Hingham Institution for Savings : Form 8-K Current Report

Published: 2025-07-11 16:17:05 ET HIFS

Published on 07/11/2025 at 16:17

‌FEDERAL DEPOSIT INSURANCE CORPORATION WASHINGTON, D.C. 20492

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): July 11, 2025 (July 11, 2025)

HINGHAM INSTITUTION FOR SAVINGS

(Exact name of registrant as specified in its charter)

Massachusetts

No. 90211-0

04-1442480

(State or Other Jurisdiction of

(FDIC File Number)

(I.R.S. Employer

Incorporation)

Identification No.)

55 Main Street, Hingham, Massachusetts, 02043 (Address of principal executive offices) (Zip Code)

(781) 749-2200

(Registrant's telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

On July 11, 2025, Hingham Institution for Savings announced its financial results for the quarter ended June 30, 2025. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Form 8-K (including Exhibit 99.1) shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

99.1 Press Release entitled "Hingham Reports Second Quarter 2025 Results" issued by the Bank on July 11, 2025.

EXHIBIT INDEX

Exhibit No. Description

99.1 Press Release entitled "Hingham Reports Second Quarter 2025 Results" issued by the Bank on July 11, 2025.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 11, 2025 Hingham Institution for Savings (Registrant)

By:

Cristian Melej

Vice President & Chief Financial Officer

‌PRESS RELEASE

FROM: Robert H. Gaughen, Jr., Chairman and Chief Executive Officer Hingham Institution for Savings

Hingham, MA (NASDAQ: HIFS)

DATE: July 11, 2025

CONTACT: Patrick R. Gaughen, President and Chief Operating Officer (781) 783-1761

HINGHAM REPORTS SECOND QUARTER 2025 RESULTS

HINGHAM INSTITUTION FOR SAVINGS (NASDAQ: HIFS), Hingham, Massachusetts

announced results for the quarter ended June 30, 2025.

Earnings

Net income for the quarter ended June 30, 2025 was $9,414,000 or $4.32 per share basic and $4.28 per share diluted, as compared to $4,102,000 or $1.88 per share basic and diluted for the same period last year. The Bank's annualized return on average equity for the second quarter of 2025 was 8.43%, and the annualized return on average assets was 0.85%, as compared to 3.92% and 0.38% for the same period last year. Net income per share (diluted) for the second quarter of 2025 increased by 127.7% compared to the same period in 2024.

Core net income for the quarter ended June 30, 2025, which represents net income excluding the after-tax net gain on equity securities, both realized and unrealized, was $7,453,000 or $3.42 per share basic and $3.39 per share diluted, as compared to $2,181,000 or $1.00 per share basic and per share diluted for the same period last year. The Bank's annualized core return on average equity for the second quarter of 2025 was 6.67% and the annualized core return on average assets was 0.67%, as compared to 2.08% and 0.20% for the same period last year. Core net income per share (diluted) for the second quarter of 2025 increased by 239.0% compared to the same period in 2024.

Net income for the six months ended June 30, 2025 was $16,538,000 or $7.58 per share basic and

$7.52 per share diluted, as compared to $10,970,000 or $5.04 per share basic and $5.01 per share diluted for the same period last year. The Bank's annualized return on average equity for the first six months of 2025 was 7.45%, and the annualized return on average assets was 0.75%, as compared to 5.27% and 0.50% for the same period in 2024. Net income per share (diluted) for the first six months of 2025 increased by 50.1% over the same period in 2024.

Core net income for the six months ended June 30, 2025, which represents net income excluding the Page 1 of 10

after-tax net gain on equity securities, both realized and unrealized, was $13,578,000 or $6.23 per share basic and $6.17 per share diluted, as compared to $4,395,000 or $2.02 per share basic and $2.01 per share diluted for the same period last year. The Bank's annualized core return on average equity for the first six months of 2025 was 6.12%, and the annualized core return on average assets was 0.61%, as compared to 2.11% and 0.20% for the same period in 2024. Core net income per share (diluted) for the first six months of 2025 increased by 207.0% over the same period in 2024.

See Page 10 for a reconciliation between Generally Accepted Accounting Principles ("GAAP") net income and Non-GAAP core net income. GAAP requires that gains and losses on equity securities, net of tax, realized and unrealized, be recognized in the Consolidated Statements of Income. In calculating core net income, the Bank did not make any adjustments other than those relating to the after-tax net gain on equity securities, both realized and unrealized. In the first six months of 2024, both net income and core net income were positively impacted by lower income tax expense driven by excess tax benefit associated with the exercise of stock options and the revision of state income tax estimates.

