EX-99.1 2 exhibit991q3-12earnings.htm EXHIBIT 99.1 Exhibit 99.1 Q3-12 Earnings
Exhibit 99.1

NASDAQ: WASH
Contact: Elizabeth B. Eckel
Senior Vice President, Marketing
Telephone: (401) 348-1309
E-mail: ebeckel@washtrust.com
Date: October 22, 2012
FOR IMMEDIATE RELEASE

Washington Trust Announces Record Earnings for Third Quarter 2012
Diluted Earnings Per Share up 17% over Third Quarter 2011

Westerly, Rhode Island…Washington Trust Bancorp, Inc. (NASDAQ Global Select; symbol: WASH), parent company of The Washington Trust Company, today announced third quarter 2012 net income of $8.9 million, or 54 cents per diluted share. On a diluted earnings per share basis, third quarter 2012 results were up by 1 cent, or 2%, from second quarter 2012 and by 8 cents, or 17%, from third quarter 2011. The returns on average equity and average assets for the third quarter of 2012 were 12.02% and 1.17%, respectively, compared to 11.89% and 1.16%, respectively, for the second quarter of 2012.

“Washington Trust’s strong operating performance led to another quarter of record earnings,” stated Joseph J. MarcAurele, Washington Trust Chairman, President and CEO. “While all of our business lines performed well, total deposits and total loans reached the highest levels in our 212 year history. These results reflect our success at expanding our branch and mortgage banking footprint, generating new commercial banking and wealth management business, and continuing to build our reputation as one of the premier financial institutions in New England.”

Selected financial highlights for the third quarter of 2012 included:
•
Loans totaled $2.3 billion at September 30, 2012, up by $42.9 million, or 2%, from June 30, 2012, led by growth in the commercial loan portfolio.
•
Total deposits amounted to $2.2 billion at September 30, 2012, up $104.2 million, or 5%, from June 30, 2012, with growth in lower cost deposits.
•
Net interest margin was 3.28%, a modest 2 basis point decrease from the previous quarter, reflecting the impact of a sustained low interest rate environment on earning asset yields, which declined at a slightly higher rate than funding costs during the quarter.
•
Due to continued strong mortgage origination volume, mortgage banking revenues (net gains on loan sales and commissions on loans originated for others) totaled $3.5 million for the quarter, a 16% increase over the prior quarter.


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Washington Trust
Page 2, October 22, 2012



•
Nonperforming assets (nonaccrual loans, nonaccrual investment securities and property acquired through foreclosure or repossession) amounted to $21.1 million, or 0.69% of total assets, at September 30, 2012, compared to $18.8 million, or 0.62% of total assets, at June 30, 2012.

Third quarter 2012 results also included the following transactions:
•
A non-taxable gain of $528 thousand was recognized in the quarter resulting from the receipt of bank owned life insurance (“BOLI”) proceeds.
•
Balance sheet management transactions, which are expected to result in net interest income enhancement of approximately $319 thousand for the remainder of 2012 with continuing benefits in future years, were conducted in the latter portion of the quarter, including:
◦
Federal Home Loan Bank of Boston (“FHLBB”) advances totaling $32.4 million were prepaid, which resulted in third quarter 2012 debt prepayment penalty expense of $1.2 million.
◦
The terms of $13.0 million of FHLBB advances with original maturity dates in 2014 and 2015 were modified into longer terms maturing in 2017.
•
The net impact of these transactions was a reduction in earnings of 1 cent per diluted share in the third quarter of 2012.

Net Interest Income
The net interest margin for the third quarter of 2012 was 3.28%, down from 3.30% in the second quarter of 2012, reflecting a 7 basis point decline in the yield on interest-earning assets, partially offset by a 6 basis point decline in cost of funds. Third quarter 2012 net interest margin was up by 6 basis points from 3.22% in the third quarter of 2011, largely reflecting a reduction in the cost of funds.

Average interest-earning assets for the third quarter of 2012 increased by $25.8 million, or 1%, from the previous quarter and grew by $103.3 million, or 4%, from the third quarter of 2011, primarily reflecting loan growth.

As a result, third quarter 2012 net interest income of $22.7 million was up by $325 thousand, or 1%, compared to the previous quarter and up by $1.2 million, or 6%, compared to the third quarter of 2011.

Noninterest Income
Third quarter 2012 noninterest income totaled $16.9 million, up by $747 thousand, or 5%, from the previous quarter and up by $4.0 million, or 31%, from the third quarter of 2011. As mentioned above, third quarter 2012 results included a $528 thousand non-taxable gain related to the receipt of BOLI proceeds. There were no sales of securities or other-than-temporary impairment ("OTTI") losses on securities in the third quarter of 2012. Previous quarter noninterest income included net realized gains on securities of $299 thousand, as well as a $348 thousand gain on the sale of bank property. In the third quarter 2011, OTTI losses on securities of $158 thousand were recognized. Excluding these items, noninterest income for the third quarter of 2012 was up by $866 thousand, or 6%, from the previous quarter and up by $3.3 million, or 25%, from the third quarter of 2011.



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Washington Trust
Page 3, October 22, 2012



Significant changes in noninterest income included the following:
•
Mortgage banking revenues increased by $489 thousand from the second quarter of 2012 and by $2.4 million from the third quarter of 2011, due to another strong quarter of mortgage origination activity.
•
Third quarter 2012 wealth management revenues were $7.2 million, down by $280 thousand on a linked quarter basis and up by $402 thousand compared to the third quarter of 2011. The decline on a linked quarter basis reflects a decrease in tax preparation fees, which are typically concentrated in the second quarter. Wealth management assets under administration totaled $4.2 billion at September 30, 2012, up by $162.6 million, or 4%, from June 30, 2012.
•
Merchant processing fees totaled $3.2 million for the third quarter of 2012, up by $475 thousand on a linked quarter basis and comparable with the third quarter of 2011. On a linked quarter basis, the increase reflects a seasonal increase in the volume of transactions processed for customers. See discussion on the corresponding increase in merchant processing costs under the caption “Noninterest Expenses.”

