EX-99.1 2 exhibit9912022q3.htm EX-99.1 Document
Exhibit 99.1

bancorpflatbluehorizontala.jpg
    NASDAQ: WASH
Contact: Elizabeth B. Eckel
SVP, Chief Marketing & Corporate Communications Officer
Telephone: (401) 348-1309
E-mail: ebeckel@washtrust.com
Date: October 24, 2022
FOR IMMEDIATE RELEASE


Washington Trust Reports Third Quarter 2022 Earnings

WESTERLY, R.I., October 24, 2022 (PR NEWSWIRE)…Washington Trust Bancorp, Inc. (Nasdaq: WASH), parent company of The Washington Trust Company, today announced third quarter 2022 net income of $18.7 million, or $1.08 per diluted share, compared to net income of $20.0 million, or $1.14 per diluted share, for the second quarter of 2022.

“Washington Trust reported solid third quarter results, a testament to our diversified business model,” stated Edward O. Handy III, Washington Trust Chairman and Chief Executive Officer. “We remain committed to our customers and expanding our presence within our geographic footprint. During the quarter, we opened a new commercial lending office in New Haven, Connecticut, opened a new full-service branch in Cumberland, Rhode Island and recently announced our intention to open three new branches in Rhode Island in 2023.”

Selected financial highlights for the third quarter include:
Returns on average equity and average assets for the third quarter were 15.16% and 1.19%, respectively, compared to 16.11% and 1.37%, respectively, for the preceding quarter.
Net interest income totaled an all-time quarterly record of $42.0 million in the third quarter, up by $4.5 million, or 12%, from the preceding quarter, reflecting the impact of rising market interest rates.
Asset and credit quality metrics remain strong. In the third quarter, a provision for credit losses (or a charge) of $800 thousand was recognized, compared to a negative provision (or a benefit) of $3.0 million recognized in the preceding quarter.
Total loans amounted to an all-time high of $4.8 billion, up by $369 million, or 8%, from the end of the preceding quarter, reflecting strong loan growth in both the commercial and residential real estate loan portfolios.
In-market deposits (total deposits less wholesale brokered deposits) amounted to $4.6 billion at September 30, 2022, up by $79 million, or 2%, from the end of the preceding quarter and up by $324 million, or 8%, from the balance at September 30, 2021.
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Washington Trust
October 24, 2022
Net Interest Income
Net interest income was $42.0 million for the third quarter of 2022, up by $4.5 million, or 12%, from the second quarter of 2022. The net interest margin was 2.82% for the third quarter, up by 11 basis points from the preceding quarter. Linked quarter changes included:
Average interest-earning assets increased by $365 million, largely reflecting an increase of $305 million in average loans. The yield on interest-earning assets for the third quarter was 3.49%, up by 46 basis points from the preceding quarter, reflecting the impact of higher market interest rates.
Average interest-bearing liabilities increased by $318 million. Average in-market deposits declined by $120 million, while average wholesale funding balances increased by $438 million to fund loan growth. The cost of interest-bearing liabilities for the third quarter of 2022 was 0.86%, up by 44 basis points from the preceding quarter, reflecting higher rates paid on wholesale funding sources and money market accounts.

Noninterest Income
Noninterest income totaled $15.8 million for the third quarter of 2022, down modestly by $49 thousand, or 0.3%, from the second quarter of 2022. Linked quarter changes included:
Wealth management revenues amounted to $9.5 million in the third quarter of 2022, down by $541 thousand, or 5%, on a linked quarter basis. This included a decrease of $339 thousand, or 4%, in asset-based revenues and a decrease of $202 thousand, or 48%, in transaction-based revenues. The linked quarter decline in transaction-based revenues was mainly due to lower tax servicing fee income in the third quarter, as this income is concentrated in the first half of the year.
Wealth management assets under administration ("AUA") amounted to $6.3 billion at September 30, 2022, down by $327 million, or 5%, from June 30, 2022. The decrease reflected net investment depreciation of $240 million and net client asset outflows of $87 million in the third quarter of 2022. The average balance of AUA for the third quarter of 2022 decrease by approximately $337 million, or 5%, from the average balance for the preceding quarter.
Recently, four client-facing advisors in our registered investment adviser subsidiary resigned. As a result, Washington Trust could experience an increased level of client asset outflows in upcoming months.
Mortgage banking revenues totaled $2.0 million for the third quarter of 2022, down modestly by $35 thousand, or 2%, from the second quarter of 2022, largely reflecting both a lower volume of loans sold and a decline in the sales yield on loans sold to the secondary market.
Loan related derivative income was $1.0 million in the third quarter of 2022, up by $372 thousand, or 56%, from the preceding quarter, reflecting an increase in commercial borrower interest rate derivative transactions.

Noninterest Expense
Noninterest expense totaled $33.1 million for the third quarter of 2022, up by $2.0 million, or 6%, from the second quarter of 2022. Linked quarter changes included:
Salaries and employee benefits expense, the largest component of noninterest expense, amounted to $21.6 million for the third quarter of 2022, up by $1.2 million, or 6%, from the preceding quarter, largely reflecting adjustments to performance-based compensation accruals.
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Washington Trust
October 24, 2022
The remaining increase in noninterest expense reflects modest increases across a variety of other noninterest expense categories.

