EX-99.1 2 exhibit991.htm EXHIBIT 99.1 Exhibit 99.1 Q2-12 Earnings
Exhibit 99.1

NASDAQ: WASH
Contact: Elizabeth B. Eckel
Senior Vice President, Marketing
Telephone: (401) 348-1309
E-mail: ebeckel@washtrust.com
Date: July 23, 2012
FOR IMMEDIATE RELEASE

Washington Trust Announces Record Earnings for Second Quarter 2012

Westerly, Rhode Island…Washington Trust Bancorp, Inc. (NASDAQ Global Select; symbol: WASH), parent company of The Washington Trust Company, today announced second quarter 2012 net income of $8.7 million, or 53 cents per diluted share. On a diluted earnings per share basis, second quarter 2012 results were up by 2 cents, or 4%, from first quarter 2012 and by 7 cents, or 15%, from second quarter 2011. The returns on average equity and average assets for the second quarter of 2012 were 11.98% and 1.16%, respectively, compared to 11.85% and 1.11%, respectively, for the first quarter of 2012.

“Washington Trust posted another record quarter with good performances along key business lines,” stated Joseph J. MarcAurele, Washington Trust Chairman, President and CEO. “We’re particularly pleased with our lending results in this challenging economy, as both our mortgage and commercial banking areas showed solid growth, while asset quality remained strong.”

Selected financial highlights for the second quarter of 2012 included:
•
Net interest margin increased to 3.30%, up three basis points from the first quarter of 2012, benefiting from improvements in the mix of interest-earning assets and reductions to funding costs.
•
Mortgage banking revenues (net gains on loan sales and commissions on loans originated for others) totaled $3.0 million for the quarter, consistent with the prior quarter and reflective of continued strong mortgage origination volume.
•
Asset quality indicators showed continued improvement in the second quarter of 2012. The balances of nonperforming assets (nonaccrual loans, nonaccrual investment securities and property acquired through foreclosure or repossession), loan delinquencies and troubled debt restructurings all declined from March 31, 2012 to June 30, 2012.
•
The loan loss provision charged to earnings in the second quarter of 2012 was $600 thousand, compared to $900 thousand in the previous quarter. The provision in the second quarter 2012 was the lowest quarterly provision since the first quarter of 2008.
•
Total loans were $2.2 billion at June 30, 2012, up by $58 million, or 3%, from March 31, 2012, led by solid growth of $53 million, or 5%, in the commercial loan portfolio.
•
Total deposits were $2.1 billion at June 30, 2012, down slightly from March 31, 2012.

Second quarter 2012 results also included the following transactions:
•
A gain of $348 thousand was recognized in the quarter on the sale of a bank property. A charge of $131 thousand was also recognized in connection with a planned branch closure.

-M O R E-

Washington Trust
Page 2, July 23, 2012



•
Balance sheet management transactions, which are expected to result in net interest income enhancement of approximately $292 thousand in the second half of 2012 with continuing benefits in future years, were conducted in the latter portion of the quarter, including:
◦
Mortgage-backed securities of $6 million were sold and Federal Home Loan Bank of Boston (“FHLBB”) advances totaling $15 million were prepaid. These transactions resulted in second quarter 2012 net realized gains on securities of $217 thousand and debt prepayment penalty expense of $961 thousand.
◦
The terms of $36.7 million of FHLBB advances with original maturity dates in 2014 and 2015 were modified into longer terms maturing in 2017.
•
A realized gain of $82 thousand was recorded in the quarter on the sale of perpetual preferred stock.
•
The net impact of these transactions was a reduction of 2 cents per diluted share in the second quarter of 2012.

Net Interest Income
The net interest margin for the second quarter of 2012 was 3.30%, up from 3.27% in the first quarter of 2012, reflecting continued improvement in the mix of interest-earning assets resulting from good loan growth and pay downs in the securities portfolio; as well as continued reductions of deposit costs. Second quarter 2012 net interest margin was up by 9 basis points from 3.21% in the second quarter of 2011, largely reflecting a reduction in the cost of funds.

While net interest margin improved, average interest-earning assets for the second quarter of 2012 declined by $21.4 million, or 1%, from the previous quarter and grew by $104.0 million, or 4%, from the second quarter of 2011.

As a result, net interest income of $22.4 million for the second quarter of 2012 was level when compared to the previous quarter and up by $1.3 million, or 6%, compared to the second quarter of 2011.

Noninterest Income
Second quarter 2012 noninterest income totaled $16.2 million, up by $1.9 million, or 14%, from the previous quarter and up by $2.9 million, or 22%, from the second quarter of 2011. Included in these results were net realized gains on sales of securities of $299 thousand recognized in the second quarter of 2012, resulting from the aforementioned balance sheet management transactions and sales of perpetual preferred stock. There were no sales of securities in the first quarter of 2012, while $226 thousand net realized gains on securities were recognized in the second quarter of 2011. Other-than-temporary impairment ("OTTI") losses on securities of $209 thousand were recorded in the first quarter of 2012, while no OTTI losses were recognized in either the second quarter of 2012 or 2011. Also included in the second quarter of 2012 and 2011 were gains on the sale of bank property of $348 thousand and $203 thousand, respectively, classified in other noninterest income. Excluding the net realized gains on sales of securities, OTTI losses and gains on sale of bank property, noninterest income for the second quarter of 2012 was up by $1.1 million, or 8%, from the previous quarter and up by $2.7 million, or 21%, from the second quarter of 2011.

Significant changes in noninterest income included the following:
•
Mortgage banking revenues totaled $3.0 million in the second quarter of 2012, consistent with the previous quarter and up by $2.5 million from the second quarter of 2011, reflecting another strong quarter of mortgage origination activity.

-M O R E-

Washington Trust
Page 3, July 23, 2012



•
Second quarter 2012 wealth management revenues were $7.5 million, up by $288 thousand on a linked quarter basis and level when compared to the second quarter of 2011. On a linked quarter basis, the increase includes a $274 thousand increase in tax preparation fees, which are typically concentrated in the second quarter. Wealth management assets under administration totaled $4.1 billion at June 30, 2012, down by $90.4 million, or 2%, from March 31, 2012, primarily due to declines in the financial markets.
•
Merchant processing fees totaled $2.7 million for the second quarter of 2012, up by $744 thousand on a linked quarter basis and comparable with the second quarter of 2011. On a linked quarter basis, the increase reflects a higher volume of transactions processed for existing and new customers. See discussion on the corresponding increase in merchant processing costs under the caption “Noninterest Expenses.”

