Business Wire | Jul 29, 2021 04:08PM EDT

Eastern Bankshares, Inc. Reports Second Quarter 2021 Financial Results and Declares Quarterly Dividend

Jul. 29, 2021

BOSTON--(BUSINESS WIRE)--Jul. 29, 2021--Eastern Bankshares, Inc. (the "Company," or together with its affiliates and subsidiaries, "Eastern") (NASDAQ Global Select Market: EBC), the stock holding company of Eastern Bank, today announced its 2021 second quarter financial results and the declaration of a quarterly cash dividend of $0.08 per share. Net income for the second quarter of 2021 was $34.8 million, or $0.20 per share, compared to net income of $47.7 million, or $0.28 per share, reported for the first quarter of 2021.

Financial results for the second quarter of 2021 include $3.5 million in merger and acquisition expenses, primarily related to the pending merger with Century Bancorp, Inc. ("Century") announced on April 7, 2021 and $3.3 million in expenses related to the anticipated settlement of overdraft litigation. Excluding these, and certain other non-operating expenses, operating net income* for the second quarter of 2021 was $37.1 million, or $0.22 per share, compared to $46.5 million, or $0.27 per share, reported for the prior quarter.

"Our second quarter financial results continue to demonstrate our organic growth, strong fee income generation, sound asset quality, and focus on our long-term profitability," said Bob Rivers, Chief Executive Officer and Chair of the Board of Eastern Bankshares, Inc. and Eastern Bank. "COVID-19 vaccination rates in our core markets are among the highest in the country, and we're seeing significant progress in our local economy as businesses were able to reopen their doors and look to the future. Excluding PPP loans, we saw loan growth of $117 million this quarter, or growth of over 5% on an annualized basis, which provides further evidence of confidence and business expansion. We are optimistic about our continued growth as our colleagues work diligently on the integration of Century. We're pleased that Century shareholders approved the transaction earlier this month and are working towards a smooth integration later this year."

HIGHLIGHTS FOR THE SECOND QUARTER OF 2021

* Total loans excluding Small Business Administration ("SBA") Paycheck Protection Program ("PPP") loans grew $116.9 million, or 5% on an annualized basis from the prior quarter. Residential and commercial loans excluding PPP loans grew 15% and 5%, respectively, on an annualized basis from the prior quarter. * Net interest income increased $4.5 million from the prior quarter due to growth in the Company's securities portfolio and higher loan income, primarily attributable to higher PPP fee recognition. * An improving economic outlook coupled with strong asset quality led to a $3.3 million release of loan loss reserves. Nonperforming loans were $41.6 million, or 0.43% of total loans at the end of the second quarter. * The second quarter saw solid fee generation with insurance, wealth management and debit card revenues up 4%, 17% and 36%, respectively, from the prior year quarter.

BALANCE SHEET

Total assets were $17.0 billion at June 30, 2021, representing an increase of $320.7 million, or 2%, from March 31, 2021.

* Available for sale securities increased $862.5 million, or 22%, on a consecutive quarter basis, to $4.8 billion, as excess liquidity was deployed into U.S. Agency securities. Cash and equivalents declined $296.1 million to $1.6 billion. * Total loans were $9.6 billion, representing a decrease of $295.4 million, or 3%, from the prior quarter as the pace of forgiveness of PPP loans accelerated in the second quarter. Excluding PPP loans, total loans grew $116.9 million, or 1%, from the prior quarter, driven by growth in commercial loans excluding PPP loans of $80.7 million and residential loans of $51.0 million. * Deposits totaled $13.3 billion, representing an increase of $269.6 million, or 2%, from March 31, 2021. * Shareholders' equity was $3.4 billion, representing an increase of $43.6 million, or 1%, from the prior quarter. The increase is driven by higher retained earnings of $21.0 million as well as an increase in the after-tax market value of the available for sale investment portfolio, which drove the increase in accumulated other comprehensive income of $19.9 million. * At June 30, 2021, book value per share was $18.37 and tangible book value per share* was $16.33.

NET INTEREST INCOME

Net interest income was $104.6 million for the second quarter, compared to $100.1 million in the prior quarter, representing an increase of $4.5 million on a consecutive quarter basis.

* Included in net interest income was $9.3 million and $8.3 million of SBA PPP fee accretion net of deferred cost amortization in the second quarter and prior quarter, respectively. Between March 31, 2021 and June 30, 2021, $502.9 million in PPP loans were forgiven through the SBA or otherwise paid down compared to $240.7 million in the prior quarter. In the second quarter, PPP loan forgiveness was concentrated in higher balance loans where the Company received a lower percentage loan processing fee from the SBA relative to the prior quarter. Loans forgiven in the second quarter had lower unaccreted fee income at the time of forgiveness relative to the first quarter. * Interest income on available for sale securities increased $2.3 million to $14.3 million in the second quarter as excess cash continues to be deployed into securities. Investment securities averaged $4.3 billion for the second quarter compared to $3.6 billion for the prior quarter, an increase of $713.2 million. * The net interest margin on a fully tax equivalent ("FTE") basis* was 2.69% for the second quarter, representing a 2 basis points decrease from the prior quarter. The net interest margin continues to be pressured by the low interest rate environment and excess liquidity. The core net interest margin* in Appendix E demonstrates the impact of excess cash and the PPP program.

NONINTEREST INCOME

Noninterest income was $45.7 million for the second quarter, compared to $55.2 million for the prior quarter, representing a decrease of $9.5 million. The decline was primarily driven by lower insurance revenues from the seasonally high prior quarter and lower loan-level interest rate swap revenue due to lower market interest rates.

* Insurance commissions decreased $4.5 million to $23.7 million in the second quarter, compared to $28.1 million in the prior quarter, driven by seasonality. Compared to the prior year quarter, insurance commissions increased $1.0 million, or 4%. * Trust and investment advisory fees increased $0.4 million on a consecutive quarter basis to $6.1 million primarily due to higher equity values. * Loan-level interest rate swap losses were $1.2 million in the second quarter, compared to $5.4 million in revenue in the prior quarter, representing a decrease of $6.6 million that was primarily driven by a $6.4 million decrease in the fair value of such interest rate swap transactions due to lower market interest rates. * Income on securities held in rabbi trust accounts was $4.2 million in the second quarter compared to $1.8 million in the prior quarter, representing an increase of $2.4 million primarily due to higher equity market gains in the second quarter of 2021 as compared to the prior quarter. * Mortgage origination activity was lower in the second quarter as compared to the prior quarter with the gain on sale of loans held for sale totaling $0.8 million, down $0.6 million from the prior quarter.

Please refer to Appendix B for a reconciliation of operating revenues and expenses*.

NONINTEREST EXPENSE

Noninterest expense was $107.3 million for the second quarter representing an increase of $13.3 million, or 14%, from $94.0 million the prior quarter. The increase was primarily driven by higher salaries and employee benefits expense, expenses related to the pending merger with Century, and expenses related to the anticipated settlement of overdraft fee and nonsufficient funds fee lawsuits. Noninterest expense on an operating basis* for the second quarter of 2021 was $99.9 million, compared to $92.5 million in the prior quarter.

* Salaries and employee benefits expense was $69.3 million in the second quarter, representing an increase of $5.2 million from the prior quarter. The increase was primarily driven by higher incentive compensation expense of $3.4 million and an increase in the defined contribution supplemental executive retirement plan ("DC SERP") expense of $1.1 million associated with the increase in the market value of investments held in rabbi trust accounts. * Data processing expense was $13.6 million in the second quarter, an increase of $1.4 million from the prior quarter. Professional services expense was $6.4 million, an increase of $2.3 million from the prior quarter. These increases can be primarily attributed to costs associated with the pending acquisition of Century. * Marketing expenses were $3.5 million in the second quarter, representing an increase of $1.8 million from the prior quarter. * Other noninterest expense increased $2.5 million in the second quarter to $3.0 million. In the second quarter, the Company recorded expenses of $3.3 million related to the anticipated settlement of overdraft fee and nonsufficient fund fee suits brought against the Company that were the subject of mediation during the quarter. Partially offsetting this increased expense in the second quarter was the reversal of an impairment charge on tax credit investments of $1.4 million.

Please refer to Appendix B for a reconciliation of operating revenues and expenses*.

ASSET QUALITY

The allowance for loan losses was $105.6 million at June 30, 2021, or 1.10% of total loans, compared to $111.1 million or 1.12% of total loans at March 31, 2021. The Company released loan loss reserves totaling $3.3 million in the second quarter, compared to a release of $0.6 million in the prior quarter. The Company followed the incurred loss allowance GAAP accounting model at June 30, 2021 and all preceding periods.

Non-performing loans totaled $41.6 million at June 30, 2021 compared to $44.0 million at the end of the prior quarter. During the second quarter of 2021, the Company recorded total net charge-offs of $2.1 million, or 0.09% of average total loans on an annualized basis compared to $1.4 million and 0.06% in the prior quarter, respectively.

At June 30, 2021, approximately $149.8 million in COVID-19 modified loans remained under modified payment terms, down from $178.4 million at March 31, 2021. The commercial real estate portfolio contained $113.3 million of the remaining COVID-19 modifications at period end, of which $89.3 million or 79% were in the hotel segment.

Please refer to Appendix F for a detailed breakout on COVID-19 related loan modifications.

CONFERENCE CALL INFORMATION

A conference call and webcast covering Eastern's second quarter 2021 earnings will be held on Friday, July 30, 2021 at 9:00 a.m. Eastern Time. To join by telephone, participants can call the toll-free dial-in number (833) 233-4460 from within the U.S. or (647) 689-4543 if outside the U.S. and reference conference ID 7899073. The conference call will be simultaneously webcast. Participants may join the webcast on the Company's Investor Relations website at investor.easternbank.com. A replay of the webcast will be made available on demand on this site.

Following the webcast, Eastern will post its general investor presentation incorporating the second quarter results on its website at investor.easternbank.com under the "Events & Presentations" section.

DIVIDEND DECLARED

The Company's Board of Directors declared a quarterly cash dividend of $0.08 per common share, payable on September 15, 2021, to shareholders of record as of the close of business on September 3, 2021.

ABOUT EASTERN BANKSHARES, INC.

Eastern Bankshares, Inc. is the stock holding company for Eastern Bank. Founded in 1818, Boston-based Eastern Bank has more than 110 locations serving communities in eastern Massachusetts, southern and coastal New Hampshire, and Rhode Island. As of June 30, 2021, Eastern Bank had approximately $17 billion in total assets. Eastern provides banking, investment and insurance products and services for consumers and businesses of all sizes, including through its Eastern Wealth Management division and its Eastern Insurance Group LLC subsidiary. Eastern takes pride in its outspoken advocacy and community support that includes $240 million in charitable giving since 1994. An inclusive company, Eastern employs approximately 1,900 deeply committed professionals who value relationships with their customers, colleagues, and communities. For investor information, visit investor.easternbank.com.

NON-GAAP FINANCIAL MEASURES

*Denotes a non-GAAP financial measure used in this press release.

A non-GAAP financial measure is defined as a numerical measure of the Company's historical or future financial performance, financial position or cash flows that excludes (or includes) amounts, or is subject to adjustments that have the effect of excluding (or including) amounts that are included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States ("GAAP") in the Company's statement of income, balance sheet or statement of cash flows (or equivalent statements).

The Company presents non-GAAP financial measures, which management uses to evaluate the Company's performance, and which exclude the effects of certain transactions that management believes are unrelated to its core business and are therefore not necessarily indicative of its current performance or financial position. Management believes excluding these items facilitates greater visibility for investors into the Company's core businesses as well as underlying trends that may, to some extent, be obscured by inclusion of such items in the corresponding GAAP financial measures.

