Table of cash flow before debt service to debt service), the use of conservative capitalization rates, and the ratio of the loan amount to the appraised value. Generally, personal guarantees are obtained from commercial real estate loan borrowers.Contents

Commercial real estate and multi-family mortgage loans are typically originated for terms of five to fifteen years with amortization periods of 20 to 30 years. Many of the loans are priced at inception on a fixed-rate basis generally for periods ranging from two to five years with repricing periods for longer-term loans. When possible, prepayment penalties are included in loan covenants on these loans. For commercial customers who are interested in loans with terms longer than five years, the Company offers loan level derivatives to accommodate customer need.

The ~~Company's urban~~following table reconciles the Company’s operating earnings, operating return on average assets and ~~suburban market area is characterized by a large number~~operating return on average stockholders’ equity for the periods indicated:



	At and for the Three Months Ended March 31,
	2023			2022
	(Dollars in Thousands)
Reported Pretax Income	$	8,668		$	33,050

Less:
Security gains	1,701			—
Add:
Day 1 PCSB CECL provision	16,744			—
Merger and acquisition expense (1)	6,409			—
Operating Pretax Income	$	30,120		33,050
Estimated effective tax rate	22.7		%	25.2		%
Estimated taxes	6,837			8,345
Operating earnings after tax	$	23,283		$	24,705

Operating earnings per common share:
Basic	$	0.27		$	0.32
Diluted	$	0.27		$	0.32



(1) Merger and acquisition expense related to the acquisition of PCSB.

The following tables reconcile the Company’s return on average tangible assets and return on average tangible stockholders’ equity for the periods indicated:



	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Operating earnings	$	23,283	$	30,015	$	31,222	$	25,730	$	24,705

Average total assets	$	11,131,087	$	8,857,631	$	8,586,420	$	8,515,330	$	8,531,043
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible assets	$	10,852,952	$	8,695,365	$	8,424,033	$	8,352,823	$	8,368,411

Return on average assets (annualized)	0.27%		1.34%		1.40%		1.18%		1.16%
Less:
Security gains	0.05%		0.01%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	0.47%		—%		—%		—%		—%
Merger and acquisition expenses	0.18%		0.02%		0.04%		0.02%		—%

Operating return on average assets (annualized)	0.87%		1.35%		1.44%		1.20%		1.16%

Return on average tangible assets (annualized)	0.28%		1.37%		1.43%		1.21%		1.18%
Less:
Security gains	0.05%		0.01%		—%		—%		—%

Table of ~~apartment buildings, condominiums and office buildings. As a result, commercial real estate and multi-family mortgage lending has been a significant part~~Contents



	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Add:
Day 1 PCSB CECL provision	0.48%		—%		—%		—%		—%
Merger and acquisition expenses	0.18%		0.02%		0.04%		0.02%		—%

Operating return on average tangible assets (annualized)	0.89%		1.38%		1.47%		1.23%		1.18%

Average total stockholders' equity	$	1,159,635	$	982,306	$	981,379	$	976,167	$	997,293
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible stockholders' equity	$	881,500	$	820,040	$	818,992	$	813,660	$	834,661

Return on average stockholders' equity (annualized)	2.61%		12.09%		12.29%		10.32%		9.91%
Less:
Security gains	0.45%		0.11%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	4.46%		—%		—%		—%		—%
Merger and acquisition expenses	1.71%		0.21%		0.36%		0.16%		—%

Operating return on average stockholders' equity (annualized)	8.33%		12.19%		12.65%		10.48%		9.91%




Return on average tangible stockholders' equity (annualized)	3.43%		14.48%		14.72%		12.39%		11.84%
Less:
Security gains	0.60%		0.13%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	5.87%		—%		—%		—%		—%
Merger and acquisition expenses	2.25%		0.26%		0.43%		0.20%		—%

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Three Months Ended

March 31,
2023

December 31,
2022

September 30,
2022

June 30,
2022

March 31,
2022

(Dollars in Thousands)

Operating return on average tangible stockholders' equity (annualized)

10.95%

14.61%

15.15%

12.59%

11.84%


	Three Months Ended
	March 31, 2023		December 31, 2023		September 30, 2023		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Net income, as reported	$	7,560	$	29,695	$	30,149	$	25,195	$	24,705

Average total assets	$	11,131,087	$	8,857,631	$	8,586,420	$	8,515,330	$	8,531,043
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible assets	$	10,852,952	$	8,695,365	$	8,424,033	$	8,352,823	$	8,368,411

Return on average tangible assets (annualized)	0.28%		1.37%		1.43%		1.21%		1.18%

Average total stockholders' equity	$	1,159,635	$	982,306	$	981,379	$	976,167	$	997,293
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible stockholders' equity	$	881,500	$	820,040	$	818,992	$	813,660	$	834,661

Return on average tangible stockholders' equity (annualized)	3.43%		14.48%		14.72%		12.39%		11.84%

The following table reconciles the Company's ~~activities~~tangible equity ratio for ~~many years. These types~~the periods indicated:


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Total stockholders' equity	$	1,165,066	$	992,125	$	963,618	$	968,496	$	981,935
Less: Goodwill and identified intangible assets, net	271,302		162,208		162,329		162,449		162,569
Tangible stockholders' equity	$	893,764	$	829,917	$	801,289	$	806,047	$	819,366

Total assets	$	11,522,485	$	9,185,836	$	8,695,708	$	8,514,230	$	8,633,736
Less: Goodwill and identified intangible assets, net	271,302		162,208		162,329		162,449		162,569
Tangible assets	$	11,251,183	$	9,023,628	$	8,533,379	$	8,351,781	$	8,471,167

Tangible equity ratio	7.94%		9.20%		9.39%		9.65%		9.67%

Table of ~~loans typically generate higher yields, but also involve greater credit risk. Many of~~Contents

The following table reconciles the Company's ~~borrowers have more than one multi-family or commercial real estate loan outstanding with~~tangible book value per share for the ~~Company.~~periods indicated:


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Tangible stockholders' equity	$	893,764	$	829,917	$	801,289	$	806,047	$	819,366

Common shares issued	96,998,075		85,177,172		85,177,172		85,177,172		85,177,172
Less:
Treasury shares	7,734,891		7,731,445		7,730,945		7,995,888		7,037,464
Unallocated ESOP	—		—		4,833		11,442		18,051
Unvested restricted stock	598,049		601,495		601,995		497,297		500,098
Common shares outstanding	88,665,135		76,844,232		76,839,399		76,672,545		77,621,559

Tangible book value per share	$	10.08	$	10.80	$	10.43	$	10.51	$	10.56

The following table reconciles the Company's commercial real estate portfolio is composed primarily of loans secured by apartment buildings ($949.7 million), office buildings ($680.7 million), retail stores ($641.7 million), industrial properties ($640.4 million), mixed-use properties ($395.0 million), lodging services ($152.2 million), and food services ($59.7 million) as of September 30, 2022. At that date, approximately 95.5% ofdividend payout ratio for the ~~commercial real estate loans outstanding were secured by properties located in New England.~~periods indicated:

Construction and development financing is generally considered to involve a higher degree of risk than long-term financing on improved, occupied real estate and thus has lower concentration limits than do other commercial credit classes. Risk of loss on a construction loan is largely dependent upon the accuracy of the initial estimate of construction costs, the estimated time to sell or rent the completed property at an adequate price or rate of occupancy, and market conditions. If the estimates and projections prove to be inaccurate, the Company may be confronted with a project which, upon completion, has a value that is insufficient to assure full loan repayment.


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Dividends paid	$	11,970	$	10,374	$	9,969	$	10,030	$	9,705

Net income, as reported	$	7,560	$	29,695	$	30,149	$	25,195	$	24,705

Dividend payout ratio	158.33%		34.94%		33.07%		39.81%		39.28%

Criteria applied in underwriting construction loans for which the primary source of repayment is the sale of the property are different from the criteria applied in underwriting construction loans for which the primary source of repayment is the stabilized cash flow from the completed project. For those loans where the primary source of repayment is from resale of the property, in addition to the normal credit analysis performed for other loans, the Company also analyzes project costs, the attractiveness of the property in relation to the market in which it is located and demand within the market area. For those construction loans where the source of repayment is the stabilized cash flow from the completed project, the Company analyzes

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~~not only project costs but also how long it might take to achieve satisfactory occupancy~~Financial Condition

Loans and Leases

The following table summarizes the ~~reasonableness~~Company's portfolio of ~~projected rental rates~~loan and lease receivables as of the dates indicated:


	At March 31, 2023				At December 31, 2022
	Balance		Percent of Total		Balance		Percent of Total
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate	$	3,986,676	43.1	%	$	3,046,746	39.9	%
Multi-family mortgage	1,356,546		14.7	%	1,150,597		15.1	%
Construction	267,192		2.9	%	206,805		2.7	%
Total commercial real estate loans	5,610,414		60.7	%	4,404,148		57.7	%
Commercial loans and leases:
Commercial	858,460		9.3	%	752,691		9.9	%
Equipment financing	1,245,742		13.5	%	1,216,585		15.9	%
Condominium association	42,444		0.5	%	46,966		0.6	%
PPP	503		—	%	257		—	%
Total commercial loans and leases	2,147,149		23.3	%	2,016,499		26.4	%
Consumer loans:
Residential mortgage	1,086,754		11.7	%	844,614		11.0	%
Home equity	345,673		3.7	%	322,622		4.2	%
Other consumer	56,975		0.6	%	56,505		0.7	%
Total consumer loans	1,489,402		16.0	%	1,223,741		15.9	%
Total loans and leases	9,246,965		100.0	%	7,644,388		100.0	%
Allowance for loan and lease losses	(120,865)				(98,482)
Net loans and leases	$	9,126,100			$	7,545,906

The following table sets forth the growth in ~~relation to market rental rates.~~the Company’s loan and lease portfolios during the three months ended March 31, 2023:

~~Commercial Loans~~


	At March 31, 2023		At December 31, 2022		Dollar Change		Percent Change (Annualized)
	(Dollars in Thousands)
Commercial real estate	$	5,610,414	$	4,404,148	$	1,206,266	109.6	%
Commercial	2,147,149		2,016,499		130,650		25.9	%
Consumer	1,489,402		1,223,741		265,661		86.8	%
Total loans and leases	$	9,246,965	$	7,644,388	$	1,602,577	83.9	%
Less: PPP	503		257		246		382.9	%
Total core loans and leases	$	9,246,462	$	7,644,131	$	1,602,331	83.8	%

The Company's ~~commercial~~ loan ~~and lease~~ portfolio ~~is comprised of commercial loans, equipment financing loans and leases and condominium association loans which represented 26.0% of total loans outstanding as of September 30, 2022.~~

~~The Company's commercial loan and lease portfolio is composed~~consists primarily of loans and leases to small to medium sized businesses ($704.4 million), transportation services ($352.5 million), food services ($188.0 million), recreation services ($127.8 million), manufacturing ($107.7 million), retail ($107.6 million), and rental and leasing services ($88.8 million) as of September 30, 2022.

