NASDAQ: WASH
Contact: Elizabeth B. Eckel
SVP, Chief Marketing & Corporate Communications Officer
Telephone: (401) 348-1309
E-mail: ebeckel@washtrust.com
Date: October 24, 2022
FOR IMMEDIATE RELEASE
Washington Trust Reports Third Quarter 2022 Earnings
WESTERLY, R.I., October 24, 2022 (PR NEWSWIRE)…Washington Trust Bancorp, Inc. (Nasdaq: WASH), parent company of The Washington Trust Company, today announced third quarter 2022 net income of $18.7 million, or $1.08 per diluted share, compared to net income of $20.0 million, or $1.14 per diluted share, for the second quarter of 2022.
“Washington Trust reported solid third quarter results, a testament to our diversified business model,” stated Edward O. Handy III, Washington Trust Chairman and Chief Executive Officer. “We remain committed to our customers and expanding our presence within our geographic footprint. During the quarter, we opened a new commercial lending office in New Haven, Connecticut, opened a new full-service branch in Cumberland, Rhode Island and recently announced our intention to open three new branches in Rhode Island in 2023.”
Selected financial highlights for the third quarter include:
•Returns on average equity and average assets for the third quarter were 15.16% and 1.19%, respectively, compared to 16.11% and 1.37%, respectively, for the preceding quarter.
•Net interest income totaled an all-time quarterly record of $42.0 million in the third quarter, up by $4.5 million, or 12%, from the preceding quarter, reflecting the impact of rising market interest rates.
•Asset and credit quality metrics remain strong. In the third quarter, a provision for credit losses (or a charge) of $800 thousand was recognized, compared to a negative provision (or a benefit) of $3.0 million recognized in the preceding quarter.
•Total loans amounted to an all-time high of $4.8 billion, up by $369 million, or 8%, from the end of the preceding quarter, reflecting strong loan growth in both the commercial and residential real estate loan portfolios.
•In-market deposits (total deposits less wholesale brokered deposits) amounted to $4.6 billion at September 30, 2022, up by $79 million, or 2%, from the end of the preceding quarter and up by $324 million, or 8%, from the balance at September 30, 2021.
Washington Trust
October 24, 2022
Net Interest Income
Net interest income was $42.0 million for the third quarter of 2022, up by $4.5 million, or 12%, from the second quarter of 2022. The net interest margin was 2.82% for the third quarter, up by 11 basis points from the preceding quarter. Linked quarter changes included:
•Average interest-earning assets increased by $365 million, largely reflecting an increase of $305 million in average loans. The yield on interest-earning assets for the third quarter was 3.49%, up by 46 basis points from the preceding quarter, reflecting the impact of higher market interest rates.
•Average interest-bearing liabilities increased by $318 million. Average in-market deposits declined by $120 million, while average wholesale funding balances increased by $438 million to fund loan growth. The cost of interest-bearing liabilities for the third quarter of 2022 was 0.86%, up by 44 basis points from the preceding quarter, reflecting higher rates paid on wholesale funding sources and money market accounts.
Noninterest Income
Noninterest income totaled $15.8 million for the third quarter of 2022, down modestly by $49 thousand, or 0.3%, from the second quarter of 2022. Linked quarter changes included:
•Wealth management revenues amounted to $9.5 million in the third quarter of 2022, down by $541 thousand, or 5%, on a linked quarter basis. This included a decrease of $339 thousand, or 4%, in asset-based revenues and a decrease of $202 thousand, or 48%, in transaction-based revenues. The linked quarter decline in transaction-based revenues was mainly due to lower tax servicing fee income in the third quarter, as this income is concentrated in the first half of the year.
Wealth management assets under administration ("AUA") amounted to $6.3 billion at September 30, 2022, down by $327 million, or 5%, from June 30, 2022. The decrease reflected net investment depreciation of $240 million and net client asset outflows of $87 million in the third quarter of 2022. The average balance of AUA for the third quarter of 2022 decrease by approximately $337 million, or 5%, from the average balance for the preceding quarter.
Recently, four client-facing advisors in our registered investment adviser subsidiary resigned. As a result, Washington Trust could experience an increased level of client asset outflows in upcoming months.
•Mortgage banking revenues totaled $2.0 million for the third quarter of 2022, down modestly by $35 thousand, or 2%, from the second quarter of 2022, largely reflecting both a lower volume of loans sold and a decline in the sales yield on loans sold to the secondary market.
•Loan related derivative income was $1.0 million in the third quarter of 2022, up by $372 thousand, or 56%, from the preceding quarter, reflecting an increase in commercial borrower interest rate derivative transactions.
Noninterest Expense
Noninterest expense totaled $33.1 million for the third quarter of 2022, up by $2.0 million, or 6%, from the second quarter of 2022. Linked quarter changes included:
•Salaries and employee benefits expense, the largest component of noninterest expense, amounted to $21.6 million for the third quarter of 2022, up by $1.2 million, or 6%, from the preceding quarter, largely reflecting adjustments to performance-based compensation accruals.
Washington Trust
October 24, 2022
•The remaining increase in noninterest expense reflects modest increases across a variety of other noninterest expense categories.
Income Tax
Income tax expense totaled $5.3 million for the third quarter of 2022, down by $23 thousand from the preceding quarter. The effective tax rate for the third quarter of 2022 was 22.1%, compared to 21.1% in the preceding quarter. Based on current federal and applicable state income statutes, the Corporation currently expects its full-year 2022 effective tax rate to be approximately 21.5%.
Investment Securities
The securities portfolio totaled $983 million at September 30, 2022, down by $38 million, or 4%, from June 30, 2022, reflecting a temporary decline in fair value of available for sale securities and routine pay-downs on mortgage-backed securities, partially offset by purchases of U.S. government agency and U.S. government-sponsored debt securities, including mortgage-backed securities. Purchases of debt securities in the third quarter 2022 totaled $47 million, with a weighted average yield of 4.24%. The securities portfolio represented 15% of total assets at September 30, 2022, compared to 17% of total assets at June 30, 2022.
Loans
Total loans amounted to $4.8 billion at September 30, 2022, up by $369 million, or 8%, from the end of the preceding quarter. Linked quarter changes included:
•Commercial loans increased by $186 million, or 8%, from June 30, 2022, reflecting originations and advances of approximately $286 million, partially offset by payoffs and pay-downs of approximately $100 million.
•Residential real estate loans increased by $178 million, or 9%, from June 30, 2022. In the third quarter of 2022, residential real estate loans originated for portfolio amounted to $225 million, down by $39 million, or 15%, from the preceding quarter.
•The consumer loan portfolio increased by $6 million, or 2%, from the balance at June 30, 2022, due to growth in home equity lines and loans.
Deposits and Borrowings
At September 30, 2022, in-market deposits, which exclude wholesale brokered deposits, amounted to $4.6 billion, up by $79 million, or 2%, from the end of the preceding quarter. This included seasonal inflows of various institutional and governmental depositors based on their underlying business cycles. Wholesale brokered deposits amounted to $443 million, down by $16 million, or 3%, from June 30, 2022. Total deposits amounted to $5.1 billion at September 30, 2022, up by $63 million, or 1%, from the end of the preceding quarter.
FHLB advances totaled $700 million at September 30, 2022, up by $372 million, or 113%, from June 30, 2022, as higher levels of wholesale funding were utilized to fund balance sheet growth.
Washington Trust
October 24, 2022
Asset Quality
Total nonaccrual loans amounted to $12.1 million, or 0.25% of total loans, at September 30, 2022, down from $12.4 million, or 0.28% of total loans, at June 30, 2022. Total past due loans amounted to $7.5 million, or 0.16% of total loans, at September 30, 2022, down from $8.6 million, or 0.19% of total loans, at June 30, 2022.