There are items in the Company's financial statements that impact its financial results, but which management believes are unrelated to the Company's core business. Accordingly, the Company presents noninterest income on an operating basis, total operating revenue, noninterest expense on an operating basis, operating net income, operating earnings per share, operating return on average assets, operating return on average shareholders' equity, the operating efficiency ratio, and the ratio of noninterest income to total revenue on an operating basis. Each of these figures excludes the impact of such applicable items because management believes such exclusion can provide greater visibility into the Company's core business and underlying trends. Such items that management does not consider to be core to the Company's business include (i) income and expenses from investments held in rabbi trusts, (ii) gains and losses on sales of securities available for sale, net, (iii) gains and losses on the sale of other assets, (iv) rabbi trust employee benefits, (v) impairment charges on tax credit investments and associated tax credit benefits, (vi) expenses indirectly associated with the Company's initial public offering ("IPO"), (vii) other real estate owned ("OREO") gains, (viii) merger and acquisition expenses, (ix) the stock donation to the Eastern Bank Foundation ("EBF", formerly known as the Eastern Bank Charitable Foundation) in connection with the Company's mutual-to-stock conversion and IPO, and (x) settlement of putative consumer class action litigation matters related to overdraft and non-sufficient funds fees, and associated settlement expenses. The Company does not provide an outlook for its total noninterest expense because it contains expense components, such as expense associated with rabbi trust accounts, which is market-driven, over which the Company cannot exercise control. Accordingly, a reconciliation of the Company's outlook for its noninterest expense on an operating basis to an outlook for total noninterest expense cannot be made available without unreasonable effort.

Management also presents the Company's core net interest margin which excludes the impact of items management determines as being one-time in nature or not indicative of its core operating results. Such items include the impact of excess liquidity in the form of excess cash volume, PPP loans originated in response to the COVID-19 pandemic, and material purchase accounting adjustments. Similarly, management presents certain asset quality metrics excluding PPP loans which it does not consider to be part of the Company's core portfolios. These metrics include the ratio of total nonperforming loans to total loans excluding PPP loans, the ratio of the allowance for loan losses to total loans excluding PPP loans, and the ratio of annualized net charge-offs to average total loans excluding PPP loans. The Company anticipates that the vast majority of its PPP loans outstanding at June 30, 2021 will be forgiven, and to the extent not forgiven, a PPP loan is intended to be 100% guaranteed by the SBA.

Management also presents tangible assets, tangible shareholders' equity, tangible book value per share, and the ratio of tangible shareholders' equity to tangible assets, each of which excludes the impact of goodwill and other intangible assets, as management believes these financial measures provide investors with the ability to further assess the Company's performance, identify trends in its core business and provide a comparison of its capital adequacy to other companies. The Company included the tangible ratios because management believes that investors may find it useful to have access to the same analytical tools used by management to assess performance and identify trends.

These non-GAAP financial measures presented in this press release should not be considered an alternative or substitute for financial results or measures determined in accordance with GAAP or as an indication of the Company's cash flows from operating activities, a measure of its liquidity position or an indication of funds available for its cash needs. An item which management considers to be non-core and excludes when computing these non-GAAP measures can be of substantial importance to the Company's results for any particular period. In addition, management's methodology for calculating non-GAAP financial measures may differ from the methodologies employed by other banking companies to calculate the same or similar performance measures, and accordingly, the Company's reported non-GAAP financial measures may not be comparable to the same or similar performance measures reported by other banking companies. Please refer to Appendices A-E for reconciliations of the Company's GAAP financial measures to the non-GAAP financial measures in this press release.

FORWARD-LOOKING STATEMENTS

This press release contains "forward-looking statements" within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. You can identify these statements from the use of the words "may," "will," "should," "could," "would," "plan," "potential," "estimate," "project," "believe," "intend," "anticipate," "expect," "target" and similar expressions. Forward-looking statements, by their nature, are subject to risks and uncertainties. There are many factors that could cause actual results to differ materially from expected results described in the forward-looking statements.

Certain factors that could cause actual results to differ materially from expected results include developments in the Company's market relating to the COVID-19 pandemic, including the severity and duration of the associated economic slowdown, adverse developments in the level and direction of loan delinquencies and charge-offs and changes in estimates of the adequacy of the allowance for loan losses, increased competitive pressures, changes in the interest rate environment, risks associated with its proposed merger with Century, including the possibility that revenue or expense synergies or the other expected benefits of the transaction may not materialize for the Company in the timeframe expected or at all, or may be more costly to achieve; that the transaction may not be timely completed, if at all; that prior to the completion of the transaction or thereafter, the Company's or Century's businesses may not perform as expected due to transaction-related uncertainty or other factors; that the Company is unable to successfully implement integration strategies; that required regulatory or other approvals are not obtained or other closing conditions are not satisfied in a timely manner or at all; that the timing of completion of the proposed merger is dependent on various factors that cannot be predicted with precision at this point; reputational risks and the reaction of the companies' customers to the transaction; the inability to implement onboarding plans and other consequences associated with mergers; and diversion of management time on merger-related issues, as well as general economic conditions or conditions within the securities markets, and legislative and regulatory changes that could adversely affect the business in which the Company and its subsidiary Eastern Bank are engaged, including inflation, interest rates, interest rate sensitivity and liquidity, including the effect of, and changes in, monetary and fiscal policies and laws, such as the interest rate policies of the Board of Governors of the Federal Reserve System; market and monetary fluctuations, including fluctuations due to actual or anticipated changes to federal tax laws; and credit quality, including adverse developments in local or regional real estate markets that decrease collateral values associated with existing loans. For further discussion of such factors, please see the Company's most recent Annual Report on Form 10-K and subsequent filings with the U.S. Securities and Exchange Commission (the "SEC"), which are available on the SEC's website at www.sec.gov.

Further, given the ongoing and dynamic nature of the COVID-19 pandemic, it is difficult to predict what continued effects the COVID-19 pandemic will have on the Company's business and results of operations. The COVID-19 pandemic and the related local and national economic disruption may result in a continued decline in demand for the Company's products and services; increased levels of loan delinquencies, problem assets and foreclosures; an increase in the Company's allowance for loan losses; a decline in the value of loan collateral, including real estate; a greater decline in the yield on the Company's interest-earning assets than the decline in the cost of the Company's interest-bearing liabilities; and increased cybersecurity risks, as employees continue to work remotely. You should not place undue reliance on forward-looking statements, which reflect the Company's expectations only as of the date of this press release. The Company does not undertake any obligation to update forward-looking statements.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

SELECTED FINANCIAL HIGHLIGHTS



Certain information in this press release is presented as reviewed by theCompany's management and includes information derived from the Company'sConsolidated Statements of Income, non-GAAP financial measures, and operationaland performance metrics. For information on non-GAAP financial measures, pleasesee the section titled "Non-GAAP Financial Measures."

As of and for the three months ended

(Unaudited,dollars inthousands, Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020except pershareamounts)



Earnings data

Net interest $ 104,608 $ 100,091 $ 103,608 $ 98,742 $ 98,755 income

Noninterest 45,733 55,212 49,638 47,709 47,657 income

Total revenue 150,341 155,303 153,246 146,451 146,412

Noninterest 107,335 94,049 199,169 109,817 100,765 expense

Pre-tax,pre-provision 43,006 61,254 (45,923 ) 36,634 45,647 income (loss)

(Release of)provision for (3,300 ) (580 ) 900 700 8,600 allowance forloan losses

Pre-tax 46,306 61,834 (46,823 ) 35,934 37,047 income (loss)

Net income 34,809 47,663 (44,062 ) 28,505 29,850 (loss)

Operating netincome 37,097 46,537 31,612 32,322 27,301 (non-GAAP)



Per-share data

Earnings(loss) per $ 0.20 $ 0.28 $ (0.26 ) n.a. n.a.share

Operatingearnings per $ 0.22 $ 0.27 $ 0.18 n.a. n.a.share(non-GAAP)

Book value $ 18.37 $ 18.14 $ 18.36 n.a. n.a.per share

Tangible bookvalue per $ 16.33 $ 16.12 $ 16.34 n.a. n.a.share(non-GAAP)



Profitability

Return on )average 0.83 % 1.19 % (1.11 % 0.80 % 0.88 %assets (1)

Operatingreturn onaverage 0.89 % 1.15 % 0.79 % 0.90 % 0.81 %assets(non-GAAP)(1)

Return onaverage 4.10 % 5.66 % (5.61 ) 6.65 % 7.11 %shareholders' %equity (1)

Operatingreturn onaverageshareholders' 4.36 % 5.53 % 4.02 % 7.54 % 6.51 %equity(non-GAAP)(1)

Net interestmargin (FTE) 2.69 % 2.71 % 2.84 % 3.04 % 3.23 %(1)

Cost of 0.03 % 0.03 % 0.03 % 0.06 % 0.11 %deposits (1)

Fee income 30.42 % 35.55 % 32.39 % 32.58 % 32.55 %ratio

Efficiency 71.39 % 60.56 % 129.97 % 74.99 % 68.82 %ratio

Operatingefficiency 67.78 % 60.22 % 68.33 % 69.95 % 68.90 %ratio(non-GAAP)



Balance Sheet(end of period)

Total assets $ 17,047,453 $ 16,726,795 $ 15,964,190 $ 15,460,594 $ 13,996,523

Total loans 9,621,075 9,916,475 9,730,525 9,944,241 10,014,338

Total 13,250,433 12,980,875 12,155,784 13,332,585 11,846,765 deposits

Total loans /total 73 % 76 % 80 % 75 % 85 %deposits

PPP loans $ 825,784 $ 1,238,053 $ 1,026,117 $ 1,123,493 $ 1,100,181



Asset quality

Allowance forloan losses $ 105,637 $ 111,080 $ 113,031 $ 115,432 $ 116,636 ("ALLL")

ALLL / totalnonperforming 253.74 % 252.72 % 261.33 % 257.47 % 210.55 %loans("NPLs")

Total NPLs / 0.43 % 0.44 % 0.45 % 0.45 % 0.56 %total loans

Total NPLs /total loans(excl. PPP 0.47 % 0.51 % 0.50 % 0.51 % 0.62 %loans)(non-GAAP)

Netcharge-offs(NCOs) / 0.09 % 0.06 % 0.13 % 0.08 % 0.04 %average totalloans (1)

NCOs /average totalloans (excl. 0.10 % 0.06 % 0.15 % 0.09 % 0.05 %PPP loans)(non-GAAP)(1)

RemainingCOVID-19 loan $ 149,805 $ 178,430 $ 332,682 $ 701,227 $ 945,995 modifications(2)



Capital adequacy

Shareholders'equity / 20.12 % 20.25 % 21.47 % 11.08 % 12.10 %assets

Tangibleshareholders'equity / 18.30 % 18.42 % 19.58 % 8.87 % 9.67 %tangibleassets(non-GAAP)



(1) Presented on an annualized basis.

(2) See Appendix F: COVID-19 Related Loan Modifications

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of

Jun 30, 2021 change from

(Unaudited, dollars in thousands)

Jun 30, 2021

Mar 31, 2021

Jun 30, 2020

Mar 31, 2021

Jun 30, 2020

ASSETS

? $

? %

? $

? %

Cash and due from banks

$

58,490

$

79,497

$

67,264

(21,007

)

(26

)%

(8,774

)

(13

)%

Short-term investments

1,505,757

1,780,835

1,365,297

(275,078

)

(15

)%

140,460

10

%

Cash and cash equivalents

1,564,247

1,860,332

1,432,561

(296,085

)

(16

)%

131,686

9

%

Available for sale securities

4,848,781

3,986,253

1,600,354

862,528

22

%

3,248,427

203

%

Total securities

4,848,781

3,986,253

1,600,354

862,528

22

%

3,248,427

203

%

Loans held for sale

2,734

2,022

2,972

712

35

%

(238

)

(8

)%

Loans:

Commercial and industrial

1,740,679

1,986,366

2,271,700

(245,687

)

(12

)%

(531,021

)

(23

)%

Commercial real estate

3,775,771

3,676,941

3,584,358

98,830

3

%

191,413

5

%

Commercial construction

237,927

249,416

282,246

(11,489

)

(5

)%

(44,319

)

(16

)%

Business banking

1,339,852

1,513,051

1,234,961

(173,199

)

(11

)%

104,891

8

%

Total commercial loans

7,094,229

7,425,774

7,373,265

(331,545

)

(4

)%

(279,036

)

(4

)%

Residential real estate

1,457,498

1,406,510

1,400,855

50,988

4

%

56,643

4

%

Consumer home equity

834,938

832,466

905,484

2,472

-

%

(70,546

)

(8

)%

Other consumer

234,410

251,725

334,734

(17,315

)

(7

)%

(100,324

)

(30

)%

Total loans

9,621,075

9,916,475

10,014,338

(295,400

)

(3

)%

(393,263

)

(4

)%

Allowance for loan losses

(105,637

)

(111,080

)

(116,636

)

5,443

(5

)%

10,999

(9

)%

Unamortized prem./disc. and def. fees

(29,739

)

(32,673

)

(34,722

)

2,934

(9

)%

4,983

(14

)%

Net loans

9,485,699

9,772,722

9,862,980

(287,023

)

