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Item 5. Market for Registrant’s Common Equity

2023-02-24 compared with 2022-02-25 · 31 added, 44 removed, 24 unchanged (76% of the section changed)

5 unchanged sentences

Comparative Stock Performance Graph

The stock performance graph below and associated table compare the cumulative total shareholder return of the Company's common stock from October 15, 2020 to December 31, 2021 to the cumulative total return of the OMX NASDAQ Bank Index, the Russell 2000 Index and the KBW Regional Banking Index.

The Company selected the KBW Regional Banking Index, to which it was added in March 2021, for the stock performance graph in this Annual Report on Form 10-K because management believes its performance provides a more meaningful comparison with the Company’s performance than does the OMX NASDAQ Bank Index, of which the Company is not a member.

The lines in the graph and the numbers in the table below represent monthly index levels derived from the compounded daily returns that include reinvestment or retention of all dividends.

If the monthly interval, based on the last day of a month, was not a trading day, the preceding trading day was used.

The stock performance graph below and associated table compare the cumulative total shareholder return of our common stock from October 15, 2020 to December 31, 2022 to the cumulative total return of the Russell 2000 Index and the KBW Regional Banking Index.

The lines in the graph and the numbers in the table below represent quarterly index levels derived from the compounded daily returns that include reinvestment or retention of all dividends.

If the quarterly interval, based on the last day of a quarter, was not a trading day, the preceding trading day was used.

The index value for all of the series was set to $100.00 on October 15, 2020 (which assumes that $100.00 was invested in each of the series on October 15, 2020).

The following information in this Item 5 of this Annual Report on Form 10-K is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act or to the liabilities of Section 18 of the Exchange Act and will not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent the Company specifically incorporates it by reference into such a filing.

The following information in this Item 5 of this Annual Report on Form 10-K is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under the Exchange Act or to the liabilities of Section 18 of the Exchange Act and will not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent we specifically incorporate it by reference into such a filing.

The stock price performance shown on the stock performance graph and associated table below is not necessarily indicative of future price performance.

Information used in the graph and table was obtained from a third party provider, a source believed to be reliable, but the Company is not responsible for any errors or omission in such information.

Information used in the graph and table was obtained from a third party provider, a source believed to be reliable, but we are not responsible for any errors or omission in such information.

Period Ending

2 unchanged sentences

100.00 134.24 159.29 170.48 168.94

OMX NASDAQ Bank 100.00 103.43 118.23 128.80 134.18 155.75 164.64 169.51

Russell 2000 100.00 120.82 136.16 142.00 135.81

KBW Regional Banks 100.00 134.82 174.87 172.39 177.93

5/31/2021 6/30/2021 7/31/2021 8/31/2021 9/30/2021 10/31/2021 11/30/2021 12/31/2021

Index 12/31/2021 3/31/2022 6/30/2022 9/30/2022 12/31/2022

Eastern Bankshares, Inc.

168.53 180.81 155.75 166.55 147.04

OMX NASDAQ Bank 174.28 163.64 158.16 165.38 171.30 178.49 174.59 179.92

Russell 2000 138.72 128.28 106.22 103.90 110.37

1 unchanged sentence

Zacks Investment Research, Inc.

On January 28, 2021, we announced the initiation of a quarterly cash dividend of $0.06 per share.

On April 7, 2021, we announced an increase to the quarterly cash dividend to $0.08 per share and on January 28, 2022, we announced an increase to the quarterly cash dividend to $0.10 per share.

We intend to continue to pay regular cash dividends to shareholders of our common stock;

We intend to continue to pay regular cash dividends to holders of our common stock;

however, any future determination to declare and pay cash dividends, if any, will be made at the discretion of our Board of Directors and will depend on a variety of factors, including applicable laws, our financial condition, results of operations, business prospects, general business or financial market conditions, regulatory environment and other factors our Board of Directors may deem relevant.

To the extent dividends from Eastern Bank will be a source of cash used by the Company to pay its dividends, dividends from the Bank will be dependent on the Bank’s future earnings, capital requirements, and financial condition.

Use of Proceeds from our IPO

We completed our IPO on October 14, 2020, when we sold 179,287,828 shares of our common stock, $0.01 par value per share, for $10.00 per share or an aggregate price of $1,792,878,000.

We registered with the SEC the offer and sale of our common stock in our IPO on our Registration Statement on Form S-1 (Registration No.

333-239251), which the SEC declared effective on August 11, 2020.

We registered a total of 210,084,636 shares of common stock, which included the 7,470,326 shares of common stock that we donated to the Eastern Bank Foundation promptly following the completion of the IPO.

We do not intend to issue any of the remaining 23,326,482 shares that we registered for the IPO.

Prior to the completion of the IPO, we had no shareholders, and consequently no shareholders sold shares of our common stock in the IPO.

Our principal offering expense in the IPO were underwriting fees paid to Keefe, Bruyette & Woods, Inc., which we engaged to be our selling agent to assist us in selling the shares on a “best efforts” basis in the IPO, and to J.P.

Morgan Securities LLC, which we engaged as our capital markets advisor.

