A $16.3 million jump in salaries and employee benefits is one of the clearest clues in Eastern Bankshares’ latest 10-Q. The company tied the increase to more employees after its HarborOne merger, alongside regular wage increases.
That helps explain the broad shape of the three months ended June 30. Revenue rose 18.8% to $38.7 million, and net income increased 5.0% to $105.2 million. Per-share earnings went the other way: diluted EPS fell 4.0% to $0.48.
The arithmetic has two moving parts. Diluted shares rose 10.2%, from 199.0 million to 219.2 million, while reported net margin fell 35.9 percentage points to 272.2%. Eastern Bankshares made more money, but that money was spread across a much larger share count.
Management also connected the bank’s growth to a larger financing bill. For the three-month comparison, it pointed to increased borrowing and greater use of Federal Home Loan Bank advances to fund loan growth:
"The increase in borrowings interest expense during the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was primarily due to an increase in our total borrowings due to higher utilization of FHLB advances to fund loan growth."
10-Q 2026-08-07
In plain English, the balance sheet is expanding with borrowed funding in the mix. The disclosure does not quantify the extra interest expense in the supplied comparison, but it identifies the operating trade-off: more loans came with more reliance on FHLB advances.
The merger also left a visible mark on the cost base. Eastern Bankshares described the higher employee expense this way:
"The increase was primarily due to a $16.3 million increase in salaries and employee benefits expense, a $5.3 million increase in technology and data processing expense, and a $3.8 million increase in amortization of intangible assets Salaries and employee benefits increased primarily due to increases in salary and wages expenses and incentives, which were primarily due to an increase in the number of employees as a result of our merger with HarborOne in addition to regular employee wage increases."
10-Q 2026-08-07
It is a larger operating footprint arriving with higher staffing, technology, and amortization expense. Net income still increased, but not as quickly as revenue, and EPS declined because the share count did more growing than the bottom line.
The longer record makes the current comparison less tidy, in the purely mathematical sense. Annual revenue rose from $112.6M in 2024 to $134.1M in 2025, while diluted shares increased 12.2% in 2025. At the latest close of $23.00, the shares carried a P/E of 53.3x based on the latest annual facts, putting attention on how much of future earnings growth reaches each share.
The useful next datapoint is Eastern Bankshares’ next quarterly report, specifically the diluted share count and borrowing interest expense alongside FHLB advances. For now, the filing leaves a compact trade-off: loan growth and revenue growth arrived, but dilution and funding costs claimed part of the upside.
More loan funding, more shares, less EPS: the 10-Q’s arithmetic is not shy.