The allowance for credit losses ("ACL") on loans amounted to $36.9 million, or 0.76% of total loans, at September 30, 2022, compared to $36.3 million, or 0.81% of total loans, at June 30, 2022. The ACL on unfunded commitments, included in other liabilities on the Consolidated Balance Sheets, amounted to $2.4 million at September 30, 2022, compared to $2.2 million at June 30, 2022.
There was a positive $800 thousand provision for credit losses (or a charge) recognized in the third quarter of 2022, compared to a negative $3.0 million provision for credit losses (or a benefit) recognized in the preceding quarter. The provision for credit losses in the third quarter of 2022 reflected loan growth, our current estimate of forecasted economic conditions and strong asset and credit quality metrics. In the third quarter of 2022, net charge-offs of $54 thousand were recognized, compared to net recoveries of $10 thousand in the preceding quarter.
Capital and Dividends
Total shareholders' equity was $432.3 million at September 30, 2022, down by $44.4 million, or 9%, from June 30, 2022. The decline was largely due to a decrease of $53.7 million in the accumulated other comprehensive income component of shareholders' equity, reflecting a temporary decrease in the fair value of available for sale securities. In addition, the change in shareholders' equity also included $9.4 million in dividend declarations, partially offset by net income of $18.7 million.
In the third quarter of 2022, Washington Trust repurchased 18,754 shares, at an average price of $47.79 and a total cost of $896 thousand, under its stock repurchase program.
Capital levels at September 30, 2022 exceeded the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 12.65% at September 30, 2022, compared to 13.51% at June 30, 2022. Book value per share was $25.17 at September 30, 2022, compared to $27.73 at June 30, 2022.
The Board of Directors declared a quarterly dividend of 54 cents per share for the quarter ended September 30, 2022. The dividend was paid on October 7, 2022 to shareholders of record on October 3, 2022.
Conference Call
Washington Trust will host a conference call to discuss its third quarter results, business highlights and outlook on Tuesday, October 25, 2022 at 8:30 a.m. (Eastern Time). Individuals may dial in to the call at 1-844-200-6205 and enter Access Code 898026. An audio replay of the call will be available, shortly after the conclusion of the call, by dialing 1-866-813-9403 and entering the Replay Access Code 135067. The audio replay will be available through November 8, 2022. Also, a webcast of the call will be posted in the Investor Relations section of Washington Trust's website, https://ir.washtrust.com, and will be available through December 31, 2022.
Washington Trust
October 24, 2022
Background
Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company. Founded in 1800, Washington Trust is the oldest community bank in the nation, the largest state-chartered bank headquartered in Rhode Island and one of the Northeast's premier financial services companies. Washington Trust offers a full range of financial services, including commercial banking, mortgage banking, personal banking and wealth management and trust services through its offices located in Rhode Island, Connecticut and Massachusetts. The Corporation’s common stock trades on NASDAQ under the symbol WASH. Investor information is available on the Corporation’s website at https://ir.washtrust.com.
Forward-Looking Statements
This press release contains statements that are “forward-looking statements.” We may also make forward-looking statements in other documents we file with the U.S. Securities and Exchange Commission ("SEC"), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters. You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control. These risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements.
Some of the factors that might cause these differences include the following:
•changes in political, business and economic conditions, including inflation;
•interest rate changes or volatility, as well as changes in the balance and mix of loans and deposits;
•changes in loan demand and collectability;
•the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments;
•ongoing volatility in national and international financial markets;
•reductions in the market value or outflows of wealth management AUA;
•decreases in the value of securities and other assets;
•increases in defaults and charge-off rates;
•changes in the size and nature of our competition;
•changes in legislation or regulation and accounting principles, policies and guidelines;
•operational risks including, but not limited to, changes in information technology, cybersecurity incidents, fraud, natural disasters, war, terrorism, civil unrest, the ongoing COVID-19 pandemic, and future pandemics;
•reputational risks; and
•changes in the assumptions used in making such forward-looking statements.
In addition, the factors described under “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as updated by our Quarterly Reports on Form 10-Q and other filings submitted to the SEC, may result in these differences. You should carefully review all of these factors and you should be aware that there may be other factors that could cause these differences. These forward-looking statements were based on information, plans and estimates at the date of this report, and we assume no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.
Supplemental Information - Explanation of Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. Washington Trust's management believes that the supplemental non-GAAP information, which consists of measurements and ratios based on tangible equity and tangible assets, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CONDENSED CONSOLIDATED BALANCE SHEETS |
| (Unaudited; Dollars in thousands) |
| | | | | |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Assets: | | | | | |
| Cash and due from banks | $130,066 | | $95,544 | | $224,807 | | $175,259 | | $297,039 | |
| Short-term investments | 2,773 | | 3,079 | | 3,289 | | 3,234 | | 3,349 | |
| Mortgage loans held for sale, at fair value | 24,054 | | 22,656 | | 15,612 | | 40,196 | | 48,705 | |
| | | | | |
| Available for sale debt securities, at fair value | 982,573 | | 1,020,469 | | 1,008,184 | | 1,042,859 | | 1,045,833 | |
| | | | | |
| | | | | |
| Federal Home Loan Bank stock, at cost | 32,940 | | 16,300 | | 8,452 | | 13,031 | | 15,094 | |
| Loans: | | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| Total loans | 4,848,873 | | 4,479,822 | | 4,283,852 | | 4,272,925 | | 4,286,404 | |
| Less: allowance for credit losses on loans | 36,863 | | 36,317 | | 39,236 | | 39,088 | | 41,711 | |
| Net loans | 4,812,010 | | 4,443,505 | | 4,244,616 | | 4,233,837 | | 4,244,693 | |
| Premises and equipment, net | 30,152 | | 29,694 | | 28,878 | | 28,908 | | 28,488 | |
| Operating lease right-of-use assets | 27,788 | | 28,098 | | 28,816 | | 26,692 | | 27,518 | |
| Investment in bank-owned life insurance | 101,491 | | 100,807 | | 93,192 | | 92,592 | | 92,974 | |
| Goodwill | 63,909 | | 63,909 | | 63,909 | | 63,909 | | 63,909 | |
| Identifiable intangible assets, net | 4,766 | | 4,981 | | 5,198 | | 5,414 | | 5,631 | |
| Other assets | 195,529 | | 153,849 | | 123,046 | | 125,196 | | 129,410 | |
| Total assets | $6,408,051 | | $5,982,891 | | $5,847,999 | | $5,851,127 | | $6,002,643 | |
| Liabilities: | | | | | |
| Deposits: | | | | | |
| Noninterest-bearing deposits | $938,572 | | $888,981 | | $911,990 | | $945,229 | | $950,974 | |
| Interest-bearing deposits | 4,131,285 | | 4,117,648 | | 4,215,960 | | 4,034,822 | | 4,107,168 | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| Total deposits | 5,069,857 | | 5,006,629 | | 5,127,950 | | 4,980,051 | | 5,058,142 | |
| Federal Home Loan Bank advances | 700,000 | | 328,000 | | 55,000 | | 145,000 | | 222,592 | |
| | | | | |
| Junior subordinated debentures | 22,681 | | 22,681 | | 22,681 | | 22,681 | | 22,681 | |
| Operating lease liabilities | 30,189 | | 30,491 | | 31,169 | | 29,010 | | 29,810 | |
| Other liabilities | 153,050 | | 118,456 | | 98,007 | | 109,577 | | 114,100 | |