(3

)%

(377,281

)

(4

)%

Federal Home Loan Bank stock, at cost

10,601

8,805

8,805

1,796

20

%

1,796

20

%

Premises and equipment

44,733

46,619

52,475

(1,886

)

(4

)%

(7,742

)

(15

)%

Bank-owned life insurance

79,634

79,110

77,528

524

1

%

2,106

3

%

Goodwill and other intangibles, net

380,402

376,002

376,331

4,400

1

%

4,071

1

%

Deferred income taxes, net

26,161

31,508

7,663

(5,347

)

(17

)%

18,498

241

%

Prepaid expenses

145,941

150,453

92,517

(4,512

)

(3

)%

53,424

58

%

Other assets

458,520

412,969

482,337

45,551

11

%

(23,817

)

(5

)%

Total assets

17,047,453

16,726,795

13,996,523

320,658

2

%

3,050,930

22

%

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits:

Demand

5,399,297

5,369,164

4,740,125

30,133

1

%

659,172

14

%

Interest checking accounts

2,656,610

2,482,731

2,385,912

173,879

7

%

270,698

11

%

Savings accounts

1,403,472

1,362,463

1,157,606

41,009

3

%

245,866

21

%

Money market investment

3,544,897

3,522,990

3,254,202

21,907

1

%

290,695

9

%

Certificates of deposit

246,157

243,527

308,920

2,630

1

%

(62,763

)

(20

)%

Total deposits

13,250,433

12,980,875

11,846,765

269,558

2

%

1,403,668

12

%

Borrowed funds:

Federal Home Loan Bank advances

14,323

14,473

14,922

(150

)

(1

)%

(599

)

(4

)%

Escrow deposits of borrowers

14,119

14,878

14,233

(759

)

(5

)%

(114

)

(1

)%

Total borrowed funds

28,442

29,351

29,155

(909

)

(3

)%

(713

)

(2

)%

Other liabilities

337,956

329,524

426,973

8,432

3

%

(89,017

)

(21

)%

Total liabilities

13,616,831

13,339,750

12,302,893

277,081

2

%

1,313,938

11

%

Shareholders' equity:

Common shares

1,868

1,868

-

-

-

%

1,868

-

%

Additional paid-in capital

1,856,241

1,854,895

-

1,346

-

%

1,856,241

-

%

Unallocated common shares held by the employee stock ownership plan ("ESOP")

(145,219

)

(146,472

)

-

1,253

(1

)%

(145,219

)

-

%

Retained earnings

1,723,979

1,702,946

1,681,164

21,033

1

%

42,815

3

%

Accumulated other comprehensive income ("AOCI"), net of tax

(6,247

)

(26,192

)

12,466

19,945

(76

)%

(18,713

)

(150

)%

Total shareholders' equity

3,430,622

3,387,045

1,693,630

43,577

1

%

1,736,992

103

%

Total liabilities and shareholders' equity

17,047,453

16,726,795

13,996,523

320,658

2

%

3,050,930

22

%

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of Jun 30, 2021 change from

(Unaudited,dollars in Jun 30, 2021 Mar 31, 2021 Jun 30, 2020 Mar 31, 2021 Jun 30, 2020thousands)

ASSETS ? $ ? % ? $ ? %

Cash and due $ 58,490 $ 79,497 $ 67,264 (21,007 ) (26 ) (8,774 ) (13 )from banks % %

Short-term 1,505,757 1,780,835 1,365,297 (275,078 ) (15 ) 140,460 10 %investments %

Cash and cash 1,564,247 1,860,332 1,432,561 (296,085 ) (16 ) 131,686 9 %equivalents %

Available forsale 4,848,781 3,986,253 1,600,354 862,528 22 % 3,248,427 203 %securities

Total 4,848,781 3,986,253 1,600,354 862,528 22 % 3,248,427 203 %securities

Loans held 2,734 2,022 2,972 712 35 % (238 ) (8 )for sale %

Loans:

Commercial ) )and 1,740,679 1,986,366 2,271,700 (245,687 ) (12 % (531,021 ) (23 %industrial

Commercial 3,775,771 3,676,941 3,584,358 98,830 3 % 191,413 5 %real estate

Commercial 237,927 249,416 282,246 (11,489 ) (5 ) (44,319 ) (16 )construction % %

Business 1,339,852 1,513,051 1,234,961 (173,199 ) (11 ) 104,891 8 %banking %

Total ) )commercial 7,094,229 7,425,774 7,373,265 (331,545 ) (4 % (279,036 ) (4 %loans

Residential 1,457,498 1,406,510 1,400,855 50,988 4 % 56,643 4 %real estate

Consumer home 834,938 832,466 905,484 2,472 - % (70,546 ) (8 )equity %

Other 234,410 251,725 334,734 (17,315 ) (7 ) (100,324 ) (30 )consumer % %

Total loans 9,621,075 9,916,475 10,014,338 (295,400 ) (3 ) (393,263 ) (4 ) % %

Allowance for (105,637 ) (111,080 ) (116,636 ) 5,443 (5 ) 10,999 (9 )loan losses % %

Unamortized ) )prem./disc. (29,739 ) (32,673 ) (34,722 ) 2,934 (9 % 4,983 (14 %and def. fees

Net loans 9,485,699 9,772,722 9,862,980 (287,023 ) (3 ) (377,281 ) (4 ) % %

Federal HomeLoan Bank 10,601 8,805 8,805 1,796 20 % 1,796 20 %stock, atcost

Premises and 44,733 46,619 52,475 (1,886 ) (4 ) (7,742 ) (15 )equipment % %

Bank-ownedlife 79,634 79,110 77,528 524 1 % 2,106 3 %insurance

Goodwill andother 380,402 376,002 376,331 4,400 1 % 4,071 1 %intangibles,net

Deferred )income taxes, 26,161 31,508 7,663 (5,347 ) (17 % 18,498 241 %net

Prepaid 145,941 150,453 92,517 (4,512 ) (3 ) 53,424 58 %expenses %

Other assets 458,520 412,969 482,337 45,551 11 % (23,817 ) (5 ) %

Total assets 17,047,453 16,726,795 13,996,523 320,658 2 % 3,050,930 22 %

LIABILITIESAND SHAREHOLDERS'EQUITY

Deposits:

Demand 5,399,297 5,369,164 4,740,125 30,133 1 % 659,172 14 %

Interestchecking 2,656,610 2,482,731 2,385,912 173,879 7 % 270,698 11 %accounts

Savings 1,403,472 1,362,463 1,157,606 41,009 3 % 245,866 21 %accounts

Money market 3,544,897 3,522,990 3,254,202 21,907 1 % 290,695 9 %investment

Certificates 246,157 243,527 308,920 2,630 1 % (62,763 ) (20 )of deposit %

Total 13,250,433 12,980,875 11,846,765 269,558 2 % 1,403,668 12 %deposits

Borrowed funds:

Federal Home ) )Loan Bank 14,323 14,473 14,922 (150 ) (1 % (599 ) (4 %advances

Escrow ) )deposits of 14,119 14,878 14,233 (759 ) (5 % (114 ) (1 %borrowers

Total ) )borrowed 28,442 29,351 29,155 (909 ) (3 % (713 ) (2 %funds

Other 337,956 329,524 426,973 8,432 3 % (89,017 ) (21 )liabilities %

Total 13,616,831 13,339,750 12,302,893 277,081 2 % 1,313,938 11 %liabilities

Shareholders' equity:

Common shares 1,868 1,868 - - - % 1,868 - %

Additionalpaid-in 1,856,241 1,854,895 - 1,346 - % 1,856,241 - %capital

Unallocatedcommon sharesheld by the )employee (145,219 ) (146,472 ) - 1,253 (1 % (145,219 ) - %stockownershipplan ("ESOP")

Retained 1,723,979 1,702,946 1,681,164 21,033 1 % 42,815 3 %earnings

Accumulatedothercomprehensive (6,247 ) (26,192 ) 12,466 19,945 (76 ) (18,713 ) (150 )income % %("AOCI"), netof tax

Totalshareholders' 3,430,622 3,387,045 1,693,630 43,577 1 % 1,736,992 103 %equity

Totalliabilitiesand 17,047,453 16,726,795 13,996,523 320,658 2 % 3,050,930 22 %shareholders'equity

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Three months ended

Three months ended Jun 30, 2021 change from three months ended

(Unaudited, dollars in thousands, except share data)

Jun 30, 2021

Mar 31, 2021

Jun 30, 2020

Mar 31, 2021

Jun 30, 2020

Interest and dividend income:

? $

? %

? $

? %

Interest and fees on loans

$

90,936

$

88,639

$

92,143

2,297

3

%

(1,207

)

(1

)%

Taxable interest and dividends on available for sale securities

12,457

10,206

7,600

2,251

22

%

4,857

64

%

Non-taxable interest and dividends on available for sale securities

1,857

1,856

1,905

1

-

%

(48

)

(3

)%

Interest on federal funds sold and other short-term investments

431

432

284

(1

)

-

%

147

52

%

Interest and dividends on trading securities

-

-

1

-

-

%

(1

)

(100

)%

Total interest and dividend income

105,681

101,133

101,933

4,548

4

%

3,748

4

%

Interest expense:

Interest on deposits

1,031

1,002

3,104

29

3

%

(2,073

)

(67

)%

Interest on borrowings

42

40

74

2

5

%

(32

)

(43

)%

Total interest expense

1,073

1,042

3,178

31

3

%

(2,105

)

(66

)%

Net interest income

104,608

100,091

98,755

4,517

5

%

5,853

6

%

(Release of) provision for allowance for loan losses

(3,300

)

(580

)

8,600

(2,720

)

469

%

(11,900

)

(138

)%

Net interest income after provision for loan losses

107,908

100,671

90,155

7,237

7

%

17,753

20

%

Noninterest income:

Insurance commissions

23,664

28,147

22,697

(4,483

)

(16

)%

967

4

%

Service charges on deposit accounts

5,708

5,367

4,364

341

6

%

1,344

31

%

Trust and investment advisory fees

6,074

5,663

5,194

411

7

%

880

17

%

Debit card processing fees

3,170

2,749

2,337

421

15

%

833

36

%

Interest rate swap (losses) income

(1,164

)

5,405

771

(6,569

)

(122

)%

(1,935

)

(251

)%

Income from investments held in rabbi trusts

4,216

1,846

7,745

2,370

128

%

(3,529

)

(46

)%

Losses on trading securities, net

-

-

(1

)

-

-

%

1

(100

)%

Gains on sales of mortgage loans held for sale, net

848

1,479

1,420

(631

)

(43

)%

(572

)

(40

)%

Gains on sales of securities available for sale, net

1

1,164

163

(1,163

)

(100

)%

(162

)

(99

)%

Other

3,216

3,392

2,967

(176

)

(5

)%

249

8

%

Total noninterest income

45,733

55,212

47,657

(9,479

)

(17

)%

(1,924

)

(4

)%

Noninterest expense:

Salaries and employee benefits

69,276

64,040

63,335

5,236

8

%

5,941

9

%

Office occupancy and equipment

8,094

8,217

8,615

(123

)

(1

)%

(521

)

(6

)%

Data processing

13,572

12,129

12,180

1,443

12

%

1,392

11

%

Professional services

6,439

4,148

4,396

2,291

55

%

2,043

46

%

Charitable contributions

-

-

2,797

-

-

%

(2,797

)

(100

)%

Marketing

3,497

1,691

1,645

1,806

107

%

1,852

113

%

Loan expenses

1,854

1,847

2,036

7

-

%

(182

)

(9

)%

Federal Deposit Insurance Corporation ("FDIC") insurance

985

948

944

37

4

%

41

4

%

Amortization of intangible assets

625

532

701

93

17

%

(76

)

(11

)%

Other

2,993

497

4,116

2,496

502

%

(1,123

)

(27

)%

Total noninterest expense

107,335

94,049

100,765

13,286

14

%

6,570

7

%

Income before income tax expense

46,306

61,834

37,047

(15,528

)

(25

)%

9,259

25

%

Income tax expense

11,497

14,171

7,197

(2,674

)

(19

)%

4,300

60

%

Net income

34,809

47,663

29,850

(12,854

)

(27

)%

4,959

17

%

Share data:

Weighted average common shares outstanding (1)

172,173,707

172,049,044

n.a.

Earnings per share

$

0.20

$

0.28

n.a.

