Harborone Bancorp, Inc. (Hone): Análise de Pestle [Jan-2025 Atualizado]

No cenário dinâmico do setor bancário regional, a Harborone Bancorp, Inc. (Hone) navega em um complexo ecossistema de desafios e oportunidades, onde regulamentações políticas, mudanças econômicas, inovações tecnológicas e mudanças sociais convergem para moldar sua trajetória estratégica. Essa análise abrangente de pestles revela os fatores externos multifacetados que influenciam a resiliência operacional da Hone, revelando como uma compreensão diferenciada das dinâmicas políticas, econômicas, sociológicas, tecnológicas, legais e ambientais pode transformar possíveis obstáculos em vantagens estratégicas para esta instituição financeira baseada em Massachusetts.

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores Políticos

Regulamentos bancários estaduais de Massachusetts Impacto

A Divisão de Bancos de Massachusetts aplica rigorosos requisitos regulatórios para bancos estatais. A partir de 2024, Harborone deve cumprir:

Aspecto regulatório	Requisitos específicos
Adequação de capital	Taxa de capital mínimo de nível 1 de 8%
Requisitos de liquidez	Manter a taxa de cobertura de liquidez de 100%
Proteção ao consumidor	Divulgação estrita e diretrizes de empréstimos justos

Influência da política monetária do Federal Reserve

As políticas monetárias do Federal Reserve afetam diretamente as estratégias de empréstimos de Harborone. As principais métricas incluem:

• Taxa atual de fundos federais: 5,25% - 5,50%
• Taxa de empréstimos primários: 8,50%
• Margem de juros líquidos para Harborone: 3,12%

Conformidade da Lei de Reinvestimento Comunitário

Classificação de desempenho do CRA de Harborone a partir de 2023: Satisfatório. Métricas de conformidade específicas:

Métrica CRA	Valor de desempenho
Empréstimos de desenvolvimento comunitário	US $ 42,3 milhões
Investimento qualificado	US $ 18,7 milhões
Atividades de serviço comunitário	37 programas distintos

Mudanças federais de supervisão bancária

A abordagem regulatória bancária da administração federal atual inclui:

• Requisitos de segurança bancários digitais aprimorados
• Relatórios aumentados sobre riscos financeiros relacionados ao clima
• Protocolos mais rigorosos de lavagem de dinheiro

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores Econômicos

Condições econômicas regionais em Massachusetts e Nova Inglaterra

PIB de Massachusetts no terceiro trimestre 2023: US $ 595,8 bilhões Taxa de crescimento econômico regional da Nova Inglaterra: 2,1% em 2023 Taxa de desemprego em Massachusetts: 3,1% em dezembro de 2023

Indicador econômico	Valor de Massachusetts	Valor da Nova Inglaterra
Taxa de crescimento do PIB	2.3%	2.1%
Renda familiar média	$89,645	$81,215
Taxa de inflação	3.2%	3.3%

Flutuações da taxa de juros

Taxa de fundos federais em janeiro de 2024: 5,33% Margem de juros líquidos de Harborone Bancorp: 3,02% Taxa de empréstimos médios para empréstimos comerciais: 7,5%

Tipo de empréstimo	Taxa de juro	Volume ($ m)
Imóveis comerciais	7.25%	$ 425,6M
Empréstimos para pequenas empresas	8.15%	$ 187,3M
Empréstimos ao consumidor	6.75%	US $ 213,7M

Pequenas empresas e tendências do mercado imobiliário comercial

Massachusetts Small Business Count: 689.913 Taxa de vacância imobiliária comercial em Boston: 12,4% Empréstimos imobiliários comerciais totais: US $ 1,2 bilhão

Gastos com consumidores e emprego

Gastos do consumidor de Massachusetts em 2023: US $ 315,6 bilhões Taxa de emprego no setor de serviços: 68,3% Crescimento das vendas no varejo: 4,2%

Setor de trabalho	Total de funcionários	Taxa de crescimento
Tecnologia	247,600	3.7%
Assistência médica	398,450	2.9%
Serviços financeiros	156,300	2.1%

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores sociais

Mudanças demográficas em Massachusetts afetam as preferências do cliente bancário

Demografia populacional de Massachusetts a partir de 2024:

Faixa etária	Porcentagem populacional	Preferência de serviço bancário
18-34 anos	22.4%	Bancário digital primeiro
35-54 anos	29.6%	Serviços bancários híbridos
55-64 anos	15.2%	Bancos tradicionais de filial
65 anos ou mais	16.8%	Serviços bancários pessoais