Noninterest Expenses
Noninterest expenses totaled $26.3 million for the third quarter of 2012, up by $1.1 million, or 4%, from the previous quarter and up by $3.7 million, or 16%, from the third quarter of 2011. Included in noninterest expenses in the second and third quarters of 2012 were debt prepayment penalties of $961 thousand and $1.2 million, respectively. Also included in second quarter 2012 noninterest expenses was a charge of $131 thousand for the termination of an operating lease, classified in net occupancy expense. Excluding the debt prepayment charges and the operating lease termination charge, noninterest expenses for the third quarter of 2012 increased by $981 thousand, or 4%, from the previous quarter and up by $2.5 million, or 11%, from the third quarter of 2011.

Significant changes in noninterest expense included the following:
•
Salaries and employee benefit costs amounted to $15.2 million in the third quarter of 2012, an increase of $763 thousand, or 5%, from the previous quarter and up by $2.3 million, or 18%, from the third quarter of 2011. These increases reflect higher amounts of commissions paid to mortgage originators, higher staffing levels in support of mortgage origination and other business lines and higher incentive accruals. The increase from 2011 also reflected higher defined benefit plan cost primarily due to a lower discount rate.
•
Merchant processing costs totaled $2.7 million in the third quarter of 2012, up by $387 thousand on a linked quarter basis and comparable with the third quarter of 2011. See the discussion above regarding the corresponding increase in merchant processing fee income.

Income tax expense amounted to $3.9 million for the third quarter of 2012, compared to $4.0 million for the second quarter of 2012 and $3.3 million for the third quarter of 2011. The effective tax rate for the third quarter of 2012 was reduced to 30.3% from 31.7% in the previous quarter, as a result of the non-taxable gain related to the receipt of BOLI proceeds in the quarter.

Asset Quality
Total nonaccrual loans amounted to $17.7 million, or 0.79% of total loans, at September, 30, 2012, up by $2.0 million from June 30, 2012. At September 30, 2012, total past due loans amounted to $23.6 million, or 1.05% of total loans, up by $3.3 million from June 30, 2012. Loans classified as troubled debt restructurings ("TDRs") totaled $20.6 million at September 30, 2012, up by


-M O R E-

Washington Trust
Page 4, October 22, 2012



$7.3 million from June 30, 2012. These changes in nonaccrual loans, past due loans and TDRs are largely associated with a small number of larger commercial relationships.

The loan loss provision charged to earnings amounted to $600 thousand for the third quarter of 2012, level with the second quarter of 2012 and down by $400 thousand from the third quarter of 2011. Net charge-offs amounted to $296 thousand in the third quarter of 2012, compared to net charge-offs of $197 thousand in the second quarter of 2012 and $712 thousand in the third quarter of 2011.

The allowance for loan losses was $30.8 million, or 1.36% of total loans, at September 30, 2012 compared to $30.4 million, or 1.38% of total loans, at June 30, 2012.

Loans
Total loans rose by $42.9 million, or 2%, in the third quarter of 2012, with increases in commercial loans of $27.3 million and residential loans of $13.4 million. Total loans are up by $109.5 million, or 5%, from December 31, 2011, including a $94.7 million, or 8%, increase in total commercial loans.

Investment Securities
The investment securities portfolio amounted to $483.9 million at September 30, 2012, down by $32.3 million from June 30, 2012 and down by $109.5 million from December 31, 2011, primarily due to principal payments received on mortgage-backed securities not being reinvested.

Deposits and Borrowings
Total deposits increased by $104.2 million, or 5%, in the third quarter of 2012 and by $108.3 million, or 5%, since December 31, 2011, reflecting growth in lower cost non-time categories of deposits.

FHLBB advances totaled $417.7 million at September 30, 2012, down by $106.3 million from June 30, 2012 and down by $122.8 million from December 31, 2011. In addition to balance sheet management transactions, this decline reflects less demand for wholesale funding due to the strong deposit growth.

Other borrowings were $229 thousand at September 30, 2012, compared to $481 thousand at June 30, 2012 and $19.8 million at December 31, 2011. The $19.5 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 13.18% at September 30, 2012, compared to 12.86% at December 31, 2011. Total shareholder's equity was $298.4 million at September 30, 2012, up by $17.0 million from the balance at December 31, 2011.



-M O R E-

Washington Trust
Page 5, October 22, 2012



Dividends Declared
The Board of Directors declared a quarterly dividend of 24 cents per share for the quarter ended September 30, 2012. The dividend is a one cent increase over the amount paid in the previous quarter and is the Corporation’s second dividend increase in 2012. The dividend was paid on October 12, 2012 to shareholders of record on October 1, 2012.

Conference Call
Washington Trust will host a conference call on Tuesday, October 23, 2012 at 8:30 a.m. Eastern Time to discuss third 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 10018650. The replay will be available until 9:00 a.m. on November 7, 2012.




