HarborOne Bancorp (HONE) Q2 2024 earnings summary

Executive summary

• Net income was $7.3 million for Q2 2024 and $14.6 million for the first half, nearly flat year-over-year, reflecting stable profitability despite margin compression.

• Loan growth reached $88.9 million in Q2 2024, with client deposits up $66.9 million, supporting total asset growth to $5.79 billion.

• Net interest margin improved to 2.31% from 2.25% in Q1 2024, though down from 2.45% a year ago.

• Credit quality remained strong, with nonperforming assets at $9.8 million (0.17% of assets) and nonperforming loans at 0.20% of total loans.

• The company completed a sale-leaseback of its headquarters, recording a $1.8 million gain.

Financial highlights

• Net interest and dividend income for Q2 2024 was $31.4 million, down 2.2% year-over-year but up from Q1 2024.

• Noninterest income rose 10.4% to $7.2 million in Q2, aided by the sale-leaseback gain and higher deposit fees.

• Noninterest expense increased 6.1% year-over-year to $27.8 million, mainly due to higher compensation, marketing, and deposit insurance costs.

• Loans, net, increased 1.9% to $4.79 billion; deposits rose 1.6% to $4.46 billion, with growth in brokered and municipal deposits.

• Tangible book value per share was $11.63 and tangible common equity to tangible assets was 9.03% at June 30, 2024.

Outlook and guidance

• Management expects continued competition for deposits and liquidity, with potential impacts from interest rate changes and economic uncertainty.

• Asset quality is expected to remain strong, but management is monitoring commercial real estate, especially business-oriented hotels, non-anchored retail, and metro office space.

• Ongoing share repurchase program targets approximately 5% of outstanding shares over the next year.

• Continued investment in technology and people to support commercial and small business growth.