Crescente demanda por serviços bancários digitais entre gerações mais jovens

Taxas de adoção bancária digital em Massachusetts:

• Uso bancário móvel: 73,5%
• Penetração bancária online: 82,3%
• Transações de pagamento digital: 68,9%

Maior foco no setor bancário baseado na comunidade e no desenvolvimento econômico local

Categoria de investimento comunitário	2024 Alocação
Empréstimos para pequenas empresas	US $ 42,6 milhões
Projetos de desenvolvimento comunitário local	US $ 18,3 milhões
Suporte à organização sem fins lucrativos	US $ 7,9 milhões

Mudança de dinâmica da força de trabalho que afeta a aquisição e retenção de talentos

Estatísticas da força de trabalho de Harborone Bancorp:

• Total de funcionários: 723
• Idade média dos funcionários: 41,3 anos
• Taxa de retenção de funcionários: 86,5%
• Porcentagem de trabalho remoto: 42%

Categoria de habilidade	Nível de demanda	Prioridade de contratação
Tecnologia bancária digital	Alto	Crítico
Experiência do cliente	Médio-alto	Alto
Segurança cibernética	Alto	Crítico

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores tecnológicos

Transformação digital em andamento de plataformas e serviços bancários

A Harborone Bancorp investiu US $ 3,2 milhões em iniciativas de transformação digital em 2023. A plataforma bancária digital do banco processou 1,2 milhão de transações on -line no quarto trimestre 2023, representando um aumento de 22% em relação ao ano anterior.

Métricas de transformação digital	2023 dados
Investimento digital total	US $ 3,2 milhões
Transações online	1,2 milhão (Q4)
Crescimento da plataforma digital	22% ano a ano

Investimento em tecnologias de segurança cibernética e proteção de dados

Em 2023, a Harborone alocou US $ 1,7 milhão especificamente para a infraestrutura de segurança cibernética. O banco implementou sistemas avançados de detecção de ameaças, cobrindo 98,5% de seus pontos de extremidade bancários digitais.

Investimento de segurança cibernética	2023 Métricas
Orçamento de segurança cibernética	US $ 1,7 milhão
Cobertura de proteção de terminais	98.5%
Tempo de resposta a incidentes de segurança	12 minutos

Implementação de IA e aprendizado de máquina

A Harborone implantou algoritmos de avaliação de risco orientados pela IA que processam 85.000 pedidos de crédito mensalmente. Os modelos de aprendizado de máquina reduziram o tempo de avaliação de risco de crédito em 47% em 2023.

Métricas de AI/Aprendizado de Machine	2023 desempenho
Aplicativos de crédito mensais processados	85,000
Redução de tempo de avaliação de risco	47%
Precisão preditiva	92.3%

Aprimoramentos de plataforma bancária móvel e on -line

A plataforma bancária móvel da Harborone sofreu um crescimento de 35% do usuário em 2023. O banco processou 780.000 transações móveis por mês, com uma classificação de satisfação do usuário de 4,6/5.

Métricas bancárias móveis	2023 dados
Crescimento do usuário da plataforma móvel	35%
Transações móveis mensais	780,000
Classificação de satisfação do usuário	4.6/5

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores Legais

Conformidade com regulamentos bancários e requisitos de relatórios financeiros

A Harborone Bancorp, Inc. está sujeita a uma supervisão regulatória abrangente de várias agências federais e estaduais. A partir de 2024, o banco deve aderir às seguintes métricas importantes de conformidade regulatória:

Agência regulatória	Requisito de conformidade	Métrica específica
Federal Reserve	Índice de adequação de capital	12,4% a partir do quarto trimestre 2023
Fdic	Índice de cobertura de liquidez	138% de nível de conformidade
Sec	Precisão dos relatórios financeiros	Zero fracos materiais relatados

Possíveis desafios legais em fusões e atividades de aquisição

Avaliação de risco legal para atividades de fusões e aquisições:

• Reservas legais totais alocadas para possíveis litígios de fusões e aquisições: US $ 2,3 milhões
• Retentor de consultoria jurídica externa: US $ 750.000 anualmente
• Orçamento de due diligence de conformidade: US $ 1,1 milhão