| Total liabilities | 5,975,777 | | 5,506,257 | | 5,334,807 | | 5,286,319 | | 5,447,325 | |
| Shareholders’ Equity: | | | | | |
| Common stock | 1,085 | | 1,085 | | 1,085 | | 1,085 | | 1,085 | |
| Paid-in capital | 127,055 | | 126,079 | | 127,355 | | 126,511 | | 126,265 | |
| Retained earnings | 485,163 | | 475,889 | | 465,295 | | 458,310 | | 447,566 | |
| Accumulated other comprehensive (loss) income | (171,755) | | (118,041) | | (79,451) | | (19,981) | | (18,128) | |
| Treasury stock, at cost | (9,274) | | (8,378) | | (1,092) | | (1,117) | | (1,470) | |
| Total shareholders’ equity | 432,274 | | 476,634 | | 513,192 | | 564,808 | | 555,318 | |
| Total liabilities and shareholders’ equity | $6,408,051 | | $5,982,891 | | $5,847,999 | | $5,851,127 | | $6,002,643 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
| (Unaudited; Dollars and shares in thousands, except per share amounts) |
| For the Three Months Ended | | For the Nine Months Ended |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
| Interest income: | | | | | | | | |
| Interest and fees on loans | $45,125 | | $36,602 | | $33,930 | | $36,882 | | $35,691 | | | $115,657 | | $104,670 | |
| Interest on mortgage loans held for sale | 361 | | 258 | | 232 | | 387 | | 298 | | | 851 | | 1,144 | |
| Taxable interest on debt securities | 6,061 | | 4,918 | | 4,230 | | 3,929 | | 3,683 | | | 15,209 | | 10,366 | |
| | | | | | | | |
| Dividends on Federal Home Loan Bank stock | 88 | | 63 | | 67 | | 98 | | 95 | | | 218 | | 338 | |
| Other interest income | 503 | | 188 | | 78 | | 60 | | 56 | | | 769 | | 121 | |
| Total interest and dividend income | 52,138 | | 42,029 | | 38,537 | | 41,356 | | 39,823 | | | 132,704 | | 116,639 | |
| Interest expense: | | | | | | | | |
| Deposits | 6,656 | | 3,963 | | 3,103 | | 2,977 | | 2,789 | | | 13,722 | | 9,413 | |
| Federal Home Loan Bank advances | 3,234 | | 413 | | 244 | | 547 | | 872 | | | 3,891 | | 3,253 | |
| Junior subordinated debentures | 206 | | 138 | | 99 | | 92 | | 92 | | | 443 | | 278 | |
| | | | | | | | |
| Total interest expense | 10,096 | | 4,514 | | 3,446 | | 3,616 | | 3,753 | | | 18,056 | | 12,944 | |
| Net interest income | 42,042 | | 37,515 | | 35,091 | | 37,740 | | 36,070 | | | 114,648 | | 103,695 | |
| Provision for credit losses | 800 | | (3,000) | | 100 | | (2,822) | | — | | | (2,100) | | (2,000) | |
| Net interest income after provision for credit losses | 41,242 | | 40,515 | | 34,991 | | 40,562 | | 36,070 | | | 116,748 | | 105,695 | |
| Noninterest income: | | | | | | | | |
| Wealth management revenues | 9,525 | | 10,066 | | 10,531 | | 10,504 | | 10,455 | | | 30,122 | | 30,778 | |
| | | | | | | | |
| Mortgage banking revenues | 2,047 | | 2,082 | | 3,501 | | 4,332 | | 6,373 | | | 7,630 | | 24,294 | |
| Card interchange fees | 1,287 | | 1,303 | | 1,164 | | 1,282 | | 1,265 | | | 3,754 | | 3,714 | |
| Service charges on deposit accounts | 819 | | 763 | | 668 | | 766 | | 673 | | | 2,250 | | 1,917 | |
| Loan related derivative income | 1,041 | | 669 | | 301 | | 1,972 | | 728 | | | 2,011 | | 2,370 | |
| Income from bank-owned life insurance | 684 | | 615 | | 601 | | 1,144 | | 618 | | | 1,900 | | 1,781 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Other income | 400 | | 354 | | 393 | | 307 | | 408 | | | 1,147 | | 2,233 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Total noninterest income | 15,803 | | 15,852 | | 17,159 | | 20,307 | | 20,520 | | | 48,814 | | 67,087 | |
| Noninterest expense: | | | | | | | | |
| Salaries and employee benefits | 21,609 | | 20,381 | | 21,002 | | 21,524 | | 22,162 | | | 62,992 | | 65,771 | |
| Outsourced services | 3,552 | | 3,375 | | 3,242 | | 3,585 | | 3,294 | | | 10,169 | | 9,711 | |
| Net occupancy | 2,234 | | 2,174 | | 2,300 | | 2,145 | | 2,134 | | | 6,708 | | 6,304 | |
| Equipment | 939 | | 938 | | 918 | | 959 | | 977 | | | 2,795 | | 2,946 | |
| | | | | | | | |
| Legal, audit and professional fees | 693 | | 677 | | 770 | | 817 | | 767 | | | 2,140 | | 2,042 | |
| FDIC deposit insurance costs | 430 | | 402 | | 366 | | 391 | | 482 | | | 1,198 | | 1,201 | |
| Advertising and promotion | 799 | | 724 | | 351 | | 502 | | 559 | | | 1,874 | | 1,341 | |
| Amortization of intangibles | 215 | | 216 | | 217 | | 216 | | 223 | | | 648 | | 674 | |
| | | | | | | | |
| Debt prepayment penalties | — | | — | | — | | 2,700 | | — | | | — | | 4,230 | |
| | | | | | | | |
| | | | | | | | |
| Other expenses | 2,596 | | 2,190 | | 2,053 | | 2,380 | | 1,922 | | | 6,839 | | 6,025 | |
| Total noninterest expense | 33,067 | | 31,077 | | 31,219 | | 35,219 | | 32,520 | | | 95,363 | | 100,245 | |
| Income before income taxes | 23,978 | | 25,290 | | 20,931 | | 25,650 | | 24,070 | | | 70,199 | | 72,537 | |
| Income tax expense | 5,310 | | 5,333 | | 4,448 | | 5,462 | | 5,319 | | | 15,091 | | 15,855 | |
| Net income | $18,668 | | $19,957 | | $16,483 | | $20,188 | | $18,751 | | | $55,108 | | $56,682 | |
| | | | | | | | |
| Net income available to common shareholders | $18,615 | | $19,900 | | $16,429 | | $20,128 | | $18,697 | | | $54,944 | | $56,520 | |
| | | | | | | | |
| Weighted average common shares outstanding: | | | | | | | | |
| Basic | 17,174 | | 17,303 | | 17,331 | | 17,328 | | 17,320 | | | 17,269 | | 17,303 | |
| Diluted | 17,298 | | 17,414 | | 17,482 | | 17,469 | | 17,444 | | | 17,389 | | 17,451 | |
| Earnings per common share: | | | | | | | | |
| Basic | $1.08 | | $1.15 | | $0.95 | | $1.16 | | $1.08 | | | $3.18 | | $3.27 | |
| Diluted | $1.08 | | $1.14 | | $0.94 | | $1.15 | | $1.07 | | | $3.16 | | $3.24 | |
| | | | | | | | |
| Cash dividends declared per share | $0.54 | | $0.54 | | $0.54 | | $0.54 | | $0.52 | | | $1.62 | | $1.56 | |
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| SELECTED FINANCIAL HIGHLIGHTS |
| (Unaudited; Dollars and shares in thousands, except per share amounts) |
| |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Share and Equity Related Data: | | | | | |
| Book value per share | $25.17 | | $27.73 | | $29.61 | | $32.59 | | $32.06 | |
Tangible book value per share - Non-GAAP (1) | $21.17 | | $23.72 | | $25.62 | | $28.59 | | $28.05 | |
| Market value per share | $46.48 | | $48.37 | | $52.50 | | $56.37 | | $52.98 | |
| Shares issued at end of period | 17,363 | | 17,363 | | 17,363 | | 17,363 | | 17,363 | |
| Shares outstanding at end of period | 17,171 | | 17,190 | | 17,332 | | 17,331 | | 17,320 | |
| | | | | |
Capital Ratios (2): | | | | | |
| Tier 1 risk-based capital | 11.97 | % | 12.78 | % | 13.32 | % | 13.24 | % | 13.01 | % |
| Total risk-based capital | 12.65 | % | 13.51 | % | 14.15 | % | 14.01 | % | 13.83 | % |
| Tier 1 leverage ratio | 8.99 | % | 9.42 | % | 9.46 | % | 9.36 | % | 9.12 | % |
| Common equity tier 1 | 11.50 | % | 12.28 | % | 12.79 | % | 12.71 | % | 12.47 | % |
| | | | | |
| Balance Sheet Ratios: | | | | | |
| Equity to assets | 6.75 | % | 7.97 | % | 8.78 | % | 9.65 | % | 9.25 | % |
Tangible equity to tangible assets - Non-GAAP (1) | 5.74 | % | 6.89 | % | 7.68 | % | 8.57 | % | 8.19 | % |
Loans to deposits (3) | 95.4 | % | 89.2 | % | 83.1 | % | 85.8 | % | 84.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | For the Nine Months Ended |
| For the Three Months Ended | |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
Performance Ratios (4): | | | | | | | | |
Net interest margin (5) | 2.82 | % | 2.71 | % | 2.57 | % | 2.71 | % | 2.58 | % | | 2.71 | % | 2.55 | % |
| Return on average assets (net income divided by average assets) | 1.19 | % | 1.37 | % | 1.14 | % | 1.36 | % | 1.26 | % | | 1.23 | % | 1.30 | % |
Return on average tangible assets - Non-GAAP (1) | 1.20 | % | 1.39 | % | 1.15 | % | 1.38 | % | 1.27 | % | | 1.25 | % | 1.32 | % |
| Return on average equity (net income available for common shareholders divided by average equity) | 15.16 | % | 16.11 | % | 12.04 | % | 14.34 | % | 13.37 | % | | 14.35 | % | 13.93 | % |
Return on average tangible equity - Non-GAAP (1) | 17.65 | % | 18.71 | % | 13.77 | % | 16.39 | % | 15.29 | % | | 16.59 | % | 15.98 | % |
Efficiency ratio (6) | 57.2 | % | 58.2 | % | 59.7 | % | 60.7 | % | 57.5 | % | | 58.3 | % | 58.7 | % |
(1)See the section labeled “Supplemental Information - Calculation of Non-GAAP Financial Measures” at the end of this document.