The Company provides commercial banking services to companies in its market area. Approximately 40.1% of the commercial loans outstanding as of September 30, 2022 were made to borrowers located in New England. The remaining 59.9% of the commercial loans outstanding were made to borrowers in other areas in the United States of America, primarily by the Company's equipment financing divisions. Product offerings include lines of credit, term loans, letters of credit, deposit services and cash management. These types of credit facilities have as their primary source of repayment cash flows from the operations of a business. Interest rates offered are available on a floating basis tied to the prime rate or a similar index or on a fixed-rate basis referenced on the Federal Home Loan Bank of Boston ("FHLBB") index.

Credit extensions are made to established businesses on the basis of loan purpose and assessment of capacity to repay as determined by an analysis of their financial statements, the nature of collateral to secure the credit extension and, in most instances, the personal guarantee of the owner of the business as well as industry and general economic conditions. The Company also participates in U.S. Government programs such as the SBA 7A program and as an SBA preferred lender. Included in the commercial loans balances are the PPP loans totaling $0.9 million as of September 30, 2022.

The Company’s equipment financing divisions focus on market niches in which its lenders have deep experience and industry contacts, and on making loans to customers with business experience. An important part of the Company’s equipment financing loan origination volume comes from equipment manufacturers and existing customers as they expand their operations. The equipment financing portfolio is composed primarily of loans to finance laundry, tow trucks, fitness, dry cleaning and convenience store equipment. Approximately 16.4% of the commercial loans outstanding in the equipment financing divisions were made to borrowers located primarily in the greater New York and New Jersey metropolitan area. Typically, the loans are priced at a fixed rate of interest and require monthly payments over their 3- to 7-year life. The yields earned on equipment financing loans are higher than those earned on the commercial loans made by the Banks because they involve a higher degree of credit risk. Equipment financing customers are typically small-business owners who operate with limited financial resources and who face greater risks when the economy weakens or unforeseen adverse events arise. Because of these characteristics, personal guarantees of borrowers are usually obtained along with liens on available assets. The size of loan is determined by an analysis of cash flow and other characteristics pertaining to the business and the equipment to be financed, based on detailed revenue and profitability data of similar operations.

Loans to condominium associations are for the purpose of funding capital improvements, are made for five- to ten-year terms and are secured by a general assignment of condominium association revenues. Among the factors considered in the underwriting of such loans are the level of owner occupancy, the financial condition and history of the condominium association, the attractiveness of the property in relation to the market in which it is located and the reasonableness of estimates of the cost of capital improvements to be made. Depending on loan size, funds are advanced as capital improvements are made and, in more complex situations, after completion of engineering inspections.

~~Consumer Loans~~

The consumer loan portfolio, which is comprised of residential mortgage loans, home equity loans and lines of credit, and other consumer loans, represented 16.4% of total loans outstanding as of September 30, 2022. The Company focuses its mortgage and home equity lending on existing and new customers within its branch networks in its urban and suburban marketplaces in the greater Boston and Providence metropolitan areas.

~~The Company originates adjustable- and fixed-rate residential~~first mortgage loans secured by ~~one-~~commercial, multi-family and residential real estate properties located in the Company's primary lending area, loans to ~~four-family residences. Each residential mortgage~~business entities, including commercial lines of credit, loans to condominium associations and loans and leases used to finance equipment used by small businesses. The Company also provides financing for construction and development projects, home equity and other consumer loans.

The Company employs seasoned commercial lenders and retail bankers who rely on community and business contacts as well as referrals from customers, attorneys and other professionals to generate loans and deposits. Existing borrowers are also an important source of business since many of them have more than one loan ~~granted is subject to a satisfactorily completed application, employment verification, credit history and a demonstrated~~outstanding with the Company. The Company's ability to ~~repay~~originate loans depends on the ~~debt. Generally, loans are not made when~~strength of the ~~loan-to-value ratio exceeds 80% unless private mortgage insurance is obtained and/or there is a financially strong guarantor. Appraisals are performed by outside independent fee appraisers.~~economy, trends in interest rates, and levels of customer demand and market competition.

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~~Underwriting guidelines for home equity~~The Company's current policy is that a total credit exposure to one obligor relationship may not exceed $60.0 million unless approved by the Company's Credit Committee. As of March 31, 2023, there was one borrower with loans and ~~lines~~commitments over $60.0 million. The total of ~~credit are similar to~~ those ~~for residential mortgage loans. Home equity~~ loans and ~~lines of credit are limited to no more than 80% of the appraised value of the property securing the loan including the amount of any existing first mortgage liens.~~

~~Other consumer loans have historically been a modest part of the Company's loan originations. As of September 30, 2022, other consumer loans equaled $51.0~~commitments was $193.0 million, or ~~0.7%~~1.69% of total loans ~~outstanding.~~and commitments, as of March 31, 2023. As of December 31, 2022, there were three borrowers with loans and commitments over $60.0 million. The total of those loans and commitments was $208.5 million, or 2.2% of total loans and commitments, as of December 31, 2022.

The Company has written underwriting policies to control the inherent risks in loan origination. The policies address approval limits, loan-to-value ratios, appraisal requirements, debt service coverage ratios, loan concentration limits and other matters relevant to loan underwriting.

Asset Quality

Nonperforming assets as of March 31, 2023 totaled $29.0 million, or 0.25% of total assets, compared to $15.3 million, or 0.17% of total assets, as of December 31, 2022. Net charge-offs for the three months ended March 31, 2023 were $0.5 million, or 0.02% of average loans and leases on an annualized basis, compared to $1.9 million, or 0.11% of average loans and leases on an annualized basis, for the three months ended March 31, 2022.

The ratio of the allowance for loan and lease losses to total loans and leases was 1.31% as of March 31, 2023, compared to 1.29% as of December 31, 2022.

The ratio of the allowance for loan and lease losses to nonaccrual loans and leases was 424.77% as of March 31, 2023, compared to 661.22% as of December 31, 2022.

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Capital Strength

The Company is a "well-capitalized" bank holding company as defined in the FRB's Regulation Y. The Company's common equity Tier 1 capital ratio was 10.66% as of March 31, 2023, compared to 12.05% as of December 31, 2022. The Company's Tier 1 leverage ratio was 8.78% as of March 31, 2023, compared to 10.26% as of December 31, 2022. As of March 31, 2023, the Company's Tier 1 risk-based capital ratio was 10.76%, compared to 12.18% as of December 31, 2022. The Company's Total risk-based capital ratio was 12.85% as of March 31, 2023, compared to 14.44% as of December 31, 2022.

The Company's ratio of stockholders' equity to total assets was 10.11% and 10.80% as of March 31, 2023 and December 31, 2022, respectively. The Company's tangible equity ratio was 7.94% and 9.20% as of March 31, 2023 and December 31, 2022, respectively.

Net Income

For the three months ended March 31, 2023, the Company reported net income of $7.6 million, or $0.09 per basic and diluted share, a decrease of $17.1 million, or 69.4%, from net income of $24.7 million, or $0.32 per basic and diluted share, for the three months ended March 31, 2022. This decrease in net income is primarily the result of an increase in the provision for credit losses of $25.7 million and an increase in non-interest expense of $22.3 million, partially offset by an increase in net interest income of $16.2 million, an increase in non-interest income of $7.4 million, and a decrease in the provision for income taxes of $7.2 million. Refer to “Results of Operations" below for further discussion.

The annualized return on average assets was 0.27% for the three months ended March 31, 2023, compared to 1.16% for the three months ended March 31, 2022. The annualized return on average stockholders' equity was 2.61% for the three months ended March 31, 2023, compared to 9.91% for the three months ended March 31, 2022.

The net interest margin was 3.36% for the three months ended March 31, 2023, down from 3.49% for the three months ended March 31, 2022. The decrease in the net interest margin is a result of an increase of 165 basis points in the Company's overall cost of funds (including non-interest-bearing demand checking accounts) to 1.94% for the three months ended March 31, 2023 from 0.29% for the three months ended March 31, 2022, partially offset by an increase in the yield on interest-earning assets of 140 basis points to 5.10% for the three months ended March 31, 2023 from 3.70% for the three months ended March 31, 2022.

The Company’s net interest margin and net interest income is sensitive to the structure and level of interest rates as well as competitive pricing in all loan and deposit categories.

Critical Accounting Policies and Estimates

The SEC defines “critical accounting policies” as those involving significant judgments and difficult or complex assumptions by management, often as a result of the need to make estimates about matters that are inherently uncertain or variable, which have, or could have, a material impact on the carrying value of certain assets or net income. The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. As discussed in the Company’s 2022 Annual Report on Form 10-K, management has identified the determination of the allowance for credit losses and the review of goodwill for impairment as the Company’s most critical accounting policies.

Recent Accounting Developments

In March 2023, the FASB issued ASU 2023-02, "Investments – Equity Method and Joint Ventures (Topic 323), Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method" which allows entities to use the proportional amortization method to account for tax equity investments, under certain conditions. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years for public entities. Management has determined that ASU 2023-02 does apply to the Company and is currently determining the impact as of March 31, 2023.

Non-GAAP Financial Measures and Reconciliation to GAAP

In addition to evaluating the Company’s results of operations in accordance with GAAP, management periodically supplements this evaluation with an analysis of certain non-GAAP financial measures, such as operating earnings metrics, the return on average tangible assets, return on average tangible equity, the tangible equity ratio, tangible book value per share, and dividend payout ratio. Management believes that these non-GAAP financial measures provide information useful to investors in understanding the Company’s underlying operating performance and trends, and facilitates comparisons with the performance assessment of financial performance, including non-interest expense control, while the tangible equity ratio and tangible book value per share are used to analyze the relative strength of the Company’s capital position.

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The following table reconciles the Company’s operating earnings, operating return on average assets and operating return on average stockholders’ equity for the periods indicated:



	At and for the Three Months Ended March 31,
	2023			2022
	(Dollars in Thousands)
Reported Pretax Income	$	8,668		$	33,050

Less:
Security gains	1,701			—
Add:
Day 1 PCSB CECL provision	16,744			—
Merger and acquisition expense (1)	6,409			—
Operating Pretax Income	$	30,120		33,050
Estimated effective tax rate	22.7		%	25.2		%
Estimated taxes	6,837			8,345
Operating earnings after tax	$	23,283		$	24,705

Operating earnings per common share:
Basic	$	0.27		$	0.32
Diluted	$	0.27		$	0.32



(1) Merger and acquisition expense related to the acquisition of PCSB.

