Business Segments

3 Months Ended

Mar. 31, 2012

Segment Reporting [Abstract]

Business Segments

Business Segments

Washington Trust segregates financial information in assessing its results among two operating segments: Commercial Banking and Wealth Management Services.  The amounts in the Corporate column include activity not related to the segments, such as the investment securities portfolio, wholesale funding activities and administrative units.  The Corporate column is not considered to be an operating segment.  The methodologies and organizational hierarchies that define the business segments are periodically reviewed and revised.  Results may be restated, when necessary, to reflect changes in organizational structure or allocation methodology. Any changes in estimates and allocations that may affect the reported results of any business segment will not affect the consolidated financial position or results of operations of Washington Trust as a whole.

The following table presents the statement of operations and total assets for Washington Trust’s reportable segments:

(Dollars in thousands)	Commercial Banking				Wealth Management Services					Corporate						Consolidated Total
Three months ended March 31,	2012		2011		2012		2011			2012			2011			2012		2011
Net interest income (expense)		$19,628		$18,404		$3		($6	)		$2,754			$1,929			$22,385		$20,327
Noninterest income	6,707		4,181		7,185		7,080			340			436			14,232		11,697
Total income	26,335		22,585		7,188		7,074			3,094			2,365			36,617		32,024
Provision for loan losses	900		1,500		—		—			—			—			900		1,500
Depreciation and amortization expense	602		600		302		337			66			68			970		1,005
Other noninterest expenses	14,766		12,690		4,972		4,670			2,691			2,375			22,429		19,735
Total noninterest expenses	16,268		14,790		5,274		5,007			2,757			2,443			24,299		22,240
Income (loss) before income taxes	10,067		7,795		1,914		2,067			337			(78		)	12,318		9,784
Income tax expense (benefit)	3,451		2,588		719		770			(290		)	(374		)	3,880		2,984
Net income		$6,616		$5,207		$1,195		$1,297			$627			$296			$8,438		$6,800
Total assets at period end		$2,265,850		$2,111,474		$51,560		$51,267			$711,280			$729,531			$3,028,690		$2,892,272
Expenditures for long-lived assets		$1,351		$422		$185		$258			$116			$33			$1,652		$713

Management uses certain methodologies to allocate income and expenses to the business lines.  A funds transfer pricing methodology is used to assign interest income and interest expense to each interest-earning asset and interest-bearing liability on a matched maturity funding basis.  Certain indirect expenses are allocated to segments.  These include support unit expenses such as technology and processing operations and other support functions.

Commercial Banking

The Commercial Banking segment includes commercial, commercial real estate, residential and consumer lending activities; equity in losses of unconsolidated investments in real estate limited partnerships, mortgage banking, secondary market and loan servicing activities; deposit generation; merchant credit card services; cash management activities; and direct banking activities, which include the operation of ATMs, telephone and Internet banking services and customer support and sales.

Wealth Management Services

Wealth Management Services includes asset management services provided for individuals, institutions and mutual funds; personal trust services, including services as executor, trustee, administrator, custodian and guardian; institutional trust services, including services as trustee for pension and profit sharing plans; and other financial planning and advisory services.

Corporate

Corporate includes the Treasury Unit, which is responsible for managing the wholesale investment portfolio and wholesale funding needs.  It also includes income from bank-owned life insurance as well as administrative and executive expenses not allocated to the business lines and the residual impact of methodology allocations such as funds transfer pricing offsets.