The following table reflects our expenses incurred in connection with our IPO:

Underwriting fees $16,766,937

Legal, audit and accounting services $5,786,847

Printing, postage and mailing $3,940,916

Filing fees $1,848,690

Other $556,055

Total offering expenses $28,899,445

We did not pay any offering expenses, directly or indirectly, to any of our directors or officers, or to any of their associates, to any person owning 5% or more of our common stock, or to any entity that is an affiliate of ours.

After deducting expenses related to the IPO totaling $28.9 million, our net proceeds from the IPO totaled $1.76 billion.

From those net proceeds, we contributed $882.0 million to Eastern Bank, representing 50% of our net proceeds, and loaned $149.4 million to our ESOP, enabling the ESOP to purchase 14,940,652 shares of our common stock in the IPO.

On November 12, 2021, we completed our previously announced merger with Century for $641.9 million in cash.

Eastern Bankshares, Inc.

has invested the remaining net proceeds in various investment securities and liquid assets, including U.S.

Agency securities,

government-sponsored residential mortgage-backed securities and government-sponsored commercial mortgage-backed securities.

Eastern Bankshares, Inc.

and Eastern Bank, respectively, generally intend that over time the remaining net proceeds from the IPO will be used for the range of possible purposes specified in our IPO prospectus, dated August 11, 2020, under the caption “How We Intend to Use the Proceeds From the Offering.” Although the Century acquisition reduced the net proceeds from the IPO, we continue to expect that, due to the increase in equity resulting from the net proceeds raised in our IPO, our return on equity has been and will continue to be adversely affected until we can effectively employ the remaining proceeds of the IPO.

Repurchases of Common Shares

On November 12, 2021, we announced receipt of a notice of non-objection from the Board of Governors of the Federal Reserve System to its previously announced share repurchase program which was approved by the our Board of Directors on October 1, 2021.

The program authorizes the purchase of up to 9,337,900 shares, or 5% of our outstanding shares of common stock over a 12-month period.

Repurchases are made at management’s discretion from time to time at prices management considers to be attractive and in the best interests of both us and our shareholders, subject to the availability of shares, general market conditions, the trading price of the shares, alternative uses for capital, and its financial performance.

As further detailed below, we have received notices of non-objection from the Board of Governors of the Federal Reserve System to two share repurchase programs, one allowing the purchase of up to 9,337,900 shares of our common stock, which we competed in the third quarter of 2022, and the other allowing the purchase of up to 8,900,000 shares through August 31, 2023.

Repurchases are made at management’s discretion from time to time at prices management considers to be attractive and in the best interests of both the Company and its shareholders, subject to the availability of shares, general market conditions, the trading price of the shares, alternative uses for capital and liquidity, and our financial performance.

Repurchases may be suspended, terminated or modified by us at any time for any reason.

The program is limited to $225 million through November 30, 2022.

Information regarding the shares repurchased under the plan is presented in the following table:

Period Total Number of Shares Repurchased Average Price Paid per Share Total Number of Shares Repurchased as Part of the Share Repurchase Program Maximum Number of Shares That May Yet Be Purchased Under the Share Repurchase Program

Information regarding the shares repurchased under the plans is presented in the following table:

Period Total Number of Shares Repurchased Average Price Paid per Share Total Number of Shares Repurchased as Part of the Share Repurchase Programs Maximum Number of Shares That May Yet Be Purchased Under the Share Repurchase Programs (1)(2)

December 1, 2021 – December 31, 2021 1,135,878 $ 20.42 1,135,878 8,202,022

January 1, 2022 – January 31, 2022 987,526 21.02 2,123,404 7,214,496

February 1, 2022 – February 28, 2022 1,109,697 21.08 3,233,101 6,104,799

March 1, 2022 – March 31, 2022 769,398 21.31 4,002,499 5,335,401

April 1, 2022 – April 30, 2022 1,194,185 20.19 5,196,684 4,141,216

May 1, 2022 – May 31, 2022 1,880,381 18.93 7,077,065 2,260,835

June 1, 2022 – June 30, 2022 1,141,903 18.78 8,218,968 1,118,932

July 1, 2022 – July 31, 2022 909,785 19.02 9,128,753 209,147

August 1, 2022 – August 31, 2022 — — 9,128,753 209,147

September 1, 2022 – September 30, 2022 571,463 20.33 9,700,216 8,537,684

October 1, 2022 – October 31, 2022 1,094,049 20.32 10,794,265 7,443,635

November 1, 2022 – November 30, 2022 453,885 18.91 11,248,150 6,989,750

December 1, 2022 – December 31, 2022 — — 11,248,150 6,989,750

Total 11,248,150 $ 19.97

(1) On October 28, 2021, we announced that our Board of Directors had approved a share repurchase program, subject to receipt of a notice of non-objection from the Board of Governors of the Federal Reserve System (“Non-Objection Notice”).

On November 12, 2021, we announced we had received the Non-Objection Notice to the share repurchase program, which authorized the purchase of up

to 9,337,900 shares over a 12-month period.

The program was limited to $225.0 million through November 30, 2022.

We completed the repurchase of the total number of shares authorized through this program during the third quarter of 2022.

(2) On September 7, 2022, we announced receipt of a notice of non-objection from the Board of Governors of the Federal Reserve System for a new share repurchase program.

The program, which authorizes the purchase of up to 8,900,000 shares over a 12-month period, is limited to $200.0 million through August 31, 2023.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity