HarborOne Bancorp, Inc. (HONE): BCG Matrix [Dec-2025 Updated]

You're looking at HarborOne Bancorp, Inc.'s (HONE) business right before the Eastern Bankshares merger closes in Q4 2025, and the portfolio tells a clear story: the Commercial and Industrial lending segment is a clear Star, driving growth with a 2.52% net interest margin, while the massive Commercial Real Estate book acts as a reliable Cash Cow. Still, the Mortgage Origination unit is clearly a Dog, seeing income drop $2.9 million in Q1 2025, and Wealth Management remains a Question Mark needing a plan. Dive in below to see the full breakdown of where HONE is placing its bets ahead of integration.

Background of HarborOne Bancorp, Inc. (HONE)

You're looking at HarborOne Bancorp, Inc. (HONE) right at the tail end of its run as an independent entity, which is a key detail for any late-2025 analysis. HarborOne Bancorp, Inc. was the holding company for HarborOne Bank, a Massachusetts-chartered trust company with a deep regional footprint across Eastern Massachusetts and into Rhode Island. Its core identity was that of a community bank, focusing on building strong, local customer relationships rather than chasing national scale. That community-centric approach was definitely a differentiator in the market.

Operationally, HarborOne Bank offered the full suite of services you'd expect: deposit products like checking, savings, and certificates of deposit, alongside various lending solutions. They were active in commercial and retail lending, including commercial real estate financing, and they also had a dedicated subsidiary, HarborOne Mortgage, LLC, which handled residential mortgage origination for the secondary market. Plus, they offered wealth management and trust services through an affiliate, so they covered the main pillars of community finance.

For the most recent snapshot of its standalone performance, we look at the second quarter of 2025, just before the finalization of its acquisition. For the quarter ending June 30, 2025, HarborOne Bancorp reported net income of $8.1 million, or $0.20 per diluted share, showing sequential improvement from the first quarter. Total deposits stood at $4.49 billion as of that date, and the net interest margin was reported at 2.52%. Honestly, the biggest story for HarborOne Bancorp in late 2025 is that it ceased to exist as an independent company; it entered into a definitive merger agreement with Eastern Bankshares, Inc. back in April 2025, with the transaction closing and the stock being delisted from the NASDAQ Global Select Market effective November 1, 2025.

HarborOne Bancorp, Inc. (HONE) - BCG Matrix: Stars

The Commercial and Industrial (C&I) Lending segment for HarborOne Bancorp, Inc. (HONE) is positioned as a Star, characterized by significant recent growth within a strategically important market footprint.

This segment experienced robust expansion across the first half of 2025. Specifically, C&I loan growth registered $33 million in the first quarter of 2025. This momentum continued into the second quarter, with an additional $16.5 million increase in Commercial and Industrial loans for the quarter ended June 30, 2025. This consistent, high-dollar growth in a core lending category signals a high-growth product line for HarborOne Bancorp, Inc.

The strategic direction appears aligned with high-growth market segments. HarborOne Bancorp, Inc. maintains a strong operational footprint to support this growth, with its bank serving consumers, businesses, and municipalities throughout Eastern Massachusetts and Rhode Island, including commercial lending offices in Boston, Massachusetts and Providence, Rhode Island. The focus on niche C&I areas, such as renewable energy initiatives, suggests an effort to capture market share in future-oriented sectors, which aligns with the high-growth market characteristic of a Star.

The financial performance underpinning this segment's strength is evident in the improving profitability metrics. The net interest margin (NIM) for HarborOne Bancorp, Inc. demonstrated clear expansion, moving from 2.39% in Q1 2025 to reach 2.52% in Q2 2025. This NIM improvement, driven partly by higher loan yields, supports the investment required to maintain the high market share in this growing area.

The key statistical and financial indicators supporting the Star classification for C&I Lending are summarized below:

To maintain its leadership position and transition this segment into a Cash Cow as the market matures, continued investment is necessary. This segment is a key driver of net interest income expansion for HarborOne Bancorp, Inc.

• Strong C&I growth indicates high market penetration.
• NIM expansion to 2.52% in Q2 2025 shows pricing power.
• Geographic focus covers key New England commercial centers.
• Growth consumes cash for promotion and placement support.
• The segment is a leader in its core Eastern Massachusetts/Rhode Island footprint.

The continued success of this unit is critical, especially given the pending merger with Eastern Bankshares, Inc., which is targeted for a Q4 2025 close.

HarborOne Bancorp, Inc. (HONE) - BCG Matrix: Cash Cows

Cash Cows represent the bedrock of HarborOne Bancorp, Inc.'s financial stability, units with a high market share in mature segments that generate more cash than they consume. These are the businesses you want to maintain and 'milk' passively, funding the rest of the enterprise.

The core Commercial Real Estate (CRE) loan portfolio is a prime example of this quadrant, which represented a significant 47% of total loans as of December 31, 2024, according to HarborOne Bancorp, Inc.'s reporting context for early 2025. This segment is mature, yet it provides a consistent stream of interest income, even as the bank strategically manages its exposure. You saw this management in action during the second quarter of 2025, where CRE and construction loans saw a strategic reduction, decreasing by $118.4 million due to favoring payoffs over renewals amid market pressures. This active de-risking while maintaining a high portfolio percentage signals a mature, high-share asset being managed for yield and stability, not aggressive growth.

The physical footprint, specifically the 30 full-service branch network, is crucial for securing the stable, low-cost core deposit base, which is the lifeblood of any community bank. This stability is evident in the first quarter of 2025, where non-brokered deposits-the most desirable, sticky funding-increased by $79.6 million, representing a 1.9% quarter-over-quarter growth. Furthermore, the cost of these core deposits fell by 15 basis points in Q1 2025, directly improving margins.

This high relative market share in deposit gathering within HarborOne Bancorp, Inc.'s community-bank geographic area is the classic low-growth, high-share position. The stability of this funding base supported a Net Interest Margin (NIM) of 2.39% in Q1 2025, which subsequently expanded to 2.52% in Q2 2025, partly due to lower funding costs. This cash generation is what allows HarborOne Bancorp, Inc. to support shareholders even when other segments, like mortgage banking, face headwinds.

Here's a quick look at the cash flow generation and shareholder support derived from these stable units:

• Non-brokered deposit increase in Q1 2025: $79.6 million.
• Cost of deposits (ex-brokered) reduction in Q1 2025: 15 basis points.
• Quarterly dividend increase announced in Q1 2025: 12.5%.
• CRE loan portfolio segment as of Q1 2025: 47% of total loans.

The CRE portfolio's cash flow contribution, despite the strategic balance reduction of $118.4 million in Q2 2025, underpins the bank's ability to return capital. The bank executed 513,855 share repurchases in Q1 2025, alongside that dividend increase, showing a commitment to 'milking' these gains.

You can see the key financial metrics supporting the Cash Cow status:

Investments here are about maintaining efficiency, not massive expansion. For instance, noninterest expense was held flat at $32.9 million in Q1 2025, showing a focus on keeping the operational cost structure lean to maximize the cash flow from these established segments. If onboarding takes 14+ days, churn risk rises, but the branch network's stability helps mitigate this for core deposits.

HarborOne Bancorp, Inc. (HONE) - BCG Matrix: Dogs

The Residential Mortgage Origination segment, operating under HarborOne Mortgage, LLC, firmly sits in the Dogs quadrant. This placement is driven by its position in a market characterized by high-rate volatility and a general market contraction, leading to low relative market share and minimal growth prospects in the current environment. Dogs are units that tie up capital without generating significant returns, and this segment fits that description due to its capital-intensive nature and sensitivity to interest rate cycles.

The financial performance in early 2025 clearly illustrates these headwinds. For the first quarter of 2025, HarborOne Bancorp, Inc.'s net income was $5.5 million, a 38.1% decrease from the $8.9 million reported in the fourth quarter of 2024. This decline was directly attributed to the mortgage sector, as the quarter-over-quarter decrease in net income primarily reflects a $2.9 million decrease in mortgage banking income.

The data shows a clear struggle in monetizing origination volume. While the residential mortgage team delivered an 11.8% increase in year-over-year loan closings during Q1 2025, the resulting income was significantly lower than the prior quarter, suggesting poor pricing power or higher cost of funds/servicing valuation issues.