Noninterest Expenses
Noninterest expenses totaled $25.2 million for the second quarter of 2012, up by $1.8 million, or 8%, from the previous quarter and up by $3.0 million, or 13%, from the second quarter of 2011. Included in noninterest expenses in the second quarter of 2012 and 2011 were debt prepayment penalties of $961 thousand and $221 thousand, respectively. Also included in second quarter 2012 noninterest expenses was a charge of $131 thousand, classified in net occupancy expense, for the termination of an operating lease associated with the planned closure of a branch in September of 2012. Excluding the debt prepayment charges and the operating lease termination charge, noninterest expenses for the second quarter of 2012 increased by $737 thousand, or 3%, from the previous quarter and up by $2.1 million, or 9%, from the second quarter of 2011.

Significant changes in noninterest expense included the following:
•
Salaries and employee benefit costs amounted to $14.5 million in the second quarter of 2012, essentially unchanged from the previous quarter and up by $2.1 million, or 17%, from the second quarter of 2011. The increase from 2011 reflected higher amounts of commissions paid to mortgage originators, higher staffing levels in support of mortgage origination and other business lines and higher defined benefit plan cost primarily due to a lower discount rate.
•
Merchant processing costs totaled $2.3 million in the second quarter of 2012, up by $657 thousand on a linked quarter basis and comparable with the second quarter of 2011. See the discussion above regarding the corresponding increase in merchant processing fee income.

Income tax expense amounted to $4.0 million for the second quarter of 2012, compared to $3.9 million for the first quarter of 2012 and $3.3 million for the second quarter of 2011. The effective tax rate for the second quarter of 2012 was 31.7%.

Asset Quality
Nonperforming assets decreased to $18.8 million, or 0.62% of total assets, at June 30, 2012, from $23.6 million, or 0.78% of total assets, at March 31, 2012. At June 30, 2012, total past due loans amounted to $20.3 million, or 0.92% of total loans, down by $826 thousand from March 31, 2012. Loans classified as troubled debt restructurings totaled $13.3 million at June 30, 2012, down by $857 thousand from the balance at March 31, 2012.

The loan loss provision charged to earnings amounted to $600 thousand for the second quarter of 2012, down by $300 thousand

-M O R E-

Washington Trust
Page 4, July 23, 2012



from the first quarter of 2012 and down by $600 thousand from the second quarter of 2011. Net charge-offs amounted to $197 thousand in the second quarter of 2012, as compared to net charge-offs of $657 thousand in the first quarter of 2012 and $956 thousand in the second quarter of 2011.

Loans
Total loans rose by $58.5 million in the second quarter of 2012, led by the commercial portfolio with increases in commercial real estate loans of $28.6 million and other commercial loans of $24.0 million. Total loans are up by $66.7 million, or 3%, from December 31, 2011, including a 6% increase in total commercial loans.

Investment Securities
The investment securities portfolio amounted to $516.2 million at June 30, 2012, down by $42.1 million from March 31, 2012 and down by $77.2 million from December 31, 2011, primarily due to principal payments received on mortgage-backed securities not being reinvested as well as the sales of securities discussed above.

Deposits and Borrowings
Total deposits declined by $15.1 million, or 1%, in the second quarter of 2012, reflecting a seasonal decrease in government deposits. Total deposits were relatively flat compared to the balance at December 31, 2011. In the last twelve months, total deposits have increased $134.4 million, or 7%, including an increase of $87.4 million, or 18%, in DDA and NOW balances.

FHLBB advances totaled $524.0 million at June 30, 2012, up by $19.1 million from March 31, 2012 and down by $16.5 million from December 31, 2011. See discussion above regarding the balance sheet management transactions executed in the second quarter of 2012. Other borrowings were $481 thousand at June 30, 2012, compared to $819 thousand at March 31, 2012 and $19.8 million at December 31, 2011. The $19.3 million decline in other borrowings from the balance at December 31, 2011, was primarily due to the maturity of securities sold under repurchase agreements.

Capital Management
Capital levels continued to exceed the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 13.15% at June 30, 2012, compared to 12.86% at December 31, 2011. Total shareholder's equity was $292.7 million at June 30, 2012, up by $11.4 million from the balance at December 31, 2011.

Dividends Declared
The Board of Directors declared a quarterly dividend of 23 cents per share for the quarter ended June 30, 2012. The dividend was paid on July 13, 2012 to shareholders of record on July 2, 2012.



-M O R E-

Washington Trust
Page 5, July 23, 2012



Conference Call
Washington Trust will host a conference call on Tuesday, July 24, 2012 at 8:30 a.m. Eastern Time to discuss second quarter results and business outlook. This call is being webcast and can be accessed through the Investor Relations section of the Washington Trust web site, www.washtrust.com. Individuals may dial in to the call at 1-877-317-6789. The international dial-in number is 1-412-317-6789 and the Canada dial-in number is 1-866-605-3852. A replay of the call will be posted in this same location on the web site shortly after the conclusion of the call. To listen to the replay, dial 1-877-344-7529. For international access, dial 1-412-317-0088. The Conference Number for replay is 10015568. The replay will be available until 9:00 a.m. on August 8, 2012.

Background
Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company, a state-chartered bank headquartered in Westerly, Rhode Island. Founded in 1800, Washington Trust is the oldest community bank in the nation and is the largest independent bank headquartered in Rhode Island. Washington Trust offers a full range of financial services, including commercial banking, small business 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 The NASDAQ Global Select® Stock Market under the symbol WASH. Investor information is available on the Corporation’s web site: www.washtrust.com.

Forward-Looking Statements
This press release contains certain statements that are “forward-looking statements”. We may also make written or oral forward-looking statements in other documents we file with the 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 the control of Washington Trust. These risks, uncertainties and other factors may cause the actual results, performance or achievements of Washington Trust 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 general national, regional or international economic conditions or conditions affecting the banking or financial services industries or financial capital markets, volatility and disruption in national and international financial markets, government intervention in the U.S. financial system, reductions in net interest income resulting from interest rate volatility as well as changes in the balance and mix of loans and deposits, reductions in the market value of wealth management assets under administration, changes in the value of securities and other assets, reductions in loan demand, changes in loan collectibility, default and charge-off rates, changes in the size and nature of Washington Trust's competition, changes in legislation or regulation and accounting principles, policies and guidelines such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, 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, 2011, as filed with the Securities and Exchange Commission and as updated by our Quarterly Reports on Form 10-Q, 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 press release, and Washington Trust assumes 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
CONSOLIDATED BALANCE SHEETS (unaudited)
 
 
 
 
 
(Dollars in thousands, except par value)
 