The following tables reconcile the Company’s return on average tangible assets and return on average tangible stockholders’ equity for the periods indicated:



	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Operating earnings	$	23,283	$	30,015	$	31,222	$	25,730	$	24,705

Average total assets	$	11,131,087	$	8,857,631	$	8,586,420	$	8,515,330	$	8,531,043
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible assets	$	10,852,952	$	8,695,365	$	8,424,033	$	8,352,823	$	8,368,411

Return on average assets (annualized)	0.27%		1.34%		1.40%		1.18%		1.16%
Less:
Security gains	0.05%		0.01%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	0.47%		—%		—%		—%		—%
Merger and acquisition expenses	0.18%		0.02%		0.04%		0.02%		—%

Operating return on average assets (annualized)	0.87%		1.35%		1.44%		1.20%		1.16%

Return on average tangible assets (annualized)	0.28%		1.37%		1.43%		1.21%		1.18%
Less:
Security gains	0.05%		0.01%		—%		—%		—%

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	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Add:
Day 1 PCSB CECL provision	0.48%		—%		—%		—%		—%
Merger and acquisition expenses	0.18%		0.02%		0.04%		0.02%		—%

Operating return on average tangible assets (annualized)	0.89%		1.38%		1.47%		1.23%		1.18%

Average total stockholders' equity	$	1,159,635	$	982,306	$	981,379	$	976,167	$	997,293
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible stockholders' equity	$	881,500	$	820,040	$	818,992	$	813,660	$	834,661

Return on average stockholders' equity (annualized)	2.61%		12.09%		12.29%		10.32%		9.91%
Less:
Security gains	0.45%		0.11%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	4.46%		—%		—%		—%		—%
Merger and acquisition expenses	1.71%		0.21%		0.36%		0.16%		—%

Operating return on average stockholders' equity (annualized)	8.33%		12.19%		12.65%		10.48%		9.91%




Return on average tangible stockholders' equity (annualized)	3.43%		14.48%		14.72%		12.39%		11.84%
Less:
Security gains	0.60%		0.13%		—%		—%		—%
Add:
Day 1 PCSB CECL provision	5.87%		—%		—%		—%		—%
Merger and acquisition expenses	2.25%		0.26%		0.43%		0.20%		—%

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Three Months Ended

March 31,
2023

December 31,
2022

September 30,
2022

June 30,
2022

March 31,
2022

(Dollars in Thousands)

Operating return on average tangible stockholders' equity (annualized)

10.95%

14.61%

15.15%

12.59%

11.84%


	Three Months Ended
	March 31, 2023		December 31, 2023		September 30, 2023		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Net income, as reported	$	7,560	$	29,695	$	30,149	$	25,195	$	24,705

Average total assets	$	11,131,087	$	8,857,631	$	8,586,420	$	8,515,330	$	8,531,043
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible assets	$	10,852,952	$	8,695,365	$	8,424,033	$	8,352,823	$	8,368,411

Return on average tangible assets (annualized)	0.28%		1.37%		1.43%		1.21%		1.18%

Average total stockholders' equity	$	1,159,635	$	982,306	$	981,379	$	976,167	$	997,293
Less: Average goodwill and average identified intangible assets, net	278,135		162,266		162,387		162,507		162,632
Average tangible stockholders' equity	$	881,500	$	820,040	$	818,992	$	813,660	$	834,661

Return on average tangible stockholders' equity (annualized)	3.43%		14.48%		14.72%		12.39%		11.84%

The following table reconciles the Company's tangible equity ratio for the periods indicated:


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Total stockholders' equity	$	1,165,066	$	992,125	$	963,618	$	968,496	$	981,935
Less: Goodwill and identified intangible assets, net	271,302		162,208		162,329		162,449		162,569
Tangible stockholders' equity	$	893,764	$	829,917	$	801,289	$	806,047	$	819,366

Total assets	$	11,522,485	$	9,185,836	$	8,695,708	$	8,514,230	$	8,633,736
Less: Goodwill and identified intangible assets, net	271,302		162,208		162,329		162,449		162,569
Tangible assets	$	11,251,183	$	9,023,628	$	8,533,379	$	8,351,781	$	8,471,167

Tangible equity ratio	7.94%		9.20%		9.39%		9.65%		9.67%

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The following table reconciles the Company's tangible book value per share for the periods indicated:


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Tangible stockholders' equity	$	893,764	$	829,917	$	801,289	$	806,047	$	819,366

Common shares issued	96,998,075		85,177,172		85,177,172		85,177,172		85,177,172
Less:
Treasury shares	7,734,891		7,731,445		7,730,945		7,995,888		7,037,464
Unallocated ESOP	—		—		4,833		11,442		18,051
Unvested restricted stock	598,049		601,495		601,995		497,297		500,098
Common shares outstanding	88,665,135		76,844,232		76,839,399		76,672,545		77,621,559

Tangible book value per share	$	10.08	$	10.80	$	10.43	$	10.51	$	10.56

The following table reconciles the Company's dividend payout ratio for the periods indicated:


	Three Months Ended
	March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022
	(Dollars in Thousands)
Dividends paid	$	11,970	$	10,374	$	9,969	$	10,030	$	9,705

Net income, as reported	$	7,560	$	29,695	$	30,149	$	25,195	$	24,705

Dividend payout ratio	158.33%		34.94%		33.07%		39.81%		39.28%

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Financial Condition

Loans and Leases

The following table summarizes the Company's portfolio of loan and lease receivables as of the dates indicated:


	At March 31, 2023				At December 31, 2022
	Balance		Percent of Total		Balance		Percent of Total
	(Dollars in Thousands)
Commercial real estate loans:
Commercial real estate	$	3,986,676	43.1	%	$	3,046,746	39.9	%
Multi-family mortgage	1,356,546		14.7	%	1,150,597		15.1	%
Construction	267,192		2.9	%	206,805		2.7	%
Total commercial real estate loans	5,610,414		60.7	%	4,404,148		57.7	%
Commercial loans and leases:
Commercial	858,460		9.3	%	752,691		9.9	%
Equipment financing	1,245,742		13.5	%	1,216,585		15.9	%
Condominium association	42,444		0.5	%	46,966		0.6	%
PPP	503		—	%	257		—	%
Total commercial loans and leases	2,147,149		23.3	%	2,016,499		26.4	%
Consumer loans:
Residential mortgage	1,086,754		11.7	%	844,614		11.0	%
Home equity	345,673		3.7	%	322,622		4.2	%
Other consumer	56,975		0.6	%	56,505		0.7	%
Total consumer loans	1,489,402		16.0	%	1,223,741		15.9	%
Total loans and leases	9,246,965		100.0	%	7,644,388		100.0	%
Allowance for loan and lease losses	(120,865)				(98,482)
Net loans and leases	$	9,126,100			$	7,545,906

The following table sets forth the growth in the Company’s loan and lease portfolios during the three months ended March 31, 2023:


	At March 31, 2023		At December 31, 2022		Dollar Change		Percent Change (Annualized)
	(Dollars in Thousands)
Commercial real estate	$	5,610,414	$	4,404,148	$	1,206,266	109.6	%
Commercial	2,147,149		2,016,499		130,650		25.9	%
Consumer	1,489,402		1,223,741		265,661		86.8	%
Total loans and leases	$	9,246,965	$	7,644,388	$	1,602,577	83.9	%
Less: PPP	503		257		246		382.9	%
Total core loans and leases	$	9,246,462	$	7,644,131	$	1,602,331	83.8	%

The Company's loan portfolio consists primarily of first mortgage loans secured by commercial, multi-family and residential real estate properties located in the Company's primary lending area, loans to business entities, including commercial lines of credit, loans to condominium associations and loans and leases used to finance equipment used by small businesses. The Company also provides financing for construction and development projects, home equity and other consumer loans.

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The Company's current policy is that a total credit exposure to one obligor relationship may not exceed $60.0 million unless approved by the Company's Credit Committee. As of March 31, 2023, there was one borrower with loans and commitments over $60.0 million. The total of those loans and commitments was $193.0 million, or 1.69% of total loans and commitments, as of March 31, 2023. As of December 31, 2022, there were three borrowers with loans and commitments over $60.0 million. The total of those loans and commitments was $208.5 million, or 2.2% of total loans and commitments, as of December 31, 2022.

Commercial Real Estate Loans

The commercial real estate portfolio is comprised of commercial real estate loans, multi-family mortgage loans, and construction loans and is the largest component of the Company's overall loan portfolio, representing 60.7% of total loans and leases outstanding as of March 31, 2023.

Typically, commercial real estate loans are larger in size and involve a greater degree of risk than owner-occupied residential mortgage loans. Loan repayment is usually dependent on the successful operation and management of the properties and the value of the properties securing the loans. Economic conditions can greatly affect cash flows and property values.

A number of factors are considered in originating commercial real estate and multi-family mortgage loans. The qualifications and financial condition of the borrower (including credit history), as well as the potential income generation and the value and condition of the underlying property, are evaluated. When evaluating the qualifications of the borrower, the Company considers the financial resources of the borrower, the borrower's experience in owning or managing similar property and the borrower's payment history with the Company and other financial institutions. Factors considered in evaluating the underlying property include the net operating income of the mortgaged premises before debt service and depreciation, the debt service coverage ratio (the ratio of cash flow before debt service to debt service), the use of conservative capitalization rates, and the ratio of the loan amount to the appraised value. Generally, personal guarantees are obtained from commercial real estate loan borrowers.

The Company's urban and suburban market area is characterized by a large number of apartment buildings, condominiums and office buildings. As a result, commercial real estate and multi-family mortgage lending has been a significant part of the Company's activities for many years. These types of loans typically generate higher yields, but also involve greater credit risk. Many of the Company's borrowers have more than one multi-family or commercial real estate loan outstanding with the Company.

The Company's commercial real estate portfolio is composed primarily of loans secured by apartment buildings ($1.3 billion), office buildings ($838.7 million), retail stores ($958.4 million), industrial properties ($774.0 million), mixed-use properties ($500.0 million), lodging services ($194.6 million), and food services ($80.2 million) as of March 31, 2023. At that date, approximately 78.6% of the commercial real estate loans outstanding were secured by properties located in New England.

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not only project costs but also how long it might take to achieve satisfactory occupancy and the reasonableness of projected rental rates in relation to market rental rates.

Commercial Loans

The Company's commercial loan and lease portfolio is comprised of commercial loans, equipment financing loans and leases and condominium association loans which represented 23.3% of total loans outstanding as of March 31, 2023.

The Company's commercial loan and lease portfolio is composed primarily of loans and leases to small to medium sized businesses ($789.6 million), transportation services ($389.7 million), food services ($189.7 million), recreation services ($134.3 million), manufacturing ($115.6 million), retail ($115.7 million), and rental and leasing services ($60.6 million) as of March 31, 2023.

The Company provides commercial banking services to companies in its market area. Approximately 37.9% of the commercial loans outstanding as of March 31, 2023 were made to borrowers located in New England. The remaining 62.1% of the commercial loans outstanding were made to borrowers in other areas in the United States of America, primarily by the Company's equipment financing divisions. Product offerings include lines of credit, term loans, letters of credit, deposit services and cash management. These types of credit facilities have as their primary source of repayment cash flows from the operations of a business. Interest rates offered are available on a floating basis tied to the prime rate or a similar index or on a fixed-rate basis referenced on the Federal Home Loan Bank of Boston and New York ("FHLB") index.

