Category: GlobeNewswire

Source: GlobeNewswire (MIL-OSI)

HINGHAM, Mass., July 11, 2025 (GLOBE NEWSWIRE) — HINGHAM INSTITUTION FOR SAVINGS (NASDAQ: HIFS), Hingham, Massachusetts announced results for the quarter ended June 30, 2025.

Earnings

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

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

Net income for the six months ended June 30, 2025 was $16,538,000 or $7.58 per share basic and $7.52 per share diluted, as compared to $10,970,000 or $5.04 per share basic and $5.01 per share diluted for the same period last year. The Bank’s annualized return on average equity for the first six months of 2025 was 7.45%, and the annualized return on average assets was 0.75%, as compared to 5.27% and 0.50% for the same period in 2024. Net income per share (diluted) for the first six months of 2025 increased by 50.1% over the same period in 2024.

Core net income for the six months ended June 30, 2025, which represents net income excluding the after-tax net gain on equity securities, both realized and unrealized, was $13,578,000 or $6.23 per share basic and $6.17 per share diluted, as compared to $4,395,000 or $2.02 per share basic and $2.01 per share diluted for the same period last year. The Bank’s annualized core return on average equity for the first six months of 2025 was 6.12%, and the annualized core return on average assets was 0.61%, as compared to 2.11% and 0.20% for the same period in 2024. Core net income per share (diluted) for the first six months of 2025 increased by 207.0% over the same period in 2024.

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

Balance Sheet

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

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

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

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

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

Wholesale funds, which includes Federal Home Loan Bank (“FHLB”) borrowings, brokered deposits, and Internet listing service time deposits, were $2.052 billion at June 30, 2025 representing 6.0% annualized growth year-to-date and a 4.4% decline from June 30, 2024, as the Bank used these funds to replace certain commercial deposits in the second quarter of 2025. In the first six months of 2025, the Bank continued to manage its wholesale funding mix to lower its cost of funds while taking advantage of the inverted yield curve at certain durations by adding lower rate longer term liabilities. Wholesale deposits, which include brokered and Internet listing service time deposits, were $480.1 million at June 30, 2025, representing a 6.0% annualized decline year-to-date and a 3.5% decline from June 30, 2024. Borrowings from the FHLB totaled $1.572 billion at June 30, 2025, representing 10.0% annualized growth from December 31, 2024, and a 4.7% decline from June 30, 2024. As of June 30, 2025, the Bank maintained an additional $802.8 million in immediately available borrowing capacity at the FHLB of Boston and the Federal Reserve Bank, in addition to $360.6 million in cash and cash equivalents.

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

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

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

Operational Performance Metrics

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

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

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

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

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

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

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

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

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

HINGHAM INSTITUTION FOR SAVINGS Selected Financial Ratios
	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2025			2024			2025
(Unaudited)
Key Performance Ratios
Return on average assets (1)	0.38	%		0.85	%		0.50	%		0.75	%
Return on average equity (1)	3.92			8.43			5.27			7.45
Core return on average assets (1) (5)	0.20			0.67			0.20			0.61
Core return on average equity (1) (5)	2.08			6.67			2.11			6.12
Interest rate spread (1) (2)	0.25			0.95			0.19			0.87
Net interest margin (1) (3)	0.96			1.66			0.91			1.58
Operating expenses to average assets (1)	0.67			0.68			0.67			0.68
Efficiency ratio (4)	68.57			41.17			72.63			43.36
Average equity to average assets	9.59			10.05			9.56			10.02
Average interest-earning assets to average interest-bearing liabilities	119.93			122.94			119.92			122.60

	June 30, 2024					December 31, 2024				June 30, 2025
(Unaudited)
Asset Quality Ratios
Allowance for credit losses/total loans			0.68	%		0.69		%				0.70	%
Allowance for credit losses/non-performing loans			1,577.28			1,775.00						86.97
Non-performing loans/total loans			0.04			0.04						0.81
Non-performing loans/total assets			0.04			0.03						0.70
Non-performing assets/total assets			0.04			0.03						0.70
Share Related
Book value per share	$	191.34				$	198.03			$	204.36
Market value per share	$	178.88				$	254.14			$	248.35
Shares outstanding at end of period		2,180,250					2,180,250				2,181,250

(1)		Annualized.
(2)		Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(3)		Net interest margin represents net interest income divided by average interest-earning assets.
(4)		The efficiency ratio is a non-GAAP measure that represents total operating expenses, divided by the sum of net interest income and total other income, excluding the net gain on equity securities, both realized and unrealized.
(5)		Non-GAAP measurements that represent return on average assets and return on average equity, excluding the after-tax net gain on equity securities, both realized and unrealized.

HINGHAM INSTITUTION FOR SAVINGS Consolidated Balance Sheets
(In thousands, except share amounts)	June 30, 2024				December 31, 2024				June 30, 2025
(Unaudited)
ASSETS
Cash and due from banks	$	5,990			$	4,183			$	8,470
Federal Reserve and other short-term investments		363,151				347,647				352,144
Cash and cash equivalents		369,141				351,830				360,614
CRA investment		8,722				8,769				8,928
Other marketable equity securities		83,860				104,575				113,761
Securities, at fair value		92,582				113,344				122,689
Securities held to maturity, at amortized cost		6,493				6,493				6,494
Federal Home Loan Bank stock, at cost		66,189				61,022				64,659
Loans, net of allowance for credit losses of $26,940 at June 30, 2024, $26,980 at December 31, 2024 and $27,730 at June 30, 2025		3,933,419				3,873,662				3,931,663
Bank-owned life insurance		13,805				13,980				14,143
Premises and equipment, net		16,676				16,397				16,180
Accrued interest receivable		9,082				8,774				8,962
Other assets		13,344				12,269				13,753
Total assets	$	4,520,731			$	4,457,771			$	4,539,157

LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits	$	2,075,002			$	2,094,626			$	2,040,271
Non-interest-bearing deposits		343,262				397,469				437,608
Total deposits		2,418,264				2,492,095				2,477,879
Federal Home Loan Bank advances		1,648,675				1,497,000				1,572,000
Mortgagors’ escrow accounts		14,577				16,699				18,478
Accrued interest payable		12,242				8,244				12,959
Deferred income tax liability, net		989				3,787				4,629
Other liabilities		8,806				8,191				7,460
Total liabilities		4,103,553				4,026,016				4,093,405
Stockholders’ equity:
Preferred stock, $1.00 par value, 2,500,000 shares authorized, none issued		—				—				—
Common stock, $1.00 par value, 5,000,000 shares authorized; 2,180,250 shares issued and outstanding at June 30, 2024 and December 31, 2024, and 2,181,250 shares issued and outstanding at June 30, 2025		2,180				2,180				2,181
Additional paid-in capital		15,467				15,571				15,777
Undivided profits		399,531				414,004				427,794
Total stockholders’ equity		417,178				431,755				445,752
Total liabilities and stockholders’ equity	$	4,520,731			$	4,457,771			$	4,539,157