Leis de proteção ao consumidor que regem as práticas bancárias

Lei de Proteção ao Consumidor	Gasto de conformidade	Ações de execução
Lei da verdade em empréstimos	Infraestrutura de conformidade de US $ 450.000	Zero violações em 2023
Lei de Relatórios de Crédito Justo	Sistemas de monitoramento de US $ 375.000	Uma pequena correção solicitada

Escrutínio regulatório da governança e transparência da instituição financeira

Métricas de conformidade de governança:

• Membros independentes do conselho: 7 dos 9 membros do conselho total
• Custo anual de auditoria de governança corporativa: US $ 525.000
• Pontuação de conformidade com relatórios de transparência: 94,6%

Harborone Bancorp, Inc. (Hone) - Análise de Pestle: Fatores Ambientais

Práticas bancárias sustentáveis ​​e iniciativas de financiamento verde

Harborone Bancorp registrou US $ 42,5 milhões em portfólio de empréstimos verdes a partir do quarto trimestre 2023. Os compromissos de finanças sustentáveis ​​do banco incluem:

Iniciativa verde	Valor do investimento	Ano -alvo
Empréstimos de energia renovável	US $ 18,3 milhões	2024
Hipotecas com eficiência energética	US $ 12,7 milhões	2024
Financiamento do projeto solar	US $ 11,5 milhões	2024

Avaliação de risco climático em empréstimos comerciais e residenciais

Métricas de avaliação de risco climático para o portfólio de empréstimos de Harborone:

Categoria de risco	Valor da portfólio avaliado	Orçamento de mitigação de risco
Empréstimos de propriedade costeira	US $ 237,6 milhões	US $ 4,2 milhões
Empréstimos comerciais da zona de inundação	US $ 156,9 milhões	US $ 3,7 milhões

Melhorias de eficiência energética nas operações corporativas

Investimentos corporativos de eficiência energética para 2024:

• Despesas de capital total de eficiência energética: US $ 2,1 milhões
• Redução do consumo de energia projetado: 22,5%
• Alvo de redução de emissões de carbono: 18,3%

Conformidade ambiental e compromissos de responsabilidade social corporativa

Área de conformidade	Investimento	Porcentagem de conformidade
Conformidade regulatória ambiental	US $ 1,6 milhão	98.7%
Relatórios de sustentabilidade	$450,000	100%
Programas de compensação de carbono	$750,000	95.4%

HarborOne Bancorp, Inc. (HONE) - PESTLE Analysis: Social factors

The merger creates the largest mid-sized bank in the Greater Boston area, changing the market structure.

The most significant social and market structure change for HarborOne Bancorp, Inc. is its merger with Eastern Bankshares, Inc., which became effective on November 1, 2025. This transaction transforms the regional banking landscape. The combined entity creates a powerhouse with approximately $31 billion in total assets, solidifying its position as the largest Massachusetts-based bank.

This scale shift has a direct social impact on customers and the community. While Eastern Bankshares, Inc. gains a larger footprint, the merger is expected to result in some branch closures due to overlap, which can disrupt local banking access for some customers. For instance, the 64 Broad St. branch in Boston, Massachusetts, was expected to close and consolidate into a nearby Eastern Bank branch (0.30 miles away).

Here is a quick comparison of the two entities' scale at the time of the merger announcement:

Metric	HarborOne Bancorp (Pre-Merger)	Eastern Bankshares (Pre-Merger)	Combined Entity (Pro Forma 2025)
Total Assets	~$5.7 Billion (as of March 31, 2025)	~$25.0 Billion (as of March 31, 2025)	~$31.0 Billion
Full-Service Branches	30 (MA & RI)	109 (MA, NH, RI, CT)	~139 (Pre-consolidation)
Market Position	Leading mid-sized regional bank	Greater Boston's leading local bank	Largest Massachusetts-based bank

HarborOne Bank maintains a strong local footprint with 30 full-service branches across Massachusetts and Rhode Island.

The bank's pre-merger social strength was its deep local presence, operating 30 full-service branches across Massachusetts and Rhode Island, plus commercial lending offices in Boston, Massachusetts, and Providence, Rhode Island. This dense, local network is a significant social asset, fostering a community bank reputation that is highly valued by local consumers and small businesses, especially in the southeastern Massachusetts and Rhode Island markets.

The challenge now is to preserve this local trust as the HarborOne Bank brand merges into Eastern Bank. The integration process, which is set to complete the full transition of accounts and services in February 2026, must be handled delicately to avoid customer attrition in these key markets.