The Company’s equipment financing divisions focus on market niches in which its lenders have deep experience and industry contacts, and on making loans to customers with business experience. An important part of the Company’s equipment financing loan origination volume comes from equipment manufacturers and existing customers as they expand their operations. The equipment financing portfolio is composed primarily of loans to finance laundry, tow trucks, fitness, dry cleaning and convenience store equipment. Approximately 15.7% of the commercial loans outstanding in the equipment financing divisions were made to borrowers located primarily in the greater New York and New Jersey metropolitan area. Typically, the loans are priced at a fixed rate of interest and require monthly payments over their 3- to 7-year life. The yields earned on equipment financing loans are higher than those earned on the commercial loans made by the Banks because they involve a higher degree of credit risk. Equipment financing customers are typically small-business owners who operate with limited financial resources and who face greater risks when the economy weakens or unforeseen adverse events arise. Because of these characteristics, personal guarantees of borrowers are usually obtained along with liens on available assets. The size of loan is determined by an analysis of cash flow and other characteristics pertaining to the business and the equipment to be financed, based on detailed revenue and profitability data of similar operations.

Consumer Loans

The consumer loan portfolio, which is comprised of residential mortgage loans, home equity loans and lines of credit, and other consumer loans, represented 16.0% of total loans outstanding as of March 31, 2023. The Company focuses its mortgage and home equity lending on existing and new customers within its branch networks in its urban and suburban marketplaces in the greater Boston and Providence metropolitan areas.

The Company originates adjustable- and fixed-rate residential mortgage loans secured by one- to four-family residences. Each residential mortgage loan granted is subject to a satisfactorily completed application, employment verification, credit history and a demonstrated ability to repay the debt. Generally, loans are not made when the loan-to-value ratio exceeds 80% unless private mortgage insurance is obtained and/or there is a financially strong guarantor. Appraisals are performed by outside independent fee appraisers.

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Underwriting guidelines for home equity loans and lines of credit are similar to those for residential mortgage loans. Home equity loans and lines of credit are limited to no more than 80% of the appraised value of the property securing the loan including the amount of any existing first mortgage liens.

Other consumer loans have historically been a modest part of the Company's loan originations. As of March 31, 2023, other consumer loans equaled $57.0 million, or 0.6% of total loans outstanding.

Asset Quality

Criticized and Classified Assets

The Company's management rates certain loans and leases as "other assets especially mentioned" ("OAEM"), "substandard" or "doubtful" based on criteria established under banking regulations. These loans and leases are collectively referred to as "criticized" assets. Loans and leases rated OAEM have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects of the loan or lease at some future date. Loans and leases rated as substandard are inadequately protected by the payment capacity of the obligor or of the collateral pledged, if any. Substandard loans and leases have a well-defined weakness or weaknesses that jeopardize the liquidation of debt and are characterized by the distinct possibility that the Company will sustain some loss if existing deficiencies are not corrected. Loans and leases rated as doubtful have well-defined weaknesses that jeopardize the orderly liquidation of debt and partial loss of principal is likely. As of ~~September 30, 2022,~~March 31, 2023, the Company had ~~$97.4~~$156.4 million of total assets that were designated as criticized. This compares to ~~$95.4~~$108.2 million of assets designated as criticized as of December 31, ~~2021.~~2022. The increase of ~~$2.0~~$48.2 million in criticized assets was ~~mostly~~primarily driven by increases in commercial real estate relationships for the ~~nine~~three months ended ~~September 30, 2022.~~March 31, 2023.

Nonperforming Assets

"Nonperforming assets" consist of nonaccrual loans and leases, other real estate owned ("OREO") and other repossessed assets. Under certain circumstances, the Company may restructure the terms of a loan or lease as a concession to a borrower, except for acquired loans and leases which are individually evaluated against expected performance on the date of acquisition. These restructured loans and leases are generally considered "nonperforming loans and leases" until a history of collection of at least six months on the restructured terms of the loan or lease has been established. OREO consists of real estate acquired through foreclosure proceedings and real estate acquired through acceptance of a deed in lieu of foreclosure. Other repossessed assets consist of assets that have been acquired through foreclosure that are not real estate and are included in other assets on the Company's unaudited consolidated balance sheets.

Accrual of interest on loans generally is discontinued when contractual payment of principal or interest becomes past due 90 days or, if in management's judgment, reasonable doubt exists as to the full timely collection of interest. When a loan is placed on nonaccrual status, interest accruals cease and all previously accrued and uncollected ~~accrued~~ interest is reversed and charged against current interest income. Interest payments on nonaccrual loans are generally applied to principal. If collection of the principal is reasonably assured, interest payments are recognized as income on the cash basis. Loans are generally returned to accrual status when principal and interest payments are current, full collectability of principal and interest is reasonably assured and a consistent record of at least six months of performance has been achieved.

In cases where a borrower experiences financial difficulties and the Company makes or reasonably expects to make certain concessionary modifications to contractual terms, the loan is classified as a ~~TDR.~~modified loan. In determining whether a debtor is experiencing financial difficulties, the Company considers, among other factors, if the debtor is in payment default or is likely to be in payment default in the foreseeable future without the modification, the debtor declared or is in the process of declaring bankruptcy, there is substantial doubt that the debtor will continue as a going concern, the debtor's entity-specific projected cash flows will not be sufficient to service its debt, or the debtor cannot obtain funds from sources other than the existing creditors at market terms for debt with similar risk characteristics.

As of ~~September 30, 2022,~~March 31, 2023, the Company had nonperforming assets of ~~$18.3~~$29.0 million, representing ~~0.21%~~0.25% of total assets, compared to nonperforming assets of ~~$33.2~~$15.3 million, or ~~0.39%~~0.17% of total assets as of December 31, ~~2021.~~2022. The ~~decrease~~increase of ~~$14.9~~$13.7 million in nonperforming assets was primarily driven by ~~loan payoffs on~~the inclusion of loans related to one commercial customer totaling $5.1 million, two construction customers totaling $3.2 million, and two commercial real estate ~~and commercial and industrial ("C&I") loans~~customers totaling ~~$7.0~~$4.2 million during the ~~nine~~three months ended ~~September 30, 2022.~~March 31, 2023.

The Company evaluates the underlying collateral of each nonaccrual loan and lease and continues to pursue the collection of interest and principal. Management believes that the current level of nonperforming assets remains manageable relative to the size of the Company's loan and lease portfolio. If economic conditions were to worsen or if the marketplace were to experience prolonged economic stress, it is likely that the level of nonperforming assets would increase, as would the level of charged-off loans.

5759

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Past Due and Accruing

As of ~~September 30, 2022,~~March 31, 2023, the Company had ~~$9.6~~$0.7 million loans and leases greater than 90 days past due and accruing, compared to minimal to no loans as of December 31, ~~2021.~~2022. The ~~$9.6~~$0.7 million increase in loans and leases greater than 90 days past due and accruing is primarily due to a single commercial real estate relationship totaling ~~$7.8~~$0.7 million.

The following table sets forth information regarding nonperforming assets for the periods indicated:

At September 30, 2022 At December 31, 2021
(Dollars in Thousands)
Nonperforming loans and leases:
Nonaccrual loans and leases:
Commercial real estate $ 3,136 $ 10,848
Total commercial real estate loans 3,136 10,848
Commercial 618 2,318
Equipment financing 10,544 15,014
Condominium association 64 84
Total commercial loans and leases 11,226 17,416
Residential mortgage 2,741 3,909
Home equity 616 285
Other consumer 2 1
Total consumer loans 3,359 4,195
Total nonaccrual loans and leases 17,721 32,459
Other repossessed assets 591 718
Total nonperforming assets $ 18,312 $ 33,177
Loans and leases past due greater than 90 days and accruing $ 9,583 $ 1
Total delinquent loans and leases 61-90 days past due 5,562 6,081
Restructured loans and leases not included in nonperforming assets 9,728 12,580
Total nonperforming loans and leases as a percentage of total loans and leases 0.24 % 0.45 %
Total nonperforming assets as a percentage of total assets 0.21 % 0.39 %
Total delinquent loans and leases 61-90 days past due as a percentage of total loans and leases 0.07 % 0.08 %

~~Troubled Debt Restructuring Loans and Leases~~

Total TDR loans and leases decreased $5.2 million to $14.2 million at September 30, 2022 from $19.3 million at December 31, 2021. The decrease was primarily driven by loan payoffs on commercial loans totaling $3.7 million during the nine months ended September 30, 2022.

As of September 30, 2022, total TDR loans included $2.2 million of commercial loans, $6.3 million of equipment financing loans and leases, $2.8 million of residential mortgage loans, $1.7 million of home equity loans, and $1.2 million of commercial real estate loans. As of December 31, 2021, total TDR loans included $5.4 million of commercial loans, $7.5 million of equipment financing loans and leases, $2.9 million of residential mortgage loans, $2.0 million of home equity loans, and $1.5 million of commercial real estate loans.

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~~The following table sets forth information regarding TDR loans and leases at the dates indicated:~~

At September 30, 2022 At December 31, 2021
(Dollars in Thousands)
Troubled debt restructurings:
On accrual $ 9,728 $ 12,580
On nonaccrual 4,449 6,709
Total troubled debt restructurings $ 14,177 $ 19,289

~~Changes in TDR loans and leases were as follows for the periods indicated:~~

Three Months Ended September 30, Nine Months Ended September 30,
2022 2021 2022 2021
(Dollars in Thousands)
Balance at beginning of period $ 16,621 $ 20,797 $ 19,289 $ 18,959
Additions 411 846 1,204 5,318
Net recoveries (charge-offs) 12 (223) 96 (713)
Repayments (2,867) (1,239) (6,412) (3,383)
Balance at end of period $ 14,177 $ 20,181 $ 14,177 $ 20,181


	At March 31, 2023			At December 31, 2022
	(Dollars in Thousands)
Nonperforming loans and leases:
Nonaccrual loans and leases:
Commercial real estate	$	4,589		$	607
Multi-family mortgage	—			—
Construction	3,883			707
Total commercial real estate loans	8,472			1,314

Commercial	5,495			464
Equipment financing	9,908			9,653
Condominium association	51			58
Total commercial loans and leases	15,454			10,175

Residential mortgage	3,449			2,680
Home equity	1,079			723
Other consumer	—			2
Total consumer loans	4,528			3,405

Total nonaccrual loans and leases	28,454			14,894


Other repossessed assets	508			408
Total nonperforming assets	$	28,962		$	15,302

Loans and leases past due greater than 90 days and accruing	$	726		$	33
Total delinquent loans and leases 61-90 days past due	4,190			2,218
Restructured loans and leases not included in nonperforming assets	12,708			16,385

Total nonperforming loans and leases as a percentage of total loans and leases	0.31		%	0.19		%
Total nonperforming assets as a percentage of total assets	0.25		%	0.17		%
Total delinquent loans and leases 61-90 days past due as a percentage of total loans and leases	0.05		%	0.03		%

Allowance for Credit Losses

The allowance for credit losses consists of general and specific allowances and reflects management's estimate of expected loan and lease losses over the life of the loan or lease. Management uses a consistent and systematic process and methodology to evaluate the adequacy of the allowance for credit losses on a quarterly basis. Management continuously evaluates and challenges inputs and assumptions in the allowance for credit losses.