(2)Estimated for September 30, 2022 and actuals for prior periods.
(3)Period-end balances of net loans and mortgage loans held for sale as a percentage of total deposits.
(4)Annualized based on the actual number of days in the period.
(5)Fully taxable equivalent (FTE) net interest income as a percentage of average-earnings assets.
(6)Total noninterest expense as percentage of total revenues (net interest income and noninterest income).
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| SELECTED FINANCIAL HIGHLIGHTS |
| (Unaudited; Dollars in thousands) |
| | | | |
| For the Three Months Ended | | For the Nine Months Ended |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
| Wealth Management Results | | | | | | | | |
| Wealth Management Revenues: | | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Asset-based revenues | $9,302 | | $9,641 | | $10,211 | | $10,417 | | $10,224 | | | $29,154 | | $29,798 | |
| Transaction-based revenues | 223 | | 425 | | 320 | | 87 | | 231 | | | 968 | | 980 | |
| Total wealth management revenues | $9,525 | | $10,066 | | $10,531 | | $10,504 | | $10,455 | | | $30,122 | | $30,778 | |
| | | | | | | | |
| Assets Under Administration (AUA): | | | | | | | | |
| Balance at beginning of period | $6,650,097 | | $7,492,893 | | $7,784,211 | | $7,443,396 | | $7,441,519 | | | $7,784,211 | | $6,866,737 | |
| Net investment (depreciation) appreciation & income | (239,762) | | (816,290) | | (388,733) | | 358,796 | | (4,830) | | | (1,444,785) | | 572,506 | |
| Net client asset (outflows) inflows | (87,578) | | (26,506) | | 97,415 | | (17,981) | | 6,707 | | | (16,669) | | 4,153 | |
| | | | | | | | |
| Balance at end of period | $6,322,757 | | $6,650,097 | | $7,492,893 | | $7,784,211 | | $7,443,396 | | | $6,322,757 | | $7,443,396 | |
| | | | | | | | |
| Percentage of AUA that are managed assets | 91% | 91% | 92% | 92% | 91% | | 91% | 91% |
| | | | | | | | |
| Mortgage Banking Results | | | | | | | | |
| Mortgage Banking Revenues: | | | | | | | | |
Realized gains on loan sales, net (1) | $1,718 | | $1,917 | | $3,327 | | $5,695 | | $5,750 | | | $6,962 | | $28,057 | |
Changes in fair value, net (2) | (226) | | (330) | | (242) | | (1,594) | | 467 | | | (798) | | (3,964) | |
Loan servicing fee income, net (3) | 555 | | 495 | | 416 | | 231 | | 156 | | | 1,466 | | 201 | |
| Total mortgage banking revenues | $2,047 | | $2,082 | | $3,501 | | $4,332 | | $6,373 | | | $7,630 | | $24,294 | |
| | | | | | | | |
| Residential Mortgage Loan Originations: | | | | | | | | |
Originations for retention in portfolio (4) | $225,132 | | $263,762 | | $164,401 | | $174,438 | | $205,293 | | | $653,295 | | $581,905 | |
Originations for sale to secondary market (5) | 77,242 | | 86,459 | | 106,619 | | 188,735 | | 190,702 | | | 270,320 | | 744,589 | |
| Total mortgage loan originations | $302,374 | | $350,221 | | $271,020 | | $363,173 | | $395,995 | | | $923,615 | | $1,326,494 | |
| | | | | | | | |
| Residential Mortgage Loans Sold: | | | | | | | | |
| Sold with servicing rights retained | $34,659 | | $23,478 | | $14,627 | | $21,180 | | $108,445 | | | $72,764 | | $570,370 | |
Sold with servicing rights released (5) | 40,665 | | 56,263 | | 115,501 | | 175,818 | | 65,416 | | | 212,429 | | 186,068 | |
| Total mortgage loans sold | $75,324 | | $79,741 | | $130,128 | | $196,998 | | $173,861 | | | $285,193 | | $756,438 | |
(1)Includes gains on loan sales, commission income on loans originated for others, servicing right gains, and gains (losses) on forward loan commitments.
(2)Represents fair value changes on mortgage loans held for sale and forward loan commitments.
(3)Represents loan servicing fee income, net of servicing right amortization and valuation adjustments.
(4)Includes the full commitment amount of homeowner construction loans.
(5)Includes brokered loans (loans originated for others).
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| END OF PERIOD LOAN COMPOSITION |
| (Unaudited; Dollars in thousands) |
| |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Loans: | | | | | |
| Commercial real estate (1) | $1,762,687 | | $1,609,618 | | $1,628,620 | | $1,639,062 | | $1,661,785 | |
| Commercial & industrial | 652,758 | | 620,270 | | 614,892 | | 641,555 | | 682,774 | |
| Total commercial | 2,415,445 | | 2,229,888 | | 2,243,512 | | 2,280,617 | | 2,344,559 | |
| | | | | |
| Residential real estate (2) | 2,144,098 | | 1,966,341 | | 1,777,974 | | 1,726,975 | | 1,672,364 | |
| | | | | |
| Home equity | 273,742 | | 267,785 | | 246,097 | | 247,697 | | 249,874 | |
| Other | 15,588 | | 15,808 | | 16,269 | | 17,636 | | 19,607 | |
| Total consumer | 289,330 | | 283,593 | | 262,366 | | 265,333 | | 269,481 | |
| Total loans | $4,848,873 | | $4,479,822 | | $4,283,852 | | $4,272,925 | | $4,286,404 | |
(1)Commercial real estate loans consist of commercial mortgages and construction and development loans. Commercial mortgages are loans secured by income producing property.