The 'HarborOne U' program provides free digital content for community financial literacy and small business education.

HarborOne Bank's commitment to social responsibility is anchored by its 'HarborOne U' program, which offers free educational resources to the community. This initiative directly addresses social needs by improving financial literacy and supporting local economic development through small business education. The program delivers content through various formats:

• Provides financial education programs to groups ranging from pre-school to adulthood.
• Offers in-person or virtual programs for groups of 15 to 200 participants.
• Features curriculum like the 'Millionaire Mindset' for young adults (15-20 years of age) and 'Financial Wellbeing' for adults, focusing on budgeting and credit scores.

In addition to financial education, the bank's community investment includes significant philanthropic efforts. Since its public offering in 2016, the bank has awarded $600,000 in scholarships and pledged $1 million over a 10-year period for college scholarships to local students, underscoring its commitment to social mobility.

Integrating the two corporate cultures post-merger will be a defintely critical execution risk.

The integration of two distinct corporate cultures-HarborOne Bank and Eastern Bank-is a major, near-term social risk. While the merger is financially compelling, with an expected 16% earnings per share (EPS) accretion, the failure to merge the cultures smoothly could erode customer and employee goodwill.

Analyst and company filings highlight the 'Integration Challenges' and 'cultural clashes' as key execution risks that could impact short-term profitability. The social environment of the combined entity will be tested by:

• Employee Retention: Ensuring most HarborOne employees transition successfully to Eastern Bank, especially those in customer-facing roles.
• Customer Reaction: Managing the reputational risk associated with the merger, including the reaction of customers to branch closures and system changes.
• Foundation Integration: The HarborOne Foundation is merging with the Eastern Bank Foundation, which requires a careful transition to maintain the continuity of local charitable giving and community support.

Eastern Bankshares, Inc.'s management must actively manage this cultural integration risk to realize the promised synergies and maintain the combined entity's strong community standing.

HarborOne Bancorp, Inc. (HONE) - PESTLE Analysis: Technological factors

Digital Adoption and Customer Engagement

You need to see hard evidence that customers are actually using the digital tools you invest in, and HarborOne Bancorp's metrics show a strong foundation for the combined bank. As of the third quarter of 2024, 75% of customers were active users of Digital Banking tools. This is a high adoption rate, and it highlights the existing digital comfort of the customer base that Eastern Bankshares, Inc. is acquiring. Plus, the bank's focus on self-service is clear: 72% of customers utilize a debit card regularly, which is well above the industry average of 61%. This existing digital momentum is defintely a tailwind for the new entity's efficiency goals.

Here's the quick math on customer movement: new consumer checking production increased 6% year-over-year in the third quarter of 2024, showing that digital channels are successfully attracting new relationships, not just serving existing ones. This strong digital base is crucial for minimizing disruption as the merger proceeds.

Merger Synergy Relies Heavily on Integrating Core Banking Systems

The success of the merger hinges on a smooth and timely integration of the core banking systems. This is where the promised operational efficiencies-the core financial driver of the deal-are realized. The merger was effective on November 1, 2025, but the full transition of HarborOne Bank's accounts and services to Eastern Bank's systems is scheduled for the weekend of February 21, 2026. This short window requires flawless execution.

The primary benefit of this technological integration is the cost savings. Management projects that the merger will deliver cost savings equivalent to approximately 40% of 2026E HarborOne cash expenses. That's a huge number, and it relies entirely on eliminating redundant systems, consolidating data centers, and streamlining back-office processes through this core systems integration. If the conversion takes 14+ days, customer churn risk rises and those synergy targets get pushed out.

Cybersecurity and Operational Resilience as 2025 Supervisory Priorities

For the entire banking sector, including the newly combined entity, cybersecurity and operational resilience are not just IT issues; they are top-tier regulatory and strategic risks in 2025. The Office of the Comptroller of the Currency (OCC) has made this a clear focus in its Fiscal Year 2025 Bank Supervision Operating Plan. This means the new bank will face heightened scrutiny immediately post-merger.

The regulatory pressure is specifically on moving beyond basic preventative controls to demonstrating robust incident response, data recovery, and overall operational resilience. This focus is driven by the increasing volatility of cyberattacks and the industry's reliance on third-party technology vendors. The combined entity must now ensure its larger, integrated technology stack meets these stringent FY 2025 expectations.

