Summary Report - Easternbank.com

Transcription

Building on yesterday
Growing for tomorrow
Serving you today
2015 SUMMARY REPORT
Building on yesterday
Growing for tomorrow
Serving you today
Competition in financial services today allows no time to rest. Traditional business models are being
constantly challenged by disruptive technology firms. Fast and creative “fintech” start-ups are
increasingly forcing banks to think differently and make significant investments in innovation while
continuing to invest in growth, compliance, and security in the face of continued pressure on
operating margins.
At Eastern Bank we did all that in 2015. We continued to grow by integrating past acquisitions and
undertaking additional ones. We introduced ground-breaking new technology to better serve our
customers. And we kept building our technology and risk management infrastructure as we moved
closer to becoming a $10 billion bank.
We also stayed ahead of today’s competition while staying true to our original mission of providing
affordable banking services and credit to all people by once again being New England’s leader in
small business loans and by investing in a broad array of community development projects throughout
eastern Massachusetts and southern New Hampshire. And we continued to elevate our support
of those who are under-represented and in need through our advocacy for social justice and our
extensive philanthropic and community service efforts.
We’ve instilled a culture of innovation within our nearly 200-year-old mutual bank as well. We're
working to anticipate the future and act before our competitors, while remaining committed to meeting
our customers' needs today.
"We introduced ground-breaking new technology
to better serve our customers."
GROWTH
We continued our growth in 2015, building our
New Hampshire Division through the successful
integration of the former Centrix Bank & Trust,
which Eastern acquired in 2014. Due to the
efforts of our new colleagues there, we were
able to generate record loan volumes in that
market while providing more products and
services to former Centrix customers.
In addition, Eastern Insurance acquired three
new agencies—Sullivan Insurance of Quincy,
Doran Insurance of Duxbury and Northwestern
Benefit Associates of Boston—representing
almost 1,400 new customers and over $5
million in new annual revenues.
INNOVATION
NH Regional President Joe Reilly presents a donation
to the Boys & Girls Club of Manchester, as we
continued to introduce ourselves to the Granite State.
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EASTERN BANK 2015 • SUMMARY REPORT
We’re making fundamental changes to the way
we engage customers. In 2015, Eastern Labs
introduced the “Express Business Loan,” its first
product and a remarkable innovation that
allows our existing small business customers to
secure a loan of up to $100,000 in as little as
five minutes. With this new service the loan
decision is made with the essentially same
In 2015, Eastern Labs introduced the "Express Business Loan," which allows small business customers
to secure a loan in as little as five minutes.
information as in the past, but the software
automates what customers and bankers once
did manually. Our Express Business Loan is the
kind of ground-breaking new product that we
formed Eastern Labs to build. It allows small
business owners to spend more time growing
their companies and less time enduring the often
difficult and cumbersome process of applying
for a loan.
We also introduced Nuance’s “voice biometric
authentication”, a new service that has
dramatically improved the way we verify our
customers’ identity. Customers who call
1-800-EASTERN are now validated simply by the
sound of their voice. We were the first bank in
North America to launch this technology,
eliminating an inconvenience and annoyance for
our customers whose identity was previously
determined through a
series of questions.
We launched Apple
Pay™ for customers
last year as well, a
mobile payment and
digital service by
Apple Inc. that allows
our customers to
make payments using their Apple devices such
as their iPhone® or iPad®. Our customers are
using their mobile device for services of all kinds.
We’re helping them with the best financial
solutions. And we installed our first interactive
teller machine called “Talk2Teller” at our newly
remodeled Reading, Mass. office. Talk2Teller
allows customers to conduct virtually any typical
business with a teller, but is done remotely
through a drive-up ATM with video/audio
capabilities.
Apple, the Apple logo and iPhone are trademarks of Apple Inc.,
registered in the U.S. and other countries. Apple Pay and iPad
are trademarks of Apple Inc. Apple Pay is available in the U.S.
COMMUNITY
As a community bank, our success depends upon
a vibrant and prosperous community. We provide
financial support to non-profits and community
organizations, along with the thousands of hours
our employees donate to local causes. In 2015 we
financed projects for underserved youths, shelters
for homeless families and affordable housing for
homeless veterans. We backed projects to promote
racial understanding, international cultural events,
LGBT communities and programs to address
substance abuse and chronic health issues.
Our employees volunteered for numerous events
that raised money and awareness of issues
impacting people of color, citizens with disabilities
and elder services. They built homes on the South
Shore, walked for kids in Boston, helped organize
a veterans’ appreciation parade on the North Shore
and raised money for beds and box springs for
families in New Hampshire and Massachusetts.
Corporate social responsibility has grown in
prominence in recent years, but Eastern Bank has
been practicing it for nearly two centuries as it is
central to the reason we were first founded. We
take these actions not only because they are the
right thing to do in support of our mission, but
because they are in our business interests as well
by helping to build our communities.
Eastern employees earned a Silver Medal at the 36th
Annual Boston Hong Kong Dragon Boat Festival.
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Commitment to Customers and Colleagues
COMMERCIAL BANKING
Although community banks are usually known
for providing superior service and products for
individuals and families, commercial lending is
actually the largest part of Eastern’s loan portfolio,
supporting the growth of businesses that create
jobs and economic activity throughout the markets
we serve. In 2015, record loan originations to
our commercial clients totaled almost $1.4 billion.
Growth in our commercial loan portfolio has
outpaced the growth of similar loans in other
banks in our market. Over the last five years,
we have experienced commercial loan growth
of more than 10 percent annually, a remarkable
achievement following a deep economic
recession. During that time we added about
$3 billion in net new loans, all of it within our
market area.
This year we increased our investment in
federal tax credits in the financing of affordable
housing, including workforce housing, housing
for lower income individuals and in economically
challenged neighborhoods. We did the same with
new market tax credits which were focused on
economically distressed areas. We also invested
in federal tax credits for lending to the construction
of solar energy farms. Such farms often sell
the electricity to cities and towns, but we also
backed a project in which the energy purchaser
was a nonprofit organization for affordable
housing developments.