Jun 30,
2012
 
Dec 31,
2011
Assets:
 
 
 
 
Cash and due from banks
 

$66,702

 

$82,238

Short-term investments
 
3,913

 
4,782

Mortgage loans held for sale, at fair value; amortized cost $22,708 in 2012 and $19,624 in 2011
 
23,530

 
20,340

Securities:
 
 
 
 
Available for sale, at fair value; amortized cost $452,733 in 2012 and $524,036 in 2011
469,167

 
541,253

Held to maturity, at cost; fair value $48,220 in 2012 and $52,499 in 2011
 
47,026

 
52,139

Total securities
 
516,193

 
593,392

Federal Home Loan Bank stock, at cost
 
40,418

 
42,008

Loans:
 
 
 
 
Commercial and other
 
1,191,995

 
1,124,628

Residential real estate
 
702,019

 
700,414

Consumer
 
319,828

 
322,117

Total loans
 
2,213,842

 
2,147,159

Less allowance for loan losses
 
30,448

 
29,802

Net loans
 
2,183,394

 
2,117,357

Premises and equipment, net
 
27,223

 
26,028

Investment in bank-owned life insurance
 
54,746

 
53,783

Goodwill
 
58,114

 
58,114

Identifiable intangible assets, net
 
6,528

 
6,901

Other assets
 
60,289

 
59,155

Total assets
 

$3,041,050

 

$3,064,098

Liabilities:
 
 
 
 
Deposits:
 
 
 
 
Demand deposits
 

$321,488

 

$339,809

NOW accounts
 
263,124

 
257,031

Money market accounts
 
388,686

 
406,777

Savings accounts
 
264,772

 
243,904

Time deposits
 
892,383

 
878,794

Total deposits
 
2,130,453

 
2,126,315

Federal Home Loan Bank advances
 
523,989

 
540,450

Junior subordinated debentures
 
32,991

 
32,991

Other borrowings
 
481

 
19,758

Other liabilities
 
60,402

 
63,233

Total liabilities
 
2,748,316

 
2,782,747

Shareholders’ Equity:
 
 
 
 
Common stock of $.0625 par value; authorized 30,000,000 shares; issued 16,359,394 shares in 2012 and 16,292,471 shares in 2011
 
1,022

 
1,018

Paid-in capital
 
90,022

 
88,030

Retained earnings
 
203,726

 
194,198

Accumulated other comprehensive loss
 
(2,036
)
 
(1,895
)
Total shareholders’ equity
 
292,734

 
281,351

Total liabilities and shareholders’ equity
 

$3,041,050

 

$3,064,098







Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME (unaudited)
 
 
 
 
 
 
 
 
 
(Dollars and shares in thousands, except per share amounts)
Three Months
 
 
Six Months
Periods ended June 30,
2012

 
2011

 
2012
 
2011
Interest income:
 
 
 
 
 
 
 
Interest and fees on loans
 

$25,344

 

$24,707

 

$50,707

 

$48,966

Interest on securities:
Taxable
4,069

 
4,869

 
8,446

 
9,642

 
Nontaxable
682

 
758

 
1,375

 
1,527

Dividends on corporate stock and Federal Home Loan Bank stock
78

 
66

 
155

 
133

Other interest income
17

 
13

 
37

 
37

Total interest income
30,190

 
30,413

 
60,720

 
60,305

Interest expense:


 


 


 


Deposits
3,385

 
4,030

 
6,819

 
8,232

Federal Home Loan Bank advances
3,998

 
4,685

 
8,083

 
9,417

Junior subordinated debentures
391

 
392

 
783

 
782

Other interest expense
5

 
242

 
239

 
483

Total interest expense
7,779

 
9,349

 
15,924

 
18,914

Net interest income
22,411

 
21,064

 
44,796

 
41,391

Provision for loan losses
600

 
1,200

 
1,500

 
2,700

Net interest income after provision for loan losses
21,811

 
19,864

 
43,296

 
38,691

Noninterest income:


 


 


 


Wealth management services:
 

 
 

 
 

 
 

Trust and investment advisory fees
5,819

 
5,822

 
11,597

 
11,498

Mutual fund fees
1,002

 
1,135

 
2,027

 
2,258

Financial planning, commissions and other service fees
652

 
553

 
1,034

 
834

Wealth management services
7,473

 
7,510

 
14,658

 
14,590

Service charges on deposit accounts
764

 
909

 
1,523

 
1,841

Merchant processing fees
2,732

 
2,682

 
4,720

 
4,626

Card interchange fees
626

 
581

 
1,169

 
1,068

Income from bank-owned life insurance
477

 
482

 
963

 
958

Net gains on loan sales and commissions on loans originated for others
3,015

 
537

 
6,112

 
1,062

Net realized gains on securities
299

 
226

 
299

 
197

Net (losses) gains on interest rate swap contracts
(4
)
 
(35
)
 
24

 
41

Equity in earnings (losses) of unconsolidated subsidiaries
124

 
(145
)
 
87

 
(289
)
Other income
668

 
538

 
1,060

 
921

Noninterest income, excluding other-than-temporary impairment losses
16,174

 
13,285

 
30,615

 
25,015

Total other-than-temporary impairment losses on securities
—

 
—

 
(85
)
 
(54
)
Portion of loss recognized in other comprehensive income (before tax)
—

 
—

 
(124
)
 
21

Net impairment losses recognized in earnings
—

 
—

 
(209
)
 
(33
)
Total noninterest income
16,174

 
13,285

 
30,406

 
24,982

Noninterest expense:


 


 


 


Salaries and employee benefits
14,451

 
12,398

 
28,911

 
24,226

Net occupancy
1,527

 
1,236

 
3,053

 
2,557

Equipment
1,143

 
1,070

 
2,250

 
2,119

Merchant processing costs
2,320

 
2,345

 
3,983

 
4,014

Outsourced services
895

 
875

 
1,815

 
1,747

FDIC deposit insurance costs
426

 
464

 
884

 
1,187

Legal, audit and professional fees
519

 
467

 
1,001

 
959

Advertising and promotion
478

 
427

 
850

 
780

Amortization of intangibles
186

 
237

 
373

 
475

Foreclosed property costs
170

 
338

 
468

 
504

Debt prepayment penalties
961

 
221

 
961

 
221

Other expenses
2,152

 
2,186

 
4,078

 
4,215

Total noninterest expense
25,228

 
22,264

 
48,627

 
43,004

Income before income taxes
12,757

 
10,885

 
25,075

 
20,669

Income tax expense
4,044

 
3,320

 
7,924

 
6,304

Net income

$8,713

 

$7,565

 