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Washington Trust
Page 6, October 22, 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: continued weakness 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)
 
Sep 30,
2012
 
Dec 31,
2011
Assets:
 
 
 
 
Cash and due from banks
 

$49,935

 

$82,238

Short-term investments
 
3,599

 
4,782

Mortgage loans held for sale, at fair value; amortized cost $33,737 in 2012 and $19,624 in 2011
 
35,409

 
20,340

Securities:
 
 
 
 
Available for sale, at fair value; amortized cost $424,194 in 2012 and $524,036 in 2011
440,289

 
541,253

Held to maturity, at cost; fair value $45,031 in 2012 and $52,499 in 2011
 
43,569

 
52,139

Total securities
 
483,858

 
593,392

Federal Home Loan Bank stock, at cost
 
40,418

 
42,008

Loans:
 
 
 
 
Commercial and other
 
1,219,327

 
1,124,628

Residential real estate
 
715,412

 
700,414

Consumer
 
321,958

 
322,117

Total loans
 
2,256,697

 
2,147,159

Less allowance for loan losses
 
30,752

 
29,802

Net loans
 
2,225,945

 
2,117,357

Premises and equipment, net
 
27,482

 
26,028

Investment in bank-owned life insurance
 
54,344

 
53,783

Goodwill
 
58,114

 
58,114

Identifiable intangible assets, net
 
6,346

 
6,901

Other assets
 
63,418

 
59,155

Total assets
 

$3,048,868

 

$3,064,098

Liabilities:
 
 
 
 
Deposits:
 
 
 
 
Demand deposits
 

$352,330

 

$339,809

NOW accounts
 
267,495

 
257,031

Money market accounts
 
459,671

 
406,777

Savings accounts
 
268,191

 
243,904

Time deposits
 
886,972

 
878,794

Total deposits
 
2,234,659

 
2,126,315

Federal Home Loan Bank advances
 
417,675

 
540,450

Junior subordinated debentures
 
32,991

 
32,991

Other borrowings
 
229

 
19,758

Other liabilities
 
64,920

 
63,233

Total liabilities
 
2,750,474

 
2,782,747

Shareholders’ Equity:
 
 
 
 
Common stock of $.0625 par value; authorized 30,000,000 shares; issued and outstanding 16,371,272 shares in 2012 and 16,292,471 shares in 2011
 
1,023

 
1,018

Paid-in capital
 
90,829

 
88,030

Retained earnings
 
208,639

 
194,198

Accumulated other comprehensive loss
 
(2,097
)
 
(1,895
)
Total shareholders’ equity
 
298,394

 
281,351

Total liabilities and shareholders’ equity
 

$3,048,868

 

$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
 
 
Nine Months
Periods ended September 30,
2012

 
2011

 
2012
 
2011
Interest income:
 
 
 
 
 
 
 
Interest and fees on loans
 

$25,840

 

$25,069

 

$76,547

 

$74,035

Interest on securities:
Taxable
3,672

 
4,640

 
12,118

 
14,282

 
Nontaxable
660

 
746

 
2,035

 
2,273

Dividends on corporate stock and Federal Home Loan Bank stock
52

 
64

 
207

 
197

Other interest income
27

 
15

 
64

 
52

Total interest income
30,251

 
30,534

 
90,971

 
90,839

Interest expense:


 


 


 


Deposits
3,391

 
3,808

 
10,210

 
12,040

Federal Home Loan Bank advances
3,726

 
4,539

 
11,809

 
13,956

Junior subordinated debentures
393

 
393

 
1,176

 
1,175

Other interest expense
5

 
245

 
244

 
728

Total interest expense
7,515

 
8,985

 
23,439

 
27,899

Net interest income
22,736

 
21,549

 
67,532

 
62,940

Provision for loan losses
600

 
1,000

 
2,100

 
3,700

Net interest income after provision for loan losses
22,136

 
20,549

 
65,432

 
59,240

Noninterest income:


 


 


 


Wealth management services:
 

 
 

 
 

 
 

Trust and investment advisory fees
5,877

 
5,547

 
17,474

 
17,045

Mutual fund fees
1,024

 
1,035

 
3,051

 
3,293

Financial planning, commissions and other service fees
292

 
209

 
1,326

 
1,043

Wealth management services
7,193

 
6,791

 
21,851

 
21,381

Service charges on deposit accounts
833

 
821

 
2,356

 
2,662

Merchant processing fees
3,207

 
3,223

 
7,927

 
7,849

Card interchange fees
675

 
597

 
1,844

 
1,665

Income from bank-owned life insurance
1,006

 
488

 
1,969

 
1,446

Net gains on loan sales and commissions on loans originated for others
3,504

 
1,077

 
9,616

 
2,139

Net realized gains on securities
—

 
—

 
299

 
197

Net gains (losses) on interest rate swap contracts
63

 
(47
)
 
87

 
(6
)
Equity in earnings (losses) of unconsolidated subsidiaries
27

 
(144
)
 
114

 
(433
)
Other income
413

 
308

 
1,473

 
1,229

Noninterest income, excluding other-than-temporary impairment losses
16,921

 
13,114

 
47,536

 
38,129

Total other-than-temporary impairment losses on securities
—

 
—

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

 
(158
)
 
(124
)
 
(137
)
Net impairment losses recognized in earnings
—

 
(158
)
 
(209
)
 
(191
)
Total noninterest income
16,921

 
12,956

 
47,327

 
37,938

Noninterest expense:


 


 


 


Salaries and employee benefits
15,214

 
12,912

 
44,125

 
37,138

Net occupancy
1,468

 
1,362

 
4,521

 
3,919

Equipment
1,168

 
1,092

 
3,418

 
3,211

Merchant processing costs
2,707

 
2,781

 
6,690

 
6,795

Outsourced services
845

 
863

 
2,660

 
2,610

FDIC deposit insurance costs
427

 
427

 
1,311

 
1,614

Legal, audit and professional fees
598

 
430

 
1,599

 
1,389

Advertising and promotion
445

 
561

 
1,295

 
1,341

Amortization of intangibles
182

 
230

 
555

 
705

Foreclosed property costs
136

 
45

 
604

 
549

Debt prepayment penalties
1,173

 
—

 
2,134

 
221

Other expenses
1,927

 
1,892

 
6,005

 
6,107

Total noninterest expense
26,290

 
22,595

 
74,917

 
65,599

Income before income taxes
12,767

 
10,910

 
37,842

 
31,579

Income tax expense
3,867

 
3,328

 
11,791

 
9,632

Net income

$8,900

 

$7,582

 

$26,051

 

$21,947

 
 