Among the loans we made in 2015 were loans to
JRM Hauling and Recycling, and to the Nordblom
Company of Burlington, Mass., to assist in the
development of "3rd Ave" in Burlington, a dynamic
mix of commercial and residential space anchored
by a 140,000 square-foot Wegmans.
Eastern Bank’s Dan Field worked with JRM Hauling
and Recycling’s James Motzkin (right) and Jimmy
Motzkin (middle) on a $12.5 million loan to finance
a new recycling facility in Peabody, Mass.
Eastern provided $72 million in total financing,
which was used to develop 100,000 square-feet
of retail on 3rd Ave as well as 180 apartments
adjacent to the retail development. Retail tenants
include Kings, Tony C’s, PAUL Bakery, The
Bancroft Restaurant and Carter’s Jewelry.
Eastern Bank’s Nicholas Moise worked with Nordblom Company to provide $72 million to finance
“3rd Ave” in Burlington, Mass. Pictured is Moise (center) with Nordblom Company’s Peter Nordblom,
President, (left) and Dan Bowen, Senior Vice President/Director of Capital Markets (right).
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providing unbiased advice and expertise.
Our investment process begins with a detailed
understanding and analysis of a client’s
specific situation and investment style. Then
we follow a proven, disciplined process and
offer customized recommendations tailored
to the client’s goals.
SMALL BUSINESS
INSURANCE
With about $70 million in revenues, Eastern
Insurance has grown to become one of the
largest insurance agencies in New England,
offering personal and commercial property and
casualty insurance and employee benefit
plans. Our 340 professionals serve more than
70,000 clients and we have direct relationships
with more than 50 national and regional
insurance carriers.
Since 2002, Eastern Insurance has completed
21 acquisitions, including three more in 2015:
Sullivan Insurance, an agency based in Quincy,
Mass., with nearly 300 customers, added to
our moving and storage niche; Doran Insurance
Agency of Duxbury, Mass., added more than
600 customers and doubled our size in the
private client space; and we gained nearly 500
new customers in the group benefits field by
purchasing Northwestern Benefit Associates
of Boston.
WEALTH MANAGEMENT
With $2 billion in assets under management,
our Wealth Management team provides
investment management and financial planning
services to individuals and non-profits. Our
50 experienced professionals are committed
to delivering high quality financial services by
At Eastern, small business lending is not only
an important part of our business—it’s been
a central part of our banking mission for 197
years. We continually ask ourselves how we
can meet specific credit needs and general
banking needs of small business. Last year
we were named the No. 1 Small Business
Administration (SBA) lender in New England for
the sixth consecutive year, placing us among
the top ten SBA lenders in the United States.
EMPLOYEE SATISFACTION
Eastern Bank employees understand the
mission our bank has had for nearly 200
years—to provide services for those who
are underserved. They recognize the greater
good we perform for our customers and
in our communities. With every non-profit
organization the bank supports and every
need that we address, they’re reminded that
they are part of an organization with a genuine goal of making our communities better
places to live and work. Once again, for the
eighth consecutive year, we were named
one of the “Best Places to Work” by The
Boston Globe. We’re also proud to have been
recognized for the third year in a row as one
of the “Best Places to Work for Lesbian, Gay,
Bisexual and Transgender Equality” by the
Human Rights Campaign, the largest LGBT
civil rights advocacy group in America.
2015 Greenwich Excellence Award
Middle Market Banking—Overall Satisfaction, Northeast
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Corporate Social Responsibility
Our ties to our communities go back nearly 200 years to our founding in 1818 as The Institution
for Savings in Salem, Mass. Our mission then, as it remains today, is to help those who are
underserved by the traditional banking system. Our founders were so committed to this mission
that they staffed the bank themselves, volunteering one day each week to provide affordable
deposit services and credit services to all people.
That spirit and continuing commitment motivates us to do all that we can to strengthen our
communities. Our Community Strategy has five foundational pillars upon which all of our activities
rest: Philanthropy, Volunteerism, Business Practices, Advocacy and Leadership.
PHILANTHROPY
This year, the Boston Business Journal once
again recognized Eastern as one of the most
charitable companies in the region. Since 1999,
we have donated over 10% of our net income
to charity—a rate more than seven times the
national corporate median—representing a total
that now exceeds $100 million. The Eastern
Bank Charitable Foundation provides financial
support for select nonprofit organizations in
eastern Massachusetts and southern and
coastal New Hampshire communities. In 2015,
the Foundation awarded more than 2,000
grants, totaling $6.9 million.
In 2011, we began dedicating a portion of our
total giving to grants in areas such as affordable
housing and homelessness, community health
care, workforce development, and K-12
education. In 2015, the Foundation awarded
199 grants totaling $1.5 million to Massachusetts
and New Hampshire organizations working to
address the myriad of issues associated with
violence including: anti-bullying, hate crimes,
domestic abuse, sexual assault, physical
abuse, and safe neighborhoods.
In addition, we honored 61 Massachusettsand New Hampshire-based nonprofits with
$850,000 in grants at the eleventh Annual
"Community Quarterback" celebration.
Football great Doug Flutie made his annual
presentation, this year throwing a pass to a
recipient that was intercepted in an April Fools'
Day prank by Malcolm Butler.
And President and COO Bob Rivers accepted
the ALS Ice Bucket Challenge from Kevin
Gosnell, CEO and Founder of T&K Asphalt
headquartered in Whitman, Mass., a customer
and friend who is suffering from ALS. In honor
of Kevin, we enlisted the Frates Family, whose
son Pete started the Ice Bucket Challenge, to
help us “Dunk Bob” in a dunk tank and raise
more than $33,000 for ALS research.
Local heroes Malcolm Butler, Doug Flutie and the Frates Family helped us
celebrate and support the communities we serve.