While management evaluates currently available information in establishing the allowance for credit losses, future adjustments to the allowance for loan and lease losses may be necessary if conditions differ substantially from the assumptions used in making the evaluations. Management performs a comprehensive review of the allowance for credit losses on a quarterly basis. In addition, various regulatory agencies, as an integral part of their examination process, periodically review a financial

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institution's allowance for credit losses and carrying amounts of other real estate owned. Such agencies may require the financial institution to recognize additions or reductions to the allowance based on their judgments about information available to them at the time of their examination.

The Company’s allowance methodology provides a quantification of estimated losses in the portfolio. Under the current methodology, management estimates losses over the life of the loan using reasonable and supportable forecasts. Forecasts, loan data, and model documentation are extensively analyzed and reviewed throughout the quarter to ensure estimated losses are ~~accurate~~appropriate at quarter end. Qualitative adjustments are applied when model output does not align with management expectations. These adjustments are thoroughly reviewed and documented to provide clarity and a reasonable basis for any deviations from the model. For ~~September 30, 2022,~~March 31, 2023, qualitative adjustments were applied to the ~~CRE, C&I,~~commercial real estate, commercial, and ~~Retail~~consumer portfolios resulting in a net addition in total reserves compared to modeled calculations.

The following tables present the changes in the allowance for loan and lease losses by portfolio category for the three ~~and nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~2021.~~2022.

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		At and for the Three Months Ended September 30, 2022									At and for the Three Months Ended March 31, 2023
		Commercial Real Estate			Commercial			Consumer				Total				Commercial Real Estate			Commercial			Consumer			Total
		(In Thousands)									(In Thousands)
Balance at June 30, 2022		$	70,027		$	20,105		$	3,056			$	93,188
Balance at December 31, 2022															Balance at December 31, 2022	$	68,154		$	26,604		$	3,724		$	98,482

Charge-offs	Charge-offs	—			(584)			(14)				(598)			Charge-offs	—			(840)			(11)			(851)
Recoveries	Recoveries	6			763			8				777			Recoveries	6			383			11			400
Provision (credit) for loan and lease losses	Provision (credit) for loan and lease losses	(2,573)			2,984			391				802			Provision (credit) for loan and lease losses	14,532			6,614			1,688			22,834
Balance at September 30, 2022		$	67,460		$	23,268		$	3,441			$	94,169
Balance at Provision (credit) for loan and lease losses on PCD loans															Balance at Provision (credit) for loan and lease losses on PCD loans	$	—		$	—		$	—		—
Balance at March 31, 2023															Balance at March 31, 2023	$	82,692		$	32,761		$	5,412		$	120,865

Total loans and leases	Total loans and leases	$	4,269,512		$	1,933,645		$	1,218,147			$	7,421,304		Total loans and leases	$	5,610,414		$	2,147,149		$	1,489,402		$	9,246,965
Total allowance for loan and lease losses as a percentage of total loans and leases	Total allowance for loan and lease losses as a percentage of total loans and leases	1.58		%	1.20		%	0.28		%		1.27		%	Total allowance for loan and lease losses as a percentage of total loans and leases	1.47		%	1.53		%	0.36		%	1.31		%


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BRKL	Nasdaq Global Select Market


		Page
Part I	Financial Information

Item 1.	Unaudited Consolidated Financial Statements

	Unaudited Consolidated Balance Sheets at ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021~~2022	1

	Unaudited Consolidated Statements of Income for the Three Months Ended March 31, 2023 and ~~Nine Months Ended September 30,~~ 2022 ~~and 2021~~	2

	Unaudited Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2023 and ~~Nine Months Ended September 30,~~ 2022 ~~and 2021~~	3

	Unaudited Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2023 and ~~Nine Months Ended September 30,~~ 2022 ~~and 2021~~	4

	Unaudited Consolidated Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~	65

	Notes to Unaudited Consolidated Financial Statements	76

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4547

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	8280

Item 4.	Controls and Procedures	8482

Part II	Other Information

Item 1.	Legal Proceedings	8583

Item 1A.	Risk Factors	8583

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	8583

Item 3.	Defaults Upon Senior Securities	8583

Item 4.	Mine Safety Disclosures	8583

Item 5.	Other Information	8583

Item 6.	Exhibits	8684

	Signatures	8785


BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Balance Sheets	BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Balance Sheets					BROOKLINE BANCORP, INC. AND SUBSIDIARIES Unaudited Consolidated Balance Sheets
		At September 30, 2022		At December 31, 2021			At March 31, 2023		At December 31, 2022
		(In Thousands Except Share Data)					(In Thousands Except Share Data)
ASSETS	ASSETS					ASSETS
Cash and due from banks	Cash and due from banks	$	65,638	$	66,265	Cash and due from banks	$	30,782	$	191,767
Short-term investments	Short-term investments	46,873		261,472		Short-term investments	455,538		191,192
Total cash and cash equivalents	Total cash and cash equivalents	112,511		327,737		Total cash and cash equivalents	486,320		382,959
Investment securities available-for-sale, net	Investment securities available-for-sale, net	675,692		720,866		Investment securities available-for-sale, net	1,067,032		656,766

Total investment securities						Total investment securities	1,067,032		656,766

Loans and leases:	Loans and leases:					Loans and leases:
Commercial real estate loans	Commercial real estate loans	4,269,512		4,103,040		Commercial real estate loans	5,610,414		4,404,148
Commercial loans and leases	Commercial loans and leases	1,933,645		1,887,136		Commercial loans and leases	2,147,149		2,016,499
Consumer loans	Consumer loans	1,218,147		1,164,281		Consumer loans	1,489,402		1,223,741
Total loans and leases	Total loans and leases	7,421,304		7,154,457		Total loans and leases	9,246,965		7,644,388
Allowance for loan and lease losses	Allowance for loan and lease losses	(94,169)		(99,084)		Allowance for loan and lease losses	(120,865)		(98,482)
Net loans and leases	Net loans and leases	7,327,135		7,055,373		Net loans and leases	9,126,100		7,545,906
Restricted equity securities	Restricted equity securities	44,760		28,981		Restricted equity securities	86,230		71,307
Premises and equipment, net of accumulated depreciation of $91,216 and $87,176, respectively		69,912		70,359
Premises and equipment, net of accumulated depreciation of $100,192 and $92,219, respectively						Premises and equipment, net of accumulated depreciation of $100,192 and $92,219, respectively	87,799		71,391
Right-of-use asset operating leases	Right-of-use asset operating leases	18,614		20,508		Right-of-use asset operating leases	30,067		19,484
Deferred tax asset	Deferred tax asset	56,894		38,987		Deferred tax asset	75,028		52,237
Goodwill	Goodwill	160,427		160,427		Goodwill	241,222		160,427
Identified intangible assets, net of accumulated amortization of $40,002 and $39,628, respectively		1,902		2,276
Identified intangible assets, net of accumulated amortization of $42,089 and $40,123, respectively						Identified intangible assets, net of accumulated amortization of $42,089 and $40,123, respectively	30,080		1,781
Other real estate owned ("OREO") and repossessed assets, net	Other real estate owned ("OREO") and repossessed assets, net	591		718		Other real estate owned ("OREO") and repossessed assets, net	508		408
Other assets	Other assets	227,270		176,390		Other assets	292,099		223,170
Total assets	Total assets	$	8,695,708	$	8,602,622	Total assets	$	11,522,485	$	9,185,836
LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:	Deposits:					Deposits:
Demand checking accounts	Demand checking accounts	$	1,848,562	$	1,888,462	Demand checking accounts	$	1,899,370	$	1,802,518

Interest-bearing deposits	Interest-bearing deposits	4,887,043		5,161,444		Interest-bearing deposits	6,557,092		4,719,628
Total deposits	Total deposits	6,735,605		7,049,906		Total deposits	8,456,462		6,522,146
Borrowed funds:	Borrowed funds:					Borrowed funds:
Advances from the Federal Home Loan Bank of Boston ("FHLBB")		557,895		147,907
Advances from the Federal Home Loan Bank of Boston and New York ("FHLB")						Advances from the Federal Home Loan Bank of Boston and New York ("FHLB")	1,458,457		1,237,823
Subordinated debentures and notes	Subordinated debentures and notes	84,008		83,897		Subordinated debentures and notes	84,080		84,044
Other borrowed funds	Other borrowed funds	116,865		125,517		Other borrowed funds	87,565		110,785
Total borrowed funds	Total borrowed funds	758,768		357,321		Total borrowed funds	1,630,102		1,432,652
Operating lease liabilities	Operating lease liabilities	18,614		20,508		Operating lease liabilities	31,373		19,484
Mortgagors' escrow accounts	Mortgagors' escrow accounts	5,785		6,296		Mortgagors' escrow accounts	17,080		5,607
Reserve for unfunded credits	Reserve for unfunded credits	19,555		14,794		Reserve for unfunded credits	23,112		20,602

Accrued expenses and other liabilities	Accrued expenses and other liabilities	193,763		158,455		Accrued expenses and other liabilities	199,290		193,220
Total liabilities	Total liabilities	7,732,090		7,607,280		Total liabilities	10,357,419		8,193,711

Commitments and contingencies (Note 12)	Commitments and contingencies (Note 12)					Commitments and contingencies (Note 12)
Stockholders' Equity:	Stockholders' Equity:					Stockholders' Equity:

Common stock, $0.01 par value; 200,000,000 shares authorized; 85,177,172 shares issued and 85,177,172 shares issued, respectively		852		852
Common stock, $0.01 par value; 200,000,000 shares authorized; 96,998,075 shares issued and 85,177,172 shares issued, respectively						Common stock, $0.01 par value; 200,000,000 shares authorized; 96,998,075 shares issued and 85,177,172 shares issued, respectively	970		852
Additional paid-in capital	Additional paid-in capital	735,119		736,826		Additional paid-in capital	904,174		736,074
Retained earnings, partially restricted		392,779		342,639
Accumulated other comprehensive income (loss)		(70,227)		(110)
Treasury stock, at cost; 7,730,945 shares and 7,037,464 shares, respectively		(94,866)		(84,718)
Unallocated common stock held by Employee Stock Ownership Plan ("ESOP"); 4,833 shares and 24,660 shares, respectively		(39)		(147)
Retained earnings						Retained earnings	407,528		412,019
Accumulated other comprehensive (loss) income						Accumulated other comprehensive (loss) income	(52,688)		(61,947)
Treasury stock, at cost; 7,734,891 shares and 7,731,445 shares, respectively						Treasury stock, at cost; 7,734,891 shares and 7,731,445 shares, respectively	(94,918)		(94,873)