HINGHAM INSTITUTION FOR SAVINGS Consolidated Statements of Income
				Three Months Ended								Six Months Ended
				June 30,								June 30,
(In thousands, except per share amounts)				2024				2025				2024				2025
(Unaudited)
Interest and dividend income:
		Loans		$	44,665			$	46,752			$	87,785			$		91,973
		Debt securities			87				97				132					192
		Equity securities			1,551				1,365				3,001					2,816
		Federal Reserve and other short-term investments			2,745				3,072				5,572					6,127
			Total interest and dividend income		49,048				51,286				96,490					101,108
Interest expense:
		Deposits			22,141				17,841				43,287					36,462
		Federal Home Loan Bank			16,539				15,406				33,751					30,571
			Total interest expense		38,680				33,247				77,038					67,033
			Net interest income		10,368				18,039				19,452					34,075
Provision for credit losses					180				450				288					750
	Net interest income, after provision for credit losses				10,188				17,589				19,164					33,325
Other income:
	Customer service fees on deposits				138				139				275					274
	Increase in cash surrender value of bank-owned life insurance				82				79				163					163
	Gain on equity securities, net				2,464				2,516				8,434					3,797
	Miscellaneous				49				73				104					122
			Total other income		2,733				2,807				8,976					4,356
Operating expenses:
		Salaries and employee benefits			4,234				4,392				8,531					8,859
		Occupancy and equipment			394				417				825					856
		Data processing			738				758				1,493					1,482
		Deposit insurance			819				784				1,629					1,532
		Foreclosure and related			14				14				46					24
		Marketing			187				222				276					358
		Other general and administrative			908				959				1,721					1,905
			Total operating expenses		7,294				7,546				14,521					15,016
Income before income taxes					5,627				12,850				13,619					22,665
Income tax provision					1,525				3,436				2,649					6,127
			Net income	$	4,102			$	9,414			$	10,970			$		16,538
Cash dividends declared per common share				$	0.63			$	0.63			$	1.26			$		1.26
Weighted average shares outstanding:
		Basic			2,180				2,181				2,175					2,181
		Diluted			2,186				2,200				2,189					2,200
Earnings per share:
		Basic		$	1.88			$	4.32			$	5.04			$		7.58
		Diluted		$	1.88			$	4.28			$	5.01			$		7.52

HINGHAM INSTITUTION FOR SAVINGS Net Interest Income Analysis
	Three Months Ended
	June 30, 2024									March 31, 2025											June 30, 2025
	Average Balance (9)			Interest			Yield/ Rate (10)			Average Balance (9)					Interest			Yield/ Rate (10)			Average Balance (9)			Interest				Yield/ Rate (10)
(Dollars in thousands)
(Unaudited)
Assets
Loans (1) (2)	$	3,980,111		$	44,665		4.49	%		$	3,929,828			$		45,221		4.67	%		$	3,952,477			$	46,752		4.74	%
Securities (3) (4)		119,477			1,638		5.48				130,674					1,546		4.80				135,541				1,462		4.33
Short-term investments (5)		202,379			2,745		5.43				278,722					3,055		4.45				277,146				3,072		4.45
Total interest-earning assets		4,301,967			49,048		4.56				4,339,224					49,822		4.66				4,365,164				51,286		4.71
Other assets		66,218									79,209											78,230
Total assets	$	4,368,185								$	4,418,433										$	4,443,394
Liabilities and stockholders’ equity:
Interest-bearing deposits (6)	$	2,149,753		$	22,141		4.12	%		$	2,141,294			$		18,621		3.53	%		$	2,102,662			$	17,841		3.40	%
Borrowed funds		1,437,335			16,539		4.60				1,407,844					15,165		4.37				1,448,078				15,406		4.27
Total interest-bearing liabilities		3,587,088			38,680		4.31				3,549,138					33,786		3.86				3,550,740				33,247		3.76
Non-interest-bearing deposits		346,663									413,877											429,537
Other liabilities		15,503									14,464											16,378
Total liabilities		3,949,254									3,977,479											3,996,655
Stockholders’ equity		418,931									440,954											446,739
Total liabilities and stockholders’ equity	$	4,368,185								$	4,418,433										$	4,443,394
Net interest income				$	10,368									$		16,036									$	18,039
Weighted average interest rate spread							0.25	%										0.80	%									0.95	%
Net interest margin (7)							0.96	%										1.50	%									1.66	%

Average interest-earning assets to average interest-bearing liabilities (8)

