acquisition was completed on July 12, 2024. Therefore, the increase is attributable to the addition of these assets for the full quarter in 2025 as compared to a partial quarter in 2024.
Previous report
Noninterest income decreased $238.6 million to a net loss of $152.0 million for the nine months ended September 30, 2025 from net income of $86.6 million for the nine months ended September 30, 2024. This decrease was primarily due to a $262.1 million increase in losses on sales of securities available for sale and a $5.3 million decrease in miscellaneous income and fees. These items were partially offset by a $23.1 million increase in investment advisory fees and a $4.5 million increase in other non-operating income.
Previous report
•Miscellaneous income and fees decreased primarily as a result of non-recurring fee income received during the nine months ended September 30, 2024 as a result of the early withdrawal of an omnibus deposit contract which did not recur during the nine months ended September 30, 2025.
Previous report
•Investment advisory fees increased due to an increase in our assets under management, which increased due to our merger with Cambridge through which we acquired $5.0 billion in assets held in a fiduciary, custodial or agency capacity for customers.
Previous report
•Other non-operating income increased primarily as a result of write-offs of certain property and equipment during the nine months ended September 30, 2024 which was associated with our merger with Cambridge. Also contributing to the increase was a gain on sale on of an other equity investment during the nine months ended September 30, 2025.
Previous report
Noninterest expense decreased by $19.3 million, or 12.1%, to $140.4 million during the three months ended September 30, 2025 from $159.8 million during the three months ended September 30, 2024. The decrease was primarily due to $24.4 million decrease in non-operating expenses and was partially offset by a $3.4 million increase in salaries and employee benefits expense.
Previous report
•Non-operating expenses, which are comprised entirely of merger and acquisitions expenses, decreased primarily as a result of the timing and extent of merger and acquisition costs incurred in association with our merger with Cambridge during the three months ended September 30, 2024 in comparison to the costs incurred related to our merger with HarborOne incurred during the three months ended September 30, 2025.
Previous report
Noninterest expense increased by $36.7 million, or 9.9%, to $407.5 million during the nine months ended September 30, 2025 from $370.8 million during the nine months ended September 30, 2024. This increase was primarily due to an $34.6 million increase in salaries and employee benefits expense and an $16.2 million increase in amortization of intangible assets. Partially offsetting these increases was a decrease of $27.3 million in non-operating expenses.
Previous report
•Salaries and employee benefits expenses increased primarily due to an increase in salaries and wages expense, an increase in incentives, and an increase in health insurance expense.
Previous report
◦Salaries and wages expense increased $23.3 million primarily due to an increase in the number of employees as a result of our merger with Cambridge in addition to regular employee wage increases.
Previous report
◦Incentives increased $6.1 million primarily due to an increase in the number employees participating in our incentive compensation plans which was primarily the result of our merger with Cambridge.
Previous report
◦Health insurance expense increased $3.7 million primarily due to an increase in the number of employees, which was primarily driven by our merger with Cambridge.
Previous report
•Non-operating expenses, which are made up entirely of merger and acquisitions expenses, decreased primarily as a result of the timing and extent of merger and acquisition costs incurred in association with our merger with Cambridge during the nine months ended September 30, 2024 in comparison to the costs related to our merger with HarborOne incurred during the nine months ended September 30, 2025.
Previous report
We recognized an income tax benefit for the three months ended September 30, 2025 of $12.2 million compared to net income tax expense of $2.8 million for the three months ended September 30, 2024. Income tax expense for the nine months ended September 30, 2025 and 2024 was $21.6 million and $24.8 million, respectively.
Previous report
Refer to Note 8, “Income Taxes” for further discussion regarding income taxes.
Reworded paragraphs (68)
Previous wording
This section is intended to assist in the understanding of the financial performance of the Company and its subsidiaries through a discussion of our financial condition at September 30, 2025, and our results of operations for the three and nine months ended September 30, 2025 and 2024. This section should be read in conjunction with the unaudited interim condensed consolidated financial statements and notes thereto of the Company appearing in Part I, Item 1 of this Quarterly Report on Form 10-Q and the Company’s 2024 Form 10-K.
Current wording
This section is intended to assist in the understanding of the financial performance of the Company and its subsidiaries through a discussion of our financial condition at March 31, 2026, and our results of operations for the three months ended March 31, 2026 and 2025. This section should be read in conjunction with the unaudited interim condensed consolidated financial statements and notes thereto of the Company appearing in Part I, Item 1 of this Quarterly Report on Form 10-Q and the Company’s 2025 Form 10-K.
Previous wording
•operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters and future pandemics, including COVID-19;
Current wording
•operational risks including, but not limited to, cybersecurity incidents, fraud, new technological integration including AI, natural disasters and future pandemics, including COVID-19;
Previous wording
•a regulatory reform agenda implemented by the Trump administration that is significantly different from that of the Biden administration, impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies, including risks related to the Trump administration’s increased focus on widespread implementation of stablecoins and other digital assets;
Current wording
•a regulatory reform agenda that is significantly different from that of the prior administration, impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies, including risks related to the administration’s increased focus on widespread implementation of stablecoins and other digital assets;
Previous wording
•risks related to the implementation of acquisitions, dispositions, and restructurings, including our 2024 merger with Cambridge Bancorp and Cambridge Trust Company, which is further described in Part I, Item 1 of our 2024 Annual Report on Form 10-K under “Recent Acquisitions – Bank Acquisitions” and merger with HarborOne Bancorp and HarborOne Bank, including that revenue and expense synergies or other expected benefits may not materialize or in the time frame originally anticipated or may be more costly to achieve than anticipated and that the combined businesses may not perform as expected;
Current wording
•risks related to the implementation of acquisitions, dispositions, and restructurings, including our 2025 merger with HarborOne Bancorp and HarborOne Bank, which is further described in Part I, Item 1 of our 2025 Annual Report on Form 10-K under “Recent Acquisitions – Bank Acquisitions”, including that revenue and expense synergies or other expected benefits may not materialize or in the time frame originally anticipated or may be more costly to achieve than anticipated and that the combined businesses may not perform as expected;
Previous wording
•other risks and uncertainties detailed in this Quarterly Report on Form 10-Q and in Part I, Item 1A of our 2024 Form 10-K and as may be further updated in our filings with the SEC from time to time.
