Executive Summary

Q2 2025 delivered solid improvement: net income rose to $8.1M and diluted EPS to $0.20, up 46.5% sequentially; net interest margin expanded to 2.52% while efficiency improved to 74.57% .
Results were supported by higher prepayment fees, lower cost of funds, lower borrowings, and stronger mortgage banking income; core diluted EPS was $0.23 (non‑GAAP) .
Wall Street consensus for Q2 EPS was $0.185 and revenue $32.388M; HONE delivered $0.23 EPS and $44.697M revenue on S&P’s basis, a beat on both; GAAP diluted EPS was $0.20 and “total revenue” $45.436M, reflecting definitional differences between GAAP and S&P revenue framing *.
Strategic catalyst: pending merger with Eastern Bankshares announced April 24; share repurchases suspended pending close; quarterly dividend maintained at $0.09 per share for Q2 and Q3 2025, supporting capital return continuity .

What Went Well and What Went Wrong

What Went Well

Net interest margin expanded 13 bps q/q to 2.52% driven by higher loan yields (including $721K prepayment fees) and lower deposit costs; borrowing costs improved as average borrowings declined $87.8M .
Noninterest income increased $2.3M q/q to $12.2M on stronger mortgage banking (gain on sale $3.378M on $176.2M closings) and deposit fees; other income benefited from a $547K Employee Retention Tax Credit and $382K swap fee income .
CEO tone positive: “steady financial improvement… net interest margin expansion, improved core returns on assets and equity, and continued management of expenses,” with focus on seamless merger execution and customer service .

What Went Wrong

Credit remained a watch point: provision for credit losses was $739K; net charge‑offs were $1.7M (0.14% annualized); criticized and classified commercial loans rose to $193.7M, including an $18.3M increase in criticized construction .
Total deposits fell $125.1M q/q (brokered down $51.1M), and loans declined $93.8M, largely in CRE and construction, reflecting payoffs > renewals amid CRE pressure .
Merger‑related expenses of $1.7M elevated noninterest expense q/q; MSR valuation remained a headwind (loss of $546K, partially hedged) .

Financial Results

GAAP Results vs Prior Periods and Prior Year

Metric	Q2 2024	Q4 2024	Q1 2025	Q2 2025
Total Revenue ($USD Millions)	$43.269	$42.461	$41.360	$45.436
Net Interest & Dividend Income ($USD Millions)	$31.350	$31.893	$31.469	$33.215
Noninterest Income ($USD Millions)	$11.919	$10.568	$9.891	$12.221
Diluted EPS (GAAP)	$0.18	$0.10	$0.14	$0.20
Core Diluted EPS (non‑GAAP)	$0.16	$0.20	$0.14	$0.23
Net Interest Margin (FTE)	2.31%	2.36%	2.39%	2.52%
Efficiency Ratio (GAAP)	76.16%	75.55%	78.97%	74.57%
Cost of Total Deposits	2.53%	2.68%	2.48%	2.45%

S&P Global Consensus vs Actual (S&P framing)

Metric	Q2 2025 Consensus	Q2 2025 Actual (S&P basis)
Primary EPS	$0.185*	$0.23*
Revenue ($USD Millions)	$32.388*	$44.697*
# EPS Estimates	4*	—
# Revenue Estimates	2*	—

Values retrieved from S&P Global.
Note: GAAP “total revenue” differs from S&P’s revenue framing; GAAP diluted EPS was $0.20 while S&P’s “Primary EPS” reflects normalized/core EPS of $0.23 *.

Segment Breakdown (Q2 2025 vs Q1 2025)

Segment Metric	Q1 2025	Q2 2025
Bank Segment: Net Interest & Dividend Income ($USD Millions)	$31.315	$32.906
Bank Segment: Total Noninterest Income ($USD Millions)	$6.392	$7.381
Bank Segment: Net Income ($USD Millions)	$6.234	$8.558
Mortgage Segment: Net Interest & Dividend Income ($USD Millions)	$0.149	$0.307
Mortgage Segment: Total Mortgage Banking Income ($USD Millions)	$3.628	$5.038
Mortgage Segment: Net Income ($USD Millions)	$(0.491)	$0.469
Closed Loan Volume ($USD Millions)	$114.136	$176.210
Gain on Sale Margin	2.38%	1.92%

