BROCKTON, Mass. – HarborOne Bancorp Inc. saw its quarterly profit cut by more than a third compared with a year ago amid major declines in mortgage banking income in the first quarter in 2022.
The parent company for Harbor One Bank, which has eight branches in Rhode Island since it acquired Coastway Bancorp in 2018, reported $12.3 million in earnings on April 28, marking a 36.7% decline over the first quarter of 2021.
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Earnings per diluted share also fell 12 cents to 25 cents per share.
The primary driver of lower profits was declining mortgage banking revenue, which fell nearly 60% to $13.2 million thanks to fewer mortgage loan closings and lower gain on the loan sales to the secondary market, the company stated.
Loss of mortgage income was partially offset by a 16.1% boost to deposit account fees.
Total non-interest income was cut by just under 50% to $19.1 million.
Interest income remained relatively flat, down 0.7% to $35.6 million, the company stated. Interest expenses were down 38.6% to $2.3 million, reflecting lower interest rates and fewer of interest-bearing liabilities, the company stated.
Net interest margin, the difference between interest income generated versus the amount of interest paid, increased 7 basis points to 3.21%.
Noninterest expenses also fell 18.6% to $34.8 million, with a nearly 25% cut to employee compensation and benefits due to fewer residential mortgages, the company stated.
Total quarterly assets ticked down 0.3% to $4.6 billion, including $3.74 billion in total loans. This included gains in commercial and residential real estate loans, partially offset by fewer commercial loans due to the now-ended Paycheck Protection Program. As of March 31, the company had $13.6 million in outstanding PPP loans, it stated.
Total quarterly deposits stood at $3.8 billion, up 2.3% over a year ago thanks to gains in regular savings and club accounts.
The bank ranks ninth in terms of Rhode Island deposit market share with $656.1 million in deposits as of June 2021, according to the Federal Deposit Insurance Corp.
“We remain focused on the core fundamentals of deposit and loan growth, as we continue to invest in building out our small business banking team and tools,” said HarborOne CEO James Blake in a statement.
“We continue to be responsive to the challenges in the residential mortgage market in this rising rate environment, continuously assessing our operational costs, and making the necessary staff and expense adjustments” Joseph Casey, president and chief operating officer, also said in a statement.
Nancy Lavin is a PBN staff writer. You may reach her at Lavin@PBN.com.
