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Mar 31, 2023
Eastern Bank Q1 2023 Earnings Report
Reported a net loss due to the sale of securities, but operating net income increased driven by insurance commissions and balance sheet repositioning.
Key Takeaways
Eastern Bankshares, Inc. reported a net loss of $194.1 million for Q1 2023, primarily due to a $280 million after-tax loss from the sale of available-for-sale securities. However, operating net income was a record $61.1 million, driven by an increase in insurance commissions and a balance sheet repositioning. The company strengthened its liquidity, providing 107% coverage of uninsured deposits while maintaining a strong capital position.
Net loss of $194.1 million, or $1.20 per diluted share.
Operating net income was a record $61.1 million, or $0.38 per diluted share, excluding the after-tax loss from the sale of securities and certain other non-recurring items.
Total loans increased by $99.7 million, or 1%, from the prior quarter, driven by commercial and residential loans.
Cash and cash equivalents were $2.1 billion, and secured borrowing capacity totaled $5.0 billion, providing 107% coverage of customer uninsured deposits.
Forward Guidance
The company expects to improve its overall financial profile by enhancing liquidity and strengthening earnings, while maintaining strong capital ratios on a GAAP and regulatory basis.
Positive Outlook
- Enhancing liquidity
- Strengthening earnings
- Maintaining strong capital ratios on a GAAP basis
- Maintaining strong capital ratios on a regulatory basis
- Better execute on strategic objectives
Challenges Ahead
- Adverse developments in the level and direction of loan delinquencies and charge-offs
- Changes in interest rates and resulting changes in competitor or customer behavior
- Adverse national or regional economic conditions or conditions within the securities markets or banking sector
- Legislative and regulatory changes and related compliance costs
Historical Earnings Impact
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Avg. Return Before/After Earnings
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