HarborOne Bancorp, Inc. operates as the bank holding company for HarborOne Bank that provides a variety of financial services.
The company’s subsidiaries include Legion Parkway Company LLC (a security corporation) and HarborOne Bank; and the bank’s wholly owned subsidiaries, which consist of HarborOne Mortgage, HarborOne Security Company, Inc., and a passive investment corporation. The passive investment corporation maintains and manages certain assets of the bank. HarborOne Security Company, I...
HarborOne Bancorp, Inc. operates as the bank holding company for HarborOne Bank that provides a variety of financial services.
The company’s subsidiaries include Legion Parkway Company LLC (a security corporation) and HarborOne Bank; and the bank’s wholly owned subsidiaries, which consist of HarborOne Mortgage, HarborOne Security Company, Inc., and a passive investment corporation. The passive investment corporation maintains and manages certain assets of the bank. HarborOne Security Company, Inc. was established for the purpose of buying, holding and selling securities on its own behalf. The company has a charitable foundation, The HarborOne Foundation.
The bank provides its services to individuals and businesses online and through its various full-service branches located in Massachusetts and Rhode Island, and commercial lending offices in each of Boston, Massachusetts and Providence, Rhode Island. The bank also provides a range of educational services through ‘HarborOne U,’ with free digital content, webinars, and recordings for small business and personal financial education.
HarborOne Mortgage
HarborOne Mortgage, LLC, a wholly owned subsidiary of the bank, is a residential mortgage company headquartered in New Hampshire that maintains offices in Massachusetts, New Hampshire, Rhode Island, Maine, New Jersey, and Florida; and is licensed to lend in five additional states.
Market Area
The bank provides financial services to individuals, families, small and mid-size businesses and municipalities throughout Eastern Massachusetts and Rhode Island. While the company’s primary deposit-gathering area is concentrated within its branch office communities and surrounding cities and towns, its lending area encompasses the broader New England market.
Lending Activities
Mortgage Banking Activity. The company originates residential mortgage loans through HarborOne Mortgage. HarborOne Mortgage sells loans on both a servicing-released and a servicing-retained basis. Loans sold with servicing retained are generally serviced by a third party. HarborOne Bank purchases residential mortgage loans for its portfolio from HarborOne Mortgage. These purchases generally consist of jumbo mortgages, adjustable-rate mortgages, and other nonconforming mortgages.
Commercial Real Estate Loans: The company’s largest loan type is loans secured by commercial real estate, representing 47.0% of total loans at December 31, 2024. This portfolio is well-diversified with loans secured by industrial and warehouse facilities, apartment buildings, hospitality facilities, retail developments, healthcare facilities and office buildings.
The company focuses its commercial real estate efforts on small- and mid-size owner occupants and investors in its market area seeking loans between $350,000 and $30.0 million. The company originates fixed- and adjustable-rate commercial real estate loans typically with terms between 10 and 15 years. Interest rates and payments on the company’s adjustable-rate loans typically adjust every 30 days in accordance with a designated index and amortize over a 25- to 30-year term. The company also offers interest rate swaps to accommodate customer needs. Loan amounts generally do not exceed 75% of the property’s appraised value at the time the loan is originated.
Commercial and Industrial Loans: The company originates commercial and industrial loans and lines of credit to a variety of professionals, sole proprietorships and small- to medium-sized privately held businesses, primarily in Massachusetts and Rhode Island, with sales typically up to $100.0 million and borrowing needs up to $30.0 million, for working capital and other business purposes. The company’s small business lending team generates small business loans, including loans originated through the U.S. Small Business Administration (‘SBA’), which provide a partial government guarantee. Small business loans, including real estate loans, generally consist of loans to businesses with commercial credit needs of less than or equal to $3.0 million and revenues of less than $5.0 million.
In addition to originating these loans, the company participates in commercial and industrial loans with other financial institutions located primarily in Massachusetts and Rhode Island and sell participation interests in commercial and industrial loans to local financial institutions, in an amount that is considered prudent to manages its credit risk.
Commercial Construction Loans. The company originates commercial construction loans for commercial development projects, including industrial buildings, retail and office buildings, and speculative residential real estate. The company’s commercial construction loans generally call for the payment of interest only with interest rates tied to a SOFR index or the Prime rate.
Loans to consumers. The company loans to consumers consists of real estate loans consists of residential mortgages and home equity loans and lines, all secured by one-to four-family residential properties, as well as other consumer loans such as auto loans and personal lines of credit. The company provides residential real estate mortgages through HarborOne Mortgage for home purchase or refinancing of existing homes, most of which serve as the primary residence of the owner.