Current wording
•other risks and uncertainties detailed in Part I, Item 1A of our 2025 Form 10-K and as may be further updated in our filings with the SEC from time to time.
Previous wording
There have been no other material changes in critical accounting policies during the three and nine months ended September 30, 2025.
Current wording
There have been no other material changes in critical accounting policies during the three months ended March 31, 2026.
Previous wording
We are a bank holding company, and our principal subsidiary, Eastern Bank, is a Massachusetts-chartered bank that has served the banking needs of our customers since 1818. Our business philosophy is to operate as a diversified financial services enterprise providing a broad array of banking and other financial services primarily to retail, commercial and small business customers. We had total assets of $25.5 billion and $25.6 billion at September 30, 2025 and December 31, 2024, respectively. We are subject to comprehensive regulation and examination by the Massachusetts Commissioner of Banks, the New Hampshire Banking Department, the FDIC, the Federal Reserve Board and the Consumer Financial Protection Bureau. Our business consists of a full range of banking, lending (commercial, residential and consumer), savings and small business offerings, including our wealth management and trust operations that we conduct under our “Cambridge Trust Wealth Management, a division of Eastern Bank” brand name (“Cambridge Trust Wealth Management division”).
Current wording
We are a bank holding company, and our principal subsidiary, Eastern Bank, is a Massachusetts-chartered bank that has served the banking needs of our customers since 1818. Our business philosophy is to operate as a diversified financial services enterprise providing a broad array of banking and other financial services primarily to retail, commercial and small business customers. We had total assets of $30.6 billion at both March 31, 2026 and December 31, 2025. We are subject to comprehensive regulation and examination by the Massachusetts Commissioner of Banks, the New Hampshire Banking Department, the FDIC, the Federal Reserve Board and the Consumer Financial Protection Bureau. Our business consists of a full range of banking, lending (commercial, residential and consumer), savings and small business offerings, including our wealth management and trust operations that we conduct under our “Cambridge Trust Wealth Management, a division of Eastern Bank” brand name (“Cambridge Trust Wealth Management division”).
Previous wording
Net income and net loss for the three and nine months ended September 30, 2025, respectively, computed in accordance with GAAP was $106.1 million and $11.3 million, respectively, as compared to net loss and net income of $6.2 million and $58.8 million, respectively, for the three and nine months ended September 30, 2024, respectively. The increase in net income for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily due to increased net interest income and noninterest income during the three months ended September 30, 2025. The decrease in net income from the nine months ended September 30, 2024 to a net loss for nine months ended September 30, 2025 was primarily due to losses on sales of securities during the nine months ended September 30, 2025. Refer to the later sections titled“Results of Operations”within this Item 2 for additional discussion
Current wording
Net income for the three months ended March 31, 2026 computed in accordance with GAAP was $65.3 million, as compared to a net loss of $217.7 million for the three months ended March 31, 2025. The increase in net income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily due to losses on sales of available for sale securities during the three months ended March 31, 2025, which did not recur during the three months ended March 31, 2026. Refer to the later sections titled“Results of Operations”within this Item 2 for additional discussion.
Previous wording
Net income and loss for the three and nine months ended September 30, 2025, respectively, and net loss and income for the three and nine months ended September 30, 2024, respectively, included items that our management considers non-core, which management excludes for purposes of assessing our operating net income, a non-GAAP financial measure. Operating net income for the three and nine months ended September 30, 2025 was $74.1 million and $223.3 million, respectively, compared to operating net income for the three and nine months ended September 30, 2024 of $51.3 million and $128.4 million, respectively, representing increases of 44.3% and 73.8%, respectively. These increases were primarily due to higher net interest income for both the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, partially offset by higher noninterest expense on an operating basis for both the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024. See“Non-GAAP Financial Measures”and“Results of Operations” within this Item 2 for a reconciliation of operating net income to net income/(loss) on a GAAP basis and further discussion of noninterest income/(loss) and noninterest expense.
Current wording
Net income for the three months ended March 31, 2026, and net loss for the three months ended March 31, 2025 included items that our management considers non-core, which management excludes for purposes of assessing our operating net income, a non-GAAP financial measure. Operating net income for the three months ended March 31, 2026 was $88.6 million, compared to $67.5 million for the three months ended March 31, 2025, representing an increase of $21.1 million, or 31.3%. This increase was primarily due to higher net interest income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, partially offset by higher noninterest expense on an operating basis for the three months ended March 31, 2026 compared to the three months ended March 31, 2025. See“Non-GAAP Financial Measures”and“Results of Operations”within this Item 2 for a reconciliation of operating net income to net income/(loss) on a GAAP basis and further discussion of noninterest income/(loss) and noninterest expense.
Previous wording
•Commercial and industrial: Loans in this category consist of revolving and term loans extended to businesses and corporate enterprises for the purpose of financing working capital, facilitating equipment purchases and facilitating acquisitions. As of September 30, 2025 and December 31, 2024, we had total commercial and industrial loans of $3.7 billion and $3.3 billion, respectively, representing 20.2% and 18.4%, respectively, of our total loans. The primary risk associated with commercial and industrial loans is the ability of borrowers to achieve business results consistent with those projected at origination. Our primary focus for commercial and industrial loans is middle-market companies located in the markets we serve. In addition, we participate in the syndicated loan market and the SNC Program. Our commercial and industrial portfolio also includes our Asset Based Lending Portfolio (“ABL Portfolio”) and industrial revenue bonds (“IRBs”) which are municipal bonds issued to finance major capital projects. The majority of our IRB portfolio is in educational and other non-profit sectors.