(2)Residential real estate loans consist of mortgage and homeowner construction loans secured by one- to four-family residential properties.
| | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2022 | | December 31, 2021 |
| Count | Balance | % of Total | | Count | Balance | % of Total |
| Commercial Real Estate Portfolio Segmentation: | | | | | | | |
| Retail | 109 | | $441,631 | | 25 | % | | 121 | | $389,487 | | 24 | % |
| Multi-family dwelling | 123 | | 429,796 | | 24 | | | 127 | | 474,229 | | 29 | |
| Office | 55 | | 253,816 | | 14 | | | 57 | | 216,602 | | 13 | |
| Hospitality | 32 | | 196,503 | | 11 | | | 31 | | 184,990 | | 11 | |
| Industrial and warehouse | 39 | | 176,081 | | 10 | | | 35 | | 137,254 | | 8 | |
| Healthcare | 15 | | 138,475 | | 8 | | | 13 | | 128,189 | | 8 | |
| Commercial mixed use | 20 | | 43,235 | | 2 | | | 20 | | 38,978 | | 2 | |
| Other | 36 | | 83,150 | | 6 | | | 36 | | 69,333 | | 5 | |
| Commercial real estate loans | 429 | | $1,762,687 | | 100 | % | | 440 | | $1,639,062 | | 100 | % |
| | | | | | | |
| Commercial & Industrial Portfolio Segmentation: | | | | | | | |
| Healthcare and social assistance | 70 | | $194,128 | | 30 | % | | 101 | | $174,376 | | 27 | % |
| Owner occupied and other real estate | 162 | | 71,431 | | 11 | | | 185 | | 72,957 | | 11 | |
| Manufacturing | 54 | | 55,489 | | 9 | | | 65 | | 55,341 | | 9 | |
| Transportation and warehousing | 20 | | 50,597 | | 8 | | | 31 | | 35,064 | | 5 | |
| Retail | 55 | | 49,365 | | 8 | | | 79 | | 47,290 | | 7 | |
| Educational services | 20 | | 48,208 | | 7 | | | 28 | | 52,211 | | 8 | |
| Finance and insurance | 58 | | 31,579 | | 5 | | | 59 | | 31,279 | | 5 | |
| Entertainment and recreation | 24 | | 26,050 | | 4 | | | 37 | | 32,087 | | 5 | |
| Information | 8 | | 22,258 | | 3 | | | 14 | | 25,045 | | 4 | |
| Accommodation and food services | 49 | | 17,499 | | 3 | | | 114 | | 28,320 | | 4 | |
| Professional, scientific and technical | 37 | | 6,357 | | 1 | | | 69 | | 8,912 | | 1 | |
| Public administration | 12 | | 4,223 | | 1 | | | 16 | | 5,441 | | 1 | |
| Other | 164 | | 75,574 | | 10 | | | 281 | | 73,232 | | 13 | |
| Commercial & industrial loans | 733 | | $652,758 | | 100 | % | | 1,079 | | $641,555 | | 100 | % |
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| END OF PERIOD LOAN AND DEPOSIT COMPOSITION |
| (Unaudited; Dollars in thousands) |
| | | | | |
| September 30, 2022 | | December 31, 2021 |
| Balance | % of Total | | Balance | % of Total |
| Commercial Real Estate Loans by Property Location: | | | | | |
| Connecticut | $674,816 | | 38 | % | | $643,182 | | 39 | % |
| Massachusetts | 529,364 | | 30 | | | 464,018 | | 28 | |
| Rhode Island | 396,869 | | 23 | | | 408,496 | | 25 | |
| Subtotal | 1,601,049 | | 91 | | | 1,515,696 | | 92 | |
| All other states | 161,638 | | 9 | | | 123,366 | | 8 | |
| Total commercial real estate loans | $1,762,687 | | 100 | % | | $1,639,062 | | 100 | % |
| | | | | |
| Residential Real Estate Loans by Property Location: | | | | | |
| Massachusetts | $1,552,728 | | 72 | % | | $1,207,789 | | 70 | % |
| Rhode Island | 423,070 | | 20 | | | 365,831 | | 21 | |
| Connecticut | 143,701 | | 7 | | | 132,430 | | 8 | |
| Subtotal | 2,119,499 | | 99 | | | 1,706,050 | | 99 | |
| All other states | 24,599 | | 1 | | | 20,925 | | 1 | |
| Total residential real estate loans | $2,144,098 | | 100 | % | | $1,726,975 | | 100 | % |
| | | | | | | | | | | | | | | | | |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Deposits: | | | | | |
| Noninterest-bearing demand deposits | $938,572 | | $888,981 | | $911,990 | | $945,229 | | $950,974 | |
| Interest-bearing demand deposits (in-market) | 273,231 | | 258,451 | | 248,914 | | 251,032 | | 238,317 | |
| NOW accounts | 869,984 | | 887,678 | | 893,603 | | 867,138 | | 817,937 | |
| Money market accounts | 1,146,826 | | 1,139,676 | | 1,295,339 | | 1,072,864 | | 1,046,324 | |
| Savings accounts | 600,568 | | 572,251 | | 566,461 | | 555,177 | | 540,306 | |
| Time deposits (in-market) | 797,505 | | 800,898 | | 809,858 | | 773,383 | | 709,288 | |
| In-market deposits | 4,626,686 | | 4,547,935 | | 4,726,165 | | 4,464,823 | | 4,303,146 | |
| Wholesale brokered demand deposits | 31,044 | | 31,003 | | — | | — | | — | |
| Wholesale brokered time deposits | 412,127 | | 427,691 | | 401,785 | | 515,228 | | 754,996 | |
| Wholesale brokered deposits | 443,171 | | 458,694 | | 401,785 | | 515,228 | | 754,996 | |
| Total deposits | $5,069,857 | | $5,006,629 | | $5,127,950 | | $4,980,051 | | $5,058,142 | |
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CREDIT & ASSET QUALITY DATA |
| (Unaudited; Dollars in thousands) |
| |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Asset Quality Ratios: | | | | | |
| Nonperforming assets to total assets | 0.19 | % | 0.21 | % | 0.22 | % | 0.24 | % | 0.18 | % |
| Nonaccrual loans to total loans | 0.25 | % | 0.28 | % | 0.29 | % | 0.33 | % | 0.26 | % |
| Total past due loans to total loans | 0.16 | % | 0.19 | % | 0.16 | % | 0.24 | % | 0.22 | % |
| Allowance for credit losses on loans to nonaccrual loans | 304.10 | % | 292.55 | % | 311.67 | % | 275.21 | % | 380.02 | % |
| Allowance for credit losses on loans to total loans | 0.76 | % | 0.81 | % | 0.92 | % | 0.91 | % | 0.97 | % |
| | | | | |
| Nonperforming Assets: | | | | | |
| Commercial real estate | $— | | $— | | $— | | $— | | $— | |
| Commercial & industrial | — | | — | | — | | — | | — | |
| Total commercial | — | | — | | — | | — | | — | |
| Residential real estate | 11,700 | | 11,815 | | 11,916 | | 13,576 | | 10,321 | |
| Home equity | 422 | | 599 | | 673 | | 627 | | 655 | |
| Other consumer | — | | — | | — | | — | | — | |
| Total consumer | 422 | | 599 | | 673 | | 627 | | 655 | |
| Total nonaccrual loans | 12,122 | | 12,414 | | 12,589 | | 14,203 | | 10,976 | |
| Other real estate owned | — | | — | | — | | — | | — | |
| Total nonperforming assets | $12,122 | | $12,414 | | $12,589 | | $14,203 | | $10,976 | |
| | | | | |
| Past Due Loans (30 days or more past due): | | | | | |
| Commercial real estate | $— | | $— | | $— | | $— | | $— | |