119.93

%

122.26

%

122.94

%

(1)		Before allowance for credit losses.
(2)		Includes non-accrual loans.
(3)		Excludes the impact of the average net unrealized gain or loss on securities.
(4)		Includes Federal Home Loan Bank stock.
(5)		Includes cash held at the Federal Reserve Bank.
(6)		Includes mortgagors’ escrow accounts.
(7)		Net interest income divided by average total interest-earning assets.
(8)		Total interest-earning assets divided by total interest-bearing liabilities.
(9)		Average balances are calculated on a daily basis.
(10)		Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS Net Interest Income Analysis
	Six Months Ended June 30,
	2024									2025
	Average Balance (9)			Interest			Yield/ Rate (10)			Average Balance (9)			Interest			Yield/ Rate (10)
(Dollars in thousands)
(Unaudited)
Loans (1) (2)	$	3,968,123		$	87,785		4.42	%		$	3,941,215		$	91,973		4.71	%
Securities (3) (4)		117,840			3,133		5.32				133,121			3,008		4.56
Short-term investments (5)		205,312			5,572		5.43				277,930			6,127		4.45
Total interest-earning assets		4,291,275			96,490		4.50				4,352,266			101,108		4.68
Other assets		65,126									78,717
Total assets	$	4,356,401								$	4,430,983
Interest-bearing deposits (6)	$	2,124,302		$	43,287		4.08	%		$	2,121,871		$	36,462		3.47	%
Borrowed funds		1,454,181			33,751		4.64				1,428,072			30,571		4.32
Total interest-bearing liabilities		3,578,483			77,038		4.31				3,549,943			67,033		3.81
Non-interest-bearing deposits		346,399									421,750
Other liabilities		14,882									15,428
Total liabilities		3,939,764									3,987,121
Stockholders’ equity		416,637									443,862
Total liabilities and stockholders’ equity	$	4,356,401								$	4,430,983
Net interest income				$	19,452								$	34,075
Weighted average interest rate spread							0.19	%								0.87	%
Net interest margin (7)							0.91	%								1.58	%
Average interest-earning assets to average interest-bearing liabilities (8)		119.92	%								122.60	%

(1)		Before allowance for credit losses.
(2)		Includes non-accrual loans.
(3)		Excludes the impact of the average net unrealized gain or loss on securities.
(4)		Includes Federal Home Loan Bank stock.
(5)		Includes cash held at the Federal Reserve Bank.
(6)		Includes mortgagors’ escrow accounts.
(7)		Net interest income divided by average total interest-earning assets.
(8)		Total interest-earning assets divided by total interest-bearing liabilities.
(9)		Average balances are calculated on a daily basis.
(10)		Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS  Non-GAAP Reconciliation

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

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

	Three Months Ended								Six Months Ended
	June 30,								June 30,
(In thousands, unaudited)	2024				2025				2024				2025
Non-GAAP reconciliation:
Net income	$	4,102			$	9,414			$	10,970			$		16,538
Gain on equity securities, net		(2,464	)			(2,516	)			(8,434	)				(3,797	)
Income tax expense (1)		543				555				1,859					837
Core net income	$	2,181			$	7,453			$	4,395			$		13,578

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

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

	Three Months Ended														Six Months Ended
	June 30,					March 31,					June 30,				June 30,
(In thousands, unaudited)	2024					2025					2025				2024					2025
Non-U.S. GAAP efficiency ratio calculation:
Operating expenses	$	7,294				$	7,470				$	7,546			$	14,521				$	15,016
Net interest income	$	10,368				$	16,036				$	18,039			$	19,452				$	34,075
Other income		2,733					1,549					2,807				8,976					4,356
Gain on equity securities, net		(2,464	)				(1,281	)				(2,516	)			(8,434	)				(3,797	)
Total revenue	$	10,637				$	16,304				$	18,330			$	19,994				$	34,634
Efficiency ratio		68.57		%			45.82		%			41.17		%		72.63		%			43.36		%

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

The MIL Network –

Source: GlobeNewswire (MIL-OSI)

HINGHAM, Mass., July 11, 2025 (GLOBE NEWSWIRE) — HINGHAM INSTITUTION FOR SAVINGS (NASDAQ: HIFS), Hingham, Massachusetts announced results for the quarter ended June 30, 2025.