Current wording
•Commercial and industrial: Loans in this category consist of revolving and term loans extended to businesses and corporate enterprises for the purpose of financing working capital, facilitating equipment purchases and facilitating acquisitions. As of both March 31, 2026 and December 31, 2025, we had total commercial and industrial loans of $4.3 billion, representing 19.0% and 18.6%, respectively, of our total loans as of each period end. The primary risk associated with commercial and industrial loans is the ability of borrowers to achieve business results consistent with those projected at origination. Our primary focus for commercial and industrial loans is middle-market companies located in the markets we serve. In addition, we participate in the syndicated loan market and the SNC Program. Our commercial and industrial portfolio also includes our Asset Based Lending Portfolio (“ABL Portfolio”) and industrial revenue bonds (“IRBs”) which are municipal bonds issued to finance major capital projects. The majority of our IRB portfolio is in educational and other non-profit sectors.
Previous wording
•Commercial real estate: Loans in this category include mortgage loans and lines of credit on commercial real estate, both investment and owner occupied. Property types financed include office, industrial, multi-family, affordable housing, retail, hotel, and other type properties. As of September 30, 2025 and December 31, 2024, we had total commercial real estate loans of $7.4 billion and $7.0 billion, respectively, representing 39.7% and 39.6%, respectively, of our total loans as of each period end. As of September 30, 2025 and December 31, 2024, owner occupied loans totaled $982.8 million and $947.2 million, respectively, representing 13.3% and 13.4%, respectively, of our commercial real estate loans. Collateral values are established by independent third-party appraisals and evaluations. The primary repayment sources include operating income generated by the real estate, permanent debt refinancing and/or the sale of the real estate. Our commercial real estate loan portfolio also includes loans included in our SNC Program portfolio described above and IRB loans.
Current wording
•Commercial real estate: Loans in this category include mortgage loans and lines of credit on commercial real estate, both investment and owner occupied. Property types financed include office, industrial, multi-family, affordable housing, retail, hotel, and other type properties. As of both March 31, 2026 and December 31, 2025, we had total commercial real estate loans of $9.4 billion, representing 40.9% and 40.8%, respectively, of our total loans as of each period end. As of both March 31, 2026 and December 31, 2025, owner occupied loans totaled $1.2 billion, representing 12.8% and 12.9%, respectively, of our commercial real estate loans as of each period end. Collateral values are established by independent third-party appraisals and evaluations. The primary repayment sources include operating income generated by the real estate, permanent debt refinancing and/or the sale of the real estate. Our commercial real estate loan portfolio also includes loans included in our SNC Program portfolio described above and IRB loans.
Previous wording
•Commercial construction: Loans in this category include construction project financing and are comprised of commercial real estate, business banking and residential loans for the purpose of constructing and developing real estate. As of September 30, 2025 and December 31, 2024, we had total commercial construction loans of $462.5 million and $491.6 million, respectively, representing 2.5% and 2.8%, respectively, of our total loans. Our commercial construction loan portfolio also includes loans included in our SNC Program portfolio described above and IRB loans.
Current wording
•Commercial construction: Loans in this category include construction project financing and are comprised of commercial real estate, business banking and residential loans for the purpose of constructing and developing real estate. As of March 31, 2026 and December 31, 2025, we had total commercial construction loans of $502.0 million and $563.5 million, respectively, representing 2.2% and 2.4%, respectively, of our total loans. Our commercial construction loan portfolio also includes loans included in our SNC Program portfolio described above and IRB loans.
Previous wording
•Business banking: Loans in this category are comprised of loans to small businesses with exposures of under $1.0 million and small investment real estate projects with exposures of under $3.0 million. These loans are separate and distinct from our commercial and industrial and commercial real estate portfolios described above due to the size of the loans. As of both September 30, 2025 and December 31, 2024, we had total business banking loans of $1.4 billion, representing 7.5% and 8.1%, respectively, of our total loans for each period end. In this category, commercial and industrial loans and commercial real estate loans totaled $241.2 million and $1.2 billion, respectively, as of September 30, 2025, and $244.4 million and $1.2 billion, respectively, as of December 31, 2024.
Current wording
•Business banking: Loans in this category are comprised of loans to small businesses with exposures of under $1.0 million and small investment real estate projects with exposures of under $3.0 million. These loans are separate and distinct from our commercial and industrial and commercial real estate portfolios described above due to the size of the loans. As of March 31, 2026 and December 31, 2025, we had total business banking loans of $1.5 billion and $1.6 billion, respectively, representing 6.7% and 6.9%, respectively, of our total loans for each period end. In this category, commercial and industrial loans and commercial real estate loans totaled $316.9 million and $1.2 billion, respectively, as of March 31, 2026, and $307.6 million and $1.3 billion, respectively, as of December 31, 2025.
Previous wording
•Residential real estate: Loans in this category consist of mortgage loans on residential real estate. As of both September 30, 2025 and December 31, 2024, we had total residential real estate loans of $3.9 billion, representing 20.9% and 22.1%, respectively, of our total loans. Underwriting considerations include, among others, income sources and their reliability, willingness to repay as evidenced by credit repayment history, financial resources including cash reserves and the value of the collateral. We maintain policy standards for minimum credit scores and cash reserves and maximum loan-to-value consistent with a “prime” portfolio. Collateral consists of mortgage liens on residential dwellings. We do not originate or purchase sub-prime or other high-risk loans. Residential real estate loans are originated either for sale to investors or to retain in our loan portfolio. Decisions about whether to sell or retain residential real estate loans are made based on the interest rate characteristics, pricing for loans in the secondary mortgage market, competitive factors and our capital needs. During the three and nine months ended September 30, 2025, residential real estate mortgage loan originations were $128.1 million and $311.6 million, respectively, of which $8.9 million and $31.8 million, respectively, were sold on the secondary markets. Comparatively, during the three and nine months ended September 30, 2024, residential real estate mortgage loan originations were $117.3 million and $244.9 million, respectively, of which $30.9 million and $65.7 million, respectively, were sold on the secondary markets.