 
 
 
 
 
 
Weighted average common shares outstanding - basic
16,366

 
16,278

 
16,351

 
16,242

Weighted average common shares outstanding - diluted
16,414

 
16,294

 
16,392

 
16,269

Per share information:
Basic earnings per common share

$0.54

 

$0.46

 

$1.59

 

$1.35

 
Diluted earnings per common share

$0.54

 

$0.46

 

$1.58

 

$1.34

 
Cash dividends declared per share

$0.24

 

$0.22

 

$0.70

 

$0.66






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)
Sep 30,
2012
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Financial Data:
 
 
 
 
 
Total assets

$3,048,868


$3,041,050


$3,028,690


$3,064,098


$2,969,613

Total loans
2,256,697

2,213,842

2,155,359

2,147,159

2,087,759

Total securities
483,858

516,193

558,284

593,392

581,543

Total deposits
2,234,659

2,130,453

2,145,562

2,126,315

2,086,150

Total shareholders' equity
298,394

292,734

287,935

281,351

285,494

Net interest income
22,736

22,411

22,385

22,015

21,549

Provision for loan losses
600

600

900

1,000

1,000

Noninterest income, excluding OTTI losses
16,921

16,174

14,441

14,826

13,114

Net OTTI losses recognized in earnings
—

—

(209
)
—

(158
)
Noninterest expenses
26,290

25,228

23,399

24,774

22,595

Income tax expense
3,867

4,044

3,880

3,290

3,328

Net income
8,900

8,713

8,438

7,777

7,582

 
 
 
 
 
 
Share Data:
 
 
 
 
 
Basic earnings per common share

$0.54


$0.53


$0.51


$0.48


$0.46

Diluted earnings per common share

$0.54


$0.53


$0.51


$0.47


$0.46

Dividends declared per share

$0.24


$0.23


$0.23


$0.22


$0.22

Book value per share

$18.23


$17.89


$17.61


$17.27


$17.54

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

$14.29


$13.94


$13.64


$13.28


$13.53

Market value per share

$26.27


$24.38


$24.14


$23.86


$19.78

 
 
 
 
 
 
Shares outstanding at end of period
16,371

16,359

16,354

16,292

16,279

Weighted average common shares outstanding - basic
16,366

16,358

16,330

16,288

16,278

Weighted average common shares outstanding - diluted
16,414

16,392

16,370

16,327

16,294

 
 
 
 
 
 
Key Ratios:
 
 
 
 
 
Return on average assets
1.17
%
1.16
%
1.11
%
1.04
%
1.03
%
Return on average tangible assets - Non-GAAP (1)
1.19
%
1.18
%
1.14
%
1.07
%
1.06
%
Return on average equity
12.02
%
11.98
%
11.85
%
10.89
%
10.67
%
Return on average tangible equity - Non-GAAP (1)
15.37
%
15.41
%
15.35
%
14.10
%
13.86
%
 
 
 
 
 
 
Capital Ratios:
 
 
 
 
 
Tier 1 risk-based capital
11.93% (i)

11.90
%
11.96
%
11.61
%
11.73
%
Total risk-based capital
13.18% (i)

13.15
%
13.22
%
12.86
%
12.99
%
Tier 1 leverage ratio
9.11% (i)

9.00
%
8.75
%
8.70
%
8.69
%
Equity to assets
9.79
%
9.63
%
9.51
%
9.18
%
9.61
%
Tangible equity to tangible assets - Non-GAAP (1)
7.84
%
7.66
%
7.53
%
7.21
%
7.58
%
(i) - estimated
 
 
 
 
 
 
 
 
 
 
 
Wealth Management Assets under
 
 
 
 
 
Administration:
 
 
 
 
 
Balance at beginning of period

$4,079,913


$4,196,447


$3,900,061


$3,728,837


$4,148,433

Net investment (depreciation) appreciation & income
155,427

(131,896
)
298,155

215,449

(374,961
)
Net client cash flows
7,180

15,362

(1,769
)
(36,815
)
(44,635
)
Other (2)
—

—

—

(7,410
)
—

Balance at end of period

$4,242,520


$4,079,913


$4,196,447


$3,900,061


$3,728,837

(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)
 
 
 
Nine Months Ended
(Dollars and shares in thousands, except per share amounts)
Sep 30,
2012
 
Sep 30,
2011
Financial Data:
 
 
 
Net interest income

$67,532

 

$62,940

Provision for loan losses
2,100

 
3,700

Noninterest income, excluding OTTI losses
47,536

 
38,129

Net OTTI losses recognized in earnings
(209
)
 
(191
)
Noninterest expenses
74,917

 
65,599

Income tax expense
11,791

 
9,632

Net income
26,051

 
21,947

 
 
 
 
Share Data:
 
 
 
Basic earnings per common share

$1.59

 

$1.35

Diluted earnings per common share

$1.58

 

$1.34

Dividends declared per share

$0.70

 

$0.66

 
 
 
 
Weighted average common shares outstanding - basic
16,351

 
16,242

Weighted average common shares outstanding - diluted
16,392

 
16,269

 
 
 
 
Key Ratios:
 
 
 
Return on average assets
1.15
%
 
1.01
%
Return on average tangible assets - Non-GAAP (1)
1.17
%
 
1.03
%
Return on average equity
11.95
%
 
10.52
%
Return on average tangible equity - Non-GAAP (1)
15.38
%
 
13.76
%
 
 
 
 
Asset Quality Data:
 
 
 
Allowance for Loan Losses:
 
 
 
Balance at beginning of period

$29,802

 

$28,583

Provision charged to earnings
2,100

 
3,700

Charge-offs
(1,801
)
 
(2,914
)
Recoveries
651

 
272

Balance at end of period

$30,752

 

$29,641

 
 
 
 
Net Loan Charge-Offs (Recoveries):
 
 
 
Commercial mortgages

($169
)
 

$704

Other commercial
851

 
1,335

Residential real estate mortgages
218

 
364

Consumer
250

 
239

Total

$1,150

 

$2,642

 
 
 
 
Net charge-offs to average loans (annualized)
0.07
%
 
0.17
%
 
 
 
 
Wealth Management Assets Under Administration: 
 
 
 
Balance at beginning of period

$3,900,061

 

$3,967,207

Net investment appreciation & income
321,686

 
(227,773
)
Net client cash flows
20,773

 
(10,597
)
Balance at end of period

$4,242,520

 

$3,728,837

(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
 
Sep 30,
2012
 
Jun 30,
2012
 
Mar 31,
2012
 
Dec 31,
2011
 
Sep 30,
2011
Average Yield / Rate (taxable equivalent basis):
 
 
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
 
 
Commercial mortgages and other commercial loans
4.94
%
 
5.03
%
 
5.13
%
 
5.19
%
 
5.22
%
Residential real estate loans, including mortgage loans held for sale
4.32
%
 
4.40
%
 
4.51
%
 
4.46
%
 
4.58
%
Consumer loans
3.89
%
 
3.85
%
 
3.89
%
 
3.87
%
 
3.90
%
Total loans
4.59
%
 
4.65
%
 
4.74
%
 
4.74
%
 
4.80
%
Cash, federal funds sold and other short-term investments
0.26
%
 
0.23
%
 
0.15
%
 
0.19
%
 
0.20
%
FHLBB stock
0.51
%
 
0.54
%
 
0.50
%
 
0.30
%
 
0.26
%
Taxable debt securities
3.50
%
 
3.63
%
 
3.62
%
 
3.58
%
 
3.78
%
Nontaxable debt securities
5.83
%
 
5.93
%
 
5.92
%
 
5.82
%
 
5.82
%
Corporate stocks
—
%
 
7.58
%
 
7.16
%
 
5.89
%
 
7.58
%
Total securities
3.83
%
 
3.95
%
 
3.93
%
 
3.88
%
 
4.07
%
Total interest-earning assets
4.34
%
 
4.41
%
 
4.43
%
 
4.44
%
 
4.53
%
Liabilities:
 
 
 
 
 
 
 
 
 
NOW accounts
0.06
%
 
0.06
%
 
0.08
%
 
0.10
%
 
0.10
%
Money market accounts
0.26
%
 
0.23
%
 
0.22
%
 
0.24
%
 
0.25
%
Savings accounts
0.11
%
 
0.11
%
 
0.11
%
 
0.12
%
 
0.12
%
Time deposits
1.33
%
 
1.35
%
 
1.41
%
 
1.45
%
 
1.48
%
FHLBB advances
3.18
%
 
3.25
%
 
3.14
%
 
3.44
%
 
3.49
%
Junior subordinated debentures
4.74
%
 
4.77
%
 
4.78
%
 
4.73
%
 
4.73
%
Other
6.33
%
 
2.07
%
 
4.98
%
 
4.59
%
 
4.50
%
Total interest-bearing liabilities
1.27
%
 
1.33
%
 
1.38
%
 
1.45
%
 
1.53
%
 
 
 
 
 
 
 
 
 
 
Interest rate spread (taxable equivalent basis)
3.07
%
 
3.08
%
 
3.05
%
 
2.99
%
 
3.00
%
Net interest margin (taxable equivalent basis)
3.28
%
 
3.30
%
 
3.27
%
 
3.22
%
 
3.22
%


 
 
At September 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
 

$29,451

 

$2,584

 

$—

 

$32,035

Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises
 
277,432

 
18,394

 
—

 
295,826

States and political subdivisions
 
68,700

 
4,913

 
—

 
73,613

Trust preferred securities:
 
 
 
 
 
 
 
 
Individual name issuers
 
30,667

 
—

 
(7,231
)
 
23,436

Collateralized debt obligations
 
4,047

 
—

 
(3,117
)
 
930

Corporate bonds
 
13,897

 
585

 
(33
)
 
14,449

Total securities available for sale
 
424,194

 
26,476

 
(10,381
)
 
440,289

Held to Maturity:
 
 
 
 
 
 
 
 
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises
 
43,569

 
1,462

 
—

 
45,031

Total securities held to maturity
 
43,569

 
1,462

 
—

 
45,031

Total securities
 

$467,763

 

$27,938

 

($10,381
)
 

$485,320

(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)
Sep 30,
2012
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Loans:
 
 
 
 
 
Commercial:
Mortgages

$693,221


$664,410


$642,012


$624,813


$573,355

 
Construction & development
25,132

17,365

11,130

10,955

18,518

 
Other
500,974

510,220

486,258

488,860

478,652

 
Total commercial
1,219,327

1,191,995

1,139,400

1,124,628

1,070,525

Residential real estate:
Mortgages
692,659

680,772

675,249

678,582

674,242

 
Homeowner construction
22,753

21,247

21,708

21,832

17,226

 
Total residential real estate
715,412

702,019

696,957

700,414

691,468

Consumer:
Home equity lines
227,549

224,550

223,311

223,430

222,886

 
Home equity loans
39,452

40,690

40,793

43,121

45,354

 
Other
54,957

54,588

54,898

55,566

57,526

 
Total consumer
321,958

319,828

319,002

322,117

325,766

 
Total loans

$2,256,697


$2,213,842


$2,155,359


$2,147,159


$2,087,759

 
At September 30, 2012
(Dollars in thousands)
Balance

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

$666,871

92.8
%
New York, New Jersey, Pennsylvania
37,160

5.2
%
New Hampshire
12,135

1.7
%
Other
2,187

0.3
%
Total commercial real estate loans (1)

$718,353

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 September 30, 2012
(Dollars in thousands)
Balance
% of Total
Residential Mortgages by Property Location:
 
 
Rhode Island, Connecticut, Massachusetts

$694,274

97.0
%
New York, Virginia, New Jersey, Maryland, Pennsylvania, District of Columbia
9,658

1.3
%
New Hampshire
4,342

0.6
%
Ohio
3,706

0.5
%
Washington, Oregon
1,385

0.2
%
Georgia
1,106

0.2
%
New Mexico
477

0.1
%
Other
464

0.1
%
Total residential mortgages

$715,412

100.0
%

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

$352,330


$321,488


$333,833


$339,809


$319,203

NOW accounts
 
267,495

263,124

258,986

257,031

242,372

Money market accounts
 
459,671

388,686

400,396

406,777

374,324

Savings accounts
 
268,191

264,772

257,495

243,904

239,356

Time deposits
 
886,972

892,383

894,852

878,794

910,895

Total deposits
 

$2,234,659


$2,130,453


$2,145,562


$2,126,315


$2,086,150

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

$98,603


$102,661


$95,989


$90,073


$85,250

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

$2,136,056


$2,027,792


$2,049,573


$2,036,242


$2,000,900






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

$5,956

 

$2,597

 

$5,099

 

$5,709

 

$6,367

Commercial construction and development
—

 
—

 
—

 
—

 
—

Other commercial
3,201

 
3,405

 
4,200

 
3,708

 
2,745

Residential real estate mortgages
7,127

 
8,659

 
9,031

 
10,614

 
11,352

Consumer
1,463

 
1,081

 
1,069

 
1,206

 
1,126

Total nonaccrual loans

$17,747

 

$15,742

 

$19,399

 

$21,237

 

$21,590

Nonaccrual investment securities
929

 
767

 
750

 
887

 
796

Property acquired through foreclosure or repossession
2,447

 
2,332

 
3,478

 
2,647

 
2,201

Total nonperforming assets

$21,123

 

$18,841

 

$23,627

 

$24,771

 

$24,587

 
 
 
 
 
 
 
 
 
 
Total past due loans to total loans
1.05
%
 
0.92
%
 
0.98
%
 
1.22
%
 
1.05
%
Nonperforming assets to total assets
0.69
%
 
0.62
%
 
0.78
%
 
0.81
%
 
0.83
%
Nonaccrual loans to total loans
0.79
%
 
0.71
%
 
0.90
%
 
0.99
%
 
1.03
%
Allowance for loan losses to nonaccrual loans
173.28
%
 
193.42
%
 
154.88
%
 
140.33
%
 
137.29
%
Allowance for loan losses to total loans
1.36
%
 
1.38
%
 
1.39
%
 
1.39
%
 
1.42
%
 
 
 
 
 
 
 
 
 
 
Troubled Debt Restructured Loans:
 
 
 
 
 
 
 
 
 
Accruing troubled debt restructured loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$9,131

 

$1,251

 

$1,059

 

$6,389

 

$5,861

Other commercial
6,880

 
6,916

 
7,329

 
6,625

 
4,059

Residential real estate mortgages
386

 
570

 
935

 
1,481

 
1,158

Consumer
158

 
159

 
174

 
171

 
174

Accruing troubled debt restructured loans
16,555

 
8,896

 
9,497

 
14,666

 
11,252

Nonaccrual troubled debt restructured loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages
—

 
—

 
348

 
91

 
1,209

Other commercial
2,306

 
2,317

 
2,361

 
2,154

 
292

Residential real estate mortgages
1,697

 
2,028

 
1,904

 
2,615

 
2,686

Consumer
46

 
47

 
35

 
106

 
129

Nonaccrual troubled debt restructured loans
4,049

 
4,392

 
4,648

 
4,966

 
4,316

Total troubled debt restructured loans

$20,604

 

$13,288

 

$14,145

 

$19,632

 

$15,568







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

$3,978

 

$411

 

$104

 

$1,621

 

$874

Other commercial loans
2,719

 
849

 
1,031

 
3,760

 
1,629

Residential real estate mortgages
2,368

 
4,969

 
4,468

 
3,969

 
2,145

Consumer loans
1,876

 
2,660

 
2,404

 
1,073

 
1,100

Loans 30-59 days past due

$10,941

 

$8,889

 

$8,007

 

$10,423

 

$5,748

 
 
 
 
 
 
 
 
 
 
Loans 60-89 Days Past Due:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$874

 

$233

 

$—

 

$315

 

$328

Other commercial loans
1,169

 
434

 
33

 
982

 
103

Residential real estate mortgages
821

 
1,600

 
488

 
1,505

 
206

Consumer loans
1,213

 
677

 
219

 
263

 
420

Loans 60-89 days past due

$4,077

 

$2,944

 

$740

 

$3,065

 

$1,057

 
 
 
 
 
 
 
 
 
 
Loans 90 Days or more Past Due:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$2,495

 

$2,339

 

$4,676

 

$4,995

 

$5,510

Other commercial loans
1,366

 
1,714

 
2,521

 
633

 
1,209

Residential real estate mortgages
3,924

 
4,039

 
4,843

 
6,283

 
7,826

Consumer loans
811

 
362

 
326

 
874

 
649

Loans 90 days or more past due

$8,596

 

$8,454

 

$12,366

 

$12,785

 

$15,194

 
 
 
 
 
 
 
 
 
 
Total Past Due Loans:
 
 
 
 
 
 
 
 
 
Commercial mortgages

$7,347

 

$2,983

 

$4,780

 

$6,931

 

$6,712

Other commercial loans
5,254

 
2,997

 
3,585

 
5,375

 
2,941

Residential real estate mortgages
7,113

 
10,608

 
9,799

 
11,757

 
10,177

Consumer loans
3,900

 
3,699

 
2,949

 
2,210

 
2,169

Total past due loans

$23,614

 

$20,287

 

$21,113

 

$26,273

 

$21,999

 
 
 
 