The company’s adjustable-rate mortgage loans generally adjust semi-annually or annually after an initial fixed period up to ten years and are adjusted to a rate equal to a specified percentage above an index. The company originates one- to four-family residential mortgage loans with loan-to-value ratios up to 80%, and it generally requires private mortgage insurance for residential loans secured by a first mortgage with a loan-to-value ratio over 80%. Additionally, the company generally requires all properties securing mortgage loans to be appraised by a licensed real estate appraiser and require title insurance on all first mortgage loans.
The company offers second mortgages and equity lines of credit, which are secured by owner-occupied residences. The company offers second mortgages and equity lines of credit with cumulative loan-to-value ratios generally up to 80%. The company holds a first mortgage position on the homes that secure equity lines of credit in approximately one-third of the portfolio.
The company originates residential real estate construction loans through HarborOne Mortgage to finance the construction of residential dwellings. The company’s residential real estate construction loans generally are fixed-rate loans that provide for the payment of interest only during the construction phase, which is usually 12 to 36 months.
Other consumer loans primarily consist of auto loans, unsecured lines of credit and other personal loans. Other consumer loans are generally unsecured or secured by assets that depreciate rapidly.
Investment Portfolio
As of December 31, 2024, the company's investment portfolio included the U.S. government and government-sponsored enterprise obligations; the U.S. government and government-sponsored mortgage-backed securities and collateralized Mortgage Obligations; SBA asset-backed securities; and corporate bonds.
In addition to the company's securities portfolio, the company has investments in FHLB stock and bank-owned life insurance (“BOLI”).
Deposit Accounts
The company offers a broad selection of deposit instruments, including noninterest-bearing demand deposits (such as checking accounts), interest-bearing demand accounts (such as NOW and money market accounts), savings accounts and term certificates of deposit. The company also offers a variety of deposit accounts designed for businesses and municipalities operating in its market area. The company’s business banking deposit products include a commercial checking account, sweep accounts, money market accounts and checking accounts specifically designed for small businesses. The company also offers remote deposit capture products for business customers to meet their online banking needs. Additionally, the bank has a government banking group that provides core depository services to local municipalities.
Supervision and Regulation
As a bank holding company, the company is subject to regulation, examination, and supervision by the Board of Governors of the Federal Reserve System (the Federal Reserve) under the Bank Holding Company Act of 1956, as amended (the BHCA), and the Massachusetts Commissioner of Banks (the Commissioner) under Massachusetts law.
As a state-chartered trust company, the bank is subject to regulation, supervision and examination by the Commissioner under Massachusetts law. The Bank’s Rhode Island branches are also subject to regulation, supervision and examination by the RI Division of Banking.
The bank must also comply with consumer protection regulations issued by the Consumer Financial Protection Bureau (CFPB), as enforced by the Federal Deposit Insurance Corporation (FDIC).
Under the BHCA, as amended by the Dodd-Frank Act, the company is required to serve as a source of financial strength for the bank.
The Community Reinvestment Act (CRA) requires the FDIC to evaluate the bank’s performance in helping to meet the credit needs of the entire communities it serves, including low- and moderate-income neighborhoods, consistent with its safe and sound banking operations, and to take this record into consideration when evaluating certain applications.
The company and the bank are subject to federal and state laws designed to protect consumers and prohibit unfair, deceptive or abusive business practices, including the Equal Credit Opportunity Act, Fair Housing Act, Home Ownership Protection Act, Fair Credit Reporting Act, as amended by the Fair and Accurate Credit Transactions Act of 2003 (the ‘FACT Act’), the GLBA, the Truth in Lending Act (‘TILA’), the CRA, the Home Mortgage Disclosure Act, the Real Estate Settlement Procedures Act, the National Flood Insurance Act, and various state law counterparts. These laws and regulations mandate certain disclosure requirements and regulate the manner in which financial institutions must interact with clients when taking deposits, making loans, collecting loans, and providing other services. The FDIC examines the bank for compliance with CFPB rules and enforces CFPB rules with respect to the bank.
The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), which amended the Bank Secrecy Act (BSA), together with the implementing regulations of various federal regulatory agencies, has caused financial institutions, such as the bank, to adopt and implement additional policies or amend existing policies and procedures with respect to, among other things, anti-money laundering compliance, suspicious activity, currency transaction reporting, customer identity verification and customer risk analysis.
History
HarborOne Bancorp, Inc. was founded in 1917 as a state-chartered credit union. The company was incorporated in 2016.
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