Current wording
•Residential real estate: Loans in this category consist of mortgage loans on residential real estate. As of both March 31, 2026 and December 31, 2025, we had total residential real estate loans of $5.2 billion, representing 22.6% and 22.7%, respectively, of our total loans as of each period end. Underwriting considerations include, among others, income sources and their reliability, willingness to repay as evidenced by credit repayment history, financial resources including cash reserves and the value of the collateral. We maintain policy standards for minimum credit scores and cash reserves and maximum loan-to-value consistent with a “prime” portfolio. Collateral consists of mortgage liens on residential dwellings. We do not originate or purchase sub-prime or other high-risk loans. Residential real estate loans are originated either for sale to investors or to retain in our loan portfolio. Decisions about whether to sell or retain residential real estate loans are made based on the interest rate characteristics, pricing for loans in the secondary mortgage market, competitive factors and our capital needs. Following our merger with HarborOne, which included the acquisition of HarborOne’s mortgage company, a portion of our loans sold on the secondary markets are sold with servicing retained. During the three months ended March 31, 2026, residential real estate mortgage loan originations for secondary market sale and sales on secondary market were $101.6 million and $98.8 million, respectively. Comparatively, during the three months ended March 31, 2025, residential real estate mortgage loan originations for secondary market sale and sales on secondary market were $13.2 million and $12.8 million, respectively.
Previous wording
•Consumer home equity: Loans in this category consist of home equity lines of credit and home equity loans. As of September 30, 2025 and December 31, 2024, we had total consumer home equity loans of $1.5 billion and $1.4 billion, respectively, representing 8.1% and 7.8%, respectively, of our total loans. Home equity lines of credit are granted for ten years with monthly interest-only repayment requirements. Full principal repayment is required at the end of the ten-year draw period. Home equity lines of credit can be converted to term loans that are fully amortized. Underwriting considerations are materially consistent with those utilized in the residential real estate category. Collateral consists of a senior or subordinate lien on owner-occupied residential property.
Current wording
•Consumer home equity: Loans in this category consist of home equity lines of credit and home equity loans. As of both March 31, 2026 and December 31, 2025, we had total consumer home equity loans of $1.8 billion, representing 7.7% and 7.6%, respectively, of our total loans as of each period end. Home equity lines of credit are granted for ten years with monthly interest-only repayment requirements. Full principal repayment is required at the end of the ten-year draw period. Home equity lines of credit can be converted to term loans that are fully amortized. Underwriting considerations are materially consistent with those utilized in the residential real estate category. Collateral consists of a senior or subordinate lien on owner-occupied residential property.
Previous wording
•Other consumer: Loans in this category consist of unsecured personal lines of credit, overdraft protection, automobile and aircraft loans, home improvement loans and other personal loans. As of September 30, 2025 and December 31, 2024, we had total other consumer loans of $220.1 million and $227.2 million, respectively, representing 1.2% and 1.3%, respectively, of our total loans. Our policy and underwriting in this category include the following factors, among others: income sources and reliability, credit histories, term of repayment and collateral value, as applicable.
Current wording
•Other consumer: Loans in this category consist of unsecured personal lines of credit, overdraft protection, automobile and aircraft loans, home improvement loans and other personal loans. As of March 31, 2026 and December 31, 2025, we had total other consumer loans of $215.5 million and $232.0 million, respectively, representing 0.9% and 1.0%, respectively, of our total loans. Our policy and underwriting in this category include the following factors, among others: income sources and reliability, credit histories, term of repayment and collateral value, as applicable.
Previous wording
•We offer a variety of deposit, treasury management, electronic banking, interest rate protection and foreign exchange products to our customers. In addition, we offer cash management services to our corporate and municipal clients. Deposit products include checking products, both interest-bearing and noninterest-bearing, as well as money market deposits, savings deposits and certificates of deposits. Our treasury management products include a variety of cash management and payment products. Our interest rate protection and foreign exchange products include interest rate swaps and currency related transactions.
Current wording
•We offer a variety of deposit, treasury management, electronic banking, interest rate protection and foreign exchange products to our customers. In addition, we offer cash management services to our corporate and municipal clients. Deposit products include checking products, both interest-bearing and noninterest-bearing, as well as money market deposits, savings deposits and certificates of deposit. Our treasury management products include a variety of cash management and payment products. Our interest rate protection and foreign exchange products include interest rate swaps and currency related transactions.
Previous wording
•We offer a wide variety of deposit products and services to our consumer customers. We service these customers through our 109 branches located in eastern Massachusetts and New Hampshire, through our call center and through our online and mobile banking applications.
Current wording
•We offer a wide variety of deposit products and services to our consumer customers. We service these customers through our 128 branches located in eastern Massachusetts, New Hampshire, and Rhode Island, through our call center and through our online and mobile banking applications.
Previous wording
•Through our Cambridge Trust Wealth Management division, we provide a wide range of trust services, including (i) managing customer investments, (ii) serving as custodian for customer assets, and (iii) providing other fiduciary services, including serving as the trustee and personal representative of estates. As of September 30, 2025 and December 31, 2024, we held $9.7 billion and $8.7 billion, respectively, of assets in a fiduciary, custodial or agency capacity for customers, which are not our assets and therefore not included on the Consolidated Balance Sheets included in this Quarterly Report on Form 10-Q. For the three and nine months ended September 30, 2025, we had noninterest income of $17.6 million and $51.3 million, respectively, from providing these services compared to $14.9 million and $28.2 million for the three and nine months ended September 30, 2024, respectively.
Current wording
•Through our Cambridge Trust Wealth Management division, we provide a wide range of trust services, including (i) managing customer investments, (ii) serving as custodian for customer assets, and (iii) providing other fiduciary services, including serving as the trustee and personal representative of estates. As of March 31, 2026 and December 31, 2025, we held $10.3 billion and $10.1 billion, respectively, of assets in a fiduciary, custodial or agency capacity for customers, which are not our assets and therefore not included on the Consolidated Balance Sheets included in this Quarterly Report on Form 10-Q. For the three months ended March 31, 2026, we had noninterest income of $18.3 million from providing these services compared to $16.4 million for the three months ended March 31, 2025.
Previous wording
Beginning in March 2022, the Federal Open Market Committee (“FOMC”) voted to increase the federal funds rate multiple times from a range of 0.00% to 0.25% to a range of 5.25% to 5.50% on July 26, 2023, when the FOMC stated that it will continue to assess additional information and its implications for monetary policy. At its meeting on September 18, 2024, the FOMC decided to lower the target range for the federal funds rate by 50 basis points from the range set at its July 26, 2023 meeting to a range of 4.75% to 5.00%. The FOMC decided to lower the target range for the federal funds rate at its meeting on November 7, 2024 to a range of 4.50% to 4.75%, at its meeting on December 18, 2024 to a range of 4.25% to 4.50%, and again at its meeting on September 17, 2025 to a range of 4.00% to 4.25%. At its most recent meeting on October 29, 2025, the FOMC further lowered the target range for the federal funds rate to a range of 3.75% to 4.00% and indicated, in considering additional adjustments to the target range for the federal funds rate, it will carefully assess incoming data, the evolving outlook, and the balance of risks. The FOMC further indicated it is strongly committed to supporting maximum employment and reducing the annual inflation rate to its 2 percent objective.
Current wording
Beginning in March 2022, the Federal Open Market Committee (“FOMC”) voted to increase the federal funds rate multiple times from a range of 0.00% to 0.25% to a range of 5.25% to 5.50% on July 26, 2023, when the FOMC stated that it will continue to assess additional information and its implications for monetary policy. At its meeting on September 18, 2024, the FOMC decided to lower the target range for the federal funds rate by 50 basis points from the range set at its July 26, 2023 meeting to a range of 4.75% to 5.00%. The FOMC further decided to lower the target range for the federal funds rate at each of its meetings held on November 7, 2024, December 18, 2024, September 17, 2025, October 29, 2025, December 10, 2025, and January 28, 2026 with the most recent change reducing the target range for the federal funds rate to a range of 3.50% to 3.75%. At its most recent meeting on April 29, 2026, the FOMC decided to maintain the target range for the federal funds rate at the range set at its January 28, 2026 meeting and indicated, in considering additional adjustments to the target range for the federal funds rate, it will carefully assess incoming data, the evolving outlook, and the balance of risks. The FOMC further indicated it is strongly committed to supporting maximum employment and reducing the annual inflation rate to its 2 percent objective.
Previous wording
Inevitably, not all of our interest rate-sensitive assets and liabilities will re-price simultaneously and in equal volume in response to changes in the federal funds rate, and therefore the potential for interest rate exposure exists. Management believes that several factors will affect the actual impact of interest rate changes on our balance sheet and operating results, including, but not limited to, actual changes in interest rates or expectations of future changes, the degree of volatility in the securities markets, inflation rates or expectations of inflation, and the slope of the interest rate yield curve. We attempt to manage interest rate risk by identifying, quantifying, and, where appropriate, hedging our exposure. Approximately 36% of the outstanding principal balance of our loans, gross of outstanding interest rate swaps as described further below, as of September 30, 2025 was indexed to a market rate that is expected to re-price with similar magnitude and direction as the federal funds rate. A portion of these loans have been hedged using interest rate swaps to convert the floating rate interest receipts to a fixed rate. The notional amount of floating rate loans swapped totaled $2.2 billion on September 30, 2025, representing approximately 11.9% of the outstanding principal balance of our loans at that date. For more detail regarding such hedging financial instruments, refer to Note 11, “Derivative Financial Instruments”within the Notes to the Unaudited Consolidated Financial Statements included in Part I, Item 1 in this Quarterly Report on Form 10-Q. Refer to the section titled“Management of Market Risk” within this Item 2 for additional discussion including the estimated change to our net interest income under interest rate risk measurement methodologies that use a variety of hypothetical scenarios assuming immediate and parallel changes in interest rates that may not reflect the manner in which actual yields and costs respond to changes in market interest rates.
Current wording
Inevitably, not all of our interest rate-sensitive assets and liabilities will re-price simultaneously and in equal volume in response to changes in the federal funds rate, and therefore the potential for interest rate exposure exists. Management believes that several factors will affect the actual impact of interest rate changes on our balance sheet and operating results, including, but not limited to, actual changes in interest rates or expectations of future changes, the degree of volatility in the securities markets, inflation rates or expectations of inflation, and the slope of the interest rate yield curve. We attempt to manage interest rate risk by identifying, quantifying, and, where appropriate, hedging our exposure. Approximately 35% of the outstanding principal balance of our loans, gross of outstanding interest rate swaps as described further below, as of March 31, 2026 was indexed to a market rate that is expected to re-price with similar magnitude and direction as the federal funds rate. A portion of these loans have been hedged using interest rate swaps to convert the floating rate interest receipts to a fixed rate. The notional amount of floating rate loans swapped totaled $1.6 billion on March 31, 2026, representing approximately 7.0% of the outstanding principal balance of our loans at that date. For more detail regarding such hedging financial instruments, refer to Note 11, “Derivative Financial Instruments”within the Notes to the Unaudited Consolidated Financial Statements included in Part I, Item 1 in this Quarterly Report on Form 10-Q. Refer to the section titled“Management of Market Risk” within this Item 2 for additional discussion including the estimated change to our net interest income under interest rate risk measurement methodologies that use a variety of hypothetical scenarios assuming immediate and parallel changes in interest rates that may not reflect the manner in which actual yields and costs respond to changes in market interest rates.