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VOLUNTEERISM
At Eastern, community service is part of our DNA. We hire people who look for opportunities to step
forward to help, which benefits the community and provides fun and fulfillment for them. In 2015, our
1,800 employees, once again, donated more than 50,000 hours in community service, a level far in
excess of most other area companies.
Our Heart of Eastern Volunteer Network provides volunteer opportunities for hundreds of our
employees and information on organizations for people who want to volunteer on their own. Last
year the volunteer network, in collaboration with Catholic Charities of Boston North, held the 5th
Annual Food Drive in which more than 12 drop-off locations collected bags of food and gift cards
to support those in need. Through the volunteer network, our employees also collected 400 teddy
bears for Project Smile, which distributed them to children involved in traumatic incidents. And we
collected over 20,000 toys for Toys for Tots in support of children in need during the holidays.
Through our third annual Eastern Bank Celebration of Service in September, hundreds of Eastern
Bank personnel and their family members volunteered to work with such organizations as the
Merrimack Valley Food Bank, Cradles to Crayons, Family and Children Services of Greater Lynn,
Rosie’s Place, the Greater Lawrence Boating Program and the Brockton School on Wheels.
We participated in Boston PRIDE, North Shore PRIDE, Portsmouth PRIDE and Worcester PRIDE in
support of the LGBT community; joined with Habitat for Humanity to build a home and raised more
than $10,000 at the South Shore Walk for Hospice, an event we’ve supported since 2001.
EASTERN BANK
CHARITABLE
DONATIONS
$ MILLIONS
3.7
2011
4.1
2012
5.0
2013
6.0
2014
6.9
2015
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Business Practices
Eastern provided a $6 million construction loan
to fund the construction of 70 affordable housing
units for formerly homeless and at-risk veterans
age 55 and over. Eastern worked to fund
“Bedford Place,” which is under construction
on the VA’s campus in Bedford, Mass. Pictured
is Eastern’s Christopher Scoville (center) with
clients Betsy Collins of Peabody Properties and
Peter Gourdeau of Windover Construction, Inc.
COMMUNITY DEVELOPMENT LENDING
Eastern Bank’s Community Development Lending Group makes the loans other banks shy away from.
In 2015, we closed more than 60 loans totaling $200 million to nonprofits for projects that included
charter schools, affordable housing, senior housing and a children’s learning center.
In 2015, we closed more than 60 new loans with a variety of
non-profits providing crucial services within our communities.
Boston Community Solar III
Shared Value Investments, LLC
Eastern Bank partnered with Boston Community
Eastern Bank formed a new subsidiary to hold
Capital’s solar development affiliate in a new
equity investments in low-income housing, solar
$11 million solar project. Boston Community
developments and projects utilizing New Market
Solar III is an investment in an aggregation of
Tax credits. In 2015, the following investments
solar installations at four sites. The principal
were made: $2.5 million in senior affordable
beneficiaries of the projects are the low-income
housing through the Mass Housing Investment
residents of 1,075 apartment units in eastern
Corporation; $5 million in housing for former
Massachusetts. These residents will enjoy a
homeless individuals operated by Caritas
15% reduction in their electricity bill, a total
Communities and Pine Street Inn through
savings of more than $4 million over the life of
Boston Capital; and investment in Boston
the projects. Eastern invested equity in the
Community Solar III.
project through its new subsidiary, Shared Value
Investments, LLC, and received a combination
of solar investment tax credits and New Market
Tax credits.
Eastern Bank provided $2.8 million in tax
exempt bond financing and helped facilitate
a $1 million grant for the acquisition and
St. Botolph Terrace Apartments
redevelopment of a new facility to house this
Eastern Bank provided $14.5 million in tax
40-year-old early education and child care
exempt bond financing to the Madison Park
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provider for low-income
children. The new
Community Development Corporation to
building on Cabot Street in Beverly, Mass.
redevelop 52 units of affordable housing in
allowed the school to increase enrollment
Boston’s Symphony Hall neighborhood. All 52
by more than 20 percent.
units are designated for low-income families.
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Beverly Children’s Learning Center, Inc.
ADVOCACY
As an increasingly larger employer, we represent a strong voice in the private sector when we
speak up on behalf of equal rights and opportunity. In July, President Bob Rivers testified at the
Massachusetts State House in favor of a resolution encouraging equitable and diverse gender
representation on the boards of companies in the Commonwealth. In October, Human Resources
Executive Vice President Nancy Stager testified at a State House public hearing in favor of
legislation guaranteeing equal access in public spaces for people who are transgender. David
Dolbashian, Co-Chair of Eastern’s Sustainability Network, testified at the Massachusetts State
House in support of environmental priorities in the State budget, as well as lifting the cap on solar
net metering within Massachusetts.
Nearly 1,000 people attended our annual Celebration for Social Justice event where we honored
John Rosenthal, president of Meredith Management Corporation and founder of Stop Handgun
Violence, with the 2015 Wainwright Social Justice Award. Since its founding in 1994, Stop
Handgun Violence has developed several effective media and public education campaigns, the
centerpiece of which was one of the largest billboards in the nation along the Massachusetts
Turnpike near Fenway Park.
John Rosenthal accepts the 2015
Wainwright Social Justice Award.
Pictured (L-R) is Eastern
Chairman and CEO Rich Holbrook,
Rosenthal, MA House Speaker
Robert A. DeLeo, and Eastern
President and COO Bob Rivers.
Our Military Veterans Employee Network spearheaded a "Suits for
Success Campaign" in support of veterans interviewing for jobs.
We extended our support for other causes through numerous events and partnerships. We
joined with the Foundation for Metrowest Youth in Philanthropy to facilitate a financial literacy
program to grade school students. We hosted the Eastern Bank Community Advocacy Award
program at the Museum of African American History, in celebration of Black History month.
Our Latinos in Action Employee Network Group celebrated Hispanic Heritage month by
collaborating with Conexión, a Latino leadership program, to co-host sessions on closing the
gap in economic inequality for Latinos. Our Military Veterans Employee Network spearheaded
a “Suits for Success Campaign” in support of veterans interviewing for jobs. And Eastern Bank
joined the Climate Action Business Association and Sustainable Business Leader Program,
two organizations focused on climate change and environmental sustainability.
