Exhibit 99.1
[Graphic Omitted]
NASDAQ: WASH
Contact: Elizabeth B. Eckel
Senior Vice President, Marketing
Telephone: (401) 348-1309
E-mail: ebeckel@washtrust.com
Date: January 24, 2007
FOR IMMEDIATE RELEASE
Washington Trust Announces Earnings
Westerly, Rhode Island…Washington Trust Bancorp, Inc. (NASDAQ Global Market; symbol: WASH), parent company of The Washington Trust Company, today announced fourth quarter 2006 net income of $6.2 million, or 45 cents per diluted share. Net income for the fourth quarter of 2005 also totaled $6.2 million, or 45 cents per diluted share. For the year ended December 31, 2006, net income was $25.0 million, up $2.0 million, or 8.7 percent, from 2005. On a per diluted share basis, net income was $1.82 for the year ended December 31, 2006, up 13 cents, or 7.7 percent, from the $1.69 reported for 2005. Operating results for 2006 reflect the full year impact of Weston Financial Group, Inc. (“Weston Financial”), which was acquired in the third quarter of 2005.
Other 2006 highlights include:
| · | 2006 return on average equity and average assets were 14.99% and 1.04%, respectively, up from 14.80% and 0.98%, respectively, in 2005. |
| · | Noninterest income, as a percent of total revenues, increased from 33.8% in 2005 to 40.7% in 2006. |
| · | Asset quality remained strong as nonperforming assets to total assets amounted to 0.11% at December 31, 2006. |
"Washington Trust posted solid earnings in 2006, in light of a challenging interest rate environment and extremely competitive market,” stated John C. Warren, Washington Trust Chairman and Chief Executive Officer. "We continue to gain market share, attract new clients, and build existing relationships by focusing on service excellence and offering superior retail, business and wealth management products.”
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Washington Trust
Page Two, January 24, 2007
Net interest income totaled $15.0 million for the fourth quarter of 2006, down $727 thousand, or 4.6 percent, from the $15.7 million reported for the fourth quarter a year ago. The net interest margin (annualized tax-equivalent net interest income as a percentage of average earning assets) for the fourth quarter of 2006 amounted to 2.74%, down 10 basis points from the fourth quarter of 2005. The net interest margin was down 4 basis points from the third quarter of 2006 (excluding 8 basis points attributable to an extra third quarter dividend received from the Federal Home Loan Bank of Boston). The continued rise in short-term rates in 2006 has caused deposit costs to rise, while yields on loans and securities have increased by lesser amounts. For the year 2006, net interest income amounted to $61.5 million, up $818 thousand, or 1.3 percent, from 2005. The net interest margin for 2006 was 2.80%, compared to 2.79% for 2005.
Excluding net realized gains and losses on securities, noninterest income amounted to $10.4 million for the fourth quarter of 2006, an increase of $1.3 million, or 14 percent, from the same quarter of 2005. This increase is primarily attributable to higher revenues from wealth management services. Wealth management revenues were $6.7 million for the fourth quarter of 2006, up $898 thousand, or 15 percent, from the fourth quarter of 2005. Assets under administration totaled $3.695 billion at December 31, 2006, up $144 million in the fourth quarter of 2006 and up $423 million, or 13 percent, from $3.272 billion at December 31, 2005. These increases are due to financial market appreciation and business development efforts.
Noninterest income, excluding net realized gains and losses on securities, totaled $41.7 million for the year 2006, up $11.2 million, or 36 percent, from 2005. This increase is primarily attributable to higher revenues from wealth management services, largely due to the acquisition of Weston Financial which was completed on August 31, 2005.
Noninterest expenses amounted to $15.7 million for the fourth quarter of 2006, essentially unchanged from the same quarter a year ago although the fourth quarter of 2005 included the Corporation’s annual charitable contribution of $522 thousand. The 2006 annual contribution occurred in the second quarter. For the year ended December 31, 2006, noninterest expenses totaled $65.3 million, up $8.9 million, or 16 percent, from 2005. Included in noninterest expenses were merchant processing costs representing third-party costs incurred that are directly attributable to handling merchant credit card transactions. Merchant processing costs for 2006 increased 22 percent from 2005 largely due to increased volume of transactions processed. Excluding the impact of Weston Financial operating expenses, the increase in merchant processing costs and $605 thousand of direct acquisition and acquisition related costs recognized in 2005, noninterest expenses for 2006 increased $3.2 million, or 6 percent, from 2005.
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Washington Trust
Page Three, January 24, 2007
The effective income tax rates for 2006 were 33.8% for the fourth quarter and 32.6% for the full year compared with 32.7% and 32.3%, respectively, for the same periods in 2005. The higher effective income tax rate in the fourth quarter of 2006 was largely attributable to a change in the Corporation’s state tax position. The Corporation currently expects that the effective tax rate for 2007 will be in the range of 31.25% to 31.75%.