$17,151

 

$14,365

 
 
 
 
 
 
 
 
Weighted average common shares outstanding - basic
16,358

 
16,252

 
16,344

 
16,225

Weighted average common shares outstanding - diluted
16,392

 
16,284

 
16,381

 
16,257

Per share information:
Basic earnings per common share

$0.53

 

$0.46

 

$1.04

 

$0.88

 
Diluted earnings per common share

$0.53

 

$0.46

 

$1.04

 

$0.88

 
Cash dividends declared per share

$0.23

 

$0.22

 

$0.46

 

$0.44






Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
At or for the Quarters Ended
(Dollars and shares in thousands, except per share amounts)
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Jun 30,
2011
Financial Data:
 
 
 
 
 
Total assets

$3,041,050


$3,028,690


$3,064,098


$2,969,613


$2,936,306

Total loans
2,213,842

2,155,359

2,147,159

2,087,759

2,057,152

Total securities
516,193

558,284

593,392

581,543

591,580

Total deposits
2,130,453

2,145,562

2,126,315

2,086,150

1,996,043

Total shareholders' equity
292,734

287,935

281,351

285,494

281,425

Net interest income
22,411

22,385

22,015

21,549

21,064

Provision for loan losses
600

900

1,000

1,000

1,200

Noninterest income, excluding OTTI losses
16,174

14,441

14,826

13,114

13,285

Net OTTI losses recognized in earnings
—

(209
)
—

(158
)
—

Noninterest expenses
25,228

23,399

24,774

22,595

22,264

Income tax expense
4,044

3,880

3,290

3,328

3,320

Net income
8,713

8,438

7,777

7,582

7,565

 
 
 
 
 
 
Share Data:
 
 
 
 
 
Basic earnings per common share

$0.53


$0.51


$0.48


$0.46


$0.46

Diluted earnings per common share

$0.53


$0.51


$0.47


$0.46


$0.46

Dividends declared per share

$0.23


$0.23


$0.22


$0.22


$0.22

Book value per share

$17.89


$17.61


$17.27


$17.54


$17.30

Tangible book value per share - Non-GAAP (1)

$13.94


$13.64


$13.28


$13.53


$13.27

Market value per share

$24.38


$24.14


$23.86


$19.78


$22.97

 
 
 
 
 
 
Shares outstanding at end of period
16,359

16,354

16,292

16,279

16,266

Weighted average common shares outstanding - basic
16,358

16,330

16,288

16,278

16,252

Weighted average common shares outstanding - diluted
16,392

16,370

16,327

16,294

16,284

 
 
 
 
 
 
Key Ratios:
 
 
 
 
 
Return on average assets
1.16
%
1.11
%
1.04
%
1.03
%
1.04
%
Return on average tangible assets - Non-GAAP (1)
1.18
%
1.14
%
1.07
%
1.06
%
1.07
%
Return on average equity
11.98
%
11.85
%
10.89
%
10.67
%
10.83
%
Return on average tangible equity - Non-GAAP (1)
15.41
%
15.35
%
14.10
%
13.86
%
14.16
%
 
 
 
 
 
 
Capital Ratios:
 
 
 
 
 
Tier 1 risk-based capital
11.90% (i)

11.96
%
11.61
%
11.73
%
11.72
%
Total risk-based capital
13.15% (i)

13.22
%
12.86
%
12.99
%
12.98
%
Tier 1 leverage ratio
9.00% (i)

8.75
%
8.70
%
8.69
%
8.61
%
Equity to assets
9.63
%
9.51
%
9.18
%
9.61
%
9.58
%
Tangible equity to tangible assets - Non-GAAP (1)
7.66
%
7.53
%
7.21
%
7.58
%
7.52
%
(i) - estimated
 
 
 
 
 
 
 
 
 
 
 
Wealth Management Assets under
 
 
 
 
 
Administration:
 
 
 
 
 
Balance at beginning of period

$4,196,447


$3,900,061


$3,728,837


$4,148,433


$4,119,207

Net investment (depreciation) appreciation & income
(105,791
)
298,155

215,449

(374,961
)
1,625

Net client cash flows
15,362

(1,769
)
(36,815
)
(44,635
)
27,601

Other (2)
—

—

(7,410
)
—

—

Balance at end of period

$4,106,018


$4,196,447


$3,900,061


$3,728,837


$4,148,433

(1)
See the section labeled “Supplemental Information - Non-GAAP Financial Measures” at the end of this document.
(2)
Represents declassifications of largely low fee-paying assets from assets under administration due to a change in the scope and/or frequency of services provided by Washington Trust. The impact of this change on wealth management revenues was minimal.




Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
 
 
Six Months Ended
(Dollars and shares in thousands, except per share amounts)
Jun 30,
2012
 
Jun 30,
2011
Financial Data:
 
 
 
Net interest income

$44,796

 

$41,391

Provision for loan losses
1,500

 
2,700

Noninterest income, excluding OTTI losses
30,615

 
25,015

Net OTTI losses recognized in earnings
(209
)
 
(33
)
Noninterest expenses
48,627

 
43,004

Income tax expense
7,924

 
6,304

Net income
17,151

 
14,365

 
 
 
 
Share Data:
 
 
 
Basic earnings per common share

$1.04

 

$0.88

Diluted earnings per common share

$1.04

 

$0.88

Dividends declared per share

$0.46

 

$0.44

 
 
 
 
Weighted average common shares outstanding - basic
16,344

 
16,225

Weighted average common shares outstanding - diluted
16,381

 
16,257

 
 
 
 
Key Ratios:
 
 
 
Return on average assets
1.13
%
 
0.99
%
Return on average tangible assets - Non-GAAP (1)
1.16
%
 
1.02
%
Return on average equity
11.92
%
 
10.44
%
Return on average tangible equity - Non-GAAP (1)
15.38
%
 
13.72
%
 
 
 
 
Asset Quality Data:
 
 
 
Allowance for Loan Losses:
 
 
 
Balance at beginning of period

$29,802

 

$28,583

Provision charged to earnings
1,500

 
2,700

Charge-offs
(1,377
)
 
(2,097
)
Recoveries
523

 
167

Balance at end of period

$30,448

 

$29,353

 
 
 
 
Net Loan Charge-Offs (Recoveries):
 
 
 
Commercial mortgages

($381
)
 

$455

Other commercial
873

 
1,049

Residential real estate mortgages
177

 
263

Consumer
185

 
163

Total

$854

 

$1,930

 
 
 
 
Net charge-offs to average loans (annualized)
0.08
%
 
0.19
%
 
 
 
 
Wealth Management Assets Under Administration: 
 
 
 
Balance at beginning of period

$3,900,061

 

$3,967,207

Net investment appreciation & income
192,364

 
147,188

Net client cash flows
13,593

 
34,038

Balance at end of period

$4,106,018

 

$4,148,433

(1)
See the section labeled “Supplemental Information - Non-GAAP Financial Measures” at the end of this document.





Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
 
 
For the Quarters Ended
 
Jun 30,
2012
 
Mar 31,
2012
 
Dec 31,
2011
 
Sep 30,
2011
 
Jun 30,
2011
Average Yield / Rate (taxable equivalent basis):
 
 
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
 
 
Commercial mortgages and other commercial loans
5.03
%
 
5.13
%
 
5.19
%
 
5.22
%
 
5.23
%
Residential real estate loans, including mortgage loans held for sale
4.40
%
 
4.51
%
 
4.46
%
 
4.58
%
 
4.72
%
Consumer loans
3.85
%
 
3.89
%
 
3.87
%
 
3.90
%
 
3.91
%
Total loans
4.65
%
 
4.74
%
 
4.74
%
 
4.80
%
 
4.86
%
Cash, federal funds sold and other short-term investments
0.23
%
 
0.15
%
 
0.19
%
 
0.20
%
 
0.15
%
FHLBB stock
0.54
%
 
0.50
%
 
0.30
%
 
0.26
%
 
0.31
%
Taxable debt securities
3.63
%
 
3.62
%
 
3.58
%
 
3.78
%
 
4.01
%
Nontaxable debt securities
5.93
%
 
5.92
%
 
5.82
%
 
5.82
%
 
5.88
%
Corporate stocks
7.58
%
 
7.16
%
 
5.89
%
 
7.58
%
 
7.50
%
Total securities
3.95
%
 
3.93
%
 
3.88
%
 
4.07
%
 
4.28
%
Total interest-earning assets
4.41
%
 
4.43
%
 
4.44
%
 
4.53
%
 
4.61
%
Liabilities:
 
 
 
 
 
 
 
 
 
NOW accounts
0.06
%
 
0.08
%
 
0.10
%
 
0.10
%
 
0.10
%
Money market accounts
0.23
%
 
0.22
%
 
0.24
%
 
0.25
%
 
0.25
%
Savings accounts
0.11
%
 
0.11
%
 
0.12
%
 
0.12
%
 
0.12
%
Time deposits
1.35
%
 
1.41
%
 
1.45
%
 
1.48
%
 
1.57
%
FHLBB advances
3.25
%
 
3.14
%
 
3.44
%
 
3.49
%
 
3.80
%
Junior subordinated debentures
4.77
%
 
4.78
%
 
4.73
%
 
4.73
%
 
4.77
%
Other
2.07
%
 
4.98
%
 
4.59
%
 
4.50
%
 
4.48
%
Total interest-bearing liabilities
1.33
%
 
1.38
%
 
1.45
%
 
1.53
%
 
1.61
%
 
 
 
 
 
 
 
 
 
 
Interest rate spread (taxable equivalent basis)
3.08
%
 
3.05
%
 
2.99
%
 
3.00
%
 
3.00
%
Net interest margin (taxable equivalent basis)
3.30
%
 
3.27
%
 
3.22
%
 
3.22
%
 
3.21
%


 
 
At June 30, 2012
 
 
Amortized
 
Unrealized
 
Unrealized
 
Fair
(Dollars in thousands)
 
Cost (1)
 
Gains
 
Losses
 
Value
Securities Available for Sale:
 
 
 
 
 
 
 
 
Obligations of U.S. government-sponsored enterprises
 

$29,443

 

$2,876

 

$—

 

$32,319

Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises
 
305,757

 
18,535

 
—

 
324,292

States and political subdivisions
 
68,939

 
4,784

 
—

 
73,723

Trust preferred securities:
 
 
 
 
 
 
 
 
Individual name issuers
 
30,658

 
—

 
(7,038
)
 
23,620

Collateralized debt obligations
 
4,047

 
—

 
(3,280
)
 
767

Corporate bonds
 
13,889

 
659

 
(102
)
 
14,446

Total securities available for sale
 
452,733

 
26,854

 
(10,420
)
 
469,167

Held to Maturity:
 
 
 
 
 
 
 
 
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises
 
47,026

 
1,194

 
—

 
48,220

Total securities held to maturity
 
47,026

 
1,194

 
—

 
48,220

Total securities
 

$499,759

 

$28,048

 

($10,420
)
 

$517,387

(1)
Net of other-than-temporary impairment losses recognized in earnings.





Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
 
 
Period End Balances At
(Dollars in thousands)
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Jun 30,
2011
Loans:
 
 
 
 
 
Commercial:
Mortgages

$664,410


$642,012


$624,813


$573,355


$562,976

 
Construction & development
17,365

11,130

10,955

18,518

19,448

 
Other
510,220

486,258

488,860

478,652

491,071

 
Total commercial
1,191,995

1,139,400

1,124,628

1,070,525

1,073,495

Residential real estate:
Mortgages
680,772

675,249

678,582

674,242

644,210

 
Homeowner construction
21,247

21,708

21,832

17,226

14,137

 
Total residential real estate
702,019

696,957

700,414

691,468

658,347

Consumer:
Home equity lines
224,550

223,311

223,430

222,886

223,284

 
Home equity loans
40,690

40,793

43,121

45,354

46,797

 
Other
54,588

54,898

55,566

57,526

55,229

 
Total consumer
319,828

319,002

322,117

325,766

325,310

 
Total loans

$2,213,842


$2,155,359


$2,147,159


$2,087,759


$2,057,152

 
At June 30, 2012
(Dollars in thousands)
Balance

% of Total
Commercial Real Estate Loans by Property Location:
 
 
Rhode Island, Connecticut, Massachusetts

$629,891

92.4
%
New York, New Jersey, Pennsylvania
37,428

5.5
%
New Hampshire
12,271

1.8
%
Other
2,185

0.3
%
Total commercial real estate loans (1)

$681,775

100.0
%
(1)
Commercial real estate loans consist of commercial mortgages and construction and development loans. Commercial mortgages are loans secured by income producing property.
 