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Katherine "Kathy" Jones and
Hubert "Hubie" Jones
Anthony Simonelli
Curt Rogers
Molly Baldwin
Gregg Croteau
Joy Barrett
Lysetta Hurge-Putnam
LEADERSHIP
Leadership is about making a difference in the community even when daunting challenges and
intractable problems stand in the way. Last year we presented Eastern Bank’s Community Advocacy
Award to several of the region’s most deserving community leaders who are working to address
issues related to violence prevention, our special targeted grant category for 2015. They included:
•
Hubert “Hubie” Jones and Katherine
“Kathy” Jones of Newton for their 50-year-
fight for equality in education for all children
and for their community activism to stem violence.
•
Molly Baldwin, founder and CEO of Roca, Inc., for her lifelong commitment to advocating, mentoring and helping the highest at-risk youth in the community for more than
25 years.
•
Curt Rogers, executive director of the GLBTQ Domestic Violence Project, for his
commitment to advocating for survivors of
domestic violence and sexual assault.
• Anthony Simonelli, CEO of Brockton Area
Multi-Services, Inc. (BAMSI), for his lifelong
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commitment to human services, working
with adults and children with developmental
disabilities.
•
Joy Barrett, executive director of the Granite
State Children’s Alliance, for her dedicated effort to break the cycle of child abuse and improve children’s lives in the community.
•
Gregg Croteau, executive director of
United Teen Equality Center (UTEC), for his
commitment to empowering teens and
reducing gang-related violence in the
community.
•
Lysetta Hurge-Putnam, executive director
of Independence House, Inc., for her
commitment to advocating for sexual and
domestic violence victims in the Cape
Cod area.
EASTERN BANK AND OUR EMPLOYEES WERE RECOGNIZED FOR
OUR COMMUNITY SERVICE AND ADVOCACY BY THE FOLLOWING
ORGANIZATIONS:
• Best Places to Work for Lesbian, Gay, Bisexual and Transgender Equality
—Human Rights Campaign
• Boston Academy of Women Achievers Award—YWCA Boston
• Community Impact Award—Old Colony YMCA
• Corporate Partner Award—YMCA Metro North
• Excellence for Best Practices in Sustainability—International Facility
Management Association
• Excellence in Literacy Leadership Award—Operation Bootstrap
• First One Award—uAspire
• Gold Fit Friendly Award—American Heart Association
• Good Guys Award—Massachusetts Women’s Political Caucus
• Multicultural Business Leadership Award—Lynn Area Chamber of Commerce
• North Shore Distinguished Leaders—North Shore Chamber of Commerce
• Outstanding Leadership Award in Finance & Business—Community Teamwork
• Powermeter 100—El Planeta
• Private Company Board of the Year—National Association of Corporate Directors
—New England Chapter
• Starfish Thrower Award—Operation A.B.L.E.
• Silver Medal—Hong Kong Dragon Boat Race
• Transgender Ally Award—Massachusetts Transgender Political Coalition
• True Colors Champion Award—The Theater Offensive
“COMMUNITY BANKER OF THE YEAR”
In 2015, Eastern Bank Chairman and CEO Rich Holbrook was
named a “Community Banker of the Year” by American Banker.
The national industry newspaper and website noted that during his
tenure the bank increased its assets by more than five times and
became a "household name across New England." It also highlighted
his foresight in embracing technology to respond to customer changes
and upstart competitors, as well as for positioning Eastern “as a
survivor in an industry that’s destined for consolidation.” Rich’s strong
commitment to social justice was also noted.
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Management’s Letter
For Eastern, 2015 was much like the prior year, both in terms of the economic
environment, our financial performance, and our overall progress in several key areas.
Although economic conditions continued to improve, interest rates remained at record
lows, putting continued pressure upon our operating margins. This compression upon
earnings was further exacerbated by the significant costs associated with meeting everincreasing regulatory and technology requirements.
Despite these challenges, our net income of $62.6 million was 14% higher than 2014 and
we ended the year with record levels of assets ($9.6 billion), deposits ($8.1 billion), and
loans ($7.1 billion), while enjoying the strongest credit quality in our company’s history.
As a result, our total capital levels of $1.2 billion also ended the year at record levels,
representing a tangible equity ratio of 9.13%.
Our banking professionals produced our fifth consecutive year of strong loan growth
of 5.4%, driven by record originations of commercial and home equity loans, and
supported by solid deposit growth of 4.3%—due to another record year for checking
deposit balances and accounts. In addition, our diverse business mix continued to deliver
benefits in 2015 as both Eastern Insurance and Eastern Wealth Management generated
continued growth in fee income and profitability.
While we continued to grow organically, this resulting combination of outstanding
asset quality, strong capital and liquidity, and increased revenue diversity allowed us to
continue to leverage our position as America’s oldest and largest mutual bank by making
significant investments in order to help drive our continued growth, future sustainability,
and relevance.
We successfully integrated Centrix Bank & Trust which we acquired in late 2014,
achieving outstanding levels of customer retention and new business generation,
providing a solid foundation upon which to build our New Hampshire franchise in the
years ahead.
Eastern Insurance purchased three more agencies in 2015, bringing our total number
of insurance acquisitions since 2002 to 21. Sullivan Insurance of Quincy, Mass.;
Doran Insurance Agency of Duxbury, Mass.; and Northwestern Benefit Associates of
Boston added over $5 million in combined new annual revenues and almost 1,400 new
customers. With about $70 million in total revenues, Eastern Insurance is now the 51st
largest agency in the country.