The returns on average equity and average assets for the quarter ended December 31, 2006 were 14.06% and 1.04%, respectively, compared to 15.63% and 1.03%, respectively, for the comparable quarter in 2005. The returns on average equity and average assets for the year 2006 were 14.99% and 1.04%, respectively, compared to 14.80% and 0.98%, respectively, for 2005.
Total assets were $2.399 billion at December 31, 2006, down $2.8 million from December 31, 2005. The Corporation has experienced relatively modest loan demand during 2006 and has also reduced its investment securities portfolio.
Total loans increased by $31.5 million, or 2.2 percent, in the fourth quarter of 2006 and $58.1 million, or 4.1 percent, in the year, with the largest increase in the commercial loan category. Commercial and commercial real estate loans were up by $26.1 million on a linked quarter basis and $32.7 million for the year. Residential mortgages increased by $1.3 million from September 30, 2006 and $6.0 million from December 31, 2005. Led by growth in home equity loans, consumer loans rose by $4.1 million in the fourth quarter of 2006 and $19.4 million from the end of 2005.
The investment securities portfolio has declined by $80.1 million since December 31, 2005, primarily resulting from balance sheet repositioning transactions in response to the flat to inverted yield curve shape in effect during most of this period. Net realized losses on securities of $16 thousand were recognized in the fourth quarter of 2006, including sales of mortgage-backed securities totaling $48.1 million with a realized loss of $1.2 million and sales of equity securities with a realized gain of $1.2 million. For the year ended December 31, 2006, net realized gains on securities sales amounted to $443 thousand. This included a realized gain of $381 thousand recognized in the second quarter of 2006 in connection with the annual charitable donation of appreciated equity securities. Net realized gains and losses on securities sales during 2005 totaled $357 thousand, resulting principally from the fourth quarter 2005 charitable donation of appreciated equity securities. Proceeds from the sales transactions during the fourth quarter of 2006 were
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Washington Trust
Page Four, January 24, 2007
primarily used to reduce advances from the Federal Home Loan Bank of Boston (“FHLBB”). FHLBB advances increased by $10.4 million and declined by $70.8 million during the three and twelve month periods ended December 31, 2006, respectively.
Total deposits declined by $22.2 million, or 1.3 percent, in the fourth quarter of 2006 and increased by $38.7 million, or 2.4 percent, from December 31, 2005. Excluding brokered certificates of deposit, in-market deposits were down $11.6 million, or 0.8 percent, on a linked quarter basis and up $63.2 million, or 4.4 percent, for the year. The Corporation has generally experienced little in-market deposit growth during the fourth quarter in recent years.
Asset quality continues to remain strong , with nonperforming assets (nonaccrual loans and property acquired through foreclosure) amounting to $2.7 million, or 0.11% of total assets, at December 31, 2006, compared to $2.4 million, or 0.10% of total assets at December 31, 2005. Net charge-offs amounted to $224 thousand for the year ended December 31, 2006, compared to net loan recoveries of $197 thousand for 2005.
The allowance for loan losses was $18.9 million, or 1.29% of total loans, at December 31, 2006, compared to $17.9 million, or 1.28% of total loans, at December 31, 2005. The Corporation’s loan loss provision charged to earnings amounted to $300 thousand and $1.2 million, respectively, for the quarter and year ended December 31, 2006, unchanged from the amounts recorded for the same periods in 2005.
Total shareholders’ equity amounted to $173.1 million at December 31, 2006, compared to $158.4 million at December 31, 2005. Book value per share as of December 31, 2006 and December 31, 2005 amounted to $12.89 and $11.86, respectively.
The Corporation announced during the fourth quarter of 2006 that its Board of Directors has approved a new common stock repurchase plan to replace its prior stock repurchase plan. The new plan authorizes the repurchase of up to 400,000 shares, or approximately 3%, of the Corporation's common stock in open market transactions. During the fourth quarter of 2006, 50,000 shares were repurchased under the prior plan at a cost of $1.4 million.
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Washington Trust
Page Five, January 24, 2007
Washington Trust President and Chief Executive Officer John C. Warren, and David V. Devault, Executive Vice President, Secretary, Treasurer, and Chief Financial Officer, will host a conference call on Wednesday, January 24, 2007 at 4:30 p.m. (Eastern Time) to discuss the Corporation’s fourth quarter and year-end results. This call is being webcast by VCall and can be accessed through the Investor Relations section of the Washington Trust website, www.washtrust.com. A replay of the call will be posted in this same location on the website shortly after the conclusion of the call. You may also listen to a replay by dialing (877) 660-6853, and entering Account #: 286 and Conference ID #: 226875. The replay will be available until 11:59 p.m. on January 31, 2007.
Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company, a Rhode Island state-chartered bank founded in 1800. Washington Trust offers personal banking, business banking and wealth management services through its offices in Rhode Island, Massachusetts and southeastern Connecticut. Washington Trust Bancorp, Inc.’s common stock trades on the NASDAQ Global Market® under the symbol WASH. Investor information is available on the Corporation’s web site: www.washtrust.com.
# # #
This report contains certain statements that may be considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, including statements regarding our strategy, effectiveness of investment programs, evaluations of future interest rate trends and liquidity, expectations as to growth in assets, deposits and results of operations, success of acquisitions, future operations, market position, financial position, and prospects, plans, goals and objectives of management are forward-looking statements. The actual results, performance or achievements of the Corporation could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in general national or regional economic conditions, changes in interest rates, reductions in the market value of wealth management and trust assets under administration, reductions in loan demand, reductions in deposit levels necessitating increased borrowing to fund loans and investments, changes in loan default and charge-off rates, changes in the size and nature of the Corporation’s competition, changes in legislation or regulation and accounting principles, policies and guidelines, and changes in the assumptions used in making such forward-looking statements. The Corporation assumes no obligation to update forward-looking statements or update the reasons actual results, performance or achievements could differ materially from those provided in the forward-looking statements, except as required by law.
| Washington Trust Bancorp, Inc. and Subsidiaries | |
FINANCIAL SUMMARY | |
| | |
| | | Three Months Ended | |
| | | Dec. 31, | | Sep. 30, | | Dec. 31, | |
| (Dollars and shares in thousands, except per share amounts) | | 2006 | | 2006 | | 2005 | |
| | | | | | | | | | | |
Operating Results | | | | | | | | | | |
| Net interest income | | $ | 14,976 | | $ | 15,866 | | $ | 15,703 | |
| Provision for loan losses | | | 300 | | | 300 | | | 300 | |
| Net realized (1osses) gains on securities | | | (16 | ) | | (365 | ) | | 337 | |
| Other noninterest income | | | 10,449 | | | 11,148 | | | 9,162 | |
| Noninterest expenses | | | 15,740 | | | 16,611 | | | 15,766 | |
| Income tax expense | | | 3,166 | | | 3,160 | | | 2,983 | |
| Net income | | | 6,203 | | | 6,578 | | | 6,153 | |
| | | | | | | | | | | |
Per Share | | | | | | | | | | |
| Basic earnings | | $ | 0.46 | | $ | 0.49 | | $ | 0.46 | |
| Diluted earnings | | $ | 0.45 | | $ | 0.48 | | $ | 0.45 | |
| Dividends declared | | $ | 0.19 | | $ | 0.19 | | $ | 0.18 | |
| | | | | | | | | | | |
Weighted Average Shares Outstanding | | | | | | | | | | |
| Basic | | | 13,452.5 | | | 13,436.6 | | | 13,352.4 | |
| Diluted | | | 13,769.3 | | | 13,726.3 | | | 13,659.6 | |
| | | | | | | | | | | |
Key Ratios | | | | | | | | | | |
| Return on average assets | | | 1.04 | % | | 1.09 | % | | 1.03 | % |
| Return on average equity | | | 14.06 | % | | 15.62 | % | | 15.63 | % |
| Interest rate spread (taxable equivalent basis) | | | 2.39 | % | | 2.51 | % | | 2.53 | % |
| Net interest margin (taxable equivalent basis) | | | 2.74 | % | | 2.86 | % | | 2.84 | % |
| | | | | | | | | | | |
Allowance for Loan Losses | | | | | | | | | | |
| Balance at beginning of period | | $ | 18,645 | | $ | 18,480 | | $ | 17,614 | |
| Provision charged to earnings | | | 300 | | | 300 | | | 300 | |
| Net (charge-offs) recoveries | | | (51 | ) | | (135 | ) | | 4 | |
| Balance at end of period | | $ | 18,894 | | $ | 18,645 | | $ | 17,918 | |
| Washington Trust Bancorp, Inc. and Subsidiaries | |
FINANCIAL SUMMARY | |
| | |
| | | Years Ended | |
| | | Dec. 31, | | Dec. 31, | |
| (Dollars and shares in thousands, except per share amounts) | | 2006 | | 2005 | |
| | | | | | | | |
Operating Results | | | | | | | |
| Net interest income | | $ | 61,474 | | $ | 60,656 | |
| Provision for loan losses | | | 1,200 | | | 1,200 | |
| Net realized gains on securities | | | 443 | | | 357 | |
| Other noninterest income | | | 41,740 | | | 30,589 | |
| Noninterest expenses | | | 65,335 | | | 56,393 | |
| Income tax expense | | | 12,091 | | | 10,985 | |
| Net income | | | 25,031 | | | 23,024 | |
| | | | | | | | |
Per Share | | | | | | | |
| Basic earnings | | $ | 1.86 | | $ | 1.73 | |
