Eastern Bank reported another very profitable year, reporting annual earnings in 2018 that exceeded those of similarly-sized peers such as Berkshire Bank and Rockland Trust.

The mutual bank reported annual net income in 2018 of $122.7 million, more than 40 percent higher than in 2017 and nearly double net income in 2016.

Net interest income was $390 million, a $51.5 million increase over 2017, as higher interest rates of loans and investments exceeded higher costs of deposits and other funding. The net interest margin improved 19 basis points from 2017, ending the year at 3.84 percent.

Eastern once again posted record earnings in 2018,” Bob Rivers, chairman of the board of directors and CEO of Eastern Bank, said in a statement. “Generating record financial results is not an end in and of itself, and as the oldest and largest mutual bank in the U.S., our success is directly linked to the strength of the communities we serve. We are driven by a fiduciary responsibility to preserve and grow our capital base to support the continued growth of our business so that our local communities thrive. We thank our customers, colleagues and community partners for making 2018 another outstanding year.

Total assets at the bank ended 2018 at $11.4 billion, an all-time high and a 5 percent increase from 2017. Loans, deposits and capital levels also set records. Loans totaled $8.8 billion in 2018, up 7.6 percent from 2017; deposits were $9.4 billion, up 7 percent from 2017 and capital exceeded $1.4 billion, up nearly 8 percent over 2017.

Loan credit quality remained good with very low loan losses of 0.10 percent of average loans and non-performing loans of 0.29 percent of total loans, leading measures among national and local banks.

Part of Eastern’s success can be attributed to rising interest rates and a strong local economy.

“All our businesses had very successful years, with our commercial banking group performing exceptionally well as commercial loans increased 10 percent,” James B. Fitzgerald, chief financial officer and chief administrative officer of Eastern Bank, said in a statement. “We believe we are well positioned for continued success and look forward to achieving new highs in 2019.”

Other highlights at the bank in 2018 include continued strong issuance of U.S. Small Business Administration loans; Eastern ranked as the number one in SBA lending in New England for the ninth consecutive year. The bank’s insurance group also wrote premiums that exceeded $1 billion for the second year in a row, and wealth management’s investment management fees increased 8 percent to $19.1 million. 

Profits at Eastern Bank Swell in 2018

by Banker & Tradesman time to read: 2 min