In addition, we continued to make significant investments in technology, data analytics,
and risk management in order to generate and support additional growth. Our recentlyestablished innovation center, Eastern Labs, introduced its first product, providing our
small business customers with the opportunity to obtain a loan of up to $100,000 in as
little as five minutes from application to funding—completely digitally—representing
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the easiest, fastest, and most transparent borrowing experience offered by any bank in
the United States. More importantly, our work in this area has begun to significantly
influence many other initiatives designed to better serve our customers, positioning us
to more effectively compete with an increasing number of technology start-ups within
financial services.
The continued success of our business also provides us with the opportunity to further
our mission through our various and expanding philanthropic, community service, and
advocacy initiatives. In 2015 we contributed $5.5 million to the Eastern Bank Charitable
Foundation, plus $1.7 million directly to local charities, distributing a record $6.9 million
in grants to more than 1,500 local charities. As a result, the Boston Business Journal
recognized us as one of the most charitable companies in the region.
We also continued to earn more accolades in 2015 for our activities in the pursuit of
equal opportunity and social justice for all. For the third consecutive year, Eastern was
recognized by the Human Rights Campaign as one of the “Best Places to Work for
Lesbian, Gay, Bisexual and Transgender Equality” and one of the “Top Places to Work”
by The Boston Globe for the eighth consecutive year.
During 2015, seven Corporators, Kasey Coredini, Edward W. Kirk, Gordon H. Lewis,
Jr., Vivien Li, Katherine N. Pendergast, Richard Shmishkiss and Patricia Zlotin, seven
Trustees, Ferdinand Alvaro, Jr., Robert V. Antonucci, Frank D’Orio, Jane E. Hager,
John M. Shesky, William L. Thompson, and Ralph Yohe, and one director, Deborah
H. Bornheimer, retired after many years of service. We thank them for their leadership,
dedication and support. We also mourn the passing and remember the legacy of three
honorary trustees, Martha DeBoer, Joseph Ryan, and Robert W. Welch.
As we look to the future, we continue to be excited by the many opportunities available
to us to increasingly meet the needs of our customers and the many communities we
serve. As always, we greatly appreciate the confidence of our customers, the tremendous
work of our Eastern colleagues, the guidance of our Board, and the support of our
many friends and community partners which make our work and continued success and
progress possible.
Sincerely,
RICHARD E. HOLBROOK
ROBERT F. RIVERS
Chairman and Chief Executive Officer
Vice Chairman
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Consolidated Balance Sheets
EASTERN BANK CORPORATION
December 31
2015
ASSETS
Cash and due from banks
Other short-term investments
Cash and cash equivalents
Trading securities
Securities available for sale
Loans held for sale
Loans and leases, net of allowance for credit losses of
$65,500 in 2015 and $64,083 in 2014
Federal Home Loan Bank stock, at cost
Premises and equipment
Bank-owned life insurance
Goodwill and other intangibles, net
Deferred income taxes, net
Rabbi trust assets
Other assets
2014
(In Thousands)
$72,931
610,865
683,796
$
119,315
730,245
849,560
61,050
979,647
21,998
113,857
1,048,763
17,654
7,069,066
10,548
72,842
71,931
362,762
59,009
67,543
128,594
6,706,570
18,949
67,211
70,274
355,950
54,629
70,377
104,101
Total assets
$9,588,786
$9,477,895
LIABILITIES AND RETAINED EARNINGS
Liabilities:
Deposits:
Demand
Savings
Interest checking
Money market investment
Time
Time—$250,000 and over
Total deposits
$3,005,194
899,613
1,451,151
2,287,890
415,187
74,695
8,133,730
$
2,650,218
858,262
1,398,618
2,167,204
549,747
178,084
7,802,133
Borrowed funds
Other liabilities
Total liabilities
53,048
196,994
8,383,772
349,735
182,771
8,334,639
Retained earnings
Accumulated other comprehensive income, net of tax:
Unrealized appreciation on securities available for sale
Funded status of defined benefit postretirement plans
Total retained earnings
Total liabilities and retained earnings
1,229,595
1,167,031
16,315
(40,896)
1,205,014
$9,588,786
24,332
(48,107)
1,143,256
$9,477,895
Eastern Bank Corporation’s audited financial
statements are available at easternbank.com
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Consolidated Statements of Income
Year Ended December 31
2015
INTEREST AND DIVIDEND INCOME:
Loans, including fees
Trading securities
Taxable securities available for sale
Tax-exempt securities available for sale
Federal funds sold and other short-term investments
Total interest and dividend income
INTEREST EXPENSE:
Deposits
Borrowed funds
Total interest expense
Net interest income
Provision for credit losses
Net interest income after provision for credit losses
2014
2013
(In Thousands)
$246,371
476
26,514
5,200
2,235
280,796
$203,986
621
28,518
4,306
3,261
240,692
$188,400
1,031
29,252
3,467
4,396
226,546
5,089
730
5,819
5,352
752
6,104
5,902
737
6,639
274,977
(325)
275,302
234,588
1,750
232,838
219,907
(6,500)
226,407
NONINTEREST INCOME:
Insurance commissions
Service charges on deposit accounts
Debit card processing fees
Trust and investment advisory fees
Interest rate swap income
Income from investments held in rabbi trusts
Trading securities gains, net
Net gain on sales of mortgage loans held for sale
(Losses) Gains on sales of securities available for sale, net
Other-than-temporary impairment (charges) recoveries
on securities available for sale, net
Other
Total noninterest income
69,691
22,917
18,175
15,495
4,197
698
2,365
1,835
(62)
66,082
23,771
17,168
14,965
3,672
2,088
2,414
931
652
62,435
24,746
15,754
13,792
7,839
5,150
2,801
2,553
784
–
17,696
153,007
–
15,639
147,382
(727)
14,309
149,436
NONINTEREST EXPENSE:
Salaries and employee benefits
Office occupancy and equipment
Data processing
Professional services
Charitable contributions
Marketing
FDIC insurance
Amortization of intangible assets
Other
Total noninterest expense
199,897
34,259
33,760
11,537
7,152
7,488
4,969
2,703
31,930
333,695
174,624
30,566
30,970
11,367
6,108
6,393
4,506
1,986
31,611
298,131
167,099
30,429
28,461
8,948
6,516
5,584
4,563
2,058
30,936
284,594
Income before income tax expense
Income tax expense
Net income
94,614
32,050
$62,564
82,089
27,039
$55,050
91,249
29,747
$61,502
15
Financial Highlights
FISCAL YEAR ENDED DECEMBER 2015
DEPOSIT LEVELS ($BILLIONS)
7.1
7.8 8.1
Deposits ended 2015 at a record
level of $8.1 billion. We continue
to experience record levels in our
checking accounts for Consumers,
Businesses and Municipalities.