| Diluted earnings | | $ | 1.82 | | $ | 1.69 | |
| Dividends declared | | $ | 0.76 | | $ | 0.72 | |
| | | | | | | | |
| Weighted Average Shares Outstanding | | | | | | | |
| Basic | | | 13,424.1 | | | 13,315.2 | |
| Diluted | | | 13,723.2 | | | 13,626.7 | |
| | | | | | | | |
Key Ratios | | | | | | | |
| Return on average assets | | | 1.04 | % | | 0.98 | % |
| Return on average equity | | | 14.99 | % | | 14.80 | % |
| Interest rate spread (taxable equivalent basis) | | | 2.47 | % | | 2.49 | % |
| Net interest margin (taxable equivalent basis) | | | 2.80 | % | | 2.79 | % |
| | | | | | | | |
Allowance for Loan Losses | | | | | | | |
| Balance at beginning of period | | $ | 17,918 | | $ | 16,771 | |
| Provision charged to earnings | | | 1,200 | | | 1,200 | |
| Reclassification of allowance on off-balance sheet exposures | | | - | | | (250 | ) |
| Net (charge-offs) recoveries | | | (224 | ) | | 197 | |
| Balance at end of period | | $ | 18,894 | | $ | 17,918 | |
| Washington Trust Bancorp, Inc. and Subsidiaries | |
FINANCIAL SUMMARY | |
| (Dollars and shares in thousands, except per share amounts) | | Dec. 31, | | Sep. 30, | | Dec. 31, | |
Period-End Balance Sheet | | 2006 | | 2006 | | 2005 | |
| Assets | | $ | 2,399,165 | | $ | 2,403,266 | | $ | 2,402,003 | |
| Total securities | | | 703,851 | | | 741,350 | | | 783,941 | |
| Loans: | | | | | | | | | | |
| Commercial and other: | | | | | | | | | | |
| Mortgages | | | 282,019 | | | 274,635 | | | 291,292 | |
| Construction and development | | | 32,233 | | | 29,653 | | | 37,190 | |
| Other | | | 273,145 | | | 257,026 | | | 226,252 | |
| Total commercial and other | | | 587,397 | | | 561,314 | | | 554,734 | |
| Residential real estate: | | | | | | | | | | |
| Mortgages | | | 577,522 | | | 572,399 | | | 565,680 | |
| Homeowner construction | | | 11,149 | | | 14,973 | | | 17,028 | |
| Total residential real estate | | | 588,671 | | | 587,372 | | | 582,708 | |
| Consumer: | | | | | | | | | | |
| Home equity lines | | | 145,676 | | | 147,897 | | | 161,100 | |
| Home equity loans | | | 93,947 | | | 90,711 | | | 72,288 | |
| Other | | | 44,295 | | | 41,190 | | | 31,078 | |
| Total consumer | | | 283,918 | | | 279,798 | | | 264,466 | |
| Total loans | | | 1,459,986 | | | 1,428,484 | | | 1,401,908 | |
| Deposits: | | | | | | | | | | |
| Demand deposits | | | 186,533 | | | 189,329 | | | 196,102 | |
| NOW accounts | | | 175,479 | | | 172,317 | | | 178,677 | |
| Money market accounts | | | 286,998 | | | 295,431 | | | 223,255 | |
| Savings accounts | | | 205,998 | | | 193,029 | | | 212,499 | |
| Time deposits | | | 822,989 | | | 850,080 | | | 828,725 | |
| Total deposits | | | 1,677,997 | | | 1,700,186 | | | 1,639,258 | |
| Brokered deposits included in time deposits | | | 175,618 | | | 186,184 | | | 200,115 | |
| Federal Home Loan Bank advances | | | 474,561 | | | 464,148 | | | 545,323 | |
| Shareholders’ equity | | | 173,056 | | | 172,420 | | | 158,446 | |
Capital Ratios | | | | | | | | | | |
| Tier 1 risk-based capital | | | 9.60 | % | | 9.55 | % | | 9.06 | % |
| Total risk-based capital | | | 11.00 | % | | 10.96 | % | | 10.51 | % |
| Tier 1 leverage ratio | | | 6.04 | % | | 5.81 | % | | 5.45 | % |
Share Information | | | | | | | | | | |
| Shares outstanding at end of period | | | 13,429.7 | | | 13,445.1 | | | 13,361.8 | |
| Book value per share | | $ | 12.89 | | $ | 12.82 | | $ | 11.86 | |
| Tangible book value per share | | $ | 8.61 | | $ | 8.53 | | $ | 7.79 | |
| Market value per share | | $ | 27.89 | | $ | 26.51 | | $ | 26.18 | |
Credit Quality | | | | | | | | | | |
| Nonaccrual loans: | | | | | | | | | | |
| Commercial: | | | | | | | | | | |
| Mortgages | | $ | 981 | | $ | 436 | | $ | 394 | |
| Construction and development | | | - | | | - | | | - | |
| Other | | | 831 | | | 608 | | | 624 | |
| Residential real estate | | | 721 | | | 1,004 | | | 1,147 | |
| Consumer | | | 190 | | | 132 | | | 249 | |
| Total nonaccrual loans | | $ | 2,723 | | $ | 2,180 | | $ | 2,414 | |
| Other real estate owned, net | | | - | | | 402 | | | - | |
| Nonperforming assets to total assets | | | 0.11 | % | | 0.11 | % | | 0.10 | % |
| Nonaccrual loans to total loans | | | 0.19 | % | | 0.15 | % | | 0.17 | % |
| Allowance for loan losses to nonaccrual loans | | | 693.87 | % | | 855.28 | % | | 742.25 | % |
| Allowance for loan losses to total loans | | | 1.29 | % | | 1.31 | % | | 1.28 | % |
Assets Under Administration | | | | | | | | | | |
| Market value | | $ | 3,694,813 | | $ | 3,550,965 | | $ | 3,271,756 | |
Certain prior year amounts have been reclassified to conform to the current year classification.
