Eastern Bank Q3 net interest income rises on commercial loan growth

Overview

• U.S. regional bank's Q3 adjusted EPS beat analyst expectations

• Company's net interest income rose, supported by commercial loan growth

• Company returned $89.1 mln to shareholders, including $56.7 mln in buybacks

Outlook

• Company notes commercial loan pipelines remain strong, but closings are slower amid interest rate uncertainty

• Company says Wealth Management business is generating momentum, with a positive long-term outlook

Result Drivers

• COMMERCIAL LENDING - Growth in commercial real estate and commercial & industrial lending drove total loan growth, though CRE payoffs remained a headwind

• NET INTEREST INCOME - Higher net interest income was driven by balance sheet growth, but margin declined due to increased deposit costs

• NONINTEREST INCOME DECLINE - Lower noninterest income reflected weaker equity market performance and fewer commercial loan sale gains

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the banks peer group is "buy"

• Wall Street's median 12-month price target for Eastern Bankshares Inc is $24.50, about 13.9% above its October 21 closing price of $21.51

• The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 11 three months ago

Reuters Recommended Reads

• Oct 20 - Metropolitan Bank Q3 net interest margin rises on higher yields and loan payoffs

• Oct 20 - East West Bancorp Q3 revenue beats estimates on loan and deposit growth

• Oct 21 - Pinnacle Financial Partners Q3 adjusted profit beats estimates on loan, fee income growth

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)