• Focus on preventative controls and incident response.
• Emphasis on operational resilience capabilities for critical operations.
• Scrutiny of third-party risks, especially those with financial technology companies (fintechs).

Scaling Technology for a Broader Customer Base

The merger creates a much larger institution, and the technology platform must scale immediately to handle the expanded footprint and customer volume. The combined organization is a $30 billion locally-based entity, with Eastern Bank reporting approximately $25 billion in assets as of March 31, 2025, and the combined entity holding approximately $26.2 billion in deposits. This scale demands a technology infrastructure that is not only robust but also highly efficient.

The challenge is to leverage the technology to serve a broader geographic area, which now includes an expanded branch network into Rhode Island, while simultaneously delivering the projected cost savings. The technology team's focus must shift from maintaining two separate systems to optimizing one large, unified platform. This is why the core system conversion in February 2026 is the single most important technological milestone for the new organization.

Key Technological Milestone/Metric	Value/Date (2025 Fiscal Year Data)	Strategic Implication
Merger Effective Date	November 1, 2025	Start of the integration period.
Active Digital Banking Users (HONE Q3 2024)	75% of Customers	High digital adoption minimizes friction during transition.
Projected Cost Synergy from Integration	~40% of 2026E HarborOne cash expenses	The core financial objective of the technology integration.
Core Banking System Conversion Date	February 2026 (Q1 2026)	The critical deadline for achieving operational scale and synergy.
Combined Entity Assets	~$31 billion	Defines the necessary scale for the new technology platform.

HarborOne Bancorp, Inc. (HONE) - PESTLE Analysis: Legal factors

The Merger with Eastern Bankshares, Inc.

The most significant legal event for HarborOne Bancorp, Inc. in the 2025 fiscal year is its definitive merger with Eastern Bankshares, Inc. This transaction fundamentally changes the regulatory landscape for the entity, moving it from a standalone regional bank to part of a much larger, more scrutinized institution. HarborOne Bancorp shareholders secured the necessary approval for all merger-related matters on August 20, 2025. This shareholder vote was a critical legal milestone, clearing the path for the final closing.

Merger Consideration and Trading Status

The merger officially became effective shortly after midnight on November 1, 2025, marking the formal legal cessation of HarborOne Bancorp as an independent public company. As a result of the acquisition, trading in HarborOne Bancorp shares was halted effective November 3, 2025, with the stock officially delisted from the NASDAQ Global Select Market after the close of trading on October 31, 2025. This is a clean one-liner: The stock is now off the board.

The final merger consideration offered to HarborOne shareholders was a critical component of the legal agreement, subject to allocation and proration procedures to ensure a specific mix of cash and stock.

Consideration Type	Amount Per Share	Shareholder Election/Conversion
Stock Consideration	0.765 shares of Eastern Bankshares, Inc. common stock	91.87% of shares timely elected stock
Cash Consideration	$12.00 in cash	84.99% of shares were converted into the right to receive Stock Consideration (due to proration)
Total Deal Value (Approx.)	N/A	Approximately $592.08 million (based on 49.34 million shares outstanding)

Here's the quick math: Despite the high demand for stock, the proration mechanism in the merger agreement meant only 84.99% of the shares ultimately received the stock component, with the remainder receiving the cash equivalent of $12.00 per share.

Compliance with Evolving Bank Capital and Liquidity Rules

The combined entity, Eastern Bankshares, Inc., must now navigate a more complex web of financial regulation. Post-merger, the organization is a larger regional bank with approximately $30 billion in assets as of the third quarter of 2025. This increased size subjects it to stricter prudential standards (rules designed to ensure safety and soundness) from the Federal Reserve and other regulators.

Regulators are defintely tightening the screws on capital and liquidity requirements, especially for banks of this scale, following recent market stresses. The combined bank must comply with key US regulatory standards:

• Maintain a minimum Common Equity Tier 1 (CET1) capital ratio of 4.5%.
• Meet the Stress Capital Buffer (SCB) requirement, which is determined by supervisory stress tests and is at least 2.5%.
• Adhere to the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) requirements, which ensure sufficient high-quality liquid assets and stable, long-term funding.

What this estimate hides is the new supervisory focus from the Federal Reserve, outlined in a November 2025 memo, which is shifting examiner attention to material financial risks over procedural documentation. The combined bank needs to ensure its internal audit function is strong, as examiners are now relying more on a firm's internal audit for validating the remediation of Matters Requiring Attention (MRAs). If onboarding takes 14+ days, the risk of a compliance misstep during system integration rises.