| Washington Trust Bancorp, Inc. and Subsidiaries | |
CONSOLIDATED BALANCE SHEETS | |
| | | (Unaudited) | | | |
| (Dollars in thousands) | | Dec. 31, | | Dec. 31, | |
| | | 2006 | | 2005 | |
Assets: | | | | | |
| Cash and due from banks | | $ | 54,337 | | $ | 48,997 | |
| Federal funds sold and other short-term investments | | | 17,572 | | | 17,166 | |
| Mortgage loans held for sale | | | 2,148 | | | 439 | |
| Securities: | | | | | | | |
| Available for sale, at fair value; amortized cost $525,966 in 2006 and $620,638 in 2005 | | | 526,396 | | | 619,234 | |
| Held to maturity, at cost; fair value $175,369 in 2006 and $162,756 in 2005 | | | 177,455 | | | 164,707 | |
| Total securities | | | 703,851 | | | 783,941 | |
| Federal Home Loan Bank stock, at cost | | | 28,727 | | | 34,966 | |
| Loans: | | | | | | | |
| Commercial and other | | | 587,397 | | | 554,734 | |
| Residential real estate | | | 588,671 | | | 582,708 | |
| Consumer | | | 283,918 | | | 264,466 | |
| Total loans | | | 1,459,986 | | | 1,401,908 | |
| Less allowance for loan losses | | | 18,894 | | | 17,918 | |
| Net loans | | | 1,441,092 | | | 1,383,990 | |
| Premises and equipment, net | | | 24,307 | | | 23,737 | |
| Accrued interest receivable | | | 11,268 | | | 10,594 | |
| Investment in bank-owned life insurance | | | 39,770 | | | 30,360 | |
| Goodwill | | | 44,558 | | | 39,963 | |
| Identifiable intangible assets, net | | | 12,816 | | | 14,409 | |
| Other assets | | | 18,719 | | | 13,441 | |
| Total assets | | $ | 2,399,165 | | $ | 2,402,003 | |
Liabilities: | | | | | | | |
| Deposits: | | | | | | | |
| Demand deposits | | $ | 186,533 | | $ | 196,102 | |
| NOW accounts | | | 175,479 | | | 178,677 | |
| Money market accounts | | | 286,998 | | | 223,255 | |
| Savings accounts | | | 205,998 | | | 212,499 | |
| Time deposits | | | 822,989 | | | 828,725 | |
| Total deposits | | | 1,677,997 | | | 1,639,258 | |
| Dividends payable | | | 2,556 | | | 2,408 | |
| Federal Home Loan Bank advances | | | 474,561 | | | 545,323 | |
| Junior subordinated debentures | | | 22,681 | | | 22,681 | |
| Other borrowings | | | 14,684 | | | 9,774 | |
| Accrued expenses and other liabilities | | | 33,630 | | | 24,113 | |
| Total liabilities | | | 2,226,109 | | | 2,243,557 | |
Shareholders’ Equity: | | | | | | | |
| Common stock of $.0625 par value; authorized 30,000,000 shares; | | | | | | | |
| issued 13,492,110 shares in 2006 and 13,372,295 in 2005 | | | 843 | | | 836 | |
| Paid-in capital | | | 35,893 | | | 32,778 | |
| Retained earnings | | | 141,548 | | | 126,735 | |
| Accumulated other comprehensive loss | | | (3,515 | ) | | (1,653 | ) |
| Treasury stock, at cost; 62,432 shares in 2006 and 10,519 in 2005 | | | (1,713 | ) | | (250 | ) |
| Total shareholders’ equity | | | 173,056 | | | 158,446 | |
| Total liabilities and shareholders’ equity | | $ | 2,399,165 | | $ | 2,402,003 | |
| Washington Trust Bancorp, Inc. and Subsidiaries | |
CONSOLIDATED STATEMENTS OF INCOME | |
| (Dollars and shares in thousands, except per share amounts) | | (Unaudited) | |
| | | Three Months | | Twelve Months | |
| Periods ended December 31, | | 2006 | | 2005 | | 2006 | | 2005 | |
| Interest income: | | | | | | | | | | | | | |
| Interest and fees on loans | | $ | 23,733 | | $ | 21,592 | | $ | 92,190 | | $ | 78,931 | |
| Interest on securities | | | | | | | | | | | | | |
| Taxable | | | 8,210 | | | 8,130 | | | 33,763 | | | 32,934 | |
| Nontaxable | | | 514 | | | 276 | | | 1,618 | | | 886 | |
| Dividends on corporate stock and Federal Home Loan Bank stock | | | 718 | | | 653 | | | 2,842 | | | 2,491 | |