Here's a quick look at the quarter-over-quarter shift in mortgage banking activity:

The segment's low profitability is further evidenced by the Mortgage Servicing Rights (MSR) valuation, which decreased by $1.2 million in Q1 2025, though this was an improvement from the prior quarter's loss. The low-growth, low-profitability profile makes expensive turn-around plans generally ill-advised for a Dog category asset.

The strategic context of the merger with Eastern Bankshares, Inc. makes the long-term viability of this unit under the current structure defintely questionable. The definitive merger agreement was announced on April 24, 2025, and the transaction closed on October 31, 2025, with the merger becoming effective on November 1, 2025. The combined franchise will have $31 billion in assets. This impending integration suggests that capital and strategic focus will shift toward the combined entity's core strengths, making continued, significant investment in a struggling, rate-sensitive origination unit a low priority for the new leadership.

The key indicators pointing to the Dog classification for HarborOne Mortgage, LLC include:

• Mortgage banking income fell by $2.9 million quarter-over-quarter in Q1 2025.
• Gain on loan sales dropped from $4.0 million (Q4 2024) to $2.7 million (Q1 2025).
• The segment is highly exposed to interest rate cycles, which constrains loan demand.
• The unit's future is now subsumed into the larger Eastern Bank entity post-merger close on November 1, 2025.

HarborOne Bancorp, Inc. (HONE) - BCG Matrix: Question Marks

You're looking at the segments within HarborOne Bancorp, Inc. (HONE) that fit the Question Mark profile as of 2025: high potential growth markets but currently holding a low market share, thus consuming cash without delivering substantial returns yet. Given the definitive merger agreement with Eastern Bankshares, Inc., effective November 1, 2025, the near-term strategy for these units is heavily influenced by integration plans.

HarborOne Wealth Management and Trust Services represents a unit in a growing financial services market, but its scale is dwarfed by the acquiring entity. As of Q3 2025, Eastern Bank's Cambridge Trust Wealth Management division reported $9.2 billion in assets under management (AUM). While HarborOne Bancorp, Inc. does not have a publicly stated AUM for its wealth management segment in its Q1 2025 filings, its overall asset base of $5.70 billion as of March 31, 2025, suggests a significantly smaller wealth operation compared to its peer, which had $8.7 billion in AUM as of Q2 2025. This low current share demands heavy investment to compete or swift integration to benefit from the larger platform.

The Consumer Loan portfolio, encompassing auto loans and personal lines of credit, is another area fitting the Question Mark description due to its relatively small size within the total lending book. As of Q3 2024, the combined Residential Mortgage and Consumer Lending portfolio stood at $1.7 Billion. The scenario suggests the pure consumer loan portion is only about 4% of the total loan portfolio, indicating a low market penetration in this specific high-growth lending area relative to the core commercial real estate and residential mortgage segments. The total loan portfolio for HarborOne Bancorp, Inc. was $4.82 billion at the end of Q1 2025.

These segments require capital to aggressively pursue market share before the merger closes, or they risk being absorbed into the larger entity with minimal independent growth trajectory. The uncertainty is compounded by the pending transaction, where the combined entity projects an earnings per share accretion of approximately 16%, suggesting the combined management sees clear value creation from integrating these functions.

Here's a quick comparison of the scale of the two entities leading into the merger, which frames the market share challenge for HarborOne Bancorp, Inc.'s smaller units:

The immediate strategic focus for these Question Marks revolves around the integration timeline and the potential for rapid scaling post-merger. The investment decision hinges on whether the expected growth justifies the cash burn now, or if the immediate path is to streamline for the November 1, 2025 closing.

• HarborOne Bancorp, Inc. reported net income of $5.5 million for Q1 2025.
• The merger consideration was valued at approximately $490 million based on Eastern Bankshares, Inc.'s closing price of $15.48 on April 23, 2025.
• The Consumer Loan portfolio, as part of the $1.7 Billion Residential Mortgage and Consumer Lending segment in Q3 2024, is a candidate for investment or consolidation.
• The combined entity projects a Net Interest Margin of approximately 3.70%, up from HarborOne Bancorp, Inc.'s Q1 2025 NIM of 2.39%.