The state's largest community bank just got a little bigger, crossing the key $10 billion threshold, according to federal regulatory filings.
Eastern Bank reported that at the end of the second quarter it had over $10 billion in assets, a milestone that will trigger greater oversight from its regulators.
Eastern has been planning for the transition into a bigger bank for several years by boosting its compliance team and upgrading technology. As a larger bank, Eastern will also see a hit to its fee income when its credit cards are used at retailers, since regulations require a cap on these interchange fees to help consumers save money. The cost of increased compliance, more technology, and decreases in swipe fees, will likely cost Eastern about $14 million annually before taxes, officials have estimated.
"In the near-term, we'll see some real pressure on earnings that will cause us to reassess some of our spending," said Richard Holbrook, the chairman of Eastern. Holbrook said he doesn't expect Eastern will have to cut positions to save money, but may not add new employees as quickly.
A number of acquisitions in recent years has helped Eastern Bank grow by more than 40 percent since 2007, from $7 billion in assets to its current size. Eastern has also expanded into parts of Boston and into New Hampshire.
While Eastern is the first of the state's community institutions to cross $10 billion in recent years, it likely won't be the last. Pittsfield-based Berkshire Hills Bancorp, with about $8 billion in assets, has said in earnings calls that it, too, is talking to regulators and making preparations as it gets bigger.
Deirdre Fernandes can be reached at deirdre.fernandes@globe.com. Follow her on Twitter @fernandesglobe.