| Interest on federal funds sold and other short-term investments | | | 204 | | | 130 | | | 721 | | | 451 | |
| Total interest income | | | 33,379 | | | 30,781 | | | 131,134 | | | 115,693 | |
| Interest expense: | | | | | | | | | | | | | |
| Deposits | | | 13,110 | | | 9,386 | | | 46,982 | | | 32,186 | |
| Federal Home Loan Bank advances | | | 4,801 | | | 5,273 | | | 20,916 | | | 22,233 | |
| Junior subordinated debentures | | | 338 | | | 334 | | | 1,352 | | | 458 | |
| Other | | | 154 | | | 85 | | | 410 | | | 160 | |
| Total interest expense | | | 18,403 | | | 15,078 | | | 69,660 | | | 55,037 | |
| Net interest income | | | 14,976 | | | 15,703 | | | 61,474 | | | 60,656 | |
| Provision for loan losses | | | 300 | | | 300 | | | 1,200 | | | 1,200 | |
| Net interest income after provision for loan losses | | | 14,676 | | | 15,403 | | | 60,274 | | | 59,456 | |
| Noninterest income: | | | | | | | | | | | | | |
| Wealth management services: | | | | | | | | | | | | | |
| Trust and investment advisory fees | | $ | 5,063 | | $ | 4,507 | | $ | 19,099 | | $ | 14,407 | |
| Mutual fund fees | | | 1,092 | | | 1,032 | | | 4,665 | | | 1,336 | |
| Financial planning, commissions and other service fees | | | 583 | | | 301 | | | 2,616 | | | 919 | |
| Wealth management services | | | 6,738 | | | 5,840 | | | 26,380 | | | 16,662 | |
| Service charges on deposit accounts | | | 1,248 | | | 1,165 | | | 4,915 | | | 4,502 | |
| Merchant processing fees | | | 1,380 | | | 1,156 | | | 6,208 | | | 5,203 | |
| Income from bank-owned life insurance | | | 396 | | | 277 | | | 1,410 | | | 1,110 | |
| Net gains on loan sales | | | 394 | | | 359 | | | 1,423 | | | 1,679 | |
| Net realized (losses) gains on securities | | | (16 | ) | | 337 | | | 443 | | | 357 | |
| Other income | | | 293 | | | 365 | | | 1,404 | | | 1,433 | |
| Total noninterest income | | | 10,433 | | | 9,499 | | | 42,183 | | | 30,946 | |
| Noninterest expense: | | | | | | | | | | | | | |
| Salaries and employee benefits | | | 9,598 | | | 9,030 | | | 38,698 | | | 32,133 | |
| Net occupancy | | | 982 | | | 977 | | | 3,888 | | | 3,460 | |
| Equipment | | | 818 | | | 873 | | | 3,370 | | | 3,456 | |
| Merchant processing costs | | | 1,167 | | | 962 | | | 5,257 | | | 4,319 | |
| Outsourced services | | | 505 | | | 460 | | | 2,009 | | | 1,723 | |
| Advertising and promotion | | | 405 | | | 481 | | | 1,894 | | | 1,977 | |
| Legal, audit and professional fees | | | 295 | | | 475 | | | 1,637 | | | 1,900 | |
| Amortization of intangibles | | | 384 | | | 410 | | | 1,593 | | | 852 | |
| Other | | | 1,586 | | | 2,098 | | | 6,989 | | | 6,573 | |
| Total noninterest expense | | | 15,740 | | | 15,766 | | | 65,335 | | | 56,393 | |
| Income before income taxes | | | 9,369 | | | 9,136 | | | 37,122 | | | 34,009 | |
| Income tax expense | | | 3,166 | | | 2,983 | | | 12,091 | | | 10,985 | |
| Net income | | $ | 6,203 | | $ | 6,153 | | $ | 25,031 | | $ | 23,024 | |
| Weighted average shares outstanding - basic | | | 13,452.5 | | | 13,352.4 | | | 13,424.1 | | | 13,315.2 | |
| Weighted average shares outstanding - diluted | | | 13,769.3 | | | 13,659.6 | | | 13,723.2 | | | 13,626.7 | |
| Per share information: | | | | | | | | | | | | | |
| Basic earnings per share | | $ | 0.46 | | $ | 0.46 | | $ | 1.86 | | $ | 1.73 | |
| Diluted earnings per share | | $ | 0.45 | | $ | 0.45 | | $ | 1.82 | | $ | 1.69 | |
| Cash dividends declared per share | | $ | 0.19 | | $ | 0.18 | | $ | 0.76 | | $ | 0.72 | |
Certain prior year amounts have been reclassified to conform to the current year classification.