(1) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") that have not been allocated to employees in accordance with the terms of the ESOP are not deemed outstanding for earnings per share calculations.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Three months ended Three months ended Jun 30, 2021 change from three months ended

(Unaudited,dollars in Jun 30,thousands, Jun 30, 2021 Mar 31, 2021 2020 Mar 31, 2021 Jun 30, 2020except sharedata)



Interest anddividend ? $ ? % ? $ ? %income:

Interest and $ 90,936 $ 88,639 $ 92,143 2,297 3 % (1,207 ) (1 )fees on loans %

Taxableinterest anddividends on 12,457 10,206 7,600 2,251 22 % 4,857 64 %available forsalesecurities

Non-taxableinterest anddividends on 1,857 1,856 1,905 1 - % (48 ) (3 )available for %salesecurities

Interest onfederal fundssold and 431 432 284 (1 ) - % 147 52 %othershort-terminvestments

Interest anddividends on - - 1 - - % (1 ) (100 )trading %securities

Totalinterest and 105,681 101,133 101,933 4,548 4 % 3,748 4 %dividendincome

Interest expense:

Interest on 1,031 1,002 3,104 29 3 % (2,073 ) (67 )deposits %

Interest on 42 40 74 2 5 % (32 ) (43 )borrowings %

Total )interest 1,073 1,042 3,178 31 3 % (2,105 ) (66 %expense

Net interest 104,608 100,091 98,755 4,517 5 % 5,853 6 %income

(Release of)provision for (3,300 ) (580 ) 8,600 (2,720 ) 469 % (11,900 ) (138 )allowance for %loan losses

Net interestincome after 107,908 100,671 90,155 7,237 7 % 17,753 20 %provision forloan losses

Noninterest income:

Insurance 23,664 28,147 22,697 (4,483 ) (16 ) 967 4 %commissions %

Servicecharges on 5,708 5,367 4,364 341 6 % 1,344 31 %depositaccounts

Trust andinvestment 6,074 5,663 5,194 411 7 % 880 17 %advisory fees

Debit cardprocessing 3,170 2,749 2,337 421 15 % 833 36 %fees

Interest rate ) )swap (losses) (1,164 ) 5,405 771 (6,569 ) (122 % (1,935 ) (251 %income

Income frominvestments 4,216 1,846 7,745 2,370 128 % (3,529 ) (46 )held in rabbi %trusts

Losses ontrading - - (1 ) - - % 1 (100 )securities, %net

Gains onsales of ) )mortgage 848 1,479 1,420 (631 ) (43 % (572 ) (40 %loans heldfor sale, net

Gains onsales of ) )securities 1 1,164 163 (1,163 ) (100 % (162 ) (99 %available forsale, net

Other 3,216 3,392 2,967 (176 ) (5 ) 249 8 % %

Total ) )noninterest 45,733 55,212 47,657 (9,479 ) (17 % (1,924 ) (4 %income

Noninterest expense:

Salaries andemployee 69,276 64,040 63,335 5,236 8 % 5,941 9 %benefits

Office ) )occupancy and 8,094 8,217 8,615 (123 ) (1 % (521 ) (6 %equipment

Data 13,572 12,129 12,180 1,443 12 % 1,392 11 %processing

Professional 6,439 4,148 4,396 2,291 55 % 2,043 46 %services

Charitable - - 2,797 - - % (2,797 ) (100 )contributions %

Marketing 3,497 1,691 1,645 1,806 107 % 1,852 113 %

Loan expenses 1,854 1,847 2,036 7 - % (182 ) (9 ) %

FederalDepositInsurance 985 948 944 37 4 % 41 4 %Corporation("FDIC")insurance

Amortization )of intangible 625 532 701 93 17 % (76 ) (11 %assets

Other 2,993 497 4,116 2,496 502 % (1,123 ) (27 ) %

Totalnoninterest 107,335 94,049 100,765 13,286 14 % 6,570 7 %expense

Income before )income tax 46,306 61,834 37,047 (15,528 ) (25 % 9,259 25 %expense

Income tax 11,497 14,171 7,197 (2,674 ) (19 ) 4,300 60 %expense %

Net income 34,809 47,663 29,850 (12,854 ) (27 ) 4,959 17 % %



Share data:

Weightedaveragecommon shares 172,173,707 172,049,044 n.a. outstanding(1)

Earnings per $ 0.20 $ 0.28 n.a. share



(1) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") thathave not been allocated to employees in accordance with the terms of the ESOPare not deemed outstanding for earnings per share calculations.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Six months ended

(Unaudited, dollars in thousands, except share data)

Jun 30, 2021

Jun 30, 2020

Change

Interest and dividend income:

? $

? %

Interest and fees on loans

$

179,575

$

187,681

(8,106

)

(4

)%

Taxable interest and dividends on available for sale securities

22,663

15,778

6,885

44

%

Non-taxable interest and dividends on available for sale securities

3,713

3,826

(113

)

(3

)%

Interest on federal funds sold and other short-term investments

863

801

62

8

%

Interest and dividends on trading securities

-

6

(6

)

(100

)%

Total interest and dividend income

206,814

208,092

(1,278

)

(1

)%

Interest expense:

Interest on deposits

2,033

8,518

(6,485

)

(76

)%

Interest on borrowings

82

673

(591

)

(88

)%

Total interest expense

2,115

9,191

(7,076

)

(77

)%

Net interest income

204,699

198,901

5,798

3

%

(Release of) provision for allowance for loan losses

(3,880

)

37,200

(41,080

)

(110

)%

Net interest income after provision for loan losses

208,579

161,701

46,878

29

%

Noninterest income:

Insurance commissions

51,811

50,174

1,637

3

%

Service charges on deposit accounts

11,075

10,462

613

6

%

Trust and investment advisory fees

11,737

10,289

1,448

14

%

Debit card processing fees

5,919

4,807

1,112

23

%

Interest rate swap income (losses)

4,241

(5,238

)

9,479

(181

)%

Income from investments held in rabbi trusts

6,062

1,002

5,060

505

%

Losses on trading securities, net

-

(3

)

3

(100

)%

Gains on sales of mortgage loans held for sale, net

2,327

1,513

814

54

%

Gains on sales of securities available for sale, net

1,165

285

880

309

%

Other

6,608

7,735

(1,127

)

(15

)%

Total noninterest income

100,945

81,026

19,919

25

%

Noninterest expense:

Salaries and employee benefits

133,316

124,924

8,392

7

%

Office occupancy and equipment

16,311

17,304

(993

)

(6

)%

Data processing

25,701

22,184

3,517

16

%

Professional services

10,587

8,085

2,502

31

%

Charitable contributions

-

3,984

(3,984

)

(100

)%

Marketing

5,188

4,113

1,075

26

%

Loan expenses

3,701

3,148

553

18

%

FDIC insurance

1,933

1,850

83

4

%

Amortization of intangible assets

1,157

1,403

(246

)

(18

)%

Other

3,490

8,942

(5,452

)

(61

)%

Total noninterest expense

201,384

195,937

5,447

3

%

Income before income tax expense

108,140

46,790

61,350

131

%

Income tax expense

25,668

8,495

17,173

202

%

Net income

82,472

38,295

44,177

115

%

Share data:

Weighted average common shares outstanding (1)

172,111,372

n.a.

Earnings per share

$

0.48

n.a.

(1) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") that have not been allocated to employees in accordance with the terms of the ESOP are not deemed outstanding for earnings per share calculations.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

Six months ended

(Unaudited, dollars in Jun 30, 2021 Jun 30, Changethousands, except share data) 2020



Interest and dividend income: ? $ ? %

Interest and fees on loans $ 179,575 $ 187,681 (8,106 ) (4 ) %

Taxable interest anddividends on available for 22,663 15,778 6,885 44 %sale securities

Non-taxable interest and )dividends on available for 3,713 3,826 (113 ) (3 %sale securities

Interest on federal fundssold and other short-term 863 801 62 8 %investments

Interest and dividends on - 6 (6 ) (100 )trading securities %

Total interest and dividend 206,814 208,092 (1,278 ) (1 )income %

Interest expense:

Interest on deposits 2,033 8,518 (6,485 ) (76 ) %

Interest on borrowings 82 673 (591 ) (88 ) %

Total interest expense 2,115 9,191 (7,076 ) (77 ) %

Net interest income 204,699 198,901 5,798 3 %

(Release of) provision for (3,880 ) 37,200 (41,080 ) (110 )allowance for loan losses %

Net interest income after 208,579 161,701 46,878 29 %provision for loan losses

Noninterest income:

Insurance commissions 51,811 50,174 1,637 3 %

Service charges on deposit 11,075 10,462 613 6 %accounts

Trust and investment advisory 11,737 10,289 1,448 14 %fees

Debit card processing fees 5,919 4,807 1,112 23 %

Interest rate swap income 4,241 (5,238 ) 9,479 (181 )(losses) %

Income from investments held 6,062 1,002 5,060 505 %in rabbi trusts

Losses on trading securities, - (3 ) 3 (100 )net %

Gains on sales of mortgage 2,327 1,513 814 54 %loans held for sale, net

Gains on sales of securities 1,165 285 880 309 %available for sale, net

Other 6,608 7,735 (1,127 ) (15 ) %

Total noninterest income 100,945 81,026 19,919 25 %

Noninterest expense:

Salaries and employee 133,316 124,924 8,392 7 %benefits

Office occupancy and 16,311 17,304 (993 ) (6 )equipment %

Data processing 25,701 22,184 3,517 16 %

Professional services 10,587 8,085 2,502 31 %

Charitable contributions - 3,984 (3,984 ) (100 ) %

Marketing 5,188 4,113 1,075 26 %

Loan expenses 3,701 3,148 553 18 %

FDIC insurance 1,933 1,850 83 4 %

Amortization of intangible 1,157 1,403 (246 ) (18 )assets %

Other 3,490 8,942 (5,452 ) (61 ) %

Total noninterest expense 201,384 195,937 5,447 3 %

Income before income tax 108,140 46,790 61,350 131 %expense

Income tax expense 25,668 8,495 17,173 202 %

Net income 82,472 38,295 44,177 115 %



Share data:

Weighted average common 172,111,372 n.a. shares outstanding (1)

Earnings per share $ 0.48 n.a.



(1) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") thathave not been allocated to employees in accordance with the terms of the ESOPare not deemed outstanding for earnings per share calculations.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN

As of and for the three months ended

Jun 30, 2021

Mar 31, 2021

Jun 30, 2020

(Unaudited, dollars in thousands)

Avg.

Balance

Interest

Yield /

Cost (5)

Avg.

Balance

Interest

Yield /

Cost (5)

Avg.

Balance

Interest

Yield /

Cost (5)

Interest-earning assets:

Loans (1):

Commercial

$

7,301,745

$

71,747

3.94

%

$

7,317,951

$

69,210

3.84

%

$

7,195,093

$

69,779

3.90

%

Residential

1,433,056

11,397

3.19

%

1,393,139

11,274

3.28

%

1,416,326

12,555

3.57

%

Consumer

1,061,900

8,597

3.25

%

1,105,698

8,937

3.28

%

1,263,691

10,610

3.38

%

Total loans

9,796,701

91,741

3.76

%

9,816,788

89,421

3.69

%

9,875,110

92,944

3.79

%

Investment securities

4,344,690

14,778

1.36

%

3,631,530

12,577

1.40

%

1,455,901

10,083

2.79

%

Federal funds sold and other short-term investments

1,617,741

431

0.11

%

1,740,561

432

0.10

%

1,148,332

284

0.10

%

Total interest-earning assets

15,759,132

106,950

2.72

%

15,188,879

102,430

2.73

%

12,479,343

103,311

3.33

%

Non-interest-earning assets

1,061,121

1,120,603

1,106,217

Total assets

$

16,820,253

$

16,309,482

$

13,585,560

Interest-bearing liabilities:

Deposits:

Savings

$

1,385,735

$

69

0.02

%

$

1,300,057

$

64

0.02

%

$

1,095,806

$

64

0.02

%

Interest checking

2,541,862

253

0.04

%

2,391,025

234

0.04

%

2,414,356

649

0.11

%

Money market

3,523,330

605

0.07

%

3,440,214

587

0.07

%

3,192,669

1,929

0.24

%

Time deposits

246,801

104

0.17

%

251,115

117

0.19

%

313,410

462

0.59

%

Total interest-bearing deposits

7,697,728

1,031

0.05

%

7,382,411

1,002

0.06

%

7,016,241

3,104

0.18

%

Borrowings

25,042

42

0.67

%

25,625

40

0.63

%

74,960

74

0.40

%

Total interest-bearing liabilities

7,722,770

1,073

0.06

%

7,408,036

1,042

0.06

%

7,091,201

3,178

0.18

%

Demand deposit accounts

5,355,170

5,125,831

4,448,756

Other noninterest-bearing liabilities

335,816

358,087

356,700

Total liabilities

13,413,756

12,891,954

11,896,657

Shareholders' equity

3,406,497

3,417,528

1,688,903

Total liabilities and shareholders' equity

$

16,820,253

$

16,309,482

$

13,585,560

Net interest income - FTE

$

105,877

$

101,388

$

100,133

Net interest rate spread (2)

2.66

%

2.67

%

3.15

%

Net interest-earning assets (3)

$

8,036,362

$

7,780,843

$

5,388,142

Net interest margin - FTE (4)

2.69

%

2.71

%

3.23

%

(1) Includes non-accrual loans.