 
 
 
 
 
 
Nonaccrual loans included in past due loans

$14,471

 

$12,719

 

$14,747

 

$17,588

 

$16,585


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

$30,448

 

$30,045

 

$29,802

 

$29,641

 

$29,353

Provision charged to earnings
600

 
600

 
900

 
1,000

 
1,000

Charge-offs
(424
)
 
(696
)
 
(681
)
 
(920
)
 
(818
)
Recoveries
128

 
499

 
24

 
81

 
106

Balance at end of period

$30,752

 

$30,448

 

$30,045

 

$29,802

 

$29,641

 
 
 
 
 
 
 
 
 
 
Net Loan Charge-Offs (Recoveries):
 
 
 
 
 
 
 
 
 
Commercial mortgages

$212

 

($388
)
 

$7

 

$249

 

$249

Other commercial
(22
)
 
549

 
324

 
39

 
286

Residential real estate mortgages
41

 
(47
)
 
224

 
273

 
100

Consumer
65

 
83

 
102

 
278

 
77

Total

$296

 

$197

 

$657

 

$839

 

$712






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 September 30,
 
2012
 
2011
 
 
Average Balance
Interest
Yield/
Rate
 
Average Balance
Interest
Yield/
 Rate
(Dollars in thousands)
 
Assets:
 
 
 
 
 
 
 
 
Commercial mortgages and other commercial loans
 

$1,193,006


$14,814

4.94
%
 

$1,066,916


$14,027

5.22
%
Residential real estate loans, including mortgage loans held for sale
 
739,744

8,041

4.32
%
 
688,856

7,950

4.58
%
Consumer loans
 
320,431

3,133

3.89
%
 
323,744

3,184

3.90
%
Total loans
 
2,253,181

25,988

4.59
%
 
2,079,516

25,161

4.80
%
Cash, federal funds sold and short-term investments
 
40,984

27

0.26
%
 
29,123

15

0.20
%
FHLBB stock
 
40,418

52

0.51
%
 
42,008

28

0.26
%
 
 
 
 
 
 
 
 
 
Taxable debt securities
 
417,525

3,672

3.50
%
 
487,172

4,640

3.78
%
Nontaxable debt securities
 
68,815

1,008

5.83
%
 
77,333

1,134

5.82
%
Corporate stocks
 
—

—

—
%
 
2,513

48

7.58
%
Total securities
 
486,340

4,680

3.83
%
 
567,018

5,822

4.07
%
Total interest-earning assets
 
2,820,923

30,747

4.34
%
 
2,717,665

31,026

4.53
%
Noninterest-earning assets
 
224,280

 
 
 
217,481

 
 
Total assets
 

$3,045,203

 
 
 

$2,935,146

 
 
Liabilities and Shareholders' Equity:
 
 
 
 
 
 
 
 
NOW accounts
 

$260,829


$41

0.06
%
 

$232,023


$61

0.10
%
Money market accounts
 
429,538

283

0.26
%
 
372,279

234

0.25
%
Savings accounts
 
267,614

74

0.11
%
 
232,432

72

0.12
%
Time deposits
 
896,770

2,993

1.33
%
 
921,056

3,441

1.48
%
FHLBB advances
 
466,135

3,726

3.18
%
 
515,607

4,539

3.49
%
Junior subordinated debentures
 
32,991

393

4.74
%
 
32,991

393

4.73
%
Other
 
314

5

6.33
%
 
21,608

245

4.50
%
Total interest-bearing liabilities
 
2,354,191

7,515

1.27
%
 
2,327,996

8,985

1.53
%
Demand deposits
 
337,547

 
 
 
280,453

 
 
Other liabilities
 
57,315

 
 
 
42,453

 
 
Shareholders' equity
 
296,150

 
 
 
284,244

 
 
Total liabilities and shareholders' equity
 

$3,045,203

 
 
 

$2,935,146

 
 
Net interest income (FTE)
 
 

$23,232

 
 
 

$22,041

 
Interest rate spread
 
 
 
3.07
%
 
 
 
3.00
%
Net interest margin
 
 
 
3.28
%
 
 
 
3.22
%

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

 
2011

Commercial mortgages and other commercial loans

$148

 

$92

Nontaxable debt securities
348

 
388

Corporate stocks
—

 
12

Total

$496

 

$492






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

$1,160,531


$43,702

5.03
%
 

$1,056,746


$41,433

5.24
%
Residential real estate loans, including mortgage loans held for sale
 
724,922

23,925

4.41
%
 
665,705

23,382

4.70
%
Consumer loans
 
320,274

9,297

3.88
%
 
324,226

9,494

3.91
%
Total loans
 
2,205,727

76,924

4.66
%
 
2,046,677

74,309

4.85
%
Cash, federal funds sold and short-term investments
 
41,125

64

0.21
%
 
35,690

52

0.19
%
FHLBB stock
 
40,812

158

0.52
%
 
42,008

92

0.29
%
 
 
 
 
 
 
 
 
 
Taxable debt securities
 
451,602

12,118

3.58
%
 
488,745

14,282

3.91
%
Nontaxable debt securities
 
70,389

3,107

5.90
%
 
78,403

3,450

5.88
%
Corporate stocks
 
1,215

66

7.26
%
 
2,513

143

7.61
%
Total securities
 
523,206

15,291

3.90
%
 
569,661

17,875

4.20
%
Total interest-earning assets
 
2,810,870

92,437

4.39
%
 
2,694,036

92,328

4.58
%
Noninterest-earning assets
 
222,387

 
 
 
214,099

 
 
Total assets
 

$3,033,257

 
 
 

$2,908,135

 
 
Liabilities and Shareholders' Equity:
 
 
 
 
 
 
 