Earnings

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

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

Net income for the six months ended June 30, 2025 was $16,538,000 or $7.58 per share basic and $7.52 per share diluted, as compared to $10,970,000 or $5.04 per share basic and $5.01 per share diluted for the same period last year. The Bank’s annualized return on average equity for the first six months of 2025 was 7.45%, and the annualized return on average assets was 0.75%, as compared to 5.27% and 0.50% for the same period in 2024. Net income per share (diluted) for the first six months of 2025 increased by 50.1% over the same period in 2024.

Core net income for the six months ended June 30, 2025, which represents net income excluding the after-tax net gain on equity securities, both realized and unrealized, was $13,578,000 or $6.23 per share basic and $6.17 per share diluted, as compared to $4,395,000 or $2.02 per share basic and $2.01 per share diluted for the same period last year. The Bank’s annualized core return on average equity for the first six months of 2025 was 6.12%, and the annualized core return on average assets was 0.61%, as compared to 2.11% and 0.20% for the same period in 2024. Core net income per share (diluted) for the first six months of 2025 increased by 207.0% over the same period in 2024.

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

Balance Sheet

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

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

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

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

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

Wholesale funds, which includes Federal Home Loan Bank (“FHLB”) borrowings, brokered deposits, and Internet listing service time deposits, were $2.052 billion at June 30, 2025 representing 6.0% annualized growth year-to-date and a 4.4% decline from June 30, 2024, as the Bank used these funds to replace certain commercial deposits in the second quarter of 2025. In the first six months of 2025, the Bank continued to manage its wholesale funding mix to lower its cost of funds while taking advantage of the inverted yield curve at certain durations by adding lower rate longer term liabilities. Wholesale deposits, which include brokered and Internet listing service time deposits, were $480.1 million at June 30, 2025, representing a 6.0% annualized decline year-to-date and a 3.5% decline from June 30, 2024. Borrowings from the FHLB totaled $1.572 billion at June 30, 2025, representing 10.0% annualized growth from December 31, 2024, and a 4.7% decline from June 30, 2024. As of June 30, 2025, the Bank maintained an additional $802.8 million in immediately available borrowing capacity at the FHLB of Boston and the Federal Reserve Bank, in addition to $360.6 million in cash and cash equivalents.

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

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

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

Operational Performance Metrics

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

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

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

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

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

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

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

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

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

HINGHAM INSTITUTION FOR SAVINGS Selected Financial Ratios
	Three Months Ended June 30,						Six Months Ended June 30,
	2024			2025			2024			2025
(Unaudited)
Key Performance Ratios
Return on average assets (1)	0.38	%		0.85	%		0.50	%		0.75	%
Return on average equity (1)	3.92			8.43			5.27			7.45
Core return on average assets (1) (5)	0.20			0.67			0.20			0.61
Core return on average equity (1) (5)	2.08			6.67			2.11			6.12
Interest rate spread (1) (2)	0.25			0.95			0.19			0.87
Net interest margin (1) (3)	0.96			1.66			0.91			1.58
Operating expenses to average assets (1)	0.67			0.68			0.67			0.68
Efficiency ratio (4)	68.57			41.17			72.63			43.36
Average equity to average assets	9.59			10.05			9.56			10.02
Average interest-earning assets to average interest-bearing liabilities	119.93			122.94			119.92			122.60

	June 30, 2024					December 31, 2024				June 30, 2025
(Unaudited)
Asset Quality Ratios
Allowance for credit losses/total loans			0.68	%		0.69		%				0.70	%
Allowance for credit losses/non-performing loans			1,577.28			1,775.00						86.97
Non-performing loans/total loans			0.04			0.04						0.81
Non-performing loans/total assets			0.04			0.03						0.70
Non-performing assets/total assets			0.04			0.03						0.70
Share Related
Book value per share	$	191.34				$	198.03			$	204.36
Market value per share	$	178.88				$	254.14			$	248.35
Shares outstanding at end of period		2,180,250					2,180,250				2,181,250