| Commercial & industrial | 4 | | 7 | | 108 | | 3 | | 2 | |
| Total commercial | 4 | | 7 | | 108 | | 3 | | 2 | |
| Residential real estate | 7,256 | | 7,794 | | 6,467 | | 9,622 | | 8,698 | |
| Home equity | 252 | | 728 | | 431 | | 765 | | 824 | |
| Other consumer | 17 | | 28 | | 30 | | 21 | | 24 | |
| Total consumer | 269 | | 756 | | 461 | | 786 | | 848 | |
| Total past due loans | $7,529 | | $8,557 | | $7,036 | | $10,411 | | $9,548 | |
| | | | | |
| Accruing loans 90 days or more past due | $— | | $— | | $— | | $— | | $— | |
| Nonaccrual loans included in past due loans | $7,059 | | $6,817 | | $5,707 | | $9,359 | | $6,930 | |
| | | | | |
| Troubled Debt Restructurings ("TDR"): | | | | | |
| Accruing TDRs | $7,214 | | $9,607 | | $16,303 | | $16,328 | | $7,979 | |
| Nonaccrual TDRs | 2,890 | | 2,906 | | 2,789 | | 2,819 | | 1,732 | |
| Total TDRs | $10,104 | | $12,513 | | $19,092 | | $19,147 | | $9,711 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CREDIT & ASSET QUALITY DATA |
| (Unaudited; Dollars in thousands) |
| For the Three Months Ended | | For the Nine Months Ended |
| | | | | | | | |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
| Nonaccrual Loan Activity: | | | | | | | | |
| Balance at beginning of period | $12,414 | | $12,589 | | $14,203 | | $10,976 | | $10,481 | | | $14,203 | | $13,197 | |
| Additions to nonaccrual status | 521 | | 158 | | 427 | | 3,959 | | 2,583 | | | 1,106 | | 3,854 | |
| Loans returned to accruing status | (400) | | (236) | | (63) | | (339) | | — | | | (699) | | (877) | |
| Loans charged-off | (63) | | (23) | | (36) | | (31) | | (249) | | | (122) | | (630) | |
| | | | | | | | |
| Payments, payoffs and other changes | (350) | | (74) | | (1,942) | | (362) | | (1,839) | | | (2,366) | | (4,568) | |
| Balance at end of period | $12,122 | | $12,414 | | $12,589 | | $14,203 | | $10,976 | | | $12,122 | | $10,976 | |
| | | | | | | | |
| Allowance for Credit Losses on Loans: | | | | | | | | |
| Balance at beginning of period | $36,317 | | $39,236 | | $39,088 | | $41,711 | | $41,879 | | | $39,088 | | $44,106 | |
| | | | | | | | |
Provision for credit losses on loans (1) | 600 | | (2,929) | | — | | (2,650) | | — | | | (2,329) | | (1,951) | |
| Charge-offs | (63) | | (23) | | (36) | | (33) | | (249) | | | (122) | | (630) | |
| Recoveries | 9 | | 33 | | 184 | | 60 | | 81 | | | 226 | | 186 | |
| Balance at end of period | $36,863 | | $36,317 | | $39,236 | | $39,088 | | $41,711 | | | $36,863 | | $41,711 | |
| | | | | | | | |
| Allowance for Credit Losses on Unfunded Commitments: | | | | | | | |
| Balance at beginning of period | $2,190 | | $2,261 | | $2,161 | | $2,333 | | $2,333 | | | $2,161 | | $2,382 | |
| | | | | | | | |
Provision for credit losses on unfunded commitments (1) | 200 | | (71) | | 100 | | (172) | | — | | | 229 | | (49) | |
Balance at end of period (2) | $2,390 | | $2,190 | | $2,261 | | $2,161 | | $2,333 | | | $2,390 | | $2,333 | |
(1) Included in provision for credit losses in the Consolidated Statements of Income.
(2) Included in other liabilities in the Consolidated Balance Sheets.
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the Three Months Ended | | For the Nine Months Ended |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
| Net Loan Charge-Offs (Recoveries): | | | | | | | | |
| Commercial real estate | $— | | $— | | ($145) | | $— | | $— | | | ($145) | | $— | |
| Commercial & industrial | 9 | | (11) | | (1) | | (35) | | (2) | | | (3) | | 301 | |
| Total commercial | 9 | | (11) | | (146) | | (35) | | (2) | | | (148) | | 301 | |
| Residential real estate | — | | — | | (21) | | (4) | | 52 | | | (21) | | 22 | |
| Home equity | — | | (2) | | (2) | | (12) | | 110 | | | (4) | | 104 | |
| Other consumer | 45 | | 3 | | 21 | | 24 | | 8 | | | 69 | | 17 | |
| Total consumer | 45 | | 1 | | 19 | | 12 | | 118 | | | 65 | | 121 | |
| Total | $54 | | ($10) | | ($148) | | ($27) | | $168 | | | ($104) | | $444 | |
| | | | | | | | |
| Net charge-offs (recoveries) to average loans - annualized | — | % | — | % | (0.01 | %) | — | % | 0.02 | % | | — | % | 0.01 | % |
The following table presents average balance and interest rate information. Tax-exempt income is converted to a fully taxable equivalent (“FTE”) basis using the statutory federal income tax rate adjusted for applicable state income taxes net of the related federal tax benefit. Unrealized gains (losses) on available for sale securities and changes in fair value on mortgage loans held for sale are excluded from the average balance and yield calculations. Nonaccrual loans, as well as interest recognized on these loans, are included in amounts presented for loans.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis) |
| (Unaudited; Dollars in thousands) |
| For the Three Months Ended | September 30, 2022 | | June 30, 2022 | | | Change |
| Average Balance | Interest | Yield/
Rate | | Average Balance | Interest | Yield/
Rate | | | | | Average Balance | Interest | Yield/
Rate |
|
| Assets: | | | | | | | | | | | | | | |
| Cash, federal funds sold and short-term investments | $92,708 | | $503 | | 2.15 | % | | $110,424 | | $188 | | 0.68 | % | | | | | ($17,716) | | $315 | | 1.47 | % |
| Mortgage loans held for sale | 34,503 | | 361 | | 4.15 | | | 26,914 | | 258 | | 3.84 | | | | | | 7,589 | | 103 | | 0.31 | |
| Taxable debt securities | 1,150,674 | | 6,061 | | 2.09 | | | 1,096,611 | | 4,918 | | 1.80 | | | | | | 54,063 | | 1,143 | | 0.29 | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| FHLB stock | 25,377 | | 88 | | 1.38 | | | 9,420 | | 63 | | 2.68 | | | | | | 15,957 | | 25 | | (1.30) | |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| Commercial real estate | 1,692,374 | | 17,974 | | 4.21 | | | 1,619,325 | | 13,495 | | 3.34 | | | | | | 73,049 | | 4,479 | | 0.87 | |
| Commercial & industrial | 630,360 | | 7,114 | | 4.48 | | | 620,543 | | 6,115 | | 3.95 | | | | | | 9,817 | | 999 | | 0.53 | |
| Total commercial | 2,322,734 | | 25,088 | | 4.29 | | | 2,239,868 | | 19,610 | | 3.51 | | | | | | 82,866 | | 5,478 | | 0.78 | |
| Residential real estate | 2,045,833 | | 17,379 | | 3.37 | | | 1,836,245 | | 15,010 | | 3.28 | | | | | | 209,588 | | 2,369 | | 0.09 | |