Total stockholders' equity	Total stockholders' equity	963,618		995,342		Total stockholders' equity	1,165,066		992,125
Total liabilities and stockholders' equity	Total liabilities and stockholders' equity	$	8,695,708	$	8,602,622	Total liabilities and stockholders' equity	$	11,522,485	$	9,185,836


		Three Months Ended September 30,				Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021		2022		2021			2023		2022
		(In Thousands Except Share Data)									(In Thousands Except Share Data)
Interest and dividend income:	Interest and dividend income:									Interest and dividend income:
Loans and leases	Loans and leases	$	84,375	$	74,332	$	230,383	$	224,367	Loans and leases	$	121,931	$	71,721
Debt securities	Debt securities	3,337		2,967		9,582		9,206		Debt securities	7,870		2,996
Marketable and restricted equity securities		467		313		1,132		847
Restricted equity securities										Restricted equity securities	1,255		328
Short-term investments	Short-term investments	464		83		686		164		Short-term investments	1,495		66
Total interest and dividend income	Total interest and dividend income	88,643		77,695		241,783		234,584		Total interest and dividend income	132,551		75,111
Interest expense:	Interest expense:									Interest expense:
Deposits	Deposits	7,354		4,571		15,407		16,658		Deposits	29,368		3,771
Borrowed funds	Borrowed funds	3,263		2,427		6,635		7,014		Borrowed funds	17,134		1,492
Total interest expense	Total interest expense	10,617		6,998		22,042		23,672		Total interest expense	46,502		5,263
Net interest income	Net interest income	78,026		70,697		219,741		210,912		Net interest income	86,049		69,848
Provision (credit) for credit losses	Provision (credit) for credit losses	2,835		(3,110)		2,902		(8,588)		Provision (credit) for credit losses	25,542		(164)

Provision for investment losses										Provision for investment losses	—		4
Net interest income after provision for credit losses	Net interest income after provision for credit losses	75,191		73,807		216,839		219,500		Net interest income after provision for credit losses	60,507		70,008
Non-interest income:	Non-interest income:									Non-interest income:
Deposit fees	Deposit fees	2,759		2,629		8,003		7,925		Deposit fees	2,657		2,500
Loan fees	Loan fees	349		487		1,762		1,647		Loan fees	391		747
Loan level derivative income, net	Loan level derivative income, net	1,275		218		3,576		699		Loan level derivative income, net	2,373		686
Loss on investment securities, net		—		—		—		(6)
Gain on investment securities, net										Gain on investment securities, net	1,701		—
Gain on sales of loans and leases held-for-sale	Gain on sales of loans and leases held-for-sale	889		557		1,524		1,804		Gain on sales of loans and leases held-for-sale	1,638		344

Other	Other	1,562		1,695		4,426		4,221		Other	4,177		1,252
Total non-interest income	Total non-interest income	6,834		5,586		19,291		16,290		Total non-interest income	12,937		5,529
Non-interest expense:	Non-interest expense:									Non-interest expense:
Compensation and employee benefits	Compensation and employee benefits	28,306		27,206		83,962		78,188		Compensation and employee benefits	36,565		26,884
Occupancy	Occupancy	3,906		3,567		11,997		11,403		Occupancy	5,223		4,284
Equipment and data processing	Equipment and data processing	5,066		4,556		15,075		13,746		Equipment and data processing	6,462		5,078
Professional services	Professional services	1,069		1,072		3,514		3,543		Professional services	1,430		1,226
FDIC insurance	FDIC insurance	709		662		2,176		2,363		FDIC insurance	1,244		728
Advertising and marketing	Advertising and marketing	1,337		1,077		3,928		3,287		Advertising and marketing	1,410		1,272
Amortization of identified intangible assets	Amortization of identified intangible assets	120		208		374		668		Amortization of identified intangible assets	1,966		134
Merger and acquisition expense	Merger and acquisition expense	1,073		—		1,608		—		Merger and acquisition expense	6,409		—
Other	Other	3,373		2,574		9,683		6,501		Other	4,067		2,881
Total non-interest expense	Total non-interest expense	44,959		40,922		132,317		119,699		Total non-interest expense	64,776		42,487
Income before provision for income taxes	Income before provision for income taxes	37,066		38,471		103,813		116,091		Income before provision for income taxes	8,668		33,050
Provision for income taxes	Provision for income taxes	6,917		9,632		23,764		29,196		Provision for income taxes	1,108		8,345

Net income	Net income	$	30,149	$	28,839	$	80,049	$	86,895	Net income	$	7,560	$	24,705
Earnings per common share:	Earnings per common share:									Earnings per common share:
Basic	Basic	$	0.39	$	0.37	$	1.04	$	1.11	Basic	$	0.09	$	0.32
Diluted	Diluted	0.39		0.37		1.04		1.11		Diluted	0.09		0.32
Weighted average common shares outstanding during the year:	Weighted average common shares outstanding during the year:									Weighted average common shares outstanding during the year:
Basic	Basic	76,779,038		78,000,261		77,159,356		78,097,600		Basic	86,563,641		77,617,227
Diluted	Diluted	77,007,971		78,240,633		77,448,290		78,371,190		Diluted	86,837,806		77,926,822
Dividends paid per common share	Dividends paid per common share	$	0.130	$	0.120	$	0.385	$	0.355	Dividends paid per common share	$	0.135	$	0.125


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
	(In Thousands)
Net income	$	30,149	$	28,839	$	80,049	$	86,895

Investment securities available-for-sale:
Unrealized securities holding gains (losses)	(29,548)		(4,450)		(87,182)		(17,797)

Income tax (expense) benefit	6,513		981		19,216		3,923
Net unrealized securities holding gains (losses) before reclassification adjustments, net of taxes	(23,035)		(3,469)		(67,966)		(13,874)







Cash flow hedges:
Change in fair value of cash flow hedges	(2,083)		(3)		(1,989)		6
Reclassification adjustment for (income) expense recognized in earnings	(132)		(2)		(162)		(7)
Net change in fair value of cash flow hedges, net of taxes	(2,215)		(5)		(2,151)		(1)






Other comprehensive income (loss), net of taxes	(25,250)		(3,474)		(70,117)		(13,875)



Comprehensive income	$	4,899	$	25,365	$	9,932	$	73,020


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


		Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Unallocated Common Stock Held by ESOP			Total Stockholders' Equity			Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Unallocated Common Stock Held by ESOP		Total Stockholders' Equity
		(In Thousands)												(In Thousands)
Balance at June 30, 2022		$	852	$	738,544	$	372,677	$	(44,977)	$	(98,525)	$	(75)		$	968,496
Balance at December 31, 2022																	Balance at December 31, 2022	$	852	$	736,074	$	412,019	$	(61,947)	$	(94,873)	—		$	992,125
Net income	Net income	—		—		30,149		—		—		—			30,149		Net income	—		—		7,560		—		—		—		7,560

PCSB acquisition																	PCSB acquisition	118		167,524		—		—		—				167,642
Other comprehensive income (loss)	Other comprehensive income (loss)	—		—		—		(25,250)		—		—			(25,250)		Other comprehensive income (loss)	—		—		—		9,259		—		—		9,259
Common stock dividends of $0.130 per share		—		—		(9,968)		—		—		—			(9,968)
Common stock dividends of $0.135 per share																	Common stock dividends of $0.135 per share	—		—		(11,970)		—		—		—		(11,970)

Restricted stock awards issued, net of awards surrendered	Restricted stock awards issued, net of awards surrendered	—		(4,340)		—		—		3,659		—			(681)		Restricted stock awards issued, net of awards surrendered	—		(8)		—		—		(45)		—		(53)
Compensation under recognition and retention plans	Compensation under recognition and retention plans	—		863		(79)		—		—		—			784		Compensation under recognition and retention plans	—		584		(81)		—		—		—		503

Common stock held by ESOP committed to be released (6,609 shares)		—		52		—		—		—		36			88

Balance at September 30, 2022		$	852	$	735,119	$	392,779	$	(70,227)	$	(94,866)	$	(39)		$	963,618

Balance at March 31, 2023																	Balance at March 31, 2023	$	970	$	904,174	$	407,528	$	(52,688)	$	(94,918)	$	—	$	1,165,066


	Net Assets Acquired at Fair Value
	(In Thousands)
Purchase price consideration	$	297,791
ASSETS
Cash	42,373
Investments	366,790
Loans	1,336,737
Allowance for credit losses on PCD loans	(2,344)
Premises and equipment	14,631
Core deposit and other intangibles	30,265
Other assets	104,654
Total assets acquired	$	1,893,106
LIABILITIES
Deposits	$	1,570,563
Borrowings	52,923
Other liabilities	52,624
Total liabilities assumed	$	1,676,110
Net assets acquired	216,996
Goodwill	$	80,795


(In Thousands)
Total Unpaid principal balance	$	16,824
Allowance for credit losses at acquisition	(2,344)
Non-credit discount	(974)
Fair value	$	13,506



(In Thousands)
Compensation and benefits (1)	$	1,221
Technology and equipment (2)	1,828
Professional and outside services (3)	3,199
Other expense (4)	162
Total merger-related expenses	$	6,410


		At September 30, 2022									At March 31, 2023
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
		(In Thousands)									(In Thousands)
Investment securities available-for-sale:	Investment securities available-for-sale:									Investment securities available-for-sale:
GSE debentures	GSE debentures	$	185,091	$	—	$	24,970	$	160,121	GSE debentures	$	198,454	$	292	$	21,524	$	177,222
GSE CMOs	GSE CMOs	21,194		—		1,754		19,440		GSE CMOs	69,766		119		2,201		67,684
GSE MBSs	GSE MBSs	165,779		2		21,292		144,489		GSE MBSs	206,416		84		17,707		188,793

Municipal obligations										Municipal obligations	23,282		145		115		23,312
Corporate debt obligations	Corporate debt obligations	14,099		—		337		13,762		Corporate debt obligations	37,661		93		458		37,296
U.S. Treasury bonds	U.S. Treasury bonds	376,446		—		39,047		337,399		U.S. Treasury bonds	598,023		1,175		26,948		572,250
Foreign government obligations	Foreign government obligations	500		—		19		481		Foreign government obligations	500		—		25		475

Total investment securities available-for-sale	Total investment securities available-for-sale	$	763,109	$	2	$	87,419	$	675,692	Total investment securities available-for-sale	$	1,134,102	$	1,908	$	68,978	$	1,067,032