Balance Sheet

Total assets increased to $4.539 billion at June 30, 2025, representing 3.7% annualized growth year-to-date and a 0.4% increase from June 30, 2024.

Net loans increased to $3.932 billion at June 30, 2025, representing 3.0% annualized growth year-to-date and stable when compared to June 30, 2024. Origination activity was concentrated in the Boston and Washington D.C. markets and remained focused on stabilized multifamily commercial real estate.

Retail and commercial deposits were $1.998 billion at June 30, 2025, flat year-to-date and representing 4.0% growth from June 30, 2024. Non-interest-bearing deposits, included in retail and commercial deposits, were $437.6 million at June 30, 2025, representing 20.2% annualized growth year-to-date and 27.5% growth from June 30, 2024, while interest-bearing deposits fell, reflecting some specific customer business needs.

Growth in non-interest bearing deposits in the first six months of 2025 continued to reflect the Bank's focus on developing and deepening deposit relationships with new and existing commercial and non-profit customers. The Bank continues to invest in its Specialized Deposit Group, actively recruiting for talented relationship managers in Boston, Washington, and San Francisco, particularly as respected competitors exit these markets or merge with larger regional banks.

The stability of the Bank's balance sheet, as well as full and unlimited deposit insurance through the Bank's participation in the Massachusetts Depositors Insurance Fund, continues to appeal to customers in times of uncertainty.

Wholesale funds, which includes Federal Home Loan Bank ("FHLB") borrowings, brokered deposits, and Internet listing service time deposits, were $2.052 billion at June 30, 2025 representing 6.0% annualized growth year-to-date and a 4.4% decline from June 30, 2024, as the Bank used these funds to replace certain commercial deposits in the second quarter of 2025. In the first six months of 2025, the Bank continued to manage its wholesale funding mix to lower its cost of funds while taking advantage of the inverted yield curve at certain durations by adding lower rate longer term liabilities. Wholesale deposits, which include brokered and Internet listing service time deposits, were $480.1 million at June 30, 2025, representing a 6.0% annualized decline year-to-date and a 3.5% decline from June 30, 2024. Borrowings from the FHLB totaled $1.572 billion at June 30, 2025,

representing 10.0% annualized growth from December 31, 2024, and a 4.7% decline from June 30, 2024. As of June 30, 2025, the Bank maintained an additional $802.8 million in immediately available borrowing capacity at the FHLB of Boston and the Federal Reserve Bank, in addition to

$360.6 million in cash and cash equivalents.

Book value per share was $204.36 as of June 30, 2025, representing 6.4% annualized growth year-to-date and 6.8% growth from June 30, 2024. In addition to the increase in book value per share, the Bank declared $2.52 in dividends per share since June 30, 2024.

On June 25, 2025, the Bank declared a regular cash dividend of $0.63 per share. This dividend will be paid on August 13, 2025 to stockholders of record as of August 4, 2025. This will be the Bank's 126th consecutive quarterly dividend.

The Bank has also generally declared special cash dividends in each of the last thirty years, typically in the fourth quarter, but did not declare a special dividend in 2024 and 2023. The Bank sets the level of the special dividend based on the Bank's capital requirements and the prospective return on other capital allocation options, particularly the incremental return on capital from new loan originations and share repurchases. This may result in special dividends, if any, significantly above or below the regular quarterly dividend. Future regular and special dividends will be considered by the Board of Directors on a quarterly basis.

Operational Performance Metrics

The net interest margin for the quarter ended June 30, 2025 increased 16 basis points to 1.66%, as compared to 1.50% in the quarter ended March 31, 2025. This was the fifth consecutive quarter of continued expansion, despite the Federal Reserve's federal funds rate target range remaining unchanged in 2025. This improvement was the result of a decline in the cost of interest-bearing liabilities, combined with an increase in the yield on interest-earning assets. The cost of interest-bearing liabilities fell 10 basis points in the second quarter of 2025, as the Bank's retail and commercial deposits continued to reprice at lower rates, and the Bank continued to take advantage of the inverted yield curve by adding lower rate FHLB advances and brokered deposits. The yield on interest-earning assets increased by 5 basis points in the second quarter of 2025, driven primarily by a higher yield on loans, as the Bank continued to originate loans at higher rates and reprice existing loans. The net interest margin in the final month of the second quarter of 2025 was 1.72% annualized.

