PROVIDENCE – HarborOne Bancorp Inc., parent of HarborOne Bank, has posted a third-quarter profit of $3.9 million, down 53.3% from the year-ago period’s $8.4 million, thanks in part to a large loan-loss provision in the quarter because of a bad loan.
Earnings per diluted share declined sharply to 10 cents from 20 cents in the third quarter of 2023.
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The Brockton, Mass.-based bank – which has 11 offices in Rhode Island and is the ninth-largest bank in the state in terms of deposits – recorded $79.6 million of revenue (interest, dividend and noninterest income) for the three months that ended Sept. 30, up 6.5% from $74.8 million a year ago.
Meanwhile, interest and noninterest expenses climbed 8.5% from $64 million in the third quarter of 2023 to $69.4 million in the quarter that was just completed, an increase that was largely caused by a jump in the interest expense on deposits. That expense was $30 million in the third quarter, up from $25 million a year ago.
The bank noted that its loan-loss provision – funds set aside for anticipated bad loans – was $5.9 million for the quarter. There was no set-aside a year ago.
Bank executives said the large provision was primarily because of a $17.2 million loan related to suburban office property. The loan is considered nonaccrual, which typically means that the borrower has not made a payment in more than 90 days.
HarborOne noted some financial highlights, including a 3.3% annualized growth rate on loans, an 8.8% annual growth in client deposits and a net interest margin that improved to 2.33% – 1 basis point better than a year ago and 4 basis points better than the second quarter of 2024.
“I am pleased to see continued margin expansion coupled with an almost $90 million increase in client deposits. Our balance sheet is positioned for margin improvement from [the] declining cost of funds enabled by lower-market interest rates,” said Joseph F. Casey, HarborOne CEO and president.