| Washington Trust Bancorp, Inc. and Subsidiaries | |
CONSOLIDATED AVERAGE BALANCE SHEETS | |
| | |
| | | (Unaudited) | |
| Three months ended December 31, | | 2006 | | 2005 | |
| | | Average | | | | Yield/ | | Average | | | | Yield/ | |
| (Dollars in thousands) | | Balance | | Interest | | Rate | | Balance | | Interest | | Rate | |
Assets: | | | | | | | | | | | | | | | | | | | |
| Residential real estate loans | | $ | 592,055 | | $ | 7,732 | | | 5.18 | % | $ | 586,775 | | $ | 7,391 | | | 5.00 | % |
| Commercial and other loans | | | 567,356 | | | 11,115 | | | 7.77 | % | | 555,746 | | | 10,212 | | | 7.29 | % |
| Consumer loans | | | 280,118 | | | 4,929 | | | 6.98 | % | | 261,424 | | | 4,039 | | | 6.13 | % |
| Total loans | | | 1,439,529 | | | 23,776 | | | 6.55 | % | | 1,403,945 | | | 21,642 | | | 6.12 | % |
| Federal funds sold and | | | | | | | | | | | | | | | | | | | |
| other short-term investments | | | 14,940 | | | 204 | | | 5.43 | % | | 13,444 | | | 130 | | | 3.86 | % |
| Taxable debt securities | | | 670,523 | | | 8,210 | | | 4.86 | % | | 736,309 | | | 8,131 | | | 4.38 | % |
| Nontaxable debt securities | | | 54,024 | | | 789 | | | 5.80 | % | | 29,235 | | | 423 | | | 5.75 | % |
| Corporate stocks and FHLBB stock | | | 45,233 | | | 811 | | | 7.11 | % | | 48,914 | | | 738 | | | 5.98 | % |
| Total securities | | | 784,720 | | | 10,014 | | | 5.06 | % | | 827,902 | | | 9,422 | | | 4.52 | % |
| Total interest-earning assets | | | 2,224,249 | | | 33,790 | | | 6.03 | % | | 2,231,847 | | | 31,065 | | | 5.52 | % |
| Non interest-earning assets | | | 171,361 | | | | | | | | | 153,043 | | | | | | | |
| Total assets | | $ | 2,395,610 | | | | | | | | $ | 2,384,890 | | | | | | | |
Liabilities and Shareholders’ Equity: | | | | | | | | | | | | | | | | | | | |
| NOW accounts | | $ | 170,111 | | $ | 76 | | | 0.18 | % | $ | 175,235 | | $ | 64 | | | 0.15 | % |
| Money market accounts | | | 306,036 | | | 3,037 | | | 3.94 | % | | 228,173 | | | 1,485 | | | 2.58 | % |
| Savings deposits | | | 201,031 | | | 577 | | | 1.14 | % | | 218,043 | | | 312 | | | 0.57 | % |
| Time deposits | | | 836,645 | | | 9,420 | | | 4.47 | % | | 800,668 | | | 7,524 | | | 3.73 | % |
| FHLBB advances | | | 457,690 | | | 4,801 | | | 4.16 | % | | 549,888 | | | 5,274 | | | 3.80 | % |
| Junior subordinated debentures | | | 22,681 | | | 338 | | | 5.91 | % | | 22,681 | | | 334 | | | 5.85 | % |
| Other | | | 12,472 | | | 154 | | | 4.91 | % | | 7,346 | | | 85 | | | 4.59 | % |
| Total interest-bearing liabilities | | | 2,006,666 | | | 18,403 | | | 3.64 | % | | 2,002,034 | | | 15,078 | | | 2.99 | % |
| Demand deposits | | | 186,017 | | | | | | | | | 202,570 | | | | | | | |
| Other liabilities | | | 26,482 | | | | | | | | | 22,857 | | | | | | | |
| Shareholders’ equity | | | 176,445 | | | | | | | | | 157,429 | | | | | | | |
| Total liabilities and shareholders’ equity | | $ | 2,395,610 | | | | | | | | $ | 2,384,890 | | | | | | | |
| Net interest income (FTE) | | | | | $ | 15,387 | | | | | | | | $ | 15,987 | | | | |
| Interest rate spread | | | | | | | | | 2.39 | % | | | | | | | | 2.53 | % |
| Net interest margin | | | | | | | | | 2.74 | % | | | | | | | | 2.84 | % |
