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Image courtesy of HarborOne Bank.
HarborOne Bank had record earnings per share in the fourth quarter as its mortgage company had more than $800 million in loan closings.
HarborOne Bank had net income of $17.6 million, or $0.33 per basic and diluted share, in the fourth quarter, compared to $11.9 million, or $0.22 per basic and diluted share, in the third quarter and $4.3 million, or $0.08 per basic and diluted share, in the fourth quarter of 2019.
For the full-year 2020, HarborOne’s net income was $44.8 million, or $0.82 per basic and diluted share, compared to $18.3 million, or $0.33 per basic and diluted share, in 2019.
“We’re pleased that the momentum we had in Q3 continued into Q4,” HarborOne’s CEO, James Blake, said in the bank’s fourth quarter earnings statement. “It’s a testament to the tremendous teamwork and commitment to our customers during a very challenging time.”
The bank’s results included charges of $1.7 million and $19.6 million for the fourth quarter and full-year 2020, respectively, to the provision for loan losses and $47,000 and $1.8 million, respectively, to non-interest expense related to the COVID-19 pandemic.
HarborOne had mortgage banking income of $31.9 million, a 145.6 percent increase over the fourth quarter 2019.
The bank said in its statement that “record-breaking mortgage demand spurred by low mortgage rates continued to provide higher than usual mortgage origination activity and other mortgage banking income for HarborOne Mortgage LLC,” the bank’s mortgage subsidiary. The company had $813.2 million in mortgage loan closings, resulting in a gain on loan sales of $28.3 million fin the fourth quarter, compared to $34.1 million in the third quarter.
The strong mortgage activity is expected to continue in the first quarter of 2021, as HarborOne said it had already had a locked residential mortgage pipeline on Dec. 31 of $485.4 million.
“[H]owever, seasonality, economic uncertainty and increased unemployment rates may have a negative impact on mortgage loan originations in the future,” the bank added.
The bank said its residential loan and consumer loan portfolios did experience significant credit quality deterioration in 2020, but cautioned that the continuing impact of the pandemic could increase delinquencies, charge offs and loan modifications in 2021. HarborOne had provided 172 payment deferrals on residential mortgage loans totaling $51.9 million, or 4.7 percent of total residential loans, with 86.1 percent of the deferrals having expired and paying as agreed and 5.4 percent in active deferral periods.