| Home equity | 269,654 | | 2,804 | | 4.13 | | | 256,771 | | 2,075 | | 3.24 | | | | | | 12,883 | | 729 | | 0.89 | |
| Other | 15,299 | | 171 | | 4.43 | | | 15,770 | | 183 | | 4.65 | | | | | | (471) | | (12) | | (0.22) | |
| Total consumer | 284,953 | | 2,975 | | 4.14 | | | 272,541 | | 2,258 | | 3.32 | | | | | | 12,412 | | 717 | | 0.82 | |
| Total loans | 4,653,520 | | 45,442 | | 3.87 | | | 4,348,654 | | 36,878 | | 3.40 | | | | | | 304,866 | | 8,564 | | 0.47 | |
| Total interest-earning assets | 5,956,782 | | 52,455 | | 3.49 | | | 5,592,023 | | 42,305 | | 3.03 | | | | | | 364,759 | | 10,150 | | 0.46 | |
| Noninterest-earning assets | 259,347 | | | | | 249,309 | | | | | | | | 10,038 | | | |
| Total assets | $6,216,129 | | | | | $5,841,332 | | | | | | | | $374,797 | | | |
| Liabilities and Shareholders' Equity: | | | | | | | | | | | | | | |
| Interest-bearing demand deposits (in-market) | $267,670 | | $822 | | 1.22 | % | | $248,764 | | $222 | | 0.36 | % | | | | | $18,906 | | $600 | | 0.86 | % |
| NOW accounts | 871,038 | | 212 | | 0.10 | | | 883,251 | | 151 | | 0.07 | | | | | | (12,213) | | 61 | | 0.03 | |
| Money market accounts | 1,137,875 | | 2,231 | | 0.78 | | | 1,268,496 | | 1,139 | | 0.36 | | | | | | (130,621) | | 1,092 | | 0.42 | |
| Savings accounts | 582,513 | | 100 | | 0.07 | | | 566,307 | | 119 | | 0.08 | | | | | | 16,206 | | (19) | | (0.01) | |
| Time deposits (in-market) | 797,199 | | 1,983 | | 0.99 | | | 809,697 | | 1,951 | | 0.97 | | | | | | (12,498) | | 32 | | 0.02 | |
| Interest-bearing in-market deposits | 3,656,295 | | 5,348 | | 0.58 | | | 3,776,515 | | 3,582 | | 0.38 | | | | | | (120,220) | | 1,766 | | 0.20 | |
| Wholesale brokered demand deposits | 31,014 | | 166 | | 2.12 | | | 20,233 | | 46 | | 0.91 | | | | | | 10,781 | | 120 | | 1.21 | |
| Wholesale brokered time deposits | 381,984 | | 1,142 | | 1.19 | | | 352,438 | | 335 | | 0.38 | | | | | | 29,546 | | 807 | | 0.81 | |
| Wholesale brokered deposits | 412,998 | | 1,308 | | 1.26 | | | 372,671 | | 381 | | 0.41 | | | | | | 40,327 | | 927 | | 0.85 | |
| Total interest-bearing deposits | 4,069,293 | | 6,656 | | 0.65 | | | 4,149,186 | | 3,963 | | 0.38 | | | | | | (79,893) | | 2,693 | | 0.27 | |
| FHLB advances | 549,729 | | 3,234 | | 2.33 | | | 151,736 | | 413 | | 1.09 | | | | | | 397,993 | | 2,821 | | 1.24 | |
| Junior subordinated debentures | 22,681 | | 206 | | 3.60 | | | 22,681 | | 138 | | 2.44 | | | | | | — | | 68 | | 1.16 | |
| | | | | | | | | | | | | | |
| Total interest-bearing liabilities | 4,641,703 | | 10,096 | | 0.86 | | | 4,323,603 | | 4,514 | | 0.42 | | | | | | 318,100 | | 5,582 | | 0.44 | |
| Noninterest-bearing demand deposits | 944,153 | | | | | 891,883 | | | | | | | | 52,270 | | | |
| Other liabilities | 143,043 | | | | | 130,273 | | | | | | | | 12,770 | | | |
| Shareholders' equity | 487,230 | | | | | 495,573 | | | | | | | | (8,343) | | | |
| Total liabilities and shareholders' equity | $6,216,129 | | | | | $5,841,332 | | | | | | | | $374,797 | | | |
| Net interest income (FTE) | | $42,359 | | | | | $37,791 | | | | | | | | $4,568 | | |
| Interest rate spread | | | 2.63 | % | | | | 2.61 | % | | | | | | | 0.02 | % |
| Net interest margin | | | 2.82 | % | | | | 2.71 | % | | | | | | | 0.11 | % |
Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:
| | | | | | | | | | | | |
| For the Three Months Ended | Sep 30, 2022 | Jun 30, 2022 | | Change |
| Commercial loans | $317 | | $276 | | | $41 | |
| | | | |
| | | | |
| Total | $317 | | $276 | | | $41 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis) |
| (Unaudited; Dollars in thousands) |
| For the Nine Months Ended | September 30, 2022 | September 30, 2021 | Change |
| Average Balance | Interest | Yield/
Rate | Average Balance | Interest | Yield/
Rate | Average Balance | Interest | Yield/
Rate |
|
| Assets: | | | | | | | | | |
| Cash, federal funds sold and short-term investments | $128,606 | | $769 | | 0.80 | % | $160,350 | | $121 | | 0.10 | % | ($31,744) | | $648 | | 0.70 | % |
| Mortgage loans for sale | 29,985 | | 851 | | 3.79 | | 53,307 | | 1,144 | | 2.87 | | (23,322) | | (293) | | 0.92 | |
| Taxable debt securities | 1,106,632 | | 15,209 | | 1.84 | | 997,741 | | 10,366 | | 1.39 | | 108,891 | | 4,843 | | 0.45 | |
| | | | | | | | | |
| | | | | | | | | |
| FHLB stock | 15,745 | | 218 | | 1.85 | | 24,265 | | 338 | | 1.86 | | (8,520) | | (120) | | (0.01) | |
| | | | | | | | | |
| | | | | | | | | |
| Commercial real estate | 1,648,061 | | 43,360 | | 3.52 | | 1,638,200 | | 35,269 | | 2.88 | | 9,861 | | 8,091 | | 0.64 | |
| Commercial & industrial | 628,574 | | 19,456 | | 4.14 | | 794,091 | | 23,865 | | 4.02 | | (165,517) | | (4,409) | | 0.12 | |
| Total commercial | 2,276,635 | | 62,816 | | 3.69 | | 2,432,291 | | 59,134 | | 3.25 | | (155,656) | | 3,682 | | 0.44 | |
| Residential real estate | 1,875,175 | | 46,376 | | 3.31 | | 1,531,529 | | 39,248 | | 3.43 | | 343,646 | | 7,128 | | (0.12) | |
| Home equity | 257,814 | | 6,753 | | 3.50 | | 255,959 | | 6,220 | | 3.25 | | 1,855 | | 533 | | 0.25 | |
| Other | 15,995 | | 550 | | 4.60 | | 20,301 | | 742 | | 4.89 | | (4,306) | | (192) | | (0.29) | |
| Total consumer | 273,809 | | 7,303 | | 3.57 | | 276,260 | | 6,962 | | 3.37 | | (2,451) | | 341 | | 0.20 | |
| Total loans | 4,425,619 | | 116,495 | | 3.52 | | 4,240,080 | | 105,344 | | 3.32 | | 185,539 | | 11,151 | | 0.20 | |
| Total interest-earning assets | 5,706,587 | | 133,542 | | 3.13 | | 5,475,743 | | 117,313 | | 2.86 | | 230,844 | | 16,229 | | 0.27 | |
| Noninterest-earning assets | 268,744 | | | | 346,514 | | | | (77,770) | | | |
| Total assets | $5,975,331 | | | | $5,822,257 | | | | $153,074 | | | |
| Liabilities and Shareholders' Equity: | | | | | | | | | |
| Interest-bearing demand deposits (in-market) | $255,014 | | $1,114 | | 0.58 | % | $190,979 | | $196 | | 0.14 | % | $64,035 | | $918 | | 0.44 | % |
| NOW accounts | 867,464 | | 492 | | 0.08 | | 747,385 | | 350 | | 0.06 | | 120,079 | | 142 | | 0.02 | |
| Money market accounts | 1,193,599 | | 3,984 | | 0.45 | | 958,812 | | 1,852 | | 0.26 | | 234,787 | | 2,132 | | 0.19 | |