Key credit and operational metrics remained acceptable in the second quarter of 2025. At June 30, 2025, non-performing assets totaled 0.70% of total assets, compared to 0.03% at December 31, 2024 and 0.04% at June 30, 2024. Non-performing loans as a percentage of the total loan portfolio totaled 0.81% at June 30, 2025, compared to 0.04% at both December 31, 2024 and June 30, 2024. The Bank did not record any charge-offs in the first six months of 2025 or 2024. In the second quarter of 2025, the Bank placed a commercial real estate loan with an outstanding balance of $30.6 million on nonaccrual, after the borrower failed to make the full payment due at maturity. This loan is secured by an entitled development site for a significant multifamily development in Washington, D.C. and has an associated conditional guarantee from a large national homebuilder and an affordable housing developer. The Bank is working actively to identify a resolution that protects the Bank's interests. The remaining non-performing assets and loans cited above were and are residential, owner-occupant loans.

As of June 30, 2025, the Bank only had the single above-mentioned non-performing commercial real

estate loan, and no other commercial real estate delinquent loans. The Bank did not have any delinquent or non-performing commercial real estate loans as of December 31, 2024 or June 30, 2024. The Bank did not own any foreclosed property at June 30, 2025, December 31, 2024 or June 30, 2024.

The efficiency ratio, as defined on page 5 below, decreased to 41.17% for the second quarter of 2025, as compared to 45.82% in the prior quarter and 68.57% for the same period last year. Operating expenses as a percentage of average assets were 0.68% for the second quarter of 2025, as compared to 0.68% for the prior quarter and 0.67% for the same period last year. This reflects, in part, continuing investment in deposit-gathering infrastructure and relatively stable average assets from period to period. As the efficiency ratio can be significantly influenced by the level of net interest income, the Bank utilizes these paired figures together to assess its operational efficiency over time. During periods of significant net interest income volatility, the efficiency ratio in isolation may over or understate the underlying operational efficiency of the Bank. The Bank remains focused on reducing waste through an ongoing process of continuous improvement and standard work that supports operational leverage.

Chairman Robert H. Gaughen Jr. stated, "Returns on equity and assets in the second quarter of 2025 remained somewhat lower than our long-term performance expectations, although they have recovered significantly. Returns in our core business continue to improve steadily, driven by a continued expansion in the net interest margin through asset repricing, falling funding costs, and growth in non-interest bearing deposits. Our operational leverage remains critical to generating satisfactory returns and we remain focused on rigorous cost control and continuous operational improvement. Although our investment returns are likely to remain volatile in any individual period, they continue to contribute meaningfully to growth in book value per share over time.

While this period has been extraordinarily challenging, the Bank's business model has been built to compound shareholder capital over the long-term. We remain focused on careful capital allocation, defensive underwriting and rigorous cost control - the building blocks for compounding shareholder capital through all stages of the economic cycle. These remain constant, regardless of the macroeconomic environment in which we operate."

The Bank's quarterly financial results are summarized in this earnings release, but shareholders are encouraged to read the Bank's quarterly report on Form 10-Q, which is generally available several weeks after the earnings release. The Bank expects to file Form 10-Q for the quarter ended June 30, 2025 with the Federal Deposit Insurance Corporation (FDIC) on or about August 6, 2025.

Incorporated in 1834, Hingham Institution for Savings is one of America's oldest banks. The Bank maintains offices in Boston, Nantucket, Washington, D.C., and San Francisco.

The Bank's shares of common stock are listed and traded on The NASDAQ Stock Market under the symbol HIFS.