(1)		Annualized.
(2)		Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(3)		Net interest margin represents net interest income divided by average interest-earning assets.
(4)		The efficiency ratio is a non-GAAP measure that represents total operating expenses, divided by the sum of net interest income and total other income, excluding the net gain on equity securities, both realized and unrealized.
(5)		Non-GAAP measurements that represent return on average assets and return on average equity, excluding the after-tax net gain on equity securities, both realized and unrealized.

HINGHAM INSTITUTION FOR SAVINGS Consolidated Balance Sheets
(In thousands, except share amounts)	June 30, 2024				December 31, 2024				June 30, 2025
(Unaudited)
ASSETS
Cash and due from banks	$	5,990			$	4,183			$	8,470
Federal Reserve and other short-term investments		363,151				347,647				352,144
Cash and cash equivalents		369,141				351,830				360,614
CRA investment		8,722				8,769				8,928
Other marketable equity securities		83,860				104,575				113,761
Securities, at fair value		92,582				113,344				122,689
Securities held to maturity, at amortized cost		6,493				6,493				6,494
Federal Home Loan Bank stock, at cost		66,189				61,022				64,659
Loans, net of allowance for credit losses of $26,940 at June 30, 2024, $26,980 at December 31, 2024 and $27,730 at June 30, 2025		3,933,419				3,873,662				3,931,663
Bank-owned life insurance		13,805				13,980				14,143
Premises and equipment, net		16,676				16,397				16,180
Accrued interest receivable		9,082				8,774				8,962
Other assets		13,344				12,269				13,753
Total assets	$	4,520,731			$	4,457,771			$	4,539,157

LIABILITIES AND STOCKHOLDERS’ EQUITY
Interest-bearing deposits	$	2,075,002			$	2,094,626			$	2,040,271
Non-interest-bearing deposits		343,262				397,469				437,608
Total deposits		2,418,264				2,492,095				2,477,879
Federal Home Loan Bank advances		1,648,675				1,497,000				1,572,000
Mortgagors’ escrow accounts		14,577				16,699				18,478
Accrued interest payable		12,242				8,244				12,959
Deferred income tax liability, net		989				3,787				4,629
Other liabilities		8,806				8,191				7,460
Total liabilities		4,103,553				4,026,016				4,093,405
Stockholders’ equity:
Preferred stock, $1.00 par value, 2,500,000 shares authorized, none issued		—				—				—
Common stock, $1.00 par value, 5,000,000 shares authorized; 2,180,250 shares issued and outstanding at June 30, 2024 and December 31, 2024, and 2,181,250 shares issued and outstanding at June 30, 2025		2,180				2,180				2,181
Additional paid-in capital		15,467				15,571				15,777
Undivided profits		399,531				414,004				427,794
Total stockholders’ equity		417,178				431,755				445,752
Total liabilities and stockholders’ equity	$	4,520,731			$	4,457,771			$	4,539,157