KPIs and Balance Sheet

KPI	Q2 2024	Q4 2024	Q1 2025	Q2 2025
Total Assets ($USD Billions)	$5.787	$5.776	$5.700	$5.609
Total Loans ($USD Billions)	$4.839	$4.880	$4.821	$4.727
Total Deposits ($USD Billions)	$4.458	$4.536	$4.619	$4.494
Loans / Deposits	108.54%	107.57%	104.38%	105.20%
ROA (GAAP)	0.50%	0.27%	0.39%	0.57%
ROE (GAAP)	5.07%	2.69%	3.79%	5.56%
NPLs / Total Loans	0.20%	0.58%	0.64%	0.69%
ACL / Total Loans	1.02%	1.11%	1.02%	1.01%
TCE / TA (non‑GAAP)	9.03%	9.17%	9.15%	9.38%
CET1 Ratio	11.73%	11.67%	11.86%	12.20%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Dividend per share	Q2 2025	$0.09 (Q1 2025 increased 12.5%)	$0.09 declared Jun 26, 2025 (paid Jul 23)	Maintained
Dividend per share	Q3 2025	N/A	$0.09 declared Jul 31, 2025 (paid Sep 15)	Initiated for Q3
Share Repurchases	2025	Ongoing (Q1 repurchased 513,855 shares)	Suspended pending Eastern merger	Suspended
Expense Outlook	Q2 2025	N/A	Merger expenses $1.7M in Q2	New expense item
Strategic	2025	N/A	Eastern merger expected to close in Q4 2025	New strategic path

No formal quantitative guidance issued for revenue, margins, OpEx run‑rate beyond disclosed items; management highlighted focus on margin expansion and expense control .

Earnings Call Themes & Trends

Note: A Q2 2025 HONE earnings call transcript was not available in our document corpus; themes tracked below leverage press releases and prior quarter disclosures.

Topic	Previous Mentions (Q4 2024 and Q1 2025)	Current Period (Q2 2025)	Trend
Net Interest Margin and Funding Costs	NIM 2.36% (Q4); cost of total deposits 2.62%; borrowings elevated $516.6M (Q4)	NIM 2.52%; cost of total deposits down to 2.45%; average borrowings down $87.8M; borrowing costs improved 2 bps	Improving margin, easing funding costs
Mortgage Banking & MSR	Q4 MSR fair value increase $2.170M offset by hedging loss; Q1 MSR valuation loss $1.372M offset by $561K hedge	Gain on sale $3.378M; MSR valuation loss $546K partially offset by $349K hedge; closings $176.2M	Activity higher, MSR volatility persists
CRE/Construction Portfolio	Q1: CRE balances down; criticized/classified commercial $187.1M; NPLs 0.64%; charge‑off on single CRE loan ($8.669M net)	Loans down $93.8M, CRE & construction declines; criticized/classified $193.7M (+$18.3M criticized construction); NPLs 0.69%	Risk metrics mildly worse, balances intentionally reduced
Deposits and Mix	Q1 deposits +$68.0M; brokered down $11.6M; FDIC‑insured ≈74%	Q2 deposits −$125.1M; brokered −$51.1M; FDIC‑insured ≈73%	Mix stable; period‑end decline
Strategic: Merger	Merger announced Apr 24; expected close Q4 2025	Repurchases suspended; integration planning continues	De‑risked, execution focus

Management Commentary

CEO Joseph F. Casey: “I’m pleased to report our steady financial improvement in the second quarter, including net interest margin expansion, improved core returns on assets and equity, and continued management of expenses.” He added: “While we look forward to a successful merger with Eastern, the HarborOne team remains focused on continuing to provide superior service and a seamless transition to our customers, communities and employees.”

Q&A Highlights

Q2 2025 HONE earnings call transcript was not available in our document set. No Q&A highlights to report from the call. We note Eastern Bankshares held investor communications referencing the pending HarborOne merger timeline to Q4 2025 close .

Estimates Context

Q2 2025 delivered beats vs S&P Global consensus: EPS $0.23 vs $0.185 and revenue $44.697M vs $32.388M (S&P framing). GAAP diluted EPS was $0.20 and GAAP total revenue $45.436M, indicating strength across both GAAP and normalized views *.
With NIM expansion and mortgage banking recovery, estimate revisions should bias upward for near‑term EPS, while credit normalization and deposit trends will shape magnitude of revisions.

Values retrieved from S&P Global.

Key Takeaways for Investors

Margin expansion and disciplined funding lowered deposit and borrowing costs, driving sequential earnings momentum; sustainability hinges on loan mix, prepayment fees, and deposit competition .
Mortgage banking rebounded with higher closings and gain on sale income; MSR valuation remains volatile but partially hedged, reducing earnings variability .
Credit metrics are improving from Q1 stress but remain a focus: net charge‑offs normalized q/q; criticized/classified balances rose, particularly in construction—watch CRE exposures into merger close .
Capital and liquidity remain robust (CET1 12.20%, TCE/TA 9.38%), enabling dividend continuity ($0.09) while repurchases are paused pending merger .
Strategic merger with Eastern is the main stock narrative; regulatory approvals and integration milestones are key catalysts through Q4 2025 .
Near‑term trading: positive estimate beats and NIM trajectory are supportive; monitor deposit flows and any incremental credit developments for signal risk. Medium‑term thesis: scale and efficiency gains post‑merger plus stabilized credit could improve profitability profile.

Sources: Q2 2025 press release and financial tables ; Q1 2025 press release ; Dividends ; Merger announcement .
S&P Global consensus and actuals for Q2 2025 estimates*.

HarborOne Bancorp, Inc. (HONE)·Q2 2025 Earnings Summary