		December 31, 2021									December 31, 2022
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value			Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
		(In Thousands)									(In Thousands)
Investment securities available-for-sale:	Investment securities available-for-sale:									Investment securities available-for-sale:
GSE debentures	GSE debentures	$	219,723	$	2,017	$	4,235	$	217,505	GSE debentures	$	176,751	$	—	$	24,329	$	152,422
GSE CMOs	GSE CMOs	27,892		274		27		28,139		GSE CMOs	19,977		—		1,757		18,220
GSE MBSs	GSE MBSs	196,930		3,749		907		199,772		GSE MBSs	159,824		1		19,249		140,576

Corporate debt obligations	Corporate debt obligations	22,178		505		—		22,683		Corporate debt obligations	14,076		—		312		13,764
U.S. Treasury bonds	U.S. Treasury bonds	253,878		1,136		2,746		252,268		U.S. Treasury bonds	362,850		280		31,823		331,307

Foreign government obligations	Foreign government obligations	500		—		1		499		Foreign government obligations	500		—		23		477

Total investment securities available-for-sale	Total investment securities available-for-sale	$	721,101	$	7,681	$	7,916	$	720,866	Total investment securities available-for-sale	$	733,978	$	281	$	77,493	$	656,766


		At September 30, 2022													At March 31, 2023
		Less than Twelve Months				Twelve Months or Longer				Total					Less than Twelve Months				Twelve Months or Longer				Total
		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses			Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
		(In Thousands)													(In Thousands)
Investment securities available-for-sale:	Investment securities available-for-sale:													Investment securities available-for-sale:
GSE debentures	GSE debentures	$	62,641	$	1,360	$	95,480	$	23,610	$	158,121	$	24,970	GSE debentures	$	12,467	$	234	$	124,811	$	21,290	$	137,278	$	21,524
GSE CMOs	GSE CMOs	19,058		1,717		382		37		19,440		1,754		GSE CMOs	37,917		691		17,515		1,510		55,432		2,201
GSE MBSs	GSE MBSs	111,519		13,018		32,814		8,274		144,333		21,292		GSE MBSs	30,663		441		131,347		17,266		162,010		17,707

Municipal obligations														Municipal obligations	3,886		115		—		—		3,886		115
Corporate debt obligations	Corporate debt obligations	13,762		337		—		—		13,762		337		Corporate debt obligations	27,710		429		2,471		29		30,181		458
U.S. Treasury bonds	U.S. Treasury bonds	222,229		15,755		115,170		23,292		337,399		39,047		U.S. Treasury bonds	161,633		762		212,468		26,186		374,101		26,948
Foreign government obligations	Foreign government obligations	481		19		—		—		481		19		Foreign government obligations	—		—		475		25		475		25

Total temporarily impaired investment securities	Total temporarily impaired investment securities	$	429,690	$	32,206	$	243,846	$	55,213	$	673,536	$	87,419	Total temporarily impaired investment securities	$	274,276	$	2,672	$	489,087	$	66,306	$	763,363	$	68,978


	~~Nine Months Ended September 30, 2022~~		~~Nine Months Ended September 30, 2021~~
	~~(In Thousands)~~

~~Proceeds from sales of investment securities available-for-sale and equity securities held-for-trading~~	$	—	$	~~520~~

~~Gross gains from securities sales~~	—				1

~~Gross losses from securities sales~~	—				—

~~Gain on sales of securities, net~~	$	—			$
	1


	Three Months Ended March 31
	2023		2022
	(In Thousands)
Investment Securities available-for-sale:
Proceeds from sales:	$	224,832	$	—
Gross gains from sales	2,702		—
Gross losses from sales	(1,001)		—
Gain (loss) on sales of securities, net	$	1,701	$	—


	Three Months Ended September 30, 2022
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at June 30, 2022	$	70,027	$	20,105	$	3,056	$	93,188

Charge-offs	—		(584)		(14)		(598)
Recoveries	6		763		8		777
(Credit) provision for loan and lease losses	(2,573)		2,984		391		802
Balance at September 30, 2022	$	67,460	$	23,268	$	3,441	$	94,169


	Three Months Ended March 31, 2023
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at December 31, 2022	$	68,154	$	26,604	$	3,724	$	98,482

Charge-offs	—		(840)		(11)		(851)
Recoveries	6		383		11		400
Provision (credit) for loan and lease losses excluding unfunded commitments	14,532		6,614		1,688		22,834

Balance at March 31, 2023	$	82,692	$	32,761	$	5,412	$	120,865


	Three Months Ended September 30, 2021
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at June 30, 2021	$	74,009	$	28,364	$	4,101	$	106,474

Charge-offs	—		(1,583)		(17)		(1,600)
Recoveries	1		308		36		345
(Credit) provision for loan and lease losses	(1,630)		101		(1,175)		(2,704)
Balance at September 30, 2021	$	72,380	$	27,190	$	2,945	$	102,515



	Nine Months Ended September 30, 2022
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at December 31, 2021	$	69,213	$	27,055	$	2,816	$	99,084


Charge-offs	(37)		(4,417)		(20)		(4,474)
Recoveries	18		1,395		52		1,465
(Credit) provision for loan and lease losses	(1,734)		(765)		593		(1,906)
Balance at September 30, 2022	$	67,460	$	23,268	$	3,441	$	94,169



	Nine Months Ended September 30, 2021
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at December 31, 2020	$	80,132	$	29,498	$	4,749	$	114,379

Charge-offs	(28)		(4,907)		(29)		(4,964)
Recoveries	12		1,127		215		1,354
(Credit) provision for loan and lease losses	(7,736)		1,472		(1,990)		(8,254)
Balance at September 30, 2021	$	72,380	$	27,190	$	2,945	$	102,515


	Three Months Ended March 31, 2022
	Commercial Real Estate		Commercial		Consumer		Total
	(In Thousands)
Balance at December 31, 2021	$	69,213	$	27,055	$	2,816	$	99,084

Charge-offs	(37)		(2,301)		(6)		(2,344)
Recoveries	6		353		38		397
Provision (credit) for loan and lease losses excluding unfunded commitments	(151)		(1,604)		81		(1,674)
Balance at March 31, 2022	$	69,031	$	23,503	$	2,929	$	95,463


		September 30, 2022										March 31, 2023
		2022		2021		2020		2019		2018			Prior		Revolving Loans			Revolving Loans Converted to Term Loans		Total			2023		2022		2021		2020		2019		Prior		Revolving Loans		Revolving Loans Converted to Term Loans		Total
				(In Thousands)													(In Thousands)
Commercial Real Estate	Commercial Real Estate																					Commercial Real Estate
Pass	Pass	$	363,706	$	648,462	$	296,885	$	376,868	$	227,324		$	995,456	$	54,683		$	11,032	$	2,974,416	Pass	$	193,343	$	645,464	$	785,001	$	400,924	$	478,600	$	1,329,857	$	70,395	$	9,684	$	3,913,268
OAEM	OAEM	—		2,618		90		14,860		2,853			31,833		—			—		52,254		OAEM	—		—		2,583		112		14,757		45,077		—		—		62,529
Substandard	Substandard	—		656		—		—		—			3,608		—			1,268		5,532		Substandard	—		—		—		—		—		10,879		—		—		10,879

Total	Total	363,706		651,736		296,975		391,728		230,177			1,030,897		54,683			12,300		3,032,202		Total	193,343		645,464		787,584		401,036		493,357		1,385,813		70,395		9,684		3,986,676
Multi-Family Mortgage	Multi-Family Mortgage																					Multi-Family Mortgage
Pass																						Pass	(2,261)		198,443		237,442		171,113		201,758		502,331		5,065		37,542		1,351,433
OAEM																						OAEM	—		—		—		—		1,340		1,513		—		—		2,853
Substandard																						Substandard	—		—		—		—		—		2,260		—		—		2,260

Total																						Total	(2,261)		198,443		237,442		171,113		203,098		506,104		5,065		37,542		1,356,546
Construction																						Construction
Pass																						Pass	9,140		150,953		67,113		14,436		16,810		3,818		(10,470)		—		251,800
OAEM																						OAEM	—		1,430		10,079		—		—		—		—		—		11,509
Substandard																						Substandard	—		—		—		—		1,543		2,340		—		—		3,883

Total																						Total	9,140		152,383		77,192		14,436		18,353		6,158		(10,470)		—		267,192


		At September 30, 2022											At March 31, 2023
		Past Due										Past Due Greater Than 90 Days and Accruing							Past Due												Past Due Greater Than 90 Days and Accruing
		31-60 Days		61-90 Days		Greater Than 90 Days		Total		Current						Total Loans and Leases				Non-accrual		Non-accrual with No Related Allowance			31-60 Days		61-90 Days		Greater Than 90 Days				Current	Past Due Greater Than 90 Days and Accruing		Total Loans and Leases				Non-accrual	Non-accrual with No Related Allowance
		(In Thousands)											(In Thousands)
Commercial real estate loans:	Commercial real estate loans:																							Commercial real estate loans:
Commercial real estate	Commercial real estate	$	3,942	$	875	$	11,016	$	15,833	$	3,016,369			$	3,032,202		$	8,085		$	3,136	$	2,930	Commercial real estate	$	2,477	$	1,062	$	994	$	4,533		$	3,982,143	$	3,986,676	$	661		$	4,589	$	—
Multi-family mortgage	Multi-family mortgage	7,039		80		353		7,472		1,045,542				1,053,014			353			—		—		Multi-family mortgage	—		—		—		—			1,356,546		1,356,546		—			—		—
Construction	Construction	1,502		—		—		1,502		182,794				184,296			—			—		—		Construction	—		—		2,217		2,217			264,975		267,192		—			3,883		3,883
Total commercial real estate loans	Total commercial real estate loans	12,483		955		11,369		24,807		4,244,705				4,269,512			8,438			3,136		2,930		Total commercial real estate loans	2,477		1,062		3,211		6,750			5,603,664		5,610,414		661			8,472		3,883
Commercial loans and leases:	Commercial loans and leases:																							Commercial loans and leases:
Commercial	Commercial	2,690		—		952		3,642		709,547				713,189			494			618		—		Commercial	192		8		347		547			858,416		858,963		—			5,495		1,272
Equipment financing	Equipment financing	4,266		2,464		6,075		12,805		1,163,443				1,176,248			160			10,544		999		Equipment financing	4,611		2,393		4,963		11,967			1,233,775		1,245,742		56			9,908		102
Condominium association	Condominium association	76		—		—		76		44,132				44,208			—			64		—		Condominium association	—		—		—		—			42,444		42,444		—			51		—
Total commercial loans and leases	Total commercial loans and leases	7,032		2,464		7,027		16,523		1,917,122				1,933,645			654			11,226		999		Total commercial loans and leases	4,803		2,401		5,310		12,514			2,134,635		2,147,149		56			15,454		1,374
Consumer loans:	Consumer loans:																							Consumer loans:
Residential mortgage	Residential mortgage	1,145		2,000		2,489		5,634		830,940				836,574			487			2,741		1,091		Residential mortgage	787		577		1,924		3,288			1,083,466		1,086,754		—			3,449		1,246
Home equity	Home equity	698		142		19		859		329,747				330,606			4			616		—		Home equity	201		150		451		802			344,871		345,673		4			1,079		296
Other consumer	Other consumer	15		1		2		18		50,949				50,967			—			2		—		Other consumer	—		—		5		5			56,970		56,975		5			—		—
Total consumer loans	Total consumer loans	1,858		2,143		2,510		6,511		1,211,636				1,218,147			491			3,359		1,091		Total consumer loans	988		727		2,380		4,095			1,485,307		1,489,402		9			4,528		1,542
Total loans and leases	Total loans and leases	$	21,373	$	5,562	$	20,906	$	47,841	$	7,373,463			$	7,421,304		$	9,583		$	17,721	$	5,020	Total loans and leases	$	8,268	$	4,190	$	10,901	$	23,359		$	9,223,606	$	9,246,965	$	726		$	28,454	$	6,799


	March 31, 2023
	Number of Loans	Amortized Cost		% of Total Class of Loans and Leases		Financial Effect
	(In thousands)
Maturity Extension

C&I	17	$	6,123	0.41	%	All 17 loans were given 6-month maturity extensions and restructured payment plans to assist borrowers. The financial effect was deemed "de minimis."