HINGHAM INSTITUTION FOR SAVINGS Consolidated Statements of Income
				Three Months Ended								Six Months Ended
				June 30,								June 30,
(In thousands, except per share amounts)				2024				2025				2024				2025
(Unaudited)
Interest and dividend income:
		Loans		$	44,665			$	46,752			$	87,785			$		91,973
		Debt securities			87				97				132					192
		Equity securities			1,551				1,365				3,001					2,816
		Federal Reserve and other short-term investments			2,745				3,072				5,572					6,127
			Total interest and dividend income		49,048				51,286				96,490					101,108
Interest expense:
		Deposits			22,141				17,841				43,287					36,462
		Federal Home Loan Bank			16,539				15,406				33,751					30,571
			Total interest expense		38,680				33,247				77,038					67,033
			Net interest income		10,368				18,039				19,452					34,075
Provision for credit losses					180				450				288					750
	Net interest income, after provision for credit losses				10,188				17,589				19,164					33,325
Other income:
	Customer service fees on deposits				138				139				275					274
	Increase in cash surrender value of bank-owned life insurance				82				79				163					163
	Gain on equity securities, net				2,464				2,516				8,434					3,797
	Miscellaneous				49				73				104					122
			Total other income		2,733				2,807				8,976					4,356
Operating expenses:
		Salaries and employee benefits			4,234				4,392				8,531					8,859
		Occupancy and equipment			394				417				825					856
		Data processing			738				758				1,493					1,482
		Deposit insurance			819				784				1,629					1,532
		Foreclosure and related			14				14				46					24
		Marketing			187				222				276					358
		Other general and administrative			908				959				1,721					1,905
			Total operating expenses		7,294				7,546				14,521					15,016
Income before income taxes					5,627				12,850				13,619					22,665
Income tax provision					1,525				3,436				2,649					6,127
			Net income	$	4,102			$	9,414			$	10,970			$		16,538
Cash dividends declared per common share				$	0.63			$	0.63			$	1.26			$		1.26
Weighted average shares outstanding:
		Basic			2,180				2,181				2,175					2,181
		Diluted			2,186				2,200				2,189					2,200
Earnings per share:
		Basic		$	1.88			$	4.32			$	5.04			$		7.58
		Diluted		$	1.88			$	4.28			$	5.01			$		7.52

HINGHAM INSTITUTION FOR SAVINGS Net Interest Income Analysis
	Three Months Ended
	June 30, 2024									March 31, 2025											June 30, 2025
	Average Balance (9)			Interest			Yield/ Rate (10)			Average Balance (9)					Interest			Yield/ Rate (10)			Average Balance (9)			Interest				Yield/ Rate (10)
(Dollars in thousands)
(Unaudited)
Assets
Loans (1) (2)	$	3,980,111		$	44,665		4.49	%		$	3,929,828			$		45,221		4.67	%		$	3,952,477			$	46,752		4.74	%
Securities (3) (4)		119,477			1,638		5.48				130,674					1,546		4.80				135,541				1,462		4.33
Short-term investments (5)		202,379			2,745		5.43				278,722					3,055		4.45				277,146				3,072		4.45
Total interest-earning assets		4,301,967			49,048		4.56				4,339,224					49,822		4.66				4,365,164				51,286		4.71
Other assets		66,218									79,209											78,230
Total assets	$	4,368,185								$	4,418,433										$	4,443,394
Liabilities and stockholders’ equity:
Interest-bearing deposits (6)	$	2,149,753		$	22,141		4.12	%		$	2,141,294			$		18,621		3.53	%		$	2,102,662			$	17,841		3.40	%
Borrowed funds		1,437,335			16,539		4.60				1,407,844					15,165		4.37				1,448,078				15,406		4.27
Total interest-bearing liabilities		3,587,088			38,680		4.31				3,549,138					33,786		3.86				3,550,740				33,247		3.76
Non-interest-bearing deposits		346,663									413,877											429,537
Other liabilities		15,503									14,464											16,378
Total liabilities		3,949,254									3,977,479											3,996,655
Stockholders’ equity		418,931									440,954											446,739
Total liabilities and stockholders’ equity	$	4,368,185								$	4,418,433										$	4,443,394
Net interest income				$	10,368									$		16,036									$	18,039
Weighted average interest rate spread							0.25	%										0.80	%									0.95	%
Net interest margin (7)							0.96	%										1.50	%									1.66	%

Average interest-earning assets to average interest-bearing liabilities (8)