2013
2014
2015
CAPITAL LEVELS ($BILLIONS)
Our capital ended the year at
$1.21 billion and is significantly
1.12 1.14 1.21
above bank regulatory minimums.
2013
16
2014
2015
LOAN OUTSTANDINGS ($BILLIONS)
6.8 7.1
5.3
2015 was another very strong year
with $300 million of loan growth,
primarily within our Commercial and
Home Equity portfolios.
2013
2014
2015
NET CREDIT LOSSES (% OF LOANS)
Loan quality has long been a strength at Eastern but 2015
was truly outstanding. Our negligible amount of credit losses
continues to be one of the best measures of any bank in the U.S.
.00 .04
2013
2014
2015
-0.03
17
Eastern Bank Corporation
Richard E. Holbrook
Vice Chairman
Robert F. Rivers
President
Jan A. Miller
Chief Financial Officer and Treasurer
James B. Fitzgerald
Secretary
Terence A. McGinnis
Assistant Secretaries and Assistant Clerks
Mary E. Conway
Norah A. Sullivan
EXECUTIVE COMMITTEE—EASTERN BANK CORPORATION
BOARD OF DIRECTORS—EASTERN BANK
Richard C. Bane
President
Bane Care Management, llc
Deborah C. Jackson
President
Cambridge College
Joseph T. Chung
Managing Director and Co-founder
Redstar Ventures
Wendell J. Knox
Director and Retired ceo
Abt Associates Inc.
Paul M. Connolly
Retired First Vice President and
Chief Operating Officer Federal
Reserve Bank of Boston
Peter K. Markell
Executive Vice-President of Administration and
Finance, Chief Financial Officer and Treasurer
Partners HealthCare System, Inc.
William "Mo" Cowan
U.S. Senator (retired)
Executive Vice President and
Chief Operating Officer
ML Strategies LLC
George E. Massaro
Vice Chairman and Retired Chairman
Huron Consulting Group
Bari A. Harlam
Executive Vice President—
Marketing & Membership
BJ’s Wholesale Club
Robert F. Rivers
President and Chief Operating Officer
Eastern Bank
Richard E. Holbrook
Chairman and Chief Executive
Officer
Eastern Bank
Paul D. Spiess
Former Chairman of the Board
Centrix Bank and Trust
“2015 PRIVATE COMPANY BOARD OF THE YEAR”
Eastern Bank Corporation as of February 1, 2016
18
Trustees and Corporators
TRUSTEES
Edward Baker-Greene
Phyllis Barajas
Del A. Berrada
Frederick E. Berry
Miriam B. Blankstein
Andrew T. Boyle
Robert L. Bradley
Gerard H. Brandi
K. Douglas Briggs
Robert J. Brown
Peter K. Chan
Mary C. Chin
Alexander G. Clark
Brenda L. Cole
Christopher B. Cooney
William H. Darling
Charles F. Desmond
Suzanne Fay Glynn
James B. Fitzgerald
Carol N. Fulp
Michael W. Gallagher
Peter H. Gamage
Robert E. Griffin
Rebecca L. Haag
Katherine A. Hesse
Sumner W. Jones
George N. Keches
C. Henry Kezer
Antonio Lopez
William E. Lucey
Thomas A. Maddigan
J. Brian McCarthy
Patricia M. Meservey
Jan A. Miller
Richard F. Moore
J. Keith Motley
Therese Murray
Judith Nitsch
James F. O’Donnell, Jr.
Nancy L. Pettinelli
Colette A.M. Phillips
Thomas Piantedosi
Joseph B. Reilly
Michael E. Rubin
William F. Rucci, Jr.
James L. Rudolph
Michael H. Shanahan
Michael J. Simchik
Inez Stewart
Kirk A. Sykes
Clayton H.W. Turnbull
Michael C. Whitney
Sherilyn Burnett Young
HONORARY
TRUSTEES
Robert V. Antonucci
Edward M. Berger
Diana M. Cataldo
Leonard H. Chace, Jr.
David H. Cohen
James G. Crosby
Michael E. Davenport
Everett M. Davis
George P. DeAngelis
Frank D’Orio, Jr.
Donald D. Durkee
Richard A. Hall
Norman D. Hammer
Barbara P. Healey
W. Lynn Jachney
Norman Katz
Arthur W. McLean
Leland B. McDonough
Garfield R. Morgan
Francis J. Murphy, Jr.
Roger W. Redfield
Charles L. Rowley
Douglas C. Ryder
David P. Sampson
Wallace E. Savory
Wilfred M. Sheehan
John M. Sheskey
Donald J. Short
Edwin G. Smith
David J. Solimine, Sr.
Norman M. Starosta, D.M.D.
William L. Thompson
Jerome F. Twomey
Ralph L. Yohe
HONORARY
DIRECTORS
Noel J. Almeida
Deborah H. Bornheimer
James C. Callahan, Jr.
William F. Collins, Jr.
Frederick J. England, Jr.
Robert A. Glassman
Martin C. Goldman
Clark A. Griffith
Daryl A. Hellman
Andre C. Jasse, Jr.
Joseph A. Jones
Lawrence J. King
Laurence B. Leonard, Jr.
Stanley J. Lukowski
Henry L. Murphy, Jr.