Previous wording
There are items in our financial statements that impact our results but which we believe are unrelated to our core business. Accordingly, we present operating net income, noninterest income on an operating basis, noninterest expense on an operating basis, total operating revenue, operating earnings per share, tangible net income to average tangible shareholders’ equity, tangible operating net income to average tangible shareholders’ equity, tangible book value per share, and the operating efficiency ratio, each of which excludes the impact of such items because we believe such exclusion can provide greater visibility into our core business and underlying trends. Such items that we do not consider to be core to our business include (i) gains and losses on sales of securities available for sale, net, (ii) gains and losses on the sale of other assets, (iii) impairment charges on tax credit investments and associated tax credit benefits, (iv) OREO gains and losses, (v) merger and acquisition expenses, and (vi) certain discrete tax items. There were no expenses indirectly associated with OREO gains or losses, or impairment charges on tax credit investments and associated tax credit benefits during the periods presented in this Quarterly Report on Form 10-Q.
Current wording
There are items in our financial statements that impact our results but which we believe are unrelated to our core business. Accordingly, we present operating net income, noninterest income on an operating basis, noninterest expense on an operating basis, total operating revenue, operating earnings per share, tangible net income to average tangible shareholders’ equity, tangible operating net income to average tangible shareholders’ equity, tangible book value per share, and the operating efficiency ratio, each of which excludes the impact of such items because we believe such exclusion can provide greater visibility into our core business and underlying trends. Such items that we do not consider to be core to our business include (i) gains and losses on sales of securities available for sale, net, (ii) gains and losses on the sale of other equity investments, (iii) gains and losses on the sale of other assets, (iv) impairment charges on tax credit investments and associated tax credit benefits, (v) OREO gains and losses, (vi) merger and acquisition expenses, (vii) non-recurring expenses associated with a staffing reorganization, and (viii) certain discrete tax items. There were no expenses indirectly associated with gains and losses on the sale of other equity investments, OREO gains or losses, or impairment charges on tax credit investments and associated tax credit benefits during the periods presented in this Quarterly Report on Form 10-Q.
Previous wording
(1)The net tax benefit 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. For discussion regarding the net tax (benefit) expense recognized for the three and nine months ended September 30, 2025, refer to Note 8, “Income Taxes” within the Notes to the Unaudited Consolidated Financial Statements included in Part I, Item 1 in this Quarterly Report on Form 10-Q.
Current wording
(1)The net tax benefit 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.
Previous wording
(3)The tax effect of amortization of intangible assets was calculated using our combined statutory tax rate of 27.7%.
Current wording
(3)The tax effect of amortization of intangible assets was calculated for the three months ended March 31, 2026 and 2025 using our combined statutory tax rate of 27.6% and 27.7%, respectively.
Previous wording
Total cash and cash equivalents decreased by $0.6 billion, or 59.2%, to $0.4 billion at September 30, 2025 from $1.0 billion at December 31, 2024. This decrease was primarily due to an increase in gross loans of $0.7 billion and a decrease in total deposits of $0.2 billion. For further discussion of the change in deposits and loans, refer to the later“Loans”and “Deposits” sections in this Item 2.
Current wording
Total cash and cash equivalents increased by $14.7 million, or 4.6%, to $331.6 million at March 31, 2026 from $316.9 million at December 31, 2025. This increase was primarily due to an increase in FHLB advances of $502.3 million and AFS and HTM maturities and principal paydowns of $118.6 million, partially offset by a decrease in total deposits of $365.5 million and a decrease in gross loans of $186.5 million. For further discussion of the change in deposits and loans, refer to the later“Loans”and “Deposits”sections in this Item 2.
Previous wording
U.S. government securities: As of September 30, 2025, our U.S. government securities consisted of U.S. Treasury securities. As of December 31, 2024, our U.S. government securities consisted of U.S. Agency bonds and U.S. Treasury securities. We maintain these investments, to the extent appropriate, for liquidity purposes, at zero risk weighting for capital purposes, and as collateral for interest rate derivative positions. U.S. Agency bonds include securities issued by Fannie Mae, Freddie Mac, the FHLB, and the Federal Farm Credit Bureau.
Current wording
U.S. government securities: As of both March 31, 2026 and December 31, 2025, our U.S. government securities consisted of U.S. Treasury securities. We maintain these investments, to the extent appropriate, for liquidity purposes, at zero risk weighting for capital purposes, and as collateral for interest rate derivative positions.
Previous wording
Our securities portfolio decreased $0.1 billion, or 2.6%, to $4.3 billion at September 30, 2025 from $4.4 billion at December 31, 2024. This slight decrease was primarily due the offsetting effect of sales of AFS securities of $1.3 billion, AFS and HTM maturities and principal paydowns of $0.4 billion, and purchases of AFS and HTM securities of $1.4 billion.
Current wording
Our securities portfolio increased $147.7 million, or 3.3%, to $4.6 billion at March 31, 2026 from $4.4 billion at December 31, 2025. This increase was primarily due to purchases of AFS and HTM securities of $288.0 million partially offset by AFS and HTM maturities and principal paydowns of $118.6 million.
Previous wording
A portion of our securities portfolio continues to be tax-exempt. Investments in federally tax-exempt securities totaled $262.6 million at September 30, 2025 compared to $183.1 million at December 31, 2024.
Current wording
A portion of our securities portfolio continues to be tax-exempt. Investments in federally tax-exempt securities totaled $454.9 million at March 31, 2026 compared to $348.8 million at December 31, 2025.