HarborOne Bancorp, Inc. (HONE) - PESTLE Analysis: Environmental factors

The environmental factors for HarborOne Bancorp are less about internal operational footprint and more about the financial risk embedded in its loan book from climate-related events, both physical and transitional. The bank's New England focus makes it defintely sensitive to coastal and extreme precipitation risks, while its reliance on Commercial Real Estate (CRE) exposes it to the transition risks of a shifting economy.

HarborOne Bancorp has not publicly committed to specific 2030 or 2050 climate goals under major frameworks.

Unlike larger financial institutions that often publish detailed Environmental, Social, and Governance (ESG) reports with Science-Based Targets (SBTs), HarborOne Bancorp has not made public commitments to major 2030 or 2050 climate goals. This lack of formal commitment means lower immediate compliance costs for climate reporting, but it also creates a potential blind spot for long-term investor relations and risk management. As a regional bank, its primary environmental exposure is not its own small carbon footprint, but the physical and transition risks within its loan portfolio.

Increased regulatory and investor pressure is forcing banks to disclose physical climate risks (e.g., extreme weather).

While the federal regulatory environment for climate disclosure has seen some pushback and pauses, the pressure on regional banks to understand and disclose physical climate risk is still rising from investors and state-level actions. The Northeast region, which includes HarborOne Bancorp's primary markets of Massachusetts and Rhode Island, is experiencing a faster growth rate in extreme precipitation than any other part of the U.S.. This necessitates a clear view of how loan collateral, especially property, is valued and insured against events like flooding.

The total cost of U.S. weather and climate disasters in 2024 reached $182.7 billion, the fourth highest on record, highlighting the escalating financial stakes for the entire banking sector. Your investors are increasingly asking how this translates to loan loss reserves.

Commercial Real Estate (CRE) exposure carries transition risk; the bank had a $17.2 million nonperforming asset in suburban office space in Q3 2024.

The transition risk-the financial risk associated with a shift to a low-carbon economy-is most visible in the bank's Commercial Real Estate (CRE) portfolio. HarborOne Bancorp's loan portfolio was approximately $4.85 billion as of December 31, 2024, with CRE loans making up a significant 47% of total loans. The market shift toward remote work has directly impacted the value of office space, a clear example of transition risk hitting the balance sheet.

This risk materialized with a specific nonperforming asset (NPA) in suburban office space, which was initially recorded at $17.2 million in Q3 2024. By the first quarter of 2025 (Q1 2025), the bank's total office exposure was reported at $212 million, or about 8% of its CRE and construction portfolio, and an aggregate of $8.3 million was charged off on one office credit during that quarter. This credit stress is a clear signal that the transition to a new economic model for commercial property is already creating losses.

Here's the quick math on recent credit quality deterioration in commercial loans:

Metric	Q3 2024 Value	Q1 2025 Value	Q2 2025 Value
Total Nonperforming Assets (NPA)	$28.4 million	$30.9 million	N/A (Focus on Classified)
Nonperforming Assets as % of Total Assets	0.49%	N/A	N/A
Total Criticized and Classified Commercial Loans	N/A	$187.1 million	$193.7 million
Q1 2025 Net Charge-offs (Annualized)	N/A	0.72%	0.14%

The New England region faces rising physical risks from increasingly severe weather events.

HarborOne Bancorp's concentration in Massachusetts and Rhode Island makes it highly vulnerable to physical climate risks, particularly coastal flooding and extreme precipitation. Sea levels along the Massachusetts coast have already risen 11 inches since 1921, exceeding the global average. In Rhode Island, a one-month stretch in January 2024 saw rainfall totals at 300 percent above normal levels, severely flooding homes and businesses. This isn't a future problem; it's a current balance sheet risk.

Key physical risks impacting collateral value and borrower repayment capacity include:

• Coastal Flooding: Long-term data from the Newport, RI, tide gauge shows the local sea level has risen 10 inches in the past century.
• Extreme Precipitation: The Northeast has seen a 60% jump in its worst precipitation events over six decades, with days seeing more than 5 inches of rain rising by 103%.
• Nor'easters: Stronger Nor'easters, fueled by warmer ocean temperatures, have seen their destructive potential increase by roughly 17% due to higher wind speeds.

For a regional bank, this means more frequent and severe damage to residential and commercial properties securing loans, leading to potential collateral impairment and higher loan delinquencies.