Eastern Bankshares in Boston reported a large quarterly loss after a major restructuring of its balance sheet.
The $22.7 billion-asset company said in a press release that it lost $194.1 million in the first quarter after it sold $1.9 billion of securities at a $280 million loss.
Proceeds from the sale were used to increase cash levels, which totaled $2.1 billion on March 31.
“Eastern deployed excess liquidity into the purchase of U.S. government and government agency bonds during the … pandemic, when interest rates were historically low,” Bob Rivers, Eastern’s chairman and CEO, said in the release.
“After careful consideration of all our options, we made the decision in early March and prior to the recent bank failures to sell a portion of our bond portfolio to improve liquidity and future earnings while maintaining robust capital levels,” Rivers added.
Eastern said it took other steps to strengthen backup sources of liquidity. It pledged securities to the Federal Reserve’s Bank Term Funding Program (BTFP), totaling $2.6 billion. The bank also has secured borrowing capacity at the Federal Reserve Bank and Federal Home Loan Bank totaling $5 billion.
Deposits fell by 2.2% from the fourth quarter and by 4.4% from a year earlier, to $18.5 billion.