(2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(3) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(4) Net interest margin represents net interest income divided by average total interest-earning assets.

(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN

As of and for the three months ended

Jun 30, 2021 Mar 31, 2021 Jun 30, 2020

Yield Yield Yield(Unaudited, dollars in Avg. / Avg. / Avg. /thousands) Interest Interest Interest Balance Cost Balance Cost Balance Cost (5) (5) (5)

Interest-earning assets:

Loans (1):

Commercial $ 7,301,745 $ 71,747 3.94 % $ 7,317,951 $ 69,210 3.84 % $ 7,195,093 $ 69,779 3.90 %

Residential 1,433,056 11,397 3.19 % 1,393,139 11,274 3.28 % 1,416,326 12,555 3.57 %

Consumer 1,061,900 8,597 3.25 % 1,105,698 8,937 3.28 % 1,263,691 10,610 3.38 %

Total loans 9,796,701 91,741 3.76 % 9,816,788 89,421 3.69 % 9,875,110 92,944 3.79 %

Investment securities 4,344,690 14,778 1.36 % 3,631,530 12,577 1.40 % 1,455,901 10,083 2.79 %

Federal funds sold andother short-term 1,617,741 431 0.11 % 1,740,561 432 0.10 % 1,148,332 284 0.10 %investments

Total interest-earning 15,759,132 106,950 2.72 % 15,188,879 102,430 2.73 % 12,479,343 103,311 3.33 %assets

Non-interest-earning 1,061,121 1,120,603 1,106,217 assets

Total assets $ 16,820,253 $ 16,309,482 $ 13,585,560



Interest-bearing liabilities:

Deposits:

Savings $ 1,385,735 $ 69 0.02 % $ 1,300,057 $ 64 0.02 % $ 1,095,806 $ 64 0.02 %

Interest checking 2,541,862 253 0.04 % 2,391,025 234 0.04 % 2,414,356 649 0.11 %

Money market 3,523,330 605 0.07 % 3,440,214 587 0.07 % 3,192,669 1,929 0.24 %

Time deposits 246,801 104 0.17 % 251,115 117 0.19 % 313,410 462 0.59 %

Total interest-bearing 7,697,728 1,031 0.05 % 7,382,411 1,002 0.06 % 7,016,241 3,104 0.18 %deposits

Borrowings 25,042 42 0.67 % 25,625 40 0.63 % 74,960 74 0.40 %

Total interest-bearing 7,722,770 1,073 0.06 % 7,408,036 1,042 0.06 % 7,091,201 3,178 0.18 %liabilities

Demand deposit accounts 5,355,170 5,125,831 4,448,756

Othernoninterest-bearing 335,816 358,087 356,700 liabilities

Total liabilities 13,413,756 12,891,954 11,896,657

Shareholders' equity 3,406,497 3,417,528 1,688,903

Total liabilities and $ 16,820,253 $ 16,309,482 $ 13,585,560 shareholders' equity





Net interest income - $ 105,877 $ 101,388 $ 100,133 FTE

Net interest rate 2.66 % 2.67 % 3.15 %spread (2)

Net interest-earning $ 8,036,362 $ 7,780,843 $ 5,388,142 assets (3)

Net interest margin - 2.69 % 2.71 % 3.23 %FTE (4)



(1) Includes non-accrual loans.

(2) Net interest rate spread represents the difference between the weightedaverage yield on interest-earning assets and the weighted average cost ofinterest-bearing liabilities.

(3) Net interest-earning assets represent total interest-earning assets lesstotal interest-bearing liabilities.

(4) Net interest margin represents net interest income divided by average totalinterest-earning assets.

(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN

As of and for the six months ended

Jun 30, 2021

Jun 30, 2020

(Unaudited, dollars in thousands)

Avg.

Balance

Interest

Yield /

Cost (5)

Avg.

Balance

Interest

Yield /

Cost (5)

Interest-earning assets:

Loans (1):

Commercial

$

7,309,803

$

140,952

3.89

%

$

6,735,075

$

139,394

4.16

%

Residential

1,413,208

22,671

3.24

%

1,423,161

25,858

3.65

%

Consumer

1,083,677

17,534

3.26

%

1,287,430

24,017

3.75

%

Total loans

9,806,688

181,157

3.73

%

9,445,666

189,269

4.03

%

Investment securities

3,990,080

27,360

1.38

%

1,478,156

20,768

2.83

%

Federal funds sold and other short-term investments

1,678,812

863

0.10

%

694,386

801

0.23

%

Total interest earning assets

15,475,580

209,380

2.73

%

11,618,208

210,838

3.65

%

Non-interest-earning assets

1,089,585

1,064,218

Total assets

$

16,565,165

$

12,682,426

Interest-bearing liabilities:

Deposits:

Savings

$

1,343,133

$

133

0.02

%

$

1,036,344

$

118

0.02

%

Interest checking

2,466,860

487

0.04

%

2,158,242

1,467

0.14

%

Money market

3,482,002

1,193

0.07

%

3,087,048

5,833

0.38

%

Time deposits

248,946

220

0.18

%

320,277

1,100

0.69

%

Total interest-bearing deposits

7,540,941

2,033

0.05

%

6,601,911

8,518

0.26

%

Borrowings

25,332

82

0.65

%

119,211

673

1.14

%

Total interest-bearing liabilities

7,566,273

2,115

0.06

%

6,721,122

9,191

0.27

%

Demand deposit accounts

5,241,134

3,963,066

Other noninterest-bearing liabilities

345,776

337,679

Total liabilities

13,153,183

11,021,867

Shareholders' equity

3,411,982

1,660,559

Total liabilities and shareholders' equity

$

16,565,165

$

12,682,426

Net interest income - FTE

$

207,265

$

201,647

Net interest rate spread (2)

2.67

%

3.38

%

Net interest-earning assets (3)

$

7,909,307

$

4,897,086

Net interest margin - FTE (4)

2.70

%

3.49

%

(1) Includes non-accrual loans.

(2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(3) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(4) Net interest margin represents net interest income divided by average total interest-earning assets.

(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

AVERAGE BALANCES, INTEREST, YIELDS AND RATES, AND NET INTEREST MARGIN

As of and for the six months ended

Jun 30, 2021 Jun 30, 2020

Yield Yield(Unaudited, dollars Avg. / Avg. /in thousands) Interest Interest Balance Cost Balance Cost (5) (5)

Interest-earning assets:

Loans (1):

Commercial $ 7,309,803 $ 140,952 3.89 % $ 6,735,075 $ 139,394 4.16 %

Residential 1,413,208 22,671 3.24 % 1,423,161 25,858 3.65 %

Consumer 1,083,677 17,534 3.26 % 1,287,430 24,017 3.75 %

Total loans 9,806,688 181,157 3.73 % 9,445,666 189,269 4.03 %

Investment 3,990,080 27,360 1.38 % 1,478,156 20,768 2.83 %securities

Federal funds soldand other short-term 1,678,812 863 0.10 % 694,386 801 0.23 %investments

Total interest 15,475,580 209,380 2.73 % 11,618,208 210,838 3.65 %earning assets

Non-interest-earning 1,089,585 1,064,218 assets

Total assets $ 16,565,165 $ 12,682,426



Interest-bearing liabilities:

Deposits:

Savings $ 1,343,133 $ 133 0.02 % $ 1,036,344 $ 118 0.02 %

Interest checking 2,466,860 487 0.04 % 2,158,242 1,467 0.14 %

Money market 3,482,002 1,193 0.07 % 3,087,048 5,833 0.38 %

Time deposits 248,946 220 0.18 % 320,277 1,100 0.69 %

Totalinterest-bearing 7,540,941 2,033 0.05 % 6,601,911 8,518 0.26 %deposits

Borrowings 25,332 82 0.65 % 119,211 673 1.14 %

Totalinterest-bearing 7,566,273 2,115 0.06 % 6,721,122 9,191 0.27 %liabilities

Demand deposit 5,241,134 3,963,066 accounts

Othernoninterest-bearing 345,776 337,679 liabilities

Total liabilities 13,153,183 11,021,867

Shareholders' equity 3,411,982 1,660,559

Total liabilitiesand shareholders' $ 16,565,165 $ 12,682,426 equity





Net interest income $ 207,265 $ 201,647 - FTE

Net interest rate 2.67 % 3.38 %spread (2)

Net interest-earning $ 7,909,307 $ 4,897,086 assets (3)

Net interest margin 2.70 % 3.49 %- FTE (4)



(1) Includes non-accrual loans.

(2) Net interest rate spread represents the difference between the weightedaverage yield on interest-earning assets and the weighted average cost ofinterest-bearing liabilities.

(3) Net interest-earning assets represent total interest-earning assets lesstotal interest-bearing liabilities.

(4) Net interest margin represents net interest income divided by average totalinterest-earning assets.

(5) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

ASSET QUALITY - NON-PERFORMING ASSETS (1)

As of

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

(Unaudited, dollars in thousands)

Non-accrual loans:

Commercial

$

29,356

$

30,275

$

30,059

$

28,968

$

31,273

Residential

6,445

8,127

6,815

7,419

11,693

Consumer

4,106

3,873

4,131

4,727

9,374

Total non-accrual loans

39,907

42,275

41,005

41,114

52,340

Accruing loans past due 90 days or more:

Commercial

1,439

1,390

1,959

3,384

2,802

Residential

277

280

279

326

244

Consumer

9

9

9

9

9

Total accruing loans past due 90 days or more

1,725

1,679

2,247

3,719

3,055

Total non-performing loans

41,632

43,954

43,252

44,833

55,395

Other real estate owned

38

-

-

40

40

Other non-performing assets:

-

-

-

-

-

Total non-performing assets

$

41,670

$

43,954

$

43,252

$

44,873

$

55,435

Total accruing troubled debt restructured loans

$

38,316

$

39,367

$

41,095

$

39,881

$

40,691

Total non-performing loans to total loans

0.43

%

0.44

%

0.45

%

0.45

%

0.56

%

Total non-performing assets to total assets

0.24

%

0.26

%

0.27

%

0.29

%

0.40

%

(1) Non-performing assets are comprised of NPLs, OREO, and non-performing securities. NPLs consist of non-accrual loans and loans that are more than 90 days past due but still accruing interest. OREO consists of real estate properties, which primarily serve as collateral to secure the Company's loans, that it controls due to foreclosure.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

ASSET QUALITY - NON-PERFORMING ASSETS (1)

As of

Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2021 2021 2020 2020 2020

(Unaudited, dollars in thousands)

Non-accrual loans:

Commercial $ 29,356 $ 30,275 $ 30,059 $ 28,968 $ 31,273

Residential 6,445 8,127 6,815 7,419 11,693

Consumer 4,106 3,873 4,131 4,727 9,374

Total non-accrual 39,907 42,275 41,005 41,114 52,340 loans

Accruing loans pastdue 90 days or more:

Commercial 1,439 1,390 1,959 3,384 2,802

Residential 277 280 279 326 244

Consumer 9 9 9 9 9

Total accruingloans past due 90 1,725 1,679 2,247 3,719 3,055 days or more

Totalnon-performing 41,632 43,954 43,252 44,833 55,395 loans

Other real estate 38 - - 40 40 owned

Othernon-performing - - - - - assets:

Totalnon-performing $ 41,670 $ 43,954 $ 43,252 $ 44,873 $ 55,435 assets

Total accruingtroubled debt $ 38,316 $ 39,367 $ 41,095 $ 39,881 $ 40,691 restructured loans