Thomas S. Olsen
E. Joel Peterson
Nils P. Peterson
John A. Plukas
Irakli A. Savas
Roger D. Scoville
John A. Shane
Michael B. Sherman
CORPORATORS
The Corporation consists of
the Directors, Trustees and
the following Corporators:
Hope A. Aldrich
Lincoln D. Andrews
Zamawa Arenas
Evelyn Barahona
Michael J. Barry
Joseph J. Bartolotta
Leonard M. Bello
Scott M. Blagden
Josefina Bonilla
Edward M. Breed
Tina P. Brzezenski
Richard R. Burns, Jr.
Susan J. Byrne
Thomas P. Callaghan
Dennis R. Cataldo
Harry Clark
Thomas A. Cole
Kasey Coredini
Gregg Croteau
Yasmin Cruz
Brian T. Dacey
Susan Lee DaSilva
Marilyn B. Durkin
Betty Francisco
Louis R. Gallo
Raymond J. Gosselin
William J. Guinee
Barbara J. Heinemann
David C. Howse
Thomas P. Jaeger
Mark Jaffe
Michael E. Kiernan
Jeffrey B. Kilgore
Richard F. LaCamera
Jimmy Liang
Patrick T. Maddigan
Juliette C. Mayers
James Meniates, Jr.
Kenneth R. Michaels, Jr.
Salvatore Migliaccio, Jr.
James B. Miller
Michael J. Miller
Eva Millona
Myechia Minter-Jordan, M.D.
Juan Carlos Morales
Nancy Nangeroni
Kenneth R. Newbegin
Daniel R. O’Malley IV
Joseph F. Riley
Stephen Rima
Betsy G. Rooks
Leslie Saltzberg
David J. Sampson
Michael Shaw
Greg A. Shell
Jeffrey N. Shribman
Charles W. Soucy
Scott E. Squillace
Nancy H. Stager
Sarah S. Stiles
Daniel J. Sullivan
Stephen C. Upton
Donald P. Uvanitte
Warren V. Valente
Alberto Vasallo III
Ronald E. Walker
Michael J. Welch
Donald M. Westermann
Damian W. Wilmot
Stephen M. Wishoski
David Zorn
19
Eastern Bank Management
Richard E. Holbrook
President & Chief Operating Officer
Robert F. Rivers
Vice Chairman
Chief Commercial Banking Officer
Jan A. Miller
Vice Chairman, Chief Administrative
Officer & Chief Financial Officer
James B. Fitzgerald
COMMERCIAL & INSTITUTIONAL BANKING
Capital Markets
Senior Vice Presidents/
Managing Directors
James N. Fox
John D. Mullin
Edward M. Stabler
Commercial Real Estate
Senior Vice Presidents
Nicholas K. Moise David B. MacManus
Richard A. Donald
Susan A. Feig
Commercial &
Industrial Lending
Joseph P. Holland
Youssef Abdouh
Robert A. Barnhard
Michael T. Bulman
Stephen J. DiPrete
Daniel C. Field
Thomas J. King
James L. Murphy
David J. Nussbaum
Joseph F. Richardi
Commercial—North
Robert J. Moodie
Frank A. Coccoluto
Paul K. Kurker
William F. Suglia
Jared H. Ward
Commercial—South
Matthew A. Osborne
Brendan P. O’Neill
NEW HAMPSHIRE
DIVISION
CONSUMER BANKING
President
Joseph B. Reilly
Executive Vice President
Joseph F. Riley
David H. Cassidy
Deborah T. Blondin
Debra R. Hallett
Brian A. Lavoie
Albert N. Romero
Matthew J. Sylvia
James L. Thompson III
Stephen H. Witt, Jr.
Strategic Partnerships
Joseph J. Bartolotta
Community Development
Gary R. Leach
Patricia A. Capalbo
Yongmei A. Chen
Pamela M. Feingold
John E. Marston
Stephen G. Pratt-Otto
Christopher W. Scoville
Private Banking
Senior Vice President
Carolyn E. Crowley
Corporate &
Institutional Services
Lisa E. Carbone
Business Banking
Joseph B. Bator
Thomas M. Conaton
Edward J. Lomasney
Leonard Silva
Charles M. Smith
Scott A. Vickery
Consumer Lending
John P. Brodrick
Paul F. Coveney
Treasury Services
Karen M. Carbone
Andrea J. Renaud
Financial Institutions
Mary Ann Jordan
Government Banking
Heather L. Tittmann
International Banking
Jonathan G. Marcus
Retail Banking
Robert D. DiGiovanni
William A. Balboni
Ruth P. Bitchell
Roxann C. Cooke
Christine L. Danjou
Rana H. Murphy
Elizabeth J. O’Hara
Scott D. Stephenson
EASTERN WEALTH MANAGEMENT
William J. Walsh
Lori B. Evans
Thomas J. Furlong
Julianne S. Lindsay
James E. Rich
David R. Sawyer
Susan K. Syversen
& Chief Investment
Officer
Michael A. Tyler
20
Managing Director
Rose M. Brooks
EASTERN INSURANCE GROUP, LLC
President & Chief
Executive Officer
Hope A. Aldrich
Operations
Chief Administrative
Officer
Ronald M. Cleaves
Accounting
John F. Ray
EIG—Commercial Lines
Executive Vice
Presidents
John P. Fallon
Frank J. Smith
John M. Berksza
Mark J. Bossé
Peter K. Brockway
Thomas A. Brown
David H. Chase, Jr.
Ann L. DeBiasio
Mikaela DeYoung-Asebrook
Thomas E. Donovan
Timothy P. Doran
Richard E. Eagan, Jr.
Rosemary W. Fulham
Dennis P. Gilligan
Roy T. Grafton
Sharon L. Gritzuk
Mark L. Kingston
Francis J. Kittredge
Jon E. Lien
Timothy J. Lodge
Michelle A. Lord
Paul-Michael Quintin
Donald J. Rielly, Jr.