 
NOW accounts
 

$253,895


$127

0.07
%
 

$228,941


$179

0.10
%
Money market accounts
 
415,661

740

0.24
%
 
388,413

806

0.28
%
Savings accounts
 
258,464

215

0.11
%
 
225,835

216

0.13
%
Time deposits
 
895,864

9,128

1.36
%
 
934,340

10,839

1.55
%
FHLBB advances
 
494,615

11,809

3.19
%
 
495,469

13,956

3.77
%
Junior subordinated debentures
 
32,991

1,176

4.76
%
 
32,991

1,175

4.76
%
Other
 
6,706

244

4.86
%
 
22,126

728

4.40
%
Total interest-bearing liabilities
 
2,358,196

23,439

1.33
%
 
2,328,115

27,899

1.60
%
Demand deposits
 
329,983

 
 
 
260,627

 
 
Other liabilities
 
54,456

 
 
 
41,173

 
 
Shareholders' equity
 
290,622

 
 
 
278,220

 
 
Total liabilities and shareholders' equity
 

$3,033,257

 
 
 

$2,908,135

 
 
Net interest income (FTE)
 
 

$68,998

 
 
 

$64,429

 
Interest rate spread
 
 
 
3.06
%
 
 
 
2.98
%
Net interest margin
 
 
 
3.28
%
 
 
 
3.20
%

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

(Dollars in thousands)
 
 
 
 
 
 
 
Nine months ended September 30,
2012

 
2011

Commercial mortgages and other commercial loans

$377

 

$274

Nontaxable debt securities
1,072

 
1,177

Corporate stocks
17

 
38

Total

$1,466

 

$1,489








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)
Sep 30,
2012
Jun 30,
2012
Mar 31,
2012
Dec 31,
2011
Sep 30,
2011
Calculation of Tangible Book Value per Share:
 
 
 
 
 
Total shareholders' equity at end of period

$298,394


$292,734


$287,935


$281,351


$285,494

Less:
 
 
 
 
 
Goodwill
58,114

58,114

58,114

58,114

58,114

Identifiable intangible assets, net
6,346

6,528

6,714

6,901

7,147

Total tangible shareholders' equity at end of period

$233,934


$228,092


$223,107


$216,336


$220,233

 
 
 
 
 
 
Shares outstanding at end of period
16,371

16,359

16,354

16,292

16,279

 
 
 
 
 
 
Book value per share - GAAP

$18.23


$17.89


$17.61


$17.27


$17.54

Tangible book value per share - Non-GAAP

$14.29


$13.94


$13.64


$13.28


$13.53

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

$233,934


$228,092


$223,107


$216,336


$220,233

 
 
 
 
 
 
Total assets at end of period

$3,048,868


$3,041,050


$3,028,690


$3,064,098


$2,969,613

Less:
 
 
 
 
 
Goodwill
58,114

58,114

58,114

58,114

58,114

Identifiable intangible assets, net
6,346

6,528

6,714

6,901

7,147

Total tangible assets at end of period

$2,984,408


$2,976,408


$2,963,862


$2,999,083


$2,904,352

 
 
 
 
 
 
Equity to assets - GAAP
9.79
%
9.63
%
9.51
%
9.18
%
9.61
%
Tangible equity to tangible assets - Non-GAAP
7.84
%
7.66
%
7.53
%
7.21
%
7.58
%
 
 
 
 
 
 
Calculation of Return on Average Tangible Assets:
 
 
 
 
 
Net income

$8,900


$8,713


$8,438


$7,777


$7,582

 
 
 
 
 
 
Total average assets

$3,045,203


$3,017,167


$3,037,270


$2,983,648


$2,935,146

Less:
 
 
 
 
 
Average goodwill
58,114

58,114

58,114

58,114

58,114

Average identifiable intangible assets, net
6,434

6,619

6,805

7,025

7,257

Total average tangible assets

$2,980,655


$2,952,434


$2,972,351


$2,918,509


$2,869,775

 
 
 
 
 
 
Return on average assets - GAAP
1.17
%
1.16
%
1.11
%
1.04
%
1.03
%
Return on average tangible assets - Non-GAAP
1.19
%
1.18
%
1.14
%
1.07
%
1.06
%
 
 
 
 
 
 
Calculation of Return on Average Tangible Equity:
 
 
 
 
 
Net income

$8,900


$8,713


$8,438


$7,777


$7,582

 
 
 
 
 
 
Total average shareholders' equity

$296,150


$290,854


$284,801


$285,707


$284,244

Less:
 
 
 
 
 
Average goodwill
58,114

58,114

58,114

58,114

58,114

Average identifiable intangible assets, net
6,434

6,619

6,805

7,025

7,257

Total average tangible shareholders' equity

$231,602


$226,121


$219,882


$220,568


$218,873

 
 
 
 
 
 
Return on average shareholders' equity - GAAP
12.02
%
11.98
%
11.85
%
10.89
%
10.67
%
Return on average tangible shareholders' equity - Non-GAAP
15.37
%
15.41
%
15.35
%
14.10
%
13.86
%





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

$26,051


$21,947

 
 
 
Total average assets

$3,033,257


$2,908,135

Less:
 
 
Average goodwill
58,114

58,114

Average identifiable intangible assets, net
6,619

7,492

Total average tangible assets

$2,968,524


$2,842,529

 
 
 
Return on average assets - GAAP
1.15
%
1.01
%
Return on average tangible assets - Non-GAAP
1.17
%
1.03
%
 
 
 
 
 
 
Calculation of return on average tangible equity:
 
 
Net income

$26,051


$21,947

 
 
 
Total average shareholders' equity

$290,622


$278,220

Less:
 
 
Average goodwill
58,114

58,114

Average identifiable intangible assets, net
6,619

7,492

Total average tangible shareholders' equity

$225,889


$212,614

 
 
 
Return on average shareholders' equity - GAAP
11.95
%
10.52
%
Return on average tangible shareholders' equity - Non-GAAP
15.38
%
13.76
%