119.93

%

122.26

%

122.94

%

(1)		Before allowance for credit losses.
(2)		Includes non-accrual loans.
(3)		Excludes the impact of the average net unrealized gain or loss on securities.
(4)		Includes Federal Home Loan Bank stock.
(5)		Includes cash held at the Federal Reserve Bank.
(6)		Includes mortgagors’ escrow accounts.
(7)		Net interest income divided by average total interest-earning assets.
(8)		Total interest-earning assets divided by total interest-bearing liabilities.
(9)		Average balances are calculated on a daily basis.
(10)		Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS Net Interest Income Analysis
	Six Months Ended June 30,
	2024									2025
	Average Balance (9)			Interest			Yield/ Rate (10)			Average Balance (9)			Interest			Yield/ Rate (10)
(Dollars in thousands)
(Unaudited)
Loans (1) (2)	$	3,968,123		$	87,785		4.42	%		$	3,941,215		$	91,973		4.71	%
Securities (3) (4)		117,840			3,133		5.32				133,121			3,008		4.56
Short-term investments (5)		205,312			5,572		5.43				277,930			6,127		4.45
Total interest-earning assets		4,291,275			96,490		4.50				4,352,266			101,108		4.68
Other assets		65,126									78,717
Total assets	$	4,356,401								$	4,430,983
Interest-bearing deposits (6)	$	2,124,302		$	43,287		4.08	%		$	2,121,871		$	36,462		3.47	%
Borrowed funds		1,454,181			33,751		4.64				1,428,072			30,571		4.32
Total interest-bearing liabilities		3,578,483			77,038		4.31				3,549,943			67,033		3.81
Non-interest-bearing deposits		346,399									421,750
Other liabilities		14,882									15,428
Total liabilities		3,939,764									3,987,121
Stockholders’ equity		416,637									443,862
Total liabilities and stockholders’ equity	$	4,356,401								$	4,430,983
Net interest income				$	19,452								$	34,075
Weighted average interest rate spread							0.19	%								0.87	%
Net interest margin (7)							0.91	%								1.58	%
Average interest-earning assets to average interest-bearing liabilities (8)		119.92	%								122.60	%

(1)		Before allowance for credit losses.
(2)		Includes non-accrual loans.
(3)		Excludes the impact of the average net unrealized gain or loss on securities.
(4)		Includes Federal Home Loan Bank stock.
(5)		Includes cash held at the Federal Reserve Bank.
(6)		Includes mortgagors’ escrow accounts.
(7)		Net interest income divided by average total interest-earning assets.
(8)		Total interest-earning assets divided by total interest-bearing liabilities.
(9)		Average balances are calculated on a daily basis.
(10)		Annualized based on the actual number of days in the period.

HINGHAM INSTITUTION FOR SAVINGS  Non-GAAP Reconciliation

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

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

	Three Months Ended								Six Months Ended
	June 30,								June 30,
(In thousands, unaudited)	2024				2025				2024				2025
Non-GAAP reconciliation:
Net income	$	4,102			$	9,414			$	10,970			$		16,538
Gain on equity securities, net		(2,464	)			(2,516	)			(8,434	)				(3,797	)
Income tax expense (1)		543				555				1,859					837
Core net income	$	2,181			$	7,453			$	4,395			$		13,578

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

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

	Three Months Ended														Six Months Ended
	June 30,					March 31,					June 30,				June 30,
(In thousands, unaudited)	2024					2025					2025				2024					2025
Non-U.S. GAAP efficiency ratio calculation:
Operating expenses	$	7,294				$	7,470				$	7,546			$	14,521				$	15,016
Net interest income	$	10,368				$	16,036				$	18,039			$	19,452				$	34,075
Other income		2,733					1,549					2,807				8,976					4,356
Gain on equity securities, net		(2,464	)				(1,281	)				(2,516	)			(8,434	)				(3,797	)
Total revenue	$	10,637				$	16,304				$	18,330			$	19,994				$	34,634
Efficiency ratio		68.57		%			45.82		%			41.17		%		72.63		%			43.36		%

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

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