| Savings accounts | 570,129 | | 246 | | 0.06 | | 513,110 | | 211 | | 0.05 | | 57,019 | | 35 | | 0.01 | |
| Time deposits (in-market) | 800,037 | | 5,997 | | 1.00 | | 687,278 | | 5,822 | | 1.13 | | 112,759 | | 175 | | (0.13) | |
| Interest-bearing in-market deposits | 3,686,243 | | 11,833 | | 0.43 | | 3,097,564 | | 8,431 | | 0.36 | | 588,679 | | 3,402 | | 0.07 | |
| Wholesale brokered demand deposits | 17,197 | | 212 | | 1.65 | | — | | — | | — | | 17,197 | | 212 | | 1.65 | |
| Wholesale brokered time deposits | 396,465 | | 1,677 | | 0.57 | | 655,165 | | 982 | | 0.20 | | (258,700) | | 695 | | 0.37 | |
| Wholesale brokered deposits | 413,662 | | 1,889 | | 0.61 | | 655,165 | | 982 | | 0.20 | | (241,503) | | 907 | | 0.41 | |
| Total interest-bearing deposits | 4,099,905 | | 13,722 | | 0.45 | | 3,752,729 | | 9,413 | | 0.34 | | 347,176 | | 4,309 | | 0.11 | |
| FHLB advances | 285,590 | | 3,891 | | 1.82 | | 438,213 | | 3,253 | | 0.99 | | (152,623) | | 638 | | 0.83 | |
| Junior subordinated debentures | 22,681 | | 443 | | 2.61 | | 22,681 | | 278 | | 1.64 | | — | | 165 | | 0.97 | |
| | | | | | | | | |
| Total interest-bearing liabilities | 4,408,176 | | 18,056 | | 0.55 | | 4,213,623 | | 12,944 | | 0.41 | | 194,553 | | 5,112 | | 0.14 | |
| Noninterest-bearing demand deposits | 925,433 | | | | 918,760 | | | | 6,673 | | | |
| Other liabilities | 129,967 | | | | 147,244 | | | | (17,277) | | | |
| Shareholders' equity | 511,755 | | | | 542,630 | | | | (30,875) | | | |
| Total liabilities and shareholders' equity | $5,975,331 | | | | $5,822,257 | | | | $153,074 | | | |
| Net interest income (FTE) | | $115,486 | | | | $104,369 | | | | $11,117 | | |
| Interest rate spread | | | 2.58 | % | | | 2.45 | % | | | 0.13 | % |
| Net interest margin | | | 2.71 | % | | | 2.55 | % | | | 0.16 | % |
Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:
| | | | | | | | | | | |
| | | |
| For the Nine Months Ended | Sep 30, 2022 | Sep 30, 2021 | Change |
| Commercial loans | $838 | | $674 | | $164 | |
| | | |
| | | |
| Total | $838 | | $674 | | $164 | |
| | | | | | | | | | | | | | | | | |
| Washington Trust Bancorp, Inc. and Subsidiaries |
| SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures |
| (Unaudited; Dollars in thousands, except per share amounts) |
| |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 |
| Tangible Book Value per Share: | | | | | |
| Total shareholders' equity, as reported | $432,274 | | $476,634 | | $513,192 | | $564,808 | | $555,318 | |
| Less: | | | | | |
| Goodwill | 63,909 | | 63,909 | | 63,909 | | 63,909 | | 63,909 | |
| Identifiable intangible assets, net | 4,766 | | 4,981 | | 5,198 | | 5,414 | | 5,631 | |
| Total tangible shareholders' equity | $363,599 | | $407,744 | | $444,085 | | $495,485 | | $485,778 | |
| | | | | |
| Shares outstanding, as reported | 17,171 | | 17,190 | | 17,332 | | 17,331 | | 17,320 | |
| | | | | |
| Book value per share - GAAP | $25.17 | | $27.73 | | $29.61 | | $32.59 | | $32.06 | |
| Tangible book value per share - Non-GAAP | $21.18 | | $23.72 | | $25.62 | | $28.59 | | $28.05 | |
| | | | | |
| Tangible Equity to Tangible Assets: | | | | | |
| Total tangible shareholders' equity | $363,599 | | $407,744 | | $444,085 | | $495,485 | | $485,778 | |
| | | | | |
| Total assets, as reported | $6,408,051 | | $5,982,891 | | $5,847,999 | | $5,851,127 | | $6,002,643 | |
| Less: | | | | | |
| Goodwill | 63,909 | | 63,909 | | 63,909 | | 63,909 | | 63,909 | |
| Identifiable intangible assets, net | 4,766 | | 4,981 | | 5,198 | | 5,414 | | 5,631 | |
| Total tangible assets | $6,339,376 | | $5,914,001 | | $5,778,892 | | $5,781,804 | | $5,933,103 | |
| | | | | |
| Equity to assets - GAAP | 6.75 | % | 7.97 | % | 8.78 | % | 9.65 | % | 9.25 | % |
| Tangible equity to tangible assets - Non-GAAP | 5.74 | % | 6.89 | % | 7.68 | % | 8.57 | % | 8.19 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| For the Three Months Ended | | For the Nine Months Ended |
| Sep 30,
2022 | Jun 30,
2022 | Mar 31,
2022 | Dec 31,
2021 | Sep 30,
2021 | | Sep 30,
2022 | Sep 30,
2021 |
| Return on Average Tangible Assets: | | | | | | | | |
| Net income, as reported | $18,668 | | $19,957 | | $16,483 | | $20,188 | | $18,751 | | | $55,108 | | $56,682 | |
| | | | | | | | |
| Total average assets, as reported | $6,216,129 | | $5,841,332 | | $5,864,668 | | $5,884,581 | | $5,919,137 | | | $5,975,331 | | $5,822,257 | |
| Less average balances of: | | | | | | | | |
| Goodwill | 63,909 | | 63,909 | | 63,909 | | 63,909 | | 63,909 | | | 63,909 | | 63,909 | |
| Identifiable intangible assets, net | 4,871 | | 5,086 | | 5,303 | | 5,526 | | 5,739 | | | 5,085 | | 5,962 | |
| Total average tangible assets | $6,147,349 | | $5,772,337 | | $5,795,456 | | $5,815,146 | | $5,849,489 | | | $5,906,337 | | $5,752,386 | |
| | | | | | | | |
| Return on average assets - GAAP | 1.19 | % | 1.37 | % | 1.14 | % | 1.36 | % | 1.26 | % | | 1.23 | % | 1.30 | % |
| Return on average tangible assets - Non-GAAP | 1.20 | % | 1.39 | % | 1.15 | % | 1.38 | % | 1.27 | % | | 1.25 | % | 1.32 | % |
| | | | | | | | |
| Return on Average Tangible Equity: | | | | | | | | |
| Net income available to common shareholders, as reported | $18,615 | | $19,900 | | $16,429 | | $20,128 | | $18,697 | | | $54,944 | | $56,520 | |
| | | | | | | | |
| Total average equity, as reported | $487,230 | | $495,573 | | $553,185 | | $556,765 | | $554,847 | | | $511,755 | | $542,630 | |
| Less average balances of: | | | | | | | | |
| Goodwill | 63,909 | | 63,909 | | 63,909 | | 63,909 | | 63,909 | | | 63,909 | | 63,909 | |
| Identifiable intangible assets, net | 4,871 | | 5,086 | | 5,303 | | 5,526 | | 5,739 | | | 5,085 | | 5,962 | |
| Total average tangible equity | $418,450 | | $426,578 | | $483,973 | | $487,330 | | $485,199 | | | $442,761 | | $472,759 | |
| | | | | | | | |
| Return on average equity - GAAP | 15.16 | % | 16.11 | % | 12.04 | % | 14.34 | % | 13.37 | % | | 14.35 | % | 13.93 | % |
| Return on average tangible equity - Non-GAAP | 17.65 | % | 18.71 | % | 13.77 | % | 16.39 | % | 15.29 | % | | 16.59 | % | 15.98 | % |