HINGHAM INSTITUTION FOR SAVINGS

Selected Financial Ratios

Three Months Ended

June 30,

Six Months Ended

June 30,

2024 2025

(Unaudited)

2024

2025

Key Performance Ratios

Return on average assets (1) 0.38 % 0.85 %

0.50 %

0.75 %

Return on average equity (1)

3.92

8.43

5.27

7.45

Core return on average assets (1) (5)

0.20

0.67

0.20

0.61

Core return on average equity (1) (5)

2.08

6.67

2.11

6.12

Interest rate spread (1) (2)

0.25

0.95

0.19

0.87

Net interest margin (1) (3)

0.96

1.66

0.91

1.58

Operating expenses to average assets (1)

0.67

0.68

0.67

0.68

Efficiency ratio (4)

68.57

41.17

72.63

43.36

Average equity to average assets

9.59

10.05

9.56

10.02

Average interest-earning assets to average interest-

bearing liabilities

119.93

122.94

119.92

122.60

June 30,

2024

December 31,

2024

June 30,

2025

(Unaudited)

Asset Quality Ratios

Allowance for credit losses/total loans

0.68 %

0.69

0.70 %

Allowance for credit losses/non-performing loans

1,577.28

1,775.00

86.97

Non-performing loans/total loans

0.04

0.81

Non-performing loans/total assets

0.04

0.03

0.70

Non-performing assets/total assets

0.04

0.03

0.70

Share Related

Book value per share

$ 191.34

$ 198.03

$ 204.36

Market value per share

$ 178.88

$ 254.14

$ 248.35

Shares outstanding at end of period

2,180,250

2,181,250

Annualized.

Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

Net interest margin represents net interest income divided by average interest-earning assets.

The efficiency ratio is a non-GAAP measure that represents total operating expenses, divided by the sum of net interest income and total other income, excluding the net gain on equity securities, both realized and unrealized.

Non-GAAP measurements that represent return on average assets and return on average equity, excluding the after-tax net gain on equity securities, both realized and unrealized.

HINGHAM INSTITUTION FOR SAVINGS

Consolidated Balance Sheets

(In thousands, except share amounts)

June 30,

2024

December 31,

2024

June 30,

2025

(Unaudited)

ASSETS

Cash and due from banks

$ 5,990

$ 4,183

$ 8,470

Federal Reserve and other short-term investments

363,151

347,647

352,144

Cash and cash equivalents

369,141

351,830

360,614

CRA investment

8,722

8,769

8,928

Other marketable equity securities

83,860

104,575

113,761

Securities, at fair value

92,582

113,344

122,689

Securities held to maturity, at amortized cost

6,493

6,494

Federal Home Loan Bank stock, at cost

Loans, net of allowance for credit losses of $26,940 at June 30, 2024, $26,980 at December 31, 2024

and $27,730 at June 30, 2025

66,189

3,933,419

61,022

3,873,662

64,659

3,931,663

Bank-owned life insurance

13,805

13,980

14,143

Premises and equipment, net

16,676

16,397

16,180

Accrued interest receivable

9,082

8,774

8,962

Other assets

13,344

12,269

13,753

Total assets

$ 4,520,731

$ 4,457,771

$ 4,539,157

LIABILITIES AND STOCKHOLDERS' EQUITY

Interest-bearing deposits

$ 2,075,002

$ 2,094,626

$ 2,040,271

Non-interest-bearing deposits

343,262

397,469

437,608

Total deposits

2,418,264

2,492,095

2,477,879

Federal Home Loan Bank advances

1,648,675

1,497,000

1,572,000

Mortgagors' escrow accounts

14,577

16,699

18,478

Accrued interest payable

12,242

8,244

12,959

Deferred income tax liability, net

989

3,787

4,629

Other liabilities

8,806

8,191

7,460

Total liabilities

4,103,553

4,026,016

4,093,405

Stockholders' equity:

Preferred stock, $1.00 par value, 2,500,000 shares authorized, none issued

Common stock, $1.00 par value, 5,000,000 shares

authorized; 2,180,250 shares issued and outstanding at June

30, 2024 and December 31, 2024, and 2,181,250 shares

2,180

2,181

issued and outstanding at June 30, 2025

Additional paid-in capital

15,467

15,571

15,777

Undivided profits

399,531

414,004

427,794

Total stockholders' equity

417,178

431,755

445,752

Total liabilities and stockholders' equity

$ 4,520,731

$ 4,457,771

$ 4,539,157

HINGHAM INSTITUTION FOR SAVINGS

Consolidated Statements of Income

(In thousands except per share amounts)

2024

2025

2024

2025

(Unaudited)

Interest and dividend income:

Loans

$ 44,665

$ 46,752

$ 87,785

$ 91,973

Debt securities

132

192

Equity securities

1,551

1,365

3,001

2,816

Federal Reserve and other short-term investments

2,745

3,072

5,572

6,127

Total interest and dividend income

49,048

51,286

96,490

101,108

Interest expense:

