v3.26.1
Employee Benefits
 3 Months Ended
Mar. 31, 2026
Share-Based Payment Arrangement [Abstract]  
Employee Benefits Employee Benefits
Pension Plans
The Company provides pension benefits for its employees through membership in the Savings Banks Employees’ Retirement Association. The plan through which benefits are provided is a noncontributory, qualified defined benefit plan and is referred to as the Defined Benefit Plan. The Company’s annual contribution to the Defined Benefit Plan is based upon standards established by the Pension Protection Act. The contribution is based on an actuarial method intended to provide not only for benefits attributable to service to date, but also for those expected to be earned in the future. The Defined Benefit Plan has a plan year end of October 31.
The Company has an unfunded Defined Benefit Supplemental Executive Retirement Plan (“DB SERP”) that provides certain Company officers upon their retirement with defined pension benefits in excess of qualified plan limits imposed by U.S. federal tax law. The DB SERP has a plan year end of December 31.
In addition, the Company has an unfunded Benefit Equalization Plan (“BEP”) to provide retirement benefits to certain employees whose retirement benefits under the qualified pension plan are limited per the Internal Revenue Code. The BEP has a plan year end of October 31.
The Company also has an unfunded Outside Directors’ Retainer Continuance Plan (“ODRCP”) that provides pension benefits to outside directors who retire from service. The ODRCP has a plan year end of December 31. Effective December 31, 2020, the Company closed the ODRCP to new participants and froze benefit accruals for active participants.
Components of Net Periodic Benefit Cost
The components of net pension expense for the plans for the periods indicated are as follows:
Three Months Ended March 31,
20262025
(In thousands)
Components of net periodic benefit cost:
Service cost$6,217 $5,733 
Interest cost5,288 5,365 
Expected return on plan assets(9,828)(9,495)
Prior service credit(2,488)(2,495)
Recognized net actuarial loss301 925 
Net periodic benefit (credit) cost$(510)$33 
Service costs for the Defined Benefit Plan and the BEP are recognized within salaries and employee benefits in the Consolidated Statements of Income. The remaining components of net periodic benefit cost are recognized in other noninterest expense in the Consolidated Statements of Income.
In accordance with the Pension Protection Act, the Company was not required to make any contributions to the Defined Benefit Plan for the plan years beginning November 1, 2025 and 2024. Accordingly, during the three months ended March 31, 2026 and 2025, there were no contributions made to the Defined Benefit Plan.
Share-Based Compensation Plan
On November 29, 2021, the shareholders of the Company approved the Eastern Bankshares, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the issuance of up to 26,146,141 shares of common stock pursuant to grants of restricted stock, restricted stock units (“RSUs”), non-qualified stock options and incentive stock options, any or all of which can be granted with performance-based vesting conditions. Under the 2021 Plan, 7,470,326 shares may be issued as restricted stock or RSUs, including those issued as performance shares and performance share units (“PSUs”), and 18,675,815 shares may be issued upon the exercise of stock options. These shares may be awarded from the Company’s authorized but unissued shares. However, the 2021 Plan permits the grant of additional awards of restricted stock or RSUs above the aforementioned limit, provided that, for each additional share of restricted stock or RSU awarded in excess of such limit, the pool of shares available to be issued upon the exercise of stock options will be reduced by three shares. Pursuant to the terms of the 2021 Plan, each of the Company’s non-employee directors were automatically granted awards of restricted stock on November 30, 2021. Such RSAs vest pro-rata on an annual basis over a five-year period. The maximum term for stock options is ten years.
The following table summarizes the share-based compensation awards for the three months ended March 31, 2026 and 2025:
TimeType of awardShares granted
Vesting Period (Approximate from date of grant) (1)
2026
MarchRSU445,2543.0 years
MarchPSU208,3582.8 years
2025
MarchRSU630,4933.0 years
MarchPSU339,5032.8 years
(1)Vesting of PSU awards is contingent upon the Compensation and Human Capital Management Committee of the Board of Directors' certification, after the conclusion of the period indicated from the date of the grant, that the Company has attained a threshold level of certain performance criteria over such period.
As of March 31, 2026 and December 31, 2025, there were 2,501,462 shares and 3,134,086 shares that remained available for issuance as restricted stock or RSU awards (including those that may be issued as performance shares and PSUs), respectively, and 18,675,815 shares that remained available for issuance upon the exercise of stock options at both dates. As of both March 31, 2026 and December 31, 2025, no stock options had been awarded under the 2021 Plan.
The following table summarizes the Company’s restricted stock award activity for the periods indicated:
For the Three Months Ended March 31,
20262025
Restricted Stock AwardsNumber of SharesWeighted-Average Grant Price Per ShareNumber of SharesWeighted-Average Grant Price Per Share
Non-vested restricted stock as of the beginning of the respective period194,968$17.75 316,945$18.02 
Granted—— —— 
Vested(16,374)14.87 (22,103)14.87 
Forfeited(1,787)14.87 (2,983)14.87 
Non-vested restricted stock as of the end of the respective period176,807$18.05 291,859$18.29 
The following table summarizes the Company’s restricted stock unit activity for the periods indicated:
For the Three Months Ended March 31,
20262025
Restricted Stock UnitsNumber of SharesWeighted-Average Grant Price Per ShareNumber of SharesWeighted-Average Grant Price Per Share
Non-vested restricted stock units as of the beginning of the respective period1,325,982$16.87 1,356,522$16.55 
Granted445,25419.72 630,49317.73 
Vested(454,403)16.82 (458,079)17.15 
Forfeited(14,246)17.93 (12,786)14.36 
Non-vested restricted stock units as of the end of the respective period1,302,587$17.85 1,516,150$16.88 
The following table summarizes the Company’s performance stock unit activity for the periods indicated:
For the Three Months Ended March 31,
20262025
Performance Stock UnitsNumber of SharesWeighted-Average Grant Price Per ShareNumber of SharesWeighted-Average Grant Price Per Share
Non-vested performance stock units as of the beginning of the respective period617,915$13.15 969,739$16.63 
Granted208,35819.06 339,50318.79 
Vested(103,633)10.74 (408,629)20.96 
Forfeited(12,392)12.31 (277,149)20.63 
Non-vested performance stock units as of the end of the respective period710,248$15.25 623,464$13.19 
Included in vested RSU, and PSU shares, as shown in the tables above, are shares withheld for employee payroll taxes. The aggregate number of RSU, and PSU shares withheld for payroll taxes during the three months ended March 31, 2026 and 2025 was 204,278 and 330,038, respectively.
The following table shows share-based compensation expense under the 2021 Plan and the related tax benefit for the periods indicated:
Three Months Ended March 31,
20262025
(In millions)
Share-based compensation expense$4.2 $4.8 
Related tax benefit (1)
1.2 1.3 
(1)Estimated based upon the Company’s statutory rate for each respective period.
As of March 31, 2026 and December 31, 2025, there was $29.1 million and $20.8 million, respectively, of total unrecognized compensation expense related to unvested RSAs, RSUs and PSUs granted and issued under the 2021 Plan, as applicable. As of March 31, 2026, this cost is expected to be recognized over a weighted average remaining period of approximately 1.9 years. As of December 31, 2025, this cost was expected to be recognized over a weighted average remaining period of approximately 1.6 years.