Previous wording
We believe that our commercial loan portfolio composition is relatively diversified in terms of industry sectors, property types and various lending specialties, and it is concentrated in the New England geographical area, with 80.8% of our commercial loans in Massachusetts and New Hampshire as of September 30, 2025.
Current wording
We believe that our commercial loan portfolio composition is relatively diversified in terms of industry sectors, property types and various lending specialties, and it is concentrated in the New England geographical area, with 79.3% of our commercial loans in Massachusetts, New Hampshire, or Rhode Island as of March 31, 2026.
Previous wording
Special mention, substandard and doubtful loans totaled 3.8% and 4.9% of total commercial loans outstanding at September 30, 2025 and December 31, 2024, respectively.
Current wording
Special mention, substandard and doubtful loans totaled 5.1% and 5.0% of total commercial loans outstanding at March 31, 2026 and December 31, 2025, respectively.
Previous wording
The delinquency rate of our total loan portfolio decreased to 0.43% at September 30, 2025, compared to 0.62% at December 31, 2024.
Current wording
The delinquency rate of our total loan portfolio increased to 0.60% at March 31, 2026, compared to 0.56% at December 31, 2025.
Previous wording
NPLs decreased $66.6 million, or 49.0%, to $69.2 million at September 30, 2025 from $135.8 million at December 31, 2024. NPLs as a percentage of total loans decreased to 0.37% at September 30, 2025 from 0.76% at December 31, 2024. The decrease was primarily due to the sales of certain non-performing commercial and industrial loans and commercial real estate loans during the nine months ended September 30, 2025. Also driving this decline is continued efforts to work with borrowers to either exit certain relationships through sales or otherwise alleviate non-performance through regular payoffs.
Current wording
NPLs decreased $34.7 million, or 20.1%, to $137.7 million at March 31, 2026 from $172.3 million at December 31, 2025. NPLs as a percentage of total loans decreased to 0.60% at March 31, 2026 from 0.75% at December 31, 2025. The decrease was primarily due to commercial loan payoffs during the three months ended March 31, 2026. Also driving this decline is continued efforts to work with borrowers to either exit certain relationships through sale of the loan or to otherwise alleviate non-performance through regular payoffs.
Previous wording
The total amount of interest recorded on NPLs during both the nine months ended September 30, 2025 and 2024 was not significant. The gross interest income that would have been recorded under the original terms of those loans if they had been performing amounted to $4.1 million and $2.9 million for the nine months ended September 30, 2025 and 2024, respectively.
Current wording
The total amount of interest recorded on NPLs during both the three months ended March 31, 2026 and 2025 was not significant. The gross interest income that would have been recorded under the original terms of those loans if they had been performing amounted to $2.1 million and $2.3 million for the three months ended March 31, 2026 and 2025, respectively.
Previous wording
In the course of resolving NPLs, we may choose to restructure the contractual terms of certain loans. We attempt to work-out alternative payment schedules with the borrowers in order to avoid foreclosure actions. The aggregate amortized cost balance as of September 30, 2025 of loans modified during the three and nine months ended September 30, 2025 which were determined to be modifications to borrowers experiencing financial difficulty was $54.3 million and $65.5 million, respectively. The aggregate amortized cost balance as of September 30, 2024 of loans modified during the three and nine months ended September 30, 2024 which were determined to be modifications to borrowers experiencing financial difficulty was $13.2 million and $33.4 million, respectively.
Current wording
In the course of resolving NPLs, we may choose to restructure the contractual terms of certain loans. We attempt to work-out alternative payment schedules with the borrowers in order to avoid foreclosure actions. The aggregate amortized cost balance as of March 31, 2026 of loans modified during the three months ended March 31, 2026 which were determined to be modifications to borrowers experiencing financial difficulty was $34.0 million. The aggregate amortized cost balance as of March 31, 2025 of loans modified during the three months ended March 31, 2025 which were determined to be modifications to borrowers experiencing financial difficulty was $4.4 million.
Previous wording
As of September 30, 2025, there was one loan with an aggregate balance of less than $0.1 million that had been modified to borrowers experiencing financial difficulty during the during the twelve-month period then ended and which had subsequently defaulted during the nine months ended September 30, 2025. As of September 30, 2024, there were two loans with an aggregate balance of $0.3 million that had been modified to borrowers experiencing financial difficulty during the twelve-month period then ended and which had subsequently defaulted during the nine months ended September 30, 2024.
Current wording
As of March 31, 2026 and 2025, there were no loans that had been modified to a borrower experiencing financial difficulty during the twelve-month period then ended and which had subsequently defaulted during the three months ended March 31, 2026 and 2025, respectively.
Previous wording
Purchased credit deteriorated (“PCD”) loans are loans that we acquired that have shown evidence of deterioration of credit quality since origination and, therefore, it was deemed unlikely that all contractually required payments would be collected upon the merger date. We consider factors such as payment history, collateral values and accrual status when determining whether there was evidence of deterioration at the merger date. As of September 30, 2025 and December 31, 2024, the carrying amount of PCD loans was $188.7 million and $331.4 million, respectively.
Current wording
Purchased credit deteriorated (“PCD”) loans are loans that we acquired that have shown evidence of deterioration of credit quality since origination and, therefore, it was deemed unlikely that all contractually required payments would be collected upon the merger date. We consider factors such as payment history, collateral values and accrual status when determining whether there was evidence of deterioration at the merger date. As of March 31, 2026 and December 31, 2025, the carrying amount of PCD loans was $619.8 million and $659.7 million, respectively.
Previous wording
Potential Problem Loans. In the normal course of business, we become aware of possible credit problems in which borrowers exhibit the potential to be unable to comply in the future with the contractual terms of their loans, but which currently do not yet meet the criteria for classification as NPLs. These loans are neither delinquent nor on non-accrual status. Our potential problem loans, or loans with potential weaknesses that were not included in the non-accrual loans or in the loans 90 or more past due categories, decreased by $0.4 million, or 0.1%, to $411.6 million at September 30, 2025 from $412.0 million at December 31, 2024. These loans as a percentage of total loans decreased to 2.2% at September 30, 2025 from 2.3% at December 31, 2024.