Deposits

22,141

17,841

43,287

36,462

Federal Home Loan Bank

16,539

15,406

33,751

30,571

Total interest expense

38,680

33,247

77,038

67,033

Net interest income

10,368

18,039

19,452

34,075

Provision for credit losses

180

450

288

750

Net interest income, after provision for credit losses

10,188

17,589

19,164

33,325

Other income:

Customer service fees on deposits

138

139

275

274

Increase in cash surrender value of bank-owned life insurance

163

Gain on equity securities, net

2,464

2,516

8,434

3,797

Miscellaneous

104

122

Total other income

2,733

2,807

8,976

4,356

Operating expenses:

Salaries and employee benefits

4,234

4,392

8,531

8,859

Occupancy and equipment

394

417

825

856

Data processing

738

758

1,493

1,482

Deposit insurance

819

784

1,629

1,532

Foreclosure and related

Marketing

187

222

276

358

Other general and administrative

908

959

1,721

1,905

Total operating expenses

7,294

7,546

14,521

15,016

Income before income taxes

5,627

12,850

13,619

22,665

Income tax provision

1,525

3,436

2,649

6,127

Net income

$ 4,102

$ 9,414

$ 10,970

$ 16,538

Cash dividends declared per common share

$ 0.63

$ 1.26

Weighted average shares outstanding: Basic

2,180

2,181

2,175

2,181

Diluted

2,186

2,200

2,189

2,200

Earnings per share: Basic

$ 1.88

$ 4.32

$ 5.04

$ 7.58

Diluted

$ 1.88

$ 4.28

$ 5.01

$ 7.52

Three Months Ended Six Months Ended June 30, June 30,

HINGHAM INSTITUTION FOR SAVINGS

Net Interest Income Analysis

Three Months Ended

June 30, 2024 March 31, 2025 June 30, 2025

Average

Balance (9) Interest

Yield/ Rate (10)

Average

Balance (9) Interest

Yield/ Rate (10)

Average

Balance (9) Interest

Yield/ Rate (10)

(Dollars in thousands) (Unaudited)

Assets

Loans (1) (2) $ 3,980,111

$ 44,665

4.49 %

$ 3,929,828

$ 45,221

4.67 %

$ 3,952,477

$ 46,752

4.74 %

Securities (3) (4) 119,477

1,638

5.48

130,674

1,546

4.80

135,541

1,462

4.33

Short-term investments (5) 202,379

2,745

5.43

278,722

3,055

4.45

277,146

3,072

4.45

Total interest-earning assets 4,301,967

49,048

4.56

4,339,224

49,822

4.66

4,365,164

51,286

4.71

Other assets 66,218

79,209

78,230

Total assets

$ 4,368,185

$ 4,418,433

$ 4,443,394

Liabilities and stockholders' equity:

Interest-bearing deposits (6)

$ 2,149,753

$ 22,141

4.12 %

$ 2,141,294

$ 18,621

3.53 %

$ 2,102,662

$ 17,841

3.40 %

Borrowed funds

1,437,335

16,539

4.60

1,407,844

15,165

4.37

1,448,078

15,406

4.27

Total interest-bearing liabilities

3,587,088

38,680

4.31

3,549,138

33,786

3.86

3,550,740

33,247

3.76

Non-interest-bearing deposits

346,663

413,877

429,537

Other liabilities

15,503

14,464

16,378

Total liabilities

3,949,254

3,977,479

3,996,655

Stockholders' equity

418,931

440,954

446,739

Total liabilities and

stockholders' equity

$ 4,368,185

$ 4,418,433

$ 4,443,394

Net interest income

$ 10,368

$ 16,036

$ 18,039

Weighted average interest rate spread

0.25 %

0.80 %

0.95 %

Net interest margin (7)

0.96 %

1.50 %

1.66 %

Average interest-earning assets

to average interest-bearing liabilities (8)

119.93

122.26

122.94

Before allowance for credit losses.

Includes non-accrual loans.

Excludes the impact of the average net unrealized gain or loss on securities.

Includes Federal Home Loan Bank stock.

Includes cash held at the Federal Reserve Bank.

Includes mortgagors' escrow accounts.

Net interest income divided by average total interest-earning assets.