At June 30, 2012
(Dollars in thousands)
Balance
% of Total
Residential Mortgages by Property Location:
 
 
Rhode Island, Connecticut, Massachusetts

$679,847

96.7
%
New York, Virginia, New Jersey, Maryland, Pennsylvania, District of Columbia
9,749

1.4
%
Ohio
4,935

0.7
%
New Hampshire
4,021

0.6
%
Washington, Oregon
1,390

0.2
%
Georgia
1,110

0.2
%
New Mexico
497

0.1
%
Other
470

0.1
%
Total residential mortgages

$702,019

100.0
%

 
 
Period End Balances At
(Dollars in thousands)
 
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Jun 30,
2011
Deposits:
 
 
 
 
 
 
Demand deposits
 

$321,488


$333,833


$339,809


$319,203


$261,016

NOW accounts
 
263,124

258,986

257,031

242,372

236,162

Money market accounts
 
388,686

400,396

406,777

374,324

355,096

Savings accounts
 
264,772

257,495

243,904

239,356

227,014

Time deposits
 
892,383

894,852

878,794

910,895

916,755

Total deposits
 

$2,130,453


$2,145,562


$2,126,315


$2,086,150


$1,996,043

 
 
 
 
 
 
 
Out-of-market brokered certificates of deposits included in time deposits
 

$102,661


$95,989


$90,073


$85,250


$85,659

In-market deposits, excluding out-of-market brokered certificates of deposit
 

$2,027,792


$2,049,573


$2,036,242


$2,000,900


$1,910,384






Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
 
 
Period End Balances At
(Dollars in thousands)
Jun 30,
2012
 
Mar 31,
2012
 
Dec 31,
2011
 
Sep 30,
2011
 
Jun 30,
2011
Asset Quality Data:
 
 
 
 
 
 
 
 
 
Nonperforming Assets:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$2,597

 

$5,099

 

$5,709

 

$6,367

 

$7,476

Commercial construction and development
—

 
—

 
—

 
—

 
—

Other commercial
3,405

 
4,200

 
3,708

 
2,745

 
3,152

Residential real estate mortgages
8,659

 
9,031

 
10,614

 
11,352

 
9,570

Consumer
1,081

 
1,069

 
1,206

 
1,126

 
780

Total nonaccrual loans

$15,742

 

$19,399

 

$21,237

 

$21,590

 

$20,978

Nonaccrual investment securities
767

 
750

 
887

 
796

 
934

Property acquired through foreclosure or repossession
2,332

 
3,478

 
2,647

 
2,201

 
2,189

Total nonperforming assets

$18,841

 

$23,627

 

$24,771

 

$24,587

 

$24,101

 
 
 
 
 
 
 
 
 
 
Total past due loans to total loans
0.92
%
 
0.98
%
 
1.22
%
 
1.05
%
 
1.19
%
Nonperforming assets to total assets
0.62
%
 
0.78
%
 
0.81
%
 
0.83
%
 
0.82
%
Nonaccrual loans to total loans
0.71
%
 
0.90
%
 
0.99
%
 
1.03
%
 
1.02
%
Allowance for loan losses to nonaccrual loans
193.42
%
 
154.88
%
 
140.33
%
 
137.29
%
 
139.92
%
Allowance for loan losses to total loans
1.38
%
 
1.39
%
 
1.39
%
 
1.42
%
 
1.43
%
 
 
 
 
 
 
 
 
 
 
Troubled Debt Restructured Loans:
 
 
 
 
 
 
 
 
 
Accruing troubled debt restructured loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$1,251

 

$1,059

 

$6,389

 

$5,861

 

$6,552

Other commercial
6,916

 
7,329

 
6,625

 
4,059

 
4,026

Residential real estate mortgages
570

 
935

 
1,481

 
1,158

 
2,279

Consumer
159

 
174

 
171

 
174

 
317

Accruing troubled debt restructured loans
8,896

 
9,497

 
14,666

 
11,252

 
13,174

Nonaccrual troubled debt restructured loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages
—

 
348

 
91

 
1,209

 
2,555

Other commercial
2,317

 
2,361

 
2,154

 
292

 
455

Residential real estate mortgages
2,028

 
1,904

 
2,615

 
2,686

 
2,303

Consumer
47

 
35

 
106

 
129

 
131

Nonaccrual troubled debt restructured loans
4,392

 
4,648

 
4,966

 
4,316

 
5,444

Total troubled debt restructured loans

$13,288

 

$14,145

 

$19,632

 

$15,568

 

$18,618







Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
 
 
 
Period End Balances At
(Dollars in thousands)
Jun 30,
2012
 
Mar 31,
2012
 
Dec 31,
2011
 
Sep 30,
2011
 
Jun 30,
2011
Past Due Loans:
 
 
 
 
 
 
 
 
 
Loans 30-59 Days Past Due:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$411

 

$104

 

$1,621

 

$874

 

$1,507

Other commercial loans
849

 
1,031

 
3,760

 
1,629

 
1,783

Residential real estate mortgages
4,969

 
4,468

 
3,969

 
2,145

 
3,355

Consumer loans
2,660

 
2,404

 
1,073

 
1,100

 
1,979

Loans 30-59 days past due

$8,889

 

$8,007

 

$10,423

 

$5,748

 

$8,624

 
 
 
 
 
 
 
 
 
 
Loans 60-89 Days Past Due:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$233

 

$—

 

$315

 

$328

 

$1,013

Other commercial loans
434

 
33

 
982

 
103

 
80

Residential real estate mortgages
1,600

 
488

 
1,505

 
206

 
992

Consumer loans
677

 
219

 
263

 
420

 
120

Loans 60-89 days past due

$2,944

 

$740

 

$3,065

 

$1,057

 

$2,205

 
 
 
 
 
 
 
 
 
 
Loans 90 Days or more Past Due:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$2,339

 

$4,676

 

$4,995

 

$5,510

 

$5,553

Other commercial loans
1,714

 
2,521

 
633

 
1,209

 
1,378

Residential real estate mortgages
4,039

 
4,843

 
6,283

 
7,826

 
6,549

Consumer loans
362

 
326

 
874

 
649

 
245

Loans 90 days or more past due

$8,454

 

$12,366

 

$12,785

 

$15,194

 

$13,725

 
 
 
 
 
 
 
 
 
 
Total Past Due Loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$2,983

 

$4,780

 

$6,931

 

$6,712

 

$8,073

Other commercial loans
2,997

 
3,585

 
5,375

 
2,941

 
3,241

Residential real estate mortgages
10,608

 
9,799

 
11,757

 
10,177

 
10,896

Consumer loans
3,699

 
2,949

 
2,210

 
2,169

 
2,344

Total past due loans

$20,287

 

$21,113

 

$26,273

 

$21,999

 

$24,554

 
 
 
 
 
 
 
 
 
 
Nonaccrual loans included in past due loans

$12,719

 

$14,747

 

$17,588

 

$16,585

 

