Eastern Bankshares, Inc.

Hello and welcome to the Eastern Bank Shares Inc. 3rd Quarter 2024 Earnings Conference Call. Today's call will include forward-looking statements, including statements about Eastern's future financial and operating results, outlook, business strategies and plans, as well as added opportunities and potential risks that management receives. Such forward-looking statements reflect management's current estimates or beliefs and are subject to risks and uncertainties that may cause actual results, or the timing of advance to differ materially from the views expressed today. More information about such risks and uncertainties is set forth under the captioned forward-looking statements in the earnings press release as well as in the risk factors section and other disclosures in the company's periodic filings with the Securities and Exchange Commission. Any forward-looking statements made during this call represent management's views and estimates As of today, the company undertakes no obligation to update these statements as a result of new information or future events. During the call, the company will also discuss both GAAP and certain non-GAAP financial measures. For a reconciliation of GAAP to the non-GAAP financial measures, please refer to the company's earnings press release, which can be found at investor.easternbank.com. Please note this event is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press the star too. Thank you. I'd now like to turn the call over to Bob Rivers, Executive Chair and Chair of the Board. Please go ahead.

Thank you, Lodi, and good morning, everyone. Thanks for joining our third quarter earnings call. With me today is Eastern CEO, Dennis Sheehan, our new CFO, David Rosado, and Jim Fitzgerald, our former CFO, who is continuing to serve as a senior advisor to our management team and our board of directors. The third quarter marked a transformational moment in Eastern's history as we closed on our merger with Cambridge Trust, completed our integration, expanded our leadership team and board, and look forward to the future as a newly combined, more robust organization. This combination represents a powerful step forward in achieving our strategic vision, positioning us as a stronger, more competitive institution, and the greater Boston region's leading local full-service bank offering comprehensive personal, commercial, and private banking solutions in addition to personalized wealth management offerings. Whereas our larger competitors focus on a wider geography, our commitment is to eastern Massachusetts and southern New Hampshire, as well as other areas of New England, which is demonstrated not only by a management team that lives and raises our families here, but makes strategic lending and community investments entirely within the markets we serve. Time and again, we hear from our customers that a point of differentiation is our deep understanding of local markets, and communities. Although we have grown larger to have the talent and technology to better serve and compete for our customers' business, we remain at our core a true community bank, understanding that we can only be as strong as our customers, our colleagues, and the communities we serve. As recent evidence of this, Eastern during the past quarter was named the number one SBA lender in Massachusetts for the sixth consecutive year, ranked among the 10 most charitable companies in Massachusetts by the Boston Business Journal for the 13th time, and was recognized by Disability In as the 2024 best place to work for disability inclusion. And the Eastern Bank Foundation was once again recognized among the top leading women-led organizations in Massachusetts by the Women's Edge. Of course, to deliver all of this requires a total team effort from my 2,000 colleagues at Eastern, who in addition to very successfully transitioning our banking and wealth management customers to new systems, also completed a major upgrade of our online and mobile banking platform. It is their incredibly hard work dedication, and commitment to our customers and each other, which make these results possible in order to deliver greater value for our shareholders and support for our communities. With that, I'll hand it over to Dennis, who will discuss the business in more detail before handing it off to David to discuss our financial results.

Thank you, Bob. Please note we have posted a slide presentation on our website And we encourage you to review the slides as David and I will reference a number of them in our commentary. I want to reiterate Bob's comments about our colleagues at Eastern. I'm incredibly proud of the work our team has completed during the quarter across our banking, wealth, and operational divisions. With the merger and conversions behind us, we can now focus on realizing the benefits of the merger and the growth opportunity ahead. We are the largest community bank serving the attractive Greater Boston, Eastern Massachusetts, and New Hampshire markets, with the fourth largest deposit market share within the Greater Boston MSA, which includes Southern New Hampshire. In addition, our combined wealth management business with over $8 billion in assets under management makes us the largest bank-owned investment advisor in Massachusetts and the 12th largest in the state overall. We're excited to bring the fuller suite of wealth management and banking services to our client base and to the market. I'll spend greater time in the future speaking to why our position is compelling and in giving you a greater sense of the capability of our firm. But I know you'd like to understand in detail how we performed on the merger, so let's get into that. I'm sure you can understand there are a number of differences in interest rates, the economy, and otherwise, since the merger was announced in September 2023, and this is an important backdrop to the variances from the original merger model guidance. Slide six gives an overview. In short, we outperformed. We outperformed the original guidance on field charges, earnings per share accretion, and cost saves. Importantly, Capital in the form of either tangible book value or tangible common equity are significantly better than originally projected due to a combination of a smaller balance sheet and rate changes over the past year. The balance sheet is smaller than projected as we decided to sell the Cambridge Trust securities portfolio and pay off borrowings, which resulted in an even healthier balance sheet. along with the lower fair value marks associated with the changes in interest rates since announcement shown on slide seven, resulted in lower earnings per share in the quarter as compared to street estimates. On the credit front, we took a hard look at Average Loans, and you will note increased reserves in the commercial real estate category, particularly office, which we feel are appropriate at this stage of the cycle. the company's overall allowance for loan losses was prudently expanded to 1.4% in the quarter. We take an aggressive approach in reserving for potential challenges. As an example, our reserve for total investor office loans represents 8% of loans in that category. So in summary regarding the merger, client retention has been terrific. We feel good about where we are relative to original expectations. Capital is stronger and asset quality is well marked and accounted for. David will provide some detail regarding an outlook for Q4, and I preface it by saying the financial metrics of Eastern are markedly stronger than pre-merger and rest atop a balance sheet with very strong capital and liquidity providing capacity for future earnings growth. And finally, I'm pleased to report that our board has approved a 9% dividend increase to $0.12 per share. David?