Total	17	$	6,123	0.41	%


	March 31, 2023
	Current		30-60 Days Past Due	61-90 Days Past Due	90+ Days Past Due	Modified	Paid Off	Charged Off
	(In thousands)
Total Modifications	$	6,123	—	—	—	—	—	—


	At December 31, 2022
	(In Thousands)
Troubled debt restructurings:
On accrual	$	16,385
On nonaccrual	3,527
Total troubled debt restructurings	$	19,912


	At and for the Three Months Ended September 30, 2021
		Amortized Cost				Specific Allowance for Credit Losses				Defaulted (1)
	Number of Loans/ Leases	At Modification		At End of Period				Nonaccrual Loans and Leases		Number of Loans/ Leases	Amortized Cost
	(Dollars in Thousands)



Commercial	1	19		19		—		—		—	—

Equipment financing	6	$	827	$	816	$	—	$	147	5	$	211


Total loans and leases	7	$	846	$	835	$	—	$	147	5	$	211



	At and for the Nine Months Ended September 30, 2022
		Amortized Cost				Specific Allowance for Credit Losses				Defaulted (1)
	Number of Loans/ Leases	At Modification		At End of Period				Nonaccrual Loans and Leases		Number of Loans/ Leases	Amortized Cost
	(Dollars in Thousands)




Equipment financing	18	$	1,203	$	1,099	$	—	$	760	5	$	323













Total loans and leases	18	$	1,203	$	1,099	$	—	$	760	5	$	323


Remainder of 2022		$	120
Remainder of 2023				Remainder of 2023	$	5,863
Year ending:	Year ending:			Year ending:
2023		263
2024	2024	151		2024	6,636
2025	2025	103		2025	5,507
2026	2026	74		2026	4,398
2027	2027	87		2027	3,329
2028				2028	2,177
Thereafter	Thereafter	15		Thereafter	1,081
Total	Total	$	813	Total	$	28,991


		Three Months Ended September 30, 2022									Three Months Ended March 31, 2023
		Investment Securities Available-for-Sale		Net Change in Fair Value of Cash Flow Hedges		Postretirement Benefits		Accumulated Other Comprehensive Income (Loss)			Investment Securities Available-for-Sale		Net Change in Fair Value of Cash Flow Hedges		Postretirement Benefits		Accumulated Other Comprehensive Income (Loss)
		(In Thousands)									(In Thousands)
Balance at June 30, 2022		$	(45,114)	$	101	$	36	$	(44,977)
Balance at December 31, 2022										Balance at December 31, 2022	$	(60,192)	$	(2,243)	$	488	$	(61,947)
Other comprehensive income (loss)	Other comprehensive income (loss)	(23,035)		(2,083)		—		(25,118)		Other comprehensive income (loss)	7,911		946		—		8,857

Reclassification adjustment for (income) expense recognized in earnings	Reclassification adjustment for (income) expense recognized in earnings	—		(132)		—		(132)		Reclassification adjustment for (income) expense recognized in earnings	—		402		—		402
Balance at September 30, 2022		$	(68,149)	$	(2,114)	$	36	$	(70,227)
Balance at March 31, 2023										Balance at March 31, 2023	$	(52,281)	$	(895)	$	488	$	(52,688)


	At September 30, 2022
	Notional Amount		Average Maturity	Weighted Average Rate				Fair Value
				Current Rate Paid		Received Fixed Swap Rate
	(in thousands)		(in years)					(in thousands)
Interest rate swaps on loans	$	75,000	3.88	2.42	%	2.73	%	$	(2,879)


		Notional Amount Maturing																Notional Amount Maturing
		Number of Positions	Less than 1 year		Less than 2 years		Less than 3 years		Less than 4 years		Thereafter		Total		Fair Value			Number of Positions	Less than 1 year		Less than 2 years		Less than 3 years		Less than 4 years		Thereafter		Total		Fair Value
		September 30, 2022																March 31, 2023
		(Dollars In Thousands)																(Dollars In Thousands)
Loan level derivatives	Loan level derivatives																Loan level derivatives
Receive fixed, pay variable	Receive fixed, pay variable	135	$	71,925	$	77,517	$	142,783	$72,088		$	1,121,000	$	1,485,313	$	112,754	Receive fixed, pay variable	152	$	68,930	$	32,353	$	133,823	$130,956		$	1,407,673	$	1,773,735	$	76,665
Pay fixed, receive variable	Pay fixed, receive variable	135	71,925		77,517		142,783		72,088		1,121,000		1,485,313		112,754		Pay fixed, receive variable	152	68,930		32,353		133,823		130,956		1,407,673		1,773,735		76,665
Risk participation-out agreements	Risk participation-out agreements	50	32,459		29,737		30,155		6,267		271,819		370,437		292		Risk participation-out agreements	63	38,643		—		27,484		32,621		412,716		511,464		1,946
Risk participation-in agreements	Risk participation-in agreements	8	—		18,495		—		—		57,183		75,678		31		Risk participation-in agreements	8	18,343		—		—		27,242		29,172		74,757		39

Foreign exchange contracts	Foreign exchange contracts																Foreign exchange contracts
Buys foreign currency, sells U.S. currency	Buys foreign currency, sells U.S. currency	16	$	4,270	$	—	$	—	$	—	$	—	$	4,270	$	19	Buys foreign currency, sells U.S. currency	14	$	2,631	$	—	$	—	$	—	$	—	$	2,631	$	339
Sells foreign currency, buys U.S. currency	Sells foreign currency, buys U.S. currency	16	4,282		—		—		—		—		4,282		2		Sells foreign currency, buys U.S. currency	14	2,650		—		—		—		—		2,650		320


		At September 30, 2022																					At March 31, 2023
		Gross Amounts Recognized		Gross Amounts Offset in the Statement of Financial Position				Net Amounts Presented in the Statement of Financial Position				Gross Amounts Not Offset in the Statement of Financial Position								Net Amount			Gross Amounts Recognized					Gross Amounts Offset in the Statement of Financial Position		Net Amounts Presented in the Statement of Financial Position			Gross Amounts Not Offset in the Statement of Financial Position				Net Amount
										Financial Instruments Pledged				Cash Collateral Pledged												Financial Instruments Pledged						Cash Collateral Pledged
		(In Thousands)																								(In Thousands)
Asset derivatives	Asset derivatives																					Asset derivatives
Derivatives designated as hedging instruments:	Derivatives designated as hedging instruments:																					Derivatives designated as hedging instruments:
Interest rate derivatives	Interest rate derivatives	$	15			$	—			$	15			$	—			$	—					$	15		Interest rate derivatives	$	854	$	—		$	854	$	—	$	—	$	854
Derivatives not designated as hedging instruments:	Derivatives not designated as hedging instruments:																					Derivatives not designated as hedging instruments:
Loan level derivatives	Loan level derivatives	$	114,159	$	—			$	114,159			$	—			$	—			$	114,159	Loan level derivatives	$	104,707				$	—	$	104,707		$	—	$	—	$	104,707
Risk participation-out agreements	Risk participation-out agreements	292		—				292				—				—				292		Risk participation-out agreements	1,946					—		1,946			—		—		1,946
Foreign exchange contracts	Foreign exchange contracts	145		—				145				—				—				145		Foreign exchange contracts	339					—		339			—		—		339
Total	Total	$	114,611	$	—			$	114,611			$	—			$	—			$	114,611	Total	$	107,846				$	—	$	107,846		$	—	$	—	$	107,846

Liability derivatives	Liability derivatives																					Liability derivatives
Derivatives designated as hedging instruments:	Derivatives designated as hedging instruments:																					Derivatives designated as hedging instruments:
Interest rate derivatives	Interest rate derivatives	$	2,879	$	—			$	2,879			$	—			$	—			$	2,879	Interest rate derivatives	$	2,285				$	—	$	2,285		$	—	$	—	$	2,285
Derivatives not designated as hedging instruments:	Derivatives not designated as hedging instruments:																					Derivatives not designated as hedging instruments:
Loan level derivatives	Loan level derivatives	$	114,159	$	—			$	114,159			$	9,633			$	5,200			$	99,326	Loan level derivatives	$	104,707				$	—	$	104,707		$	5,609	$	3,224	$	95,874
Risk participation-in agreements	Risk participation-in agreements	31		—				31				—				—				31		Risk participation-in agreements	39					—		39			—		—		39
Foreign exchange contracts	Foreign exchange contracts	128		—				128				—				—				128		Foreign exchange contracts	320					—		320			—		—		320
Total	Total	$	117,197	$	—			$	117,197			$	9,633			$	5,200			$	102,364	Total	$	107,351				$	—	$	107,351		$	5,609	$	3,224	$	98,518


		Fair Value					Fair Value
		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021			Three Months Ended March 31, 2023		Three Months Ended March 31, 2022
		(Dollars in Thousands)					(Dollars in Thousands)

Derivatives designated as hedges	Derivatives designated as hedges	$	(2,879)	$	1	Derivatives designated as hedges	$	(1,430)	$	116
(Loss) gain in OCI on derivatives (effective portion), net of tax	(Loss) gain in OCI on derivatives (effective portion), net of tax	$	(2,114)	$	6	(Loss) gain in OCI on derivatives (effective portion), net of tax	$	(895)	$	91
Gain (loss) reclassified from OCI into interest income or interest expense (effective portion)	Gain (loss) reclassified from OCI into interest income or interest expense (effective portion)	$	212	$	7	Gain (loss) reclassified from OCI into interest income or interest expense (effective portion)	$	(543)	$	2