$16,705


 
For the Quarters Ended
(Dollars in thousands)
Jun 30,
2012
 
Mar 31,
2012
 
Dec 31,
2011
 
Sep 30,
2011
 
Jun 30,
2011
Allowance for Loan Losses:
 
 
 
 
 
 
 
 
 
Balance at beginning of period

$30,045

 

$29,802

 

$29,641

 

$29,353

 

$29,109

Provision charged to earnings
600

 
900

 
1,000

 
1,000

 
1,200

Charge-offs
(696
)
 
(681
)
 
(920
)
 
(818
)
 
(1,044
)
Recoveries
499

 
24

 
81

 
106

 
88

Balance at end of period

$30,448

 

$30,045

 

$29,802

 

$29,641

 

$29,353

 
 
 
 
 
 
 
 
 
 
Net Loan Charge-Offs (Recoveries):
 
 
 
 
 
 
 
 
 
Commercial mortgages

($388
)
 

$7

 

$249

 

$249

 

$122

Other commercial
549

 
324

 
39

 
286

 
541

Residential real estate mortgages
(47
)
 
224

 
273

 
100

 
146

Consumer
83

 
102

 
278

 
77

 
147

Total

$197

 

$657

 

$839

 

$712

 

$956






The following tables present average balance and interest rate information. Tax-exempt income is converted to a fully taxable equivalent basis using the statutory federal income tax rate adjusted for applicable state income taxes, net of the related federal tax benefit. For dividends on corporate stocks, the 70% federal dividends received deduction is also used in the calculation of tax equivalency. Unrealized gains (losses) on available for sale securities are excluded from the average balance and yield calculations. Nonaccrual and renegotiated loans, as well as interest earned on these loans (to the extent recognized in the Consolidated Statements of Income) are included in amounts presented for loans.

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)
 
 
 
 
 
Three months ended June 30,
 
2012
 
2011
 
 
Average Balance
Interest
Yield/
Rate
 
Average Balance
Interest
Yield/
 Rate
(Dollars in thousands)
 
Assets:
 
 
 
 
 
 
 
 
Commercial mortgages and other commercial loans
 

$1,166,545


$14,590

5.03
%
 

$1,065,619


$13,900

5.23
%
Residential real estate loans, including mortgage loans held for sale
 
714,154

7,809

4.40
%
 
656,570

7,732

4.72
%
Consumer loans
 
320,442

3,067

3.85
%
 
324,890

3,166

3.91
%
Total loans
 
2,201,141

25,466

4.65
%
 
2,047,079

24,798

4.86
%
Cash, federal funds sold and short-term investments
 
30,078

17

0.23
%
 
34,166

13

0.15
%
FHLBB stock
 
40,418

54

0.54
%
 
42,008

32

0.31
%
 
 
 
 
 
 
 
 
 
Taxable debt securities
 
451,207

4,069

3.63
%
 
486,905

4,869

4.01
%
Nontaxable debt securities
 
70,462

1,039

5.93
%
 
78,447

1,150

5.88
%
Corporate stocks
 
1,804

34

7.58
%
 
2,513

47

7.50
%
Total securities
 
523,473

5,142

3.95
%
 
567,865

6,066

4.28
%
Total interest-earning assets
 
2,795,110

30,679

4.41
%
 
2,691,118

30,909

4.61
%
Noninterest-earning assets
 
222,057

 
 
 
212,968

 
 
Total assets
 

$3,017,167

 
 
 

$2,904,086

 
 
Liabilities and Shareholders' Equity:
 
 
 
 
 
 
 
 
NOW accounts
 

$254,528


$39

0.06
%
 

$229,746


$60

0.10
%
Money market accounts
 
405,241

232

0.23
%
 
393,945

249

0.25
%
Savings accounts
 
258,824

72

0.11
%
 
224,588

69

0.12
%
Time deposits
 
905,466

3,042

1.35
%
 
935,813

3,652

1.57
%
FHLBB advances
 
494,257

3,998

3.25
%
 
494,989

4,685

3.80
%
Junior subordinated debentures
 
32,991

391

4.77
%
 
32,991

392

4.77
%
Other
 
973

5

2.07
%
 
21,663

242

4.48
%
Total interest-bearing liabilities
 
2,352,280

7,779

1.33
%
 
2,333,735

9,349

1.61
%
Demand deposits
 
321,094

 
 
 
251,585

 
 
Other liabilities
 
52,939

 
 
 
39,485

 
 
Shareholders' equity
 
290,854

 
 
 
279,281

 
 
Total liabilities and shareholders' equity
 

$3,017,167

 
 
 

$2,904,086

 
 
Net interest income (FTE)
 
 

$22,900

 
 
 

$21,560

 
Interest rate spread
 
 
 
3.08
%
 
 
 
3.00
%
Net interest margin
 
 
 
3.30
%
 
 
 
3.21
%

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:
(Dollars in thousands)
 
 
 
 
 
 
 
Three months ended June 30,
2012

 
2011

Commercial mortgages and other commercial loans

$122

 

$91

Nontaxable debt securities
357

 
392

Corporate stocks
10

 
13

Total

$489

 

$496






Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)
 
 
 
 
 
Six months ended June 30,
 
2012
 
2011
 
 
Average Balance
Interest
Yield/
Rate
 
Average Balance
Interest
Yield/
 Rate
(Dollars in thousands)
 
Assets:
 
 
 
 
 
 
 
 
Commercial mortgages and other commercial loans
 

$1,144,114


$28,888

5.08
%
 

$1,051,577


$27,406

5.26
%
Residential real estate loans, including mortgage loans held for sale
 
717,430

15,884

4.45
%
 
653,938

15,432

4.76
%
Consumer loans
 
320,195

6,164

3.87
%
 
324,471

6,310

3.92
%
Total loans
 
2,181,739

50,936

4.69
%
 
2,029,986

49,148

4.88
%
Cash, federal funds sold and short-term investments
 
41,196

37

0.18
%
 
39,029

37

0.19
%
FHLBB stock
 
41,012

106

0.52
%
 
42,008

64

0.31
%
 
 
 
 
 
 
 
 
 
Taxable debt securities
 
468,828

8,446

3.62
%
 
489,544

9,642

3.97
%
Nontaxable debt securities
 
71,185

2,098

5.93
%
 
78,947

2,316

5.92
%
Corporate stocks
 
1,828

67

7.37
%
 
2,512

96

7.71
%
Total securities
 
541,841

10,611

3.94
%
 
571,003

12,054

4.26
%
Total interest-earning assets
 
2,805,788

61,690

4.42
%
 
2,682,026

61,303

4.61
%
Noninterest-earning assets
 
221,430

 
 