Current wording
Potential Problem Loans. In the normal course of business, we become aware of possible credit problems in which borrowers exhibit the potential to be unable to comply in the future with the contractual terms of their loans, but which currently do not yet meet the criteria for classification as NPLs. These loans are neither delinquent nor on non-accrual status. Our potential problem loans, or loans with potential weaknesses that were not included in the non-accrual loans or in the loans 90 or more past due categories, increased by $88.9 million, or 21.5%, to $502.6 million at March 31, 2026 from $413.7 million at December 31, 2025. These loans as a percentage of total loans increased to 2.2% at March 31, 2026 from 1.8% at December 31, 2025.
Previous wording
Commercial Real Estate Office Exposure. As of September 30, 2025 and December 31, 2024 our total office-related commercial real estate (“CRE”) loans (which is comprised of loans within our commercial real estate and construction portfolios that are secured by office space, medical office space, mixed-use, and laboratory/life sciences office properties where rental income is primarily from office space) totaled $0.9 billion and $1.0 billion, respectively. As of September 30, 2025, our office-related CRE loans are primarily concentrated in Massachusetts, where approximately 91.6% of the total recorded investment balance of office-related CRE loans are located, and approximately 20.6% of the total recorded investment balance of office-related CRE loans are located in the City of Boston.
Current wording
Commercial Real Estate Office Exposure. As of March 31, 2026 and December 31, 2025 our total office-related commercial real estate (“CRE”) loans (which is comprised of loans within our commercial real estate and construction portfolios that are secured by office space, medical office space, mixed-use, and laboratory/life sciences office properties where rental income is primarily from office space) totaled $1.0 billion and $1.3 billion, respectively. As of March 31, 2026, our office-related CRE loans are primarily concentrated in Massachusetts, where approximately 86.4% of the total recorded investment balance of office-related CRE loans are located, and approximately 14.3% of the total recorded investment balance of office-related CRE loans are located in the City of Boston.
Previous wording
Given prevailing market conditions such as reduced occupancy as a result of the increase in hybrid and fully remote work arrangements post-COVID and lower commercial real estate valuations, we are carefully monitoring these loans for signs of deterioration in credit quality. Such monitoring includes incremental risk management strategies undertaken by management including monthly internal CRE office exposure portfolio reporting, more frequent portfolio reviews, ongoing monitoring of market conditions, and additional portfolio analysis such as maturity risk analysis and rent rollover risk analysis. As of September 30, 2025, two of these loans, which had an aggregate recorded investment balance of $28.4 million, were on non-accrual status. As of December 31, 2024, twelve of these loans were on non-accrual status and had an aggregate recorded investment balance of $87.0 million.
Current wording
Given prevailing market conditions such as reduced occupancy as a result of the increase in hybrid and fully remote work arrangements post-COVID and lower commercial real estate valuations, we are carefully monitoring these loans for signs of deterioration in credit quality. Such monitoring includes incremental risk management strategies undertaken by management including monthly internal CRE office exposure portfolio reporting, more frequent portfolio reviews, ongoing monitoring of market conditions, and additional portfolio analysis such as maturity risk analysis and rent rollover risk analysis. As of March 31, 2026, eight of these loans, which had an aggregate recorded investment balance of $10.8 million, were on non-accrual status. As of December 31, 2025, four of these loans were on non-accrual status and had an aggregate recorded investment balance of $36.7 million.
Previous wording
The allowance for loan losses increased by $4.1 million, or 1.8%, to $233.0 million, or 1.26% of total loans, at September 30, 2025 from $229.0 million, or 1.29% of total loans at December 31, 2024. The increase in the allowance for loan losses for the nine months ended September 30, 2025 was primarily due to an increase in commercial and industrial reserve rates and an increase in commercial loan balances, partially offset by a reduction in specific reserves that was driven by the sales of certain non-performing commercial real estate and commercial and industrial loans, which had previously been reserved for on a specific reserve basis.
Current wording
The allowance for loan losses decreased by $3.9 million, or 1.2%, to $327.9 million, or 1.43% of total loans, at March 31, 2026 from $331.8 million, or 1.44% of total loans at December 31, 2025. The decrease in the allowance for loan losses for the three months ended March 31, 2026, was primarily due to charge-offs of loans that were previously reserved for on a specific reserve basis.
Showing the first 40 of 68 pairs. Open the source sections for the rest.
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Previous report — wording carried elsewhere
•Interest income on securities and other short-term investments increased by $11.6 million, or 11.3%, to $114.3 million during the nine months ended September 30, 2025 from $102.7 million during the nine months ended September 30, 2024. The increase was primarily due to an increase in our combined yield on our securities and other short-term investments, which increased 75 basis points during the nine months ended September 30, 2025 in comparison to the nine months ended September 30, 2024 due to sales of AFS securities and the purchase of new securities with higher yields. Partially offsetting this increase was a decrease in the average balance of our securities and other short-term investments during the nine months ended September 30, 2025, which resulted from maturities and principal paydowns of AFS and HTM securities.
Previous report — wording carried elsewhere
(1)Non-accrual loans are included in loans.
Previous report — wording carried elsewhere
(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.
Previous report — wording carried elsewhere
(3)Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
Previous report — wording carried elsewhere
(4)Net interest margin - FTE represents fully-taxable equivalent net interest income divided by average total interest-earning assets. Refer to the earlier “Non-GAAP Financial Measures” section within this Item 2 for additional information.
Previous report — wording carried elsewhere
(5)Presented on an annualized basis.
Previous report — wording carried elsewhere
(7)Represents net (loss) income divided by average equity.