| Washington Trust Bancorp, Inc. and Subsidiaries | |
CONSOLIDATED AVERAGE BALANCE SHEETS | |
| | |
| | | (Unaudited) | |
| Twelve months ended December 31, | | 2006 | | 2005 | |
| | | Average | | | | Yield/ | | Average | | | | Yield/ | |
| (Dollars in thousands) | | Balance | | Interest | | Rate | | Balance | | Interest | | Rate | |
Assets: | | | | | | | | | | | | | | | | | | | |
| Residential real estate loans | | $ | 590,245 | | $ | 30,237 | | | 5.12 | % | $ | 562,838 | | $ | 27,890 | | | 4.96 | % |
| Commercial and other loans | | | 564,310 | | | 43,409 | | | 7.69 | % | | 531,434 | | | 37,244 | | | 7.01 | % |
| Consumer loans | | | 274,764 | | | 18,748 | | | 6.82 | % | | 246,959 | | | 13,983 | | | 5.66 | % |
| Total loans | | | 1,429,319 | | | 92,394 | | | 6.46 | % | | 1,341,231 | | | 79,117 | | | 5.90 | % |
| Federal funds sold and | | | | | | | | | | | | | | | | | | | |
| other short-term investments | | | 14,548 | | | 721 | | | 4.96 | % | | 14,703 | | | 451 | | | 3.07 | % |
| Taxable debt securities | | | 712,870 | | | 33,763 | | | 4.74 | % | | 783,662 | | | 32,934 | | | 4.20 | % |
| Nontaxable debt securities | | | 42,977 | | | 2,486 | | | 5.79 | % | | 23,329 | | | 1,362 | | | 5.84 | % |
| Corporate stocks and FHLBB stock | | | 48,643 | | | 3,205 | | | 6.59 | % | | 50,763 | | | 2,858 | | | 5.63 | % |
| Total securities | | | 819,038 | | | 40,175 | | | 4.91 | % | | 872,457 | | | 37,605 | | | 4.31 | % |
| Total interest-earning assets | | | 2,248,357 | | | 132,569 | | | 5.90 | % | | 2,213,688 | | | 116,722 | | | 5.27 | % |
| Non interest-earning assets | | | 159,115 | | | | | | | | | 137,460 | | | | | | | |
| Total assets | | $ | 2,407,472 | | | | | | | | $ | 2,351,148 | | | | | | | |
Liabilities and Shareholders’ Equity: | | | | | | | | | | | | | | | | | | | |
| NOW accounts | | $ | 173,137 | | $ | 302 | | | 0.17 | % | $ | 176,706 | | $ | 295 | | | 0.17 | % |
| Money market accounts | | | 262,613 | | | 9,063 | | | 3.45 | % | | 203,799 | | | 4,386 | | | 2.15 | % |
| Savings deposits | | | 198,040 | | | 1,464 | | | 0.74 | % | | 234,311 | | | 1,392 | | | 0.59 | % |
| Time deposits | | | 856,979 | | | 36,153 | | | 4.22 | % | | 741,456 | | | 26,113 | | | 3.52 | % |
| FHLBB advances | | | 509,611 | | | 20,916 | | | 4.10 | % | | 611,177 | | | 22,233 | | | 3.64 | % |
| Junior subordinated debentures | | | 22,681 | | | 1,352 | | | 5.96 | % | | 7,767 | | | 458 | | | 5.90 | % |
| Other | | | 8,627 | | | 410 | | | 4.76 | % | | 3,581 | | | 160 | | | 4.48 | % |
| Total interest-bearing liabilities | | | 2,031,688 | | | 69,660 | | | 3.43 | % | | 1,978,797 | | | 55,037 | | | 2.78 | % |
| Demand deposits | | | 185,322 | | | | | | | | | 197,245 | | | | | | | |
| Other liabilities | | | 23,517 | | | | | | | | | 19,498 | | | | | | | |
| Shareholders’ equity | | | 166,945 | | | | | | | | | 155,608 | | | | | | | |
| Total liabilities and shareholders’ equity | | $ | 2,407,472 | | | | | | | | $ | 2,351,148 | | | | | | | |
| Net interest income (FTE) | | | | | $ | 62,909 | | | | | | | | $ | 61,685 | | | | |
| Interest rate spread | | | | | | | | | 2.47 | % | | | | | | | | 2.49 | % |
| Net interest margin | | | | | | | | | 2.80 | % | | | | | | | | 2.79 | % |