George R. Samoluk
Christopher S. Sheppard
James S. Smith
Donald P. Uvanitte
John J. Magee
Laurence P. Stock Lowell S. Isaacs Patricia A. North
Product Management
Jeremy K. Rabson
Laurie A. Hannigan
Melissa S. Nathan
Customer Service Center
Heather A. Allen
Steven L. Antonakes
Martha A. Dean
Caroline F. Malone
Michael R. McCullough
Operations
Lorraine M. Benoit
Thomas E. Dunn
Richard L. Sicard
Finance
& Treasurer
John F. McKinlay
Legal
General Counsel
Terence A. McGinnis
Marketing &
Communications
& Chief Marketing &
Communications Officer
Paul G. Alexander
EIG—Personal Lines
John F. Koegel
Julie E. DiMeo
Francis R. Doran
Gregory L. Grintchenko
Marguerite L. Hartley
Bruce M. Shapiro
Eastern Benefits Group
Matthew F. Shadrick
Brian F. Charon
Paul Coleman, Jr.
Charles R. Diamond
Colleen Doherty
Timothy J. Harrington, Jr.
Kevin H. Hokanson
Michael S. Kapnis
Joan A. Marasco
Anthony J. Murphy
Michael B. Uretsky
EASTERN LABS
& Chief Digital Officer
Daniel R. O’Malley IV
CORPORATE SERVICES
Credit & Collections
& Chief Credit Officer
Daniel J. Sullivan
Michael Avin
Wendy L. de Villiers
Philip S. Dunn
Kenneth C. Dyment
John P. Farmer
Pete J. Kaznoski
Thomas G. Kinchla
Katerina Papp
Karl C. Renney
Amy M. Tsokanis
Katherine C. Wheeler
Enterprise Risk
Management
Barbara J. Heinemann
& Controller
David A. Ahlquist
Human Resources
Nancy Huntington Stager
Jillian A. Belliveau
Mark P. Coryea
Tyrone F. Graham
Vidra F. Harris
Edward J. Saras
Audit
Chief Internal Auditor
Cheryle J. Leonard
Charitable Foundation
Executive Director
Laura B. Kurzrok
Tracy J. Stokes
Technology
& Chief Information
Officer
Donald M. Westermann
Julie A. Colarusso
Virginia Daniels
Craig P. Gardner
Mark T. Leonard
Lynette L. Lopez
Brian G. Plourde
21
Eastern Bank Locations
Andover
Duxbury
Marshfield
Saugus
Bedford, NH
East Falmouth
Mashpee
Sharon
Beverly
East Wareham
Mattapoisett
Somerville
Boston
Everett
Medford
Stoneham
Braintree
Falmouth
Melrose
Stoughton
Bridgewater
Hingham
Middleborough
Swampscott
Brockton
Hyannis
Nashua, NH
Taunton
Brookline
Jamaica Plain
Natick
Tewksbury
Burlington
Kingston
Newburyport
Wakefield
Cambridge
Lakeville
Newton
Wareham
Chelmsford
Lawrence
Norwell
Watertown
Chelsea
Lexington
Peabody
West Plymouth
Concord, NH
Lowell
Plymouth
Westford
Cotuit
Lynn
Portsmouth, NH
Weymouth
Danvers
Lynnfield
Quincy
Wilmington
Dedham
Malden
Randolph
Dorchester
Manchester, NH
Reading
Dover, NH
Marblehead
Salem
Dracut
Marion
Sandwich
Corporate Headquarters
265 Franklin Street, Boston
617.897.1008
Eastern Insurance Group Offices
Acton
133 Great Road
Danvers
21 Maple Street
Leominster
285 Central Street
Providence, RI
10 Dorrance Street
Andover
60 Main Street
Duxbury
33 Enterprise Street
Marshfield
933 Webster Street
Quincy
382 Quincy Avenue
Natick
233 W. Central Street
Sturbridge
54 Main Street
Newton
130 Rumford Avenue
Wakefield
100 Quannapowitt Pkwy
Northborough
155 Otis Street
West Plymouth
71 Carver Road
Norwell
77 Accord Park Drive
Wrentham
78 South Street
Gloucester
Boston
(Eastern Benefits Group) 4 Railroad Avenue
One Beacon Street
Hyannis
375 Iyannough Road
Brockton
500 Forest Avenue
Keene, NH
372 West Street
Cohasset
380 Chief Justice
Lakeville
Cushing Hgwy
45 Main Street
Corporate Office Headquarters
Corporate Headquarters
233 W. Central Street, Natick
800.333.7234
22
Eastern Bank Charitable Foundation
OUR MISSION
GRANT RESTRICTIONS
Our mission is to contribute, in a meaningful
way, to the health and vitality of the various
eastern Massachusetts and southern and
coastal New Hampshire communities
served by Eastern Bank Corporation. This is
done through financial support to selected
nonprofit organizations operating within
those communities.
Our Charitable Foundation does not make
multi-year commitments regardless of the
grant category.
AVAILABLE GRANTS
Foundation Contact
Laura Kurzrok
Eastern Bank Charitable Foundation
195 Market Street, EP5-01
Lynn, MA 01901
781.598.7530
[email protected]
Our Charitable Foundation accepts four
types of grants:
• Community Grants
• Targeted Grants
• Partnership Grants
• Neighborhood Support
Please consult www.easternbank.com/
foundation and carefully read the grant
descriptions to determine which type of
grant is most appropriate for your request.
Should you have questions on the application
process or the appropriate category for your
request, please do not hesitate to contact us
directly. If possible, please email your questions.
To view a list of organizations awarded $1,000
or more in 2015, please visit:
www.easternbank.com/grants.
HOW TO APPLY
• All requests must be submitted via our online application. To access our site, please go to www.easternbank.com/foundation.
• We do not accept paper requests or Letters of Inquiry.
• If you are a first-time user of our online system, you will need to register as a new user prior to beginning the application process.
23
Here, you’re first.SM At Eastern Bank.
1.800.EASTERN
easternbank.com
@easternbank on Twitter
facebook.com/easternbank
This report is printed on recycled paper with 30% post-consumer waste.

Summary Report - Easternbank.com

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