 
212,379

 
 
Total assets
 

$3,027,218

 
 
 

$2,894,405

 
 
Liabilities and Shareholders' Equity:
 
 
 
 
 
 
 
 
NOW accounts
 

$250,390


$85

0.07
%
 

$227,375


$118

0.10
%
Money market accounts
 
408,647

457

0.22
%
 
396,614

572

0.29
%
Savings accounts
 
253,837

142

0.11
%
 
222,481

144

0.13
%
Time deposits
 
895,405

6,135

1.38
%
 
941,093

7,398

1.59
%
FHLBB advances
 
509,012

8,083

3.19
%
 
485,233

9,417

3.91
%
Junior subordinated debentures
 
32,991

783

4.77
%
 
32,991

782

4.78
%
Other
 
9,938

239

4.84
%
 
22,389

483

4.35
%
Total interest-bearing liabilities
 
2,360,220

15,924

1.36
%
 
2,328,176

18,914

1.64
%
Demand deposits
 
326,159

 
 
 
250,550

 
 
Other liabilities
 
53,012

 
 
 
40,520

 
 
Shareholders' equity
 
287,827

 
 
 
275,159

 
 
Total liabilities and shareholders' equity
 

$3,027,218

 
 
 

$2,894,405

 
 
Net interest income (FTE)
 
 

$45,766

 
 
 

$42,389

 
Interest rate spread
 
 
 
3.06
%
 
 
 
2.97
%
Net interest margin
 
 
 
3.28
%
 
 
 
3.19
%

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:

(Dollars in thousands)
 
 
 
 
 
 
 
Six months ended June 30,
2012

 
2011

Commercial mortgages and other commercial loans

$229

 

$182

Nontaxable debt securities
723

 
789

Corporate stocks
18

 
27

Total

$970

 

$998








Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION - Non-GAAP Financial Measures (unaudited)
 
 
 
At or for the Quarters Ended
(Dollars in thousands, except per share amounts)
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Jun 30,
2011
Calculation of Tangible Book Value per Share:
 
 
 
 
 
Total shareholders' equity at end of period

$292,734


$287,935


$281,351


$285,494


$281,425

Less:
 
 
 
 
 
Goodwill
58,114

58,114

58,114

58,114

58,114

Identifiable intangible assets, net
6,528

6,714

6,901

7,147

7,377

Total tangible shareholders' equity at end of period

$228,092


$223,107


$216,336


$220,233


$215,934

 
 
 
 
 
 
Shares outstanding at end of period
16,359

16,354

16,292

16,279

16,266

 
 
 
 
 
 
Book value per share - GAAP

$17.89


$17.61


$17.27


$17.54


$17.30

Tangible book value per share - Non-GAAP

$13.94


$13.64


$13.28


$13.53


$13.27

 
 
 
 
 
 
Calculation of Tangible Equity to Tangible Assets:
 
 
 
 
 
Total tangible shareholders' equity at end of period

$228,092


$223,107


$216,336


$220,233


$215,934

 
 
 
 
 
 
Total assets at end of period

$3,041,050


$3,028,690


$3,064,098


$2,969,613


$2,936,306

Less:
 
 
 
 
 
Goodwill
58,114

58,114

58,114

58,114

58,114

Identifiable intangible assets, net
6,528

6,714

6,901

7,147

7,377

Total tangible assets at end of period

$2,976,408


$2,963,862


$2,999,083


$2,904,352


$2,870,815

 
 
 
 
 
 
Equity to assets - GAAP
9.63
%
9.51
%
9.18
%
9.61
%
9.58
%
Tangible equity to tangible assets - Non-GAAP
7.66
%
7.53
%
7.21
%
7.58
%
7.52
%
 
 
 
 
 
 
Calculation of Return on Average Tangible Assets:
 
 
 
 
 
Net income

$8,713


$8,438


$7,777


$7,582


$7,564

 
 
 
 
 
 
Total average assets

$3,017,167


$3,037,270


$2,983,648


$2,935,146


$2,904,086

Less:
 
 
 
 
 
Average goodwill
58,114

58,114

58,114

58,114

58,114

Average identifiable intangible assets, net
6,619

6,805

7,025

7,257

7,493

Total average tangible assets

$2,952,434


$2,972,351


$2,918,509


$2,869,775


$2,838,479

 
 
 
 
 
 
Return on average assets - GAAP
1.16
%
1.11
%
1.04
%
1.03
%
1.04
%
Return on average tangible assets - Non-GAAP
1.18
%
1.14
%
1.07
%
1.06
%
1.07
%
 
 
 
 
 
 
Calculation of Return on Average Tangible Equity:
 
 
 
 
 
Net income

$8,713


$8,438


$7,777


$7,582


$7,564

 
 
 
 
 
 
Total average shareholders' equity

$290,854


$284,801


$285,707


$284,244


$279,281

Less:
 
 
 
 
 
Average goodwill
58,114

58,114

58,114

58,114

58,114

Average identifiable intangible assets, net
6,619

6,805

7,025

7,257

7,493

Total average tangible shareholders' equity

$226,121


$219,882


$220,568


$218,873


$213,674

 
 
 
 
 
 
Return on average shareholders' equity - GAAP
11.98
%
11.85
%
10.89
%
10.67
%
10.83
%
Return on average tangible shareholders' equity - Non-GAAP
15.41
%
15.35
%
14.10
%
13.86
%
14.16
%





Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION - Non-GAAP Financial Measures (unaudited)
 
 
 
Six Months Ended
(Dollars in thousands)
Jun 30,
2012
Jun 30,
2011
Calculation of return on average tangible assets:
 
 
Net income

$17,151


$14,364

 
 
 
Total average assets

$3,027,218


$2,894,405

Less:
 
 
Average goodwill
58,114

58,114

Average identifiable intangible assets, net
6,712

7,611

Total average tangible assets

$2,962,392


$2,828,680

 
 
 
Return on average assets - GAAP
1.13
%
0.99
%
Return on average tangible assets - Non-GAAP
1.16
%
1.02
%
 
 
 
 
 
 
Calculation of return on average tangible equity:
 
 
Net income

$17,151


$14,364

 
 
 
Total average shareholders' equity

$287,827


$275,159

Less:
 
 
Average goodwill
58,114

58,114

Average identifiable intangible assets, net
6,712

7,611

Total average tangible shareholders' equity

$223,001


$209,434

 
 
 
Return on average shareholders' equity - GAAP
11.92
%
10.44
%
Return on average tangible shareholders' equity - Non-GAAP
15.38
%
13.72
%