Totalnon-performing 0.43 % 0.44 % 0.45 % 0.45 % 0.56 %loans to totalloans

Totalnon-performing 0.24 % 0.26 % 0.27 % 0.29 % 0.40 %assets to totalassets



(1) Non-performing assets are comprised of NPLs, OREO, and non-performingsecurities. NPLs consist of non-accrual loans and loans that are more than 90days past due but still accruing interest. OREO consists of real estateproperties, which primarily serve as collateral to secure the Company's loans,that it controls due to foreclosure.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

ASSET QUALITY - PROVISION, ALLOWANCE, AND NET CHARGE OFFS

Three months ended

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

(Unaudited, dollars in thousands)

Average total loans

$

9,796,701

$

9,816,788

$

9,796,697

$

9,914,731

$

9,875,110

Allowance for loan losses, beginning of the period

$

111,080

$

113,031

$

115,432

$

116,636

$

109,138

Charged-off loans:

Commercial and industrial

550

-

1,603

140

27

Commercial real estate

-

234

-

-

24

Commercial construction

-

-

-

-

-

Business banking

1,838

1,384

1,433

1,179

1,198

Residential real estate

-

-

-

-

-

Consumer home equity

-

-

79

22

-

Other consumer

275

364

713

1,077

15

Total charged-off loans

2,663

1,982

3,828

2,418

1,264

Recoveries on loans previously charged-off:

Commercial and industrial

13

9

92

306

58

Commercial real estate

4

-

220

4

5

Commercial construction

-

-

-

-

-

Business banking

291

365

47

91

27

Residential real estate

17

10

9

43

13

Consumer home equity

3

71

100

31

8

Other consumer

192

156

59

39

51

Total recoveries

520

611

527

514

162

Net loans charged-off (recoveries):

Commercial and industrial

537

(9

)

1,511

(166

)

(31

)

Commercial real estate

(4

)

234

(220

)

(4

)

19

Commercial construction

-

-

-

-

-

Business banking

1,547

1,019

1,386

1,088

1,171

Residential real estate

(17

)

(10

)

(9

)

(43

)

(13

)

Consumer home equity

(3

)

(71

)

(21

)

(9

)

(8

)

Other consumer

83

208

654

1,038

(36

)

Total net loans charged-off

2,143

1,371

3,301

1,904

1,102

(Release of) provision for loan losses

(3,300

)

(580

)

900

700

8,600

Total allowance for loan losses, end of period

$

105,637

$

111,080

$

113,031

$

115,432

$

116,636

Net charge-offs to average total loans outstanding during this period (1)

0.09

%

0.06

%

0.13

%

0.08

%

0.04

%

Allowance for loan losses as a percent of total loans

1.10

%

1.12

%

1.16

%

1.16

%

1.17

%

Allowance for loan losses as a percent of nonperforming loans

253.74

%

252.72

%

261.33

%

257.47

%

210.55

%

(1) Presented on an annualized basis.

EASTERN BANKSHARES, INC. AND SUBSIDIARIES

ASSET QUALITY - PROVISION, ALLOWANCE, AND NET CHARGE OFFS

Three months ended

Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020

(Unaudited,dollars in thousands)

Average total $ 9,796,701 $ 9,816,788 $ 9,796,697 $ 9,914,731 $ 9,875,110 loans

Allowance forloan losses, $ 111,080 $ 113,031 $ 115,432 $ 116,636 $ 109,138 beginning ofthe period

Charged-off loans:

Commercialand 550 - 1,603 140 27 industrial

Commercial - 234 - - 24 real estate

Commercial - - - - - construction

Business 1,838 1,384 1,433 1,179 1,198 banking

Residential - - - - - real estate

Consumer home - - 79 22 - equity

Other 275 364 713 1,077 15 consumer

Totalcharged-off 2,663 1,982 3,828 2,418 1,264 loans

Recoveries onloans previouslycharged-off:

Commercialand 13 9 92 306 58 industrial

Commercial 4 - 220 4 5 real estate

Commercial - - - - - construction

Business 291 365 47 91 27 banking

Residential 17 10 9 43 13 real estate

Consumer home 3 71 100 31 8 equity

Other 192 156 59 39 51 consumer

Total 520 611 527 514 162 recoveries

Net loanscharged-off (recoveries):

Commercialand 537 (9 ) 1,511 (166 ) (31 )industrial

Commercial (4 ) 234 (220 ) (4 ) 19 real estate

Commercial - - - - - construction

Business 1,547 1,019 1,386 1,088 1,171 banking

Residential (17 ) (10 ) (9 ) (43 ) (13 )real estate

Consumer home (3 ) (71 ) (21 ) (9 ) (8 )equity

Other 83 208 654 1,038 (36 )consumer

Total netloans 2,143 1,371 3,301 1,904 1,102 charged-off

(Release of)provision for (3,300 ) (580 ) 900 700 8,600 loan losses

Totalallowance for $ 105,637 $ 111,080 $ 113,031 $ 115,432 $ 116,636 loan losses,end of period

Netcharge-offsto averagetotal loans 0.09 % 0.06 % 0.13 % 0.08 % 0.04 %outstandingduring thisperiod (1)

Allowance forloan lossesas a percent 1.10 % 1.12 % 1.16 % 1.16 % 1.17 %of totalloans

Allowance forloan lossesas a percent 253.74 % 252.72 % 261.33 % 257.47 % 210.55 %ofnonperformingloans



(1) Presented on an annualized basis.

APPENDIX A: Reconciliation of Non-GAAP Earnings Metrics

For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

Three Months Ended

(Unaudited, dollars in thousands, except share data)

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Net income (GAAP)

$

34,809

$

47,663

$

(44,062

)

$

28,505

$

29,850

Add:

Noninterest income components:

(Income) from investments held in rabbi trusts

(4,216

)

(1,846

)

(5,535

)

(3,800

)

(7,745

)

(Gain) on sales of securities available for sale, net

(1

)

(1,164

)

(3

)

-

(163

)

(Gain) loss on sale of other assets

(29

)

(18

)

(49

)

71

27

Noninterest expense components:

Rabbi trust employee benefit expense

2,063

986

2,838

1,445

3,985

(Reversal) impairment charge on tax credit investments

(1,419

)

-

3,189

7,590

-

Indirect IPO costs (1)

-

-

-

549

380

(Gain) on sale of OREO

-

-

(61

)

(546

)

-

Merger and acquisition expenses

3,479

589

90

-

-

Settlement and expenses for putative consumer class action matters

3,325

-

-

-

-

Stock donation to the EBF

-

-

91,287

-

-

Total impact of non-GAAP adjustments

3,202

(1,453

)

91,756

5,309

(3,516

)

Less net tax benefit (expense) associated with non-GAAP adjustments (2)

914

(327

)

16,082

1,492

(967

)

Non-GAAP adjustments, net of tax

$

2,288

$

(1,126

)

$

75,674

$

3,817

$

(2,549

)

Operating net income (non-GAAP)

$

37,097

$

46,537

$

31,612

$

32,322

$

27,301

Weighted average common shares outstanding during the period (3):

Basic

172,173,707

172,049,044

171,812,535

-

-

Diluted

172,173,707

172,049,044

171,812,535

-

-

Earnings (loss) per share, basic

$

0.20

$

0.28

$

(0.26

)

n.a.

n.a.

Earnings (loss) per share, diluted

$

0.20

$

0.28

$

(0.26

)

n.a.

n.a.

Operating earnings per share, basic (non-GAAP)

$

0.22

$

0.27

$

0.18

n.a.

n.a.

Operating earnings per share, diluted (non-GAAP)

$

0.22

$

0.27

$

0.18

n.a.

n.a.

Return on average assets (4)

0.83

%

1.19

%

(1.11

)%

0.80

%

0.88

%

Add:

(Income) from investments held in rabbi trusts (4)

(0.10

)%

(0.05

)%

(0.14

)%

(0.11

)%

(0.23

)%

(Gain) on sales of securities available for sale, net (4)

-

%

(0.03

)%

-

%

-

%

-

%

(Gain) loss on sale of other assets (4)

-

%

-

%

-

%

-

%

-

%

Rabbi trust employee benefit expense (4)

0.05

%

0.02

%

0.07

%

0.04

%

0.12

%

(Reversal) impairment charge on tax credit investments (4)

(0.03

)%

-

%

0.08

%

0.21

%

-

%

Indirect IPO costs (1) (4)

-

%

-

%

-

%

0.02

%

0.01

%

(Gain) on sale of OREO (4)

-

%

-

%

-

%

(0.02

)%

-

%

Merger and acquisition expenses (4)

0.08

%

0.01

%

-

%

-

%

-

%

Settlement and expenses for putative consumer class action matters (4)

0.08

%

-

%

-

%

-

%

-

%

Stock donation to the EBF (4)

-

%

-

%

2.29

%

-

%

-

%

Less net tax benefit (expense) associated with non-GAAP adjustments (2) (4)

0.02

%

(0.01

)%

0.40

%

0.04

%

(0.03

)%

Operating return on average assets (non-GAAP) (4)

0.89

%

1.15

%

0.79

%

0.90

%

0.81

%

Return on average shareholders' equity (4)

4.10

%

5.66

%

(5.61

)%

6.65

%

7.11

%

Add:

(Income) from investments held in rabbi trusts (4)

(0.50

)%

(0.22

)%

(0.70

)%

(0.89

)%

(1.84

)%

(Gain) on sales of securities available for sale, net (4)

-

%

(0.14

)%

-

%

-

%

(0.04

)%

(Gain) loss on sale of other assets (4)

-

%

-

%

(0.01

)%

0.02

%

0.01

%

Rabbi trust employee benefit expense (4)

0.24

%

0.12

%

0.36

%

0.34

%

0.95

%

(Reversal) impairment charge on tax credit investments (4)

(0.17

)%

-

%

0.41

%

1.77

%

-

%

Indirect IPO costs (1) (4)

-

%

-

%

-

%

0.13

%

0.09

%

(Gain) on sale of OREO (4)

-

%

-

%

(0.01

)%

(0.13

)%

-

%

Merger and acquisition expenses (4)

0.41

%

0.07

%

0.01

%

-

%

-

%

Settlement and expenses for putative consumer class action matters (4)

0.39

%

-

%

-

%

-

%

-

%

Stock donation to the EBF (4)

-

%

-

%

11.62

%

-

%

-

%

Less net tax benefit (expense) associated with non-GAAP adjustments (2) (4)

0.11

%

(0.04

)%

2.05

%

0.35

%

(0.23

)%

Operating return on average shareholders' equity (non-GAAP) (4)

4.36

%

5.53

%

4.02

%

7.54

%

6.51

%

(1) Reflects costs associated with the Company's IPO that are indirectly related to the offering and were not recorded as a reduction of capital.

(2) The net tax benefit (expense) associated with these items is determined by assessing whether each item is included or excluded from net taxable income and applying the Company's combined statutory tax rate only to those items included in net taxable income. Additionally, the net tax benefit (expense) for the impairment charge of tax credit investment includes associated tax credit benefits.

(3) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") that have not been allocated to employees in accordance with the terms of the ESOP are not deemed outstanding for earnings per share calculations.

(4) Presented on an annualized basis.

APPENDIX A: Reconciliation of Non-GAAP Earnings Metrics



For information on non-GAAP financial measures, please see the section titled"Non-GAAP Financial Measures."