Total interest-earning assets divided by total interest-bearing liabilities.

Average balances are calculated on a daily basis.

Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS

Net Interest Income Analysis

Six Months Ended June 30,

2024 2025

Average

Balance (9)

Interest

Yield/

Rate (10)

Average

Balance (9)

Interest

Yield/

Rate (10)

(Dollars in thousands)

(Unaudited)

Loans (1) (2)

$ 3,968,123

$ 87,785

4.42 %

$ 3,941,215

$ 91,973

4.71 %

Securities (3) (4)

117,840

3,133

5.32

133,121

3,008

4.56

Short-term investments (5)

205,312

5,572

5.43

277,930

6,127

4.45

Total interest-earning assets

4,291,275

96,490

4.50

4,352,266

101,108

4.68

Other assets

65,126

78,717

Total assets

$ 4,356,401

$ 4,430,983

Interest-bearing deposits (6)

$ 2,124,302

$ 43,287

4.08 %

$ 2,121,871

$ 36,462

3.47 %

Borrowed funds

1,454,181

33,751

4.64

1,428,072

30,571

4.32

Total interest-bearing liabilities

3,578,483

77,038

4.31

3,549,943

67,033

3.81

Non-interest-bearing deposits

346,399

421,750

Other liabilities

14,882

15,428

Total liabilities

3,939,764

3,987,121

Stockholders' equity

416,637

443,862

Total liabilities and stockholders' equity

Net interest income

$ 4,356,401

$ 19,452

$ 4,430,983

$ 34,075

Weighted average interest rate spread

0.19 %

0.87 %

Net interest margin (7)

0.91 %

1.58 %

Average interest-earning assets to average interest-bearing

liabilities (8)

119.92 %

122.60

Before allowance for credit losses.

Includes non-accrual loans.

Excludes the impact of the average net unrealized gain or loss on securities.

Includes Federal Home Loan Bank stock.

Includes cash held at the Federal Reserve Bank.

Includes mortgagors' escrow accounts.

Net interest income divided by average total interest-earning assets.

Total interest-earning assets divided by total interest-bearing liabilities.

Average balances are calculated on a daily basis.

Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS

Non-GAAP Reconciliation

The Bank believes the presentation of the following non-GAAP financial measures provide useful supplemental information that is essential to an investor's proper understanding of the results of operations and financial condition of the Bank. Management uses these measures in its analysis of the Bank's performance. These non-GAAP measures should not be viewed as substitutes for the financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other banks.

The table below presents the reconciliation between net income and core net income, a non-GAAP measurement that represents net income excluding the after-tax net gain on equity securities, both realized and unrealized.

Three Months Ended Six Months Ended June 30, June 30,

(In thousands, unaudited)

2024

2025

2024

2025

Non-GAAP reconciliation: Net income

$ 4,102

$ 9,414

$ 10,970

$ 16,538

Gain on equity securities, net

(2,464)

(2,516)

(8,434)

(3,797)

Income tax expense (1)

543

555

1,859

837

Core net income

$ 2,181

$ 7,453

$ 4,395

$ 13,578

The equity securities are held in a tax-advantaged subsidiary corporation. The income tax effect of the gain on equity securities, net, was calculated using the effective tax rate applicable to the subsidiary.

The table below presents the calculation of the efficiency ratio, a non-U.S. GAAP performance measure that management uses to assess operational efficiency which represents total operating expenses, divided by the sum of net interest income and total other income, excluding net gain on equity securities, both realized and unrealized.

(In thousands unaudited)

2024

2025

2024

2025

Non-U.S. GAAP efficiency ratio calculation:

Operating expenses

$ 7,294

$ 7,470

$ 7,546

$ 14,521

$ 15,016

Net interest income

$ 10,368

$ 16,036

$ 18,039

$ 19,452

$ 34,075

Other income

2,733

1,549

2,807

8,976

4,356

Gain on equity securities, net

(2,464)

(1,281)

(2,516)

(8,434)

(3,797)

Total revenue

$ 10,637

$ 16,304

$ 18,330

$ 19,994

$ 34,634

Efficiency ratio

68.57

45.82

41.17 %

72.63

43.36

Three Months Ended Six Months Ended June 30, March 31, June 30, June 30,

Disclaimer

Hingham Institution for Savings published this content on July 11, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on July 11, 2025 at 20:16 UTC.