Three Months Ended

(Unaudited,dollars in Sep 30, Jun 30,thousands, Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 2020 2020except sharedata)



Net income $ 34,809 $ 47,663 $ (44,062 ) $ 28,505 $ 29,850 (GAAP)

Add:

Noninterestincome components:

(Income) frominvestments (4,216 ) (1,846 ) (5,535 ) (3,800 ) (7,745 )held in rabbitrusts

(Gain) onsales ofsecurities (1 ) (1,164 ) (3 ) - (163 )available forsale, net

(Gain) loss onsale of other (29 ) (18 ) (49 ) 71 27 assets

Noninterestexpense components:

Rabbi trustemployee 2,063 986 2,838 1,445 3,985 benefitexpense

(Reversal)impairmentcharge on tax (1,419 ) - 3,189 7,590 - creditinvestments

Indirect IPO - - - 549 380 costs (1)

(Gain) on sale - - (61 ) (546 ) - of OREO

Merger andacquisition 3,479 589 90 - - expenses

Settlement andexpenses forputative 3,325 - - - - consumer classaction matters

Stock donation - - 91,287 - - to the EBF

Total impactof non-GAAP 3,202 (1,453 ) 91,756 5,309 (3,516 )adjustments

Less net taxbenefit(expense)associated 914 (327 ) 16,082 1,492 (967 )with non-GAAPadjustments(2)

Non-GAAPadjustments, $ 2,288 $ (1,126 ) $ 75,674 $ 3,817 $ (2,549 )net of tax

Operating netincome $ 37,097 $ 46,537 $ 31,612 $ 32,322 $ 27,301 (non-GAAP)



Weightedaverage commonshares outstandingduring theperiod (3):

Basic 172,173,707 172,049,044 171,812,535 - -

Diluted 172,173,707 172,049,044 171,812,535 - -



Earnings(loss) per $ 0.20 $ 0.28 $ (0.26 ) n.a. n.a.share, basic

Earnings(loss) per $ 0.20 $ 0.28 $ (0.26 ) n.a. n.a.share, diluted



Operatingearnings per $ 0.22 $ 0.27 $ 0.18 n.a. n.a.share, basic(non-GAAP)

Operatingearnings per $ 0.22 $ 0.27 $ 0.18 n.a. n.a.share, diluted(non-GAAP)



Return on )average assets 0.83 % 1.19 % (1.11 % 0.80 % 0.88 %(4)

Add:

(Income) frominvestments (0.10 ) (0.05 ) (0.14 ) (0.11 ) (0.23 )held in rabbi % % % % %trusts (4)

(Gain) onsales of )securities - % (0.03 % - % - % - %available forsale, net (4)

(Gain) loss onsale of other - % - % - % - % - %assets (4)

Rabbi trustemployee 0.05 % 0.02 % 0.07 % 0.04 % 0.12 %benefitexpense (4)

(Reversal)impairmentcharge on tax (0.03 ) - % 0.08 % 0.21 % - %credit %investments(4)

Indirect IPO - % - % - % 0.02 % 0.01 %costs (1) (4)

(Gain) on sale - % - % - % (0.02 ) - %of OREO (4) %

Merger andacquisition 0.08 % 0.01 % - % - % - %expenses (4)

Settlement andexpenses forputative 0.08 % - % - % - % - %consumer classaction matters(4)

Stock donation - % - % 2.29 % - % - %to the EBF (4)

Less net taxbenefit(expense) ) )associated 0.02 % (0.01 % 0.40 % 0.04 % (0.03 %with non-GAAPadjustments(2) (4)

Operatingreturn on 0.89 % 1.15 % 0.79 % 0.90 % 0.81 %average assets(non-GAAP) (4)



Return onaverage 4.10 % 5.66 % (5.61 ) 6.65 % 7.11 %shareholders' %equity (4)

Add:

(Income) frominvestments (0.50 ) (0.22 ) (0.70 ) (0.89 ) (1.84 )held in rabbi % % % % %trusts (4)

(Gain) onsales of ) )securities - % (0.14 % - % - % (0.04 %available forsale, net (4)

(Gain) loss on )sale of other - % - % (0.01 % 0.02 % 0.01 %assets (4)

Rabbi trustemployee 0.24 % 0.12 % 0.36 % 0.34 % 0.95 %benefitexpense (4)

(Reversal)impairmentcharge on tax (0.17 ) - % 0.41 % 1.77 % - %credit %investments(4)

Indirect IPO - % - % - % 0.13 % 0.09 %costs (1) (4)

(Gain) on sale - % - % (0.01 ) (0.13 ) - %of OREO (4) % %

Merger andacquisition 0.41 % 0.07 % 0.01 % - % - %expenses (4)

Settlement andexpenses forputative 0.39 % - % - % - % - %consumer classaction matters(4)

Stock donation - % - % 11.62 % - % - %to the EBF (4)

Less net taxbenefit(expense) ) )associated 0.11 % (0.04 % 2.05 % 0.35 % (0.23 %with non-GAAPadjustments(2) (4)

Operatingreturn onaverage 4.36 % 5.53 % 4.02 % 7.54 % 6.51 %shareholders'equity(non-GAAP) (4)



(1) Reflects costs associated with the Company's IPO that are indirectlyrelated to the offering and were not recorded as a reduction of capital.

(2) The net tax benefit (expense) associated with these items is determined byassessing whether each item is included or excluded from net taxable income andapplying the Company's combined statutory tax rate only to those items includedin net taxable income. Additionally, the net tax benefit (expense) for theimpairment charge of tax credit investment includes associated tax creditbenefits.

(3) Shares held by the Company's Employee Stock Ownership Plan ("ESOP") thathave not been allocated to employees in accordance with the terms of the ESOPare not deemed outstanding for earnings per share calculations.

(4) Presented on an annualized basis.

APPENDIX B: Reconciliation of Non-GAAP Operating Revenues and Expenses

For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

Three Months Ended

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

(Unaudited, dollars in thousands)

Net interest income (GAAP)

$

104,608

$

100,091

$

103,608

$

98,742

$

98,755

Add:

Tax-equivalent adjustment (non-GAAP)

1,269

1,297

1,357

1,353

1,378

Fully-taxable equivalent net interest income (non-GAAP)

$

105,877

$

101,388

$

104,965

$

100,095

$

100,133

Noninterest income (GAAP)

$

45,733

$

55,212

$

49,638

$

47,709

$

47,657

Less:

Income from investments held in rabbi trusts

4,216

1,846

5,535

3,800

7,745

Gain on sales of securities available for sale, net

1

1,164

3

-

163

Gain (loss) on sale of other assets

29

18

49

(71

)

(27

)

Noninterest income on an operating basis (non-GAAP)

$

41,487

$

52,184

$

44,051

$

43,980

$

39,776

Noninterest expense (GAAP)

$

107,335

$

94,049

$

199,169

$

109,817

$

100,765

Less:

Rabbi trust employee benefit expense

2,063

986

2,838

1,445

3,985

(Reversal) impairment charge on tax credit investments

(1,419

)

-

3,189

7,590

-

Indirect IPO costs (1)

-

-

-

549

380

(Gain) on sale of OREO

-

-

(61

)

(546

)

-

Merger and acquisition expenses

3,479

589

90

-

-

Settlement and expenses for putative consumer class action matters

3,325

-

-

-

-

Stock donation to the EBF

-

-

91,287

-

-

Noninterest expense on an operating basis (non-GAAP)

$

99,887

$

92,474

$

101,826

$

100,779

$

96,400

Total revenue (GAAP)

$

150,341

$

155,303

$

153,246

$

146,451

$

146,412

Total operating revenue (non-GAAP)

$

147,364

$

153,572

$

149,016

$

144,075

$

139,909

Efficiency ratio (GAAP)

71.39

%

60.56

%

129.97

%

74.99

%

68.82

%

Operating efficiency ratio (non-GAAP)

67.78

%

60.22

%

68.33

%

69.95

%

68.90

%

Noninterest income / total revenue (GAAP)

30.42

%

35.55

%

32.39

%

32.58

%

32.55

%

Noninterest income / total revenue on an operating basis (non-GAAP)

28.15

%

33.98

%

29.56

%

30.53

%

28.43

%

(1) Reflects costs associated with the Company's IPO that are indirectly related to the offering and were not recorded as a reduction of capital.

APPENDIX B: Reconciliation of Non-GAAP Operating Revenues and Expenses



For information on non-GAAP financial measures, please see the section titled"Non-GAAP Financial Measures."

Three Months Ended

Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2021 2021 2020 2020 2020

(Unaudited,dollars in thousands)

Net interest $ 104,608 $ 100,091 $ 103,608 $ 98,742 $ 98,755 income (GAAP)

Add:

Tax-equivalentadjustment 1,269 1,297 1,357 1,353 1,378 (non-GAAP)

Fully-taxableequivalent netinterest $ 105,877 $ 101,388 $ 104,965 $ 100,095 $ 100,133 income(non-GAAP)



Noninterest $ 45,733 $ 55,212 $ 49,638 $ 47,709 $ 47,657 income (GAAP)

Less:

Income frominvestments 4,216 1,846 5,535 3,800 7,745 held in rabbitrusts

Gain on salesof securities 1 1,164 3 - 163 available forsale, net

Gain (loss) onsale of other 29 18 49 (71 ) (27 )assets

Noninterestincome on anoperating $ 41,487 $ 52,184 $ 44,051 $ 43,980 $ 39,776 basis(non-GAAP)



Noninterest $ 107,335 $ 94,049 $ 199,169 $ 109,817 $ 100,765 expense (GAAP)

Less:

Rabbi trustemployee 2,063 986 2,838 1,445 3,985 benefitexpense

(Reversal)impairmentcharge on tax (1,419 ) - 3,189 7,590 - creditinvestments

Indirect IPO - - - 549 380 costs (1)

(Gain) on sale - - (61 ) (546 ) - of OREO

Merger andacquisition 3,479 589 90 - - expenses

Settlement andexpenses forputative 3,325 - - - - consumer classaction matters

Stock donation - - 91,287 - - to the EBF

Noninterestexpense on anoperating $ 99,887 $ 92,474 $ 101,826 $ 100,779 $ 96,400 basis(non-GAAP)



Total revenue $ 150,341 $ 155,303 $ 153,246 $ 146,451 $ 146,412 (GAAP)

Totaloperating $ 147,364 $ 153,572 $ 149,016 $ 144,075 $ 139,909 revenue(non-GAAP)



Efficiency 71.39 % 60.56 % 129.97 % 74.99 % 68.82 %ratio (GAAP)

Operatingefficiency 67.78 % 60.22 % 68.33 % 69.95 % 68.90 %ratio(non-GAAP)



Noninterestincome / total 30.42 % 35.55 % 32.39 % 32.58 % 32.55 %revenue (GAAP)

Noninterestincome / totalrevenue on an 28.15 % 33.98 % 29.56 % 30.53 % 28.43 %operatingbasis(non-GAAP)



(1) Reflects costs associated with the Company's IPO that are indirectlyrelated to the offering and were not recorded as a reduction of capital.

APPENDIX C: Reconciliation of Non-GAAP Capital Metrics

For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

As of

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

(Unaudited, dollars in thousands, except share data)

Tangible shareholders' equity:

Total shareholders' equity (GAAP)

$

3,430,622

$

3,387,045

$

3,428,052

$

1,713,372

$

1,693,630

Less: Goodwill and other intangibles

380,402

376,002

376,534

375,632

376,331

Tangible shareholders' equity (non-GAAP)

3,050,220

3,011,043

3,051,518

1,337,740

1,317,299

Tangible assets:

Total assets (GAAP)

17,047,453

16,726,795

15,964,190

15,460,594

13,996,523

Less: Goodwill and other intangibles

380,402

376,002

376,534

375,632

376,331

Tangible assets (non-GAAP)

$

16,667,051

$

16,350,793

$

15,587,656

$

15,084,962

$

13,620,192

Shareholders' equity to assets ratio (GAAP)

20.12

%

20.25

%

21.47

%

11.08

%

12.10

%

Tangible shareholders' equity to tangible assets ratio (non-GAAP)

18.30

%

18.42

%

19.58

%

8.87

%

9.67

%

Common shares outstanding

186,758,154

186,758,154

186,758,154

-

-

Book value per share (GAAP)

$

18.37

$

18.14

$

18.36

n.a.

n.a.

Tangible book value per share (non-GAAP)

$

16.33

$

16.12

$

16.34

n.a.

n.a.

APPENDIX C: Reconciliation of Non-GAAP Capital Metrics



For information on non-GAAP financial measures, please see the section titled"Non-GAAP Financial Measures."

As of

Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020

(Unaudited,dollars inthousands, except sharedata)

Tangibleshareholders' equity:

Totalshareholders' $ 3,430,622 $ 3,387,045 $ 3,428,052 $ 1,713,372 $ 1,693,630 equity (GAAP)

Less:Goodwill and 380,402 376,002 376,534 375,632 376,331 otherintangibles

Tangibleshareholders' 3,050,220 3,011,043 3,051,518 1,337,740 1,317,299 equity(non-GAAP)



Tangible assets:

Total assets 17,047,453 16,726,795 15,964,190 15,460,594 13,996,523 (GAAP)

Less:Goodwill and 380,402 376,002 376,534 375,632 376,331 otherintangibles

Tangibleassets $ 16,667,051 $ 16,350,793 $ 15,587,656 $ 15,084,962 $ 13,620,192 (non-GAAP)



Shareholders'equity to 20.12 % 20.25 % 21.47 % 11.08 % 12.10 %assets ratio(GAAP)

Tangibleshareholders'equity to 18.30 % 18.42 % 19.58 % 8.87 % 9.67 %tangibleassets ratio(non-GAAP)



Common shares 186,758,154 186,758,154 186,758,154 - - outstanding



Book valueper share $ 18.37 $ 18.14 $ 18.36 n.a. n.a.(GAAP)

Tangible bookvalue per $ 16.33 $ 16.12 $ 16.34 n.a. n.a.share(non-GAAP)

APPENDIX D: Reconciliation of Non-GAAP Credit Metrics

For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

As of

(Unaudited, dollars in thousands)

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Total loans excluding PPP loans:

Total loans (GAAP) (1)

$

9,591,336

$

9,883,802

$

9,706,989

$

9,911,494

$

9,979,616

Less: PPP loans (1)

799,964

1,210,598

1,007,487

1,098,883

1,072,312

Total loans excluding PPP loans (non-GAAP)

$

8,791,372

$

8,673,204

$

8,699,502

$

8,812,611

$

8,907,304

Total nonperforming loans (NPLs) (GAAP)

$

41,632

$

43,954

$

43,252

$

44,833

$

55,395

Total NPLs / total loans (GAAP)

0.43

%

0.44

%

0.45

%

0.45

%

0.56

%

Total NPLs / total loans (excl. PPP loans) (non-GAAP)

0.47

%

0.51

%

0.50

%

0.51

%

0.62

%

Allowance for loan losses (ALLL) (GAAP)

$

105,637

$

111,080

$

113,031

$

115,432

$

116,636

ALLL / total loans (GAAP)

1.10

%

1.12

%

1.16

%

1.16

%

1.17

%

ALLL / total loans (excl. PPP loans) (non-GAAP)

1.20

%

1.28

%

1.30

%

1.31

%

1.31

%

As of and for the three months ended

(Unaudited, dollars in thousands)

Jun 30, 2021

Mar 31, 2021

Dec 31, 2020

Sep 30, 2020

Jun 30, 2020

Average total loans excluding PPP Loans:

Average total loans (GAAP)

$

9,796,701

$

9,816,788

$

9,796,697

$

9,914,731

$

9,875,110

Less: Average PPP loans

1,073,688

1,131,516

1,076,155

1,091,464

818,665

Average total loans excluding PPP loans (non-GAAP)

$

8,723,013

$

8,685,272

$

8,720,542

$

8,823,267

$

9,056,445

Total net loans charged-off (NCOs) (GAAP)

$

2,143

$

1,371

$

3,301

$

1,904

$

1,102

NCOs / Average total loans (GAAP) (2)

0.09

%

0.06

%

0.13

%

0.08

%

0.04

%

NCOs / Average total loans (excl. PPP loans) (non-GAAP) (2)

0.10

%

0.06

%

0.15

%

0.09

%

0.05

%

(1) Includes unamortized premiums, net of unearned discounts and deferred fees.

(2) Presented on an annualized basis.

APPENDIX D: Reconciliation of Non-GAAP Credit Metrics



For information on non-GAAP financial measures, please see the section titled"Non-GAAP Financial Measures."

As of

(Unaudited,dollars in Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020thousands)



Total loansexcluding PPP loans:

Total loans $ 9,591,336 $ 9,883,802 $ 9,706,989 $ 9,911,494 $ 9,979,616 (GAAP) (1)

Less: PPP 799,964 1,210,598 1,007,487 1,098,883 1,072,312 loans (1)

Total loansexcluding PPP $ 8,791,372 $ 8,673,204 $ 8,699,502 $ 8,812,611 $ 8,907,304 loans(non-GAAP)



Totalnonperforming $ 41,632 $ 43,954 $ 43,252 $ 44,833 $ 55,395 loans (NPLs)(GAAP)



Total NPLs /total loans 0.43 % 0.44 % 0.45 % 0.45 % 0.56 %(GAAP)

Total NPLs /total loans(excl. PPP 0.47 % 0.51 % 0.50 % 0.51 % 0.62 %loans)(non-GAAP)



Allowance forloan losses $ 105,637 $ 111,080 $ 113,031 $ 115,432 $ 116,636 (ALLL) (GAAP)



ALLL / total 1.10 % 1.12 % 1.16 % 1.16 % 1.17 %loans (GAAP)

ALLL / totalloans (excl. 1.20 % 1.28 % 1.30 % 1.31 % 1.31 %PPP loans)(non-GAAP)



As of and for the three months ended

(Unaudited,dollars in Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020thousands)



Average totalloans excluding PPPLoans:

Average total $ 9,796,701 $ 9,816,788 $ 9,796,697 $ 9,914,731 $ 9,875,110 loans (GAAP)

Less: Average 1,073,688 1,131,516 1,076,155 1,091,464 818,665 PPP loans

Average totalloansexcluding PPP $ 8,723,013 $ 8,685,272 $ 8,720,542 $ 8,823,267 $ 9,056,445 loans(non-GAAP)



Total netloans $ 2,143 $ 1,371 $ 3,301 $ 1,904 $ 1,102 charged-off(NCOs) (GAAP)



NCOs /Average total 0.09 % 0.06 % 0.13 % 0.08 % 0.04 %loans (GAAP)(2)

NCOs /Average totalloans (excl. 0.10 % 0.06 % 0.15 % 0.09 % 0.05 %PPP loans)(non-GAAP)(2)



(1) Includes unamortized premiums, net of unearned discounts and deferred fees.

(2) Presented on an annualized basis.

Appendix E: Reconciliation of Non-GAAP Core Margin

For information on non-GAAP financial measures, please see the section titled "Non-GAAP Financial Measures."

As of and for the three months ended

Jun 30, 2021

Mar 31, 2021

(Unaudited, dollars in thousands)

Volume

Interest

Margin Impact (1)

Volume

Interest

Margin Impact (1)

Reported total average interest-earning assets, net interest income, and net interest margin (2)

$

15,759,132

$

105,877

2.69

%

$

15,188,879

$

101,388

2.71

%

Non-GAAP adjustments:

PPP loan volume earning 1%

(1,073,688

)

(2,742

)

0.12

%

(1,131,516

)

(2,887

)

0.13

%

SBA PPP loan fee accretion, net of deferred origination cost amortization

-

(9,258

)

(0.24

)%

-

(8,339

)

(0.22

)%

Excess cash (3)

(1,302,558

)

(357

)

0.23

%

(1,436,783

)

(354

)

0.27

%

Deferred loan fee income adjustment

-

-

-

%

-

-

-

%

Core margin (Non-GAAP) (4)

$

13,382,886

$

93,520

2.80

%

$

12,620,580

$

89,808

2.89

%

Core margin change from prior quarter

(0.09

)%

(0.25

)%

Dec 31, 2020

Sep 30, 2020

Volume

Interest

Margin Impact (1)

Volume

Interest

Margin Impact (1)

Reported total average interest-earning assets, net interest income, and net interest margin (2)

$

14,715,494

$

104,965

2.84

%

$

13,089,839

$

100,095

3.04

%

Non-GAAP adjustments:

PPP loan volume earning 1%

(1,076,155

)

(2,741

)

0.14

%

(1,091,464

)

(2,795

)

0.18

%

SBA PPP loan fee accretion, net of deferred origination cost amortization

-

(6,102

)

(0.16

)%

-

(4,125

)

(0.13

)%

Excess cash (3)

(1,996,808

)

(502

)

0.43

%

(1,200,250

)

(302

)

0.30

%

Deferred loan fee income adjustment

-

(3,774

)

(0.10

)%

-

-

-

%

Core margin (Non-GAAP) (4)

$

11,642,531

$

91,846

3.14

%

$

10,798,125

$

92,873

3.42

%

Core margin change from prior quarter

(0.28

)%

(1) Presented on an annualized basis.

(2) Presented on a fully taxable equivalent basis.

(3) Consists of cash above 2% of average total earning assets at a yield of 11 basis points in the three months ended June 30, 2021 and 10 basis points in prior quarters.

(4) Core margin is the margin that results from the combined volume and interest adjustments taken together.

Appendix E: Reconciliation of Non-GAAP Core Margin



For information on non-GAAP financial measures, please see the section titled"Non-GAAP Financial Measures."

As of and for the three months ended

Jun 30, 2021 Mar 31, 2021

(Unaudited, Margin Margindollars in Volume Interest Impact Volume Interest Impactthousands) (1) (1)



Reported totalaverageinterest-earningassets, net $ 15,759,132 $ 105,877 2.69 % $ 15,188,879 $ 101,388 2.71 %interest income,and net interestmargin (2)

Non-GAAP adjustments:

PPP loan volume (1,073,688 ) (2,742 ) 0.12 % (1,131,516 ) (2,887 ) 0.13 %earning 1%

SBA PPP loan feeaccretion, net ) )of deferred - (9,258 ) (0.24 % - (8,339 ) (0.22 %origination costamortization

Excess cash (3) (1,302,558 ) (357 ) 0.23 % (1,436,783 ) (354 ) 0.27 %

Deferred loanfee income - - - % - - - %adjustment

Core margin $ 13,382,886 $ 93,520 2.80 % $ 12,620,580 $ 89,808 2.89 %(Non-GAAP) (4)



Core margin ) )change from (0.09 % (0.25 %prior quarter



Dec 31, 2020 Sep 30, 2020

Margin Margin Volume Interest Impact Volume Interest Impact (1) (1)



Reported totalaverageinterest-earningassets, net $ 14,715,494 $ 104,965 2.84 % $ 13,089,839 $ 100,095 3.04 %interest income,and net interestmargin (2)

Non-GAAP adjustments:

PPP loan volume (1,076,155 ) (2,741 ) 0.14 % (1,091,464 ) (2,795 ) 0.18 %earning 1%

SBA PPP loan feeaccretion, net ) )of deferred - (6,102 ) (0.16 % - (4,125 ) (0.13 %origination costamortization

Excess cash (3) (1,996,808 ) (502 ) 0.43 % (1,200,250 ) (302 ) 0.30 %

Deferred loan )fee income - (3,774 ) (0.10 % - - - %adjustment

Core margin $ 11,642,531 $ 91,846 3.14 % $ 10,798,125 $ 92,873 3.42 %(Non-GAAP) (4)



Core margin )change from (0.28 % prior quarter



(1) Presented on an annualized basis.

(2) Presented on a fully taxable equivalent basis.

(3) Consists of cash above 2% of average total earning assets at a yield of 11basis points in the three months ended June 30, 2021 and 10 basis points inprior quarters.

(4) Core margin is the margin that results from the combined volume andinterest adjustments taken together.

APPENDIX F: COVID-19 Related Loan Modifications

Remaining COVID-19 Modifications as of December 31, 2020 (1)

Remaining COVID-19 Modifications as of March 31, 2021 (1)

Remaining COVID-19 Modifications as of June 30, 2021 (1)

(Dollars in thousands)

Remaining Modifications

% of Total Loan Balance

Remaining Modifications

% of Total Loan Balance

Remaining Modifications

% of Total Loan Balance

Portfolio

Commercial and industrial

$

34,076

1.7

%

$

22,776

1.1

%

$

18,850

1.1

%

Commercial real estate

231,794

6.5

%

127,683

3.5

%

113,301

3.0

%

Commercial construction

10,987

3.6

%

-

-

%

-

-

%

Business banking

23,434

1.8

%

11,681

0.8

%

2,102

0.2

%

Residential real estate

26,772

2.0

%

13,754

1.0

%

13,428

0.9

%

Consumer home equity

3,432

0.4

%

1,274

0.2

%

1,124

0.1

%

Other consumer

2,187

0.8

%

1,262

0.5

%

999

0.4

%

Total

$

332,682

3.4

%

$

178,430

1.8

%

$

149,805

1.6

%

(1) Remaining COVID-19 modifications reflect those loans which underwent a modification and have not yet resumed payment. The Company defines a modified loan to have resumed payment if it is one month past the modification end date and not more than 30 days past due. These modifications with active deferrals met the criteria of either Section 4013 of the CARES Act or the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus (Revised) and therefore are not deemed troubled debt restructurings.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210729006145/en/

CONTACT: Investor Contact

CONTACT: Jillian Belliveau Eastern Bankshares, Inc. InvestorRelations@easternbank.com 781-598-7920

CONTACT: Media Contact

CONTACT: Andrea Goodman Eastern Bank a.goodman@easternbank.com 781-598-7847