Income Tax
Income tax expense totaled $5.3 million for the third quarter of 2022, down by $23 thousand from the preceding quarter. The effective tax rate for the third quarter of 2022 was 22.1%, compared to 21.1% in the preceding quarter. Based on current federal and applicable state income statutes, the Corporation currently expects its full-year 2022 effective tax rate to be approximately 21.5%.

Investment Securities
The securities portfolio totaled $983 million at September 30, 2022, down by $38 million, or 4%, from June 30, 2022, reflecting a temporary decline in fair value of available for sale securities and routine pay-downs on mortgage-backed securities, partially offset by purchases of U.S. government agency and U.S. government-sponsored debt securities, including mortgage-backed securities. Purchases of debt securities in the third quarter 2022 totaled $47 million, with a weighted average yield of 4.24%. The securities portfolio represented 15% of total assets at September 30, 2022, compared to 17% of total assets at June 30, 2022.

Loans
Total loans amounted to $4.8 billion at September 30, 2022, up by $369 million, or 8%, from the end of the preceding quarter. Linked quarter changes included:
Commercial loans increased by $186 million, or 8%, from June 30, 2022, reflecting originations and advances of approximately $286 million, partially offset by payoffs and pay-downs of approximately $100 million.
Residential real estate loans increased by $178 million, or 9%, from June 30, 2022. In the third quarter of 2022, residential real estate loans originated for portfolio amounted to $225 million, down by $39 million, or 15%, from the preceding quarter.
The consumer loan portfolio increased by $6 million, or 2%, from the balance at June 30, 2022, due to growth in home equity lines and loans.

Deposits and Borrowings
At September 30, 2022, in-market deposits, which exclude wholesale brokered deposits, amounted to $4.6 billion, up by $79 million, or 2%, from the end of the preceding quarter. This included seasonal inflows of various institutional and governmental depositors based on their underlying business cycles. Wholesale brokered deposits amounted to $443 million, down by $16 million, or 3%, from June 30, 2022. Total deposits amounted to $5.1 billion at September 30, 2022, up by $63 million, or 1%, from the end of the preceding quarter.

FHLB advances totaled $700 million at September 30, 2022, up by $372 million, or 113%, from June 30, 2022, as higher levels of wholesale funding were utilized to fund balance sheet growth.

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Washington Trust
October 24, 2022
Asset Quality
Total nonaccrual loans amounted to $12.1 million, or 0.25% of total loans, at September 30, 2022, down from $12.4 million, or 0.28% of total loans, at June 30, 2022. Total past due loans amounted to $7.5 million, or 0.16% of total loans, at September 30, 2022, down from $8.6 million, or 0.19% of total loans, at June 30, 2022.

The allowance for credit losses ("ACL") on loans amounted to $36.9 million, or 0.76% of total loans, at September 30, 2022, compared to $36.3 million, or 0.81% of total loans, at June 30, 2022. The ACL on unfunded commitments, included in other liabilities on the Consolidated Balance Sheets, amounted to $2.4 million at September 30, 2022, compared to $2.2 million at June 30, 2022.

There was a positive $800 thousand provision for credit losses (or a charge) recognized in the third quarter of 2022, compared to a negative $3.0 million provision for credit losses (or a benefit) recognized in the preceding quarter. The provision for credit losses in the third quarter of 2022 reflected loan growth, our current estimate of forecasted economic conditions and strong asset and credit quality metrics. In the third quarter of 2022, net charge-offs of $54 thousand were recognized, compared to net recoveries of $10 thousand in the preceding quarter.

Capital and Dividends
Total shareholders' equity was $432.3 million at September 30, 2022, down by $44.4 million, or 9%, from June 30, 2022. The decline was largely due to a decrease of $53.7 million in the accumulated other comprehensive income component of shareholders' equity, reflecting a temporary decrease in the fair value of available for sale securities. In addition, the change in shareholders' equity also included $9.4 million in dividend declarations, partially offset by net income of $18.7 million.

In the third quarter of 2022, Washington Trust repurchased 18,754 shares, at an average price of $47.79 and a total cost of $896 thousand, under its stock repurchase program.

Capital levels at September 30, 2022 exceeded the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 12.65% at September 30, 2022, compared to 13.51% at June 30, 2022. Book value per share was $25.17 at September 30, 2022, compared to $27.73 at June 30, 2022.

The Board of Directors declared a quarterly dividend of 54 cents per share for the quarter ended September 30, 2022. The dividend was paid on October 7, 2022 to shareholders of record on October 3, 2022.

Conference Call
Washington Trust will host a conference call to discuss its third quarter results, business highlights and outlook on Tuesday, October 25, 2022 at 8:30 a.m. (Eastern Time). Individuals may dial in to the call at 1-844-200-6205 and enter Access Code 898026. An audio replay of the call will be available, shortly after the conclusion of the call, by dialing 1-866-813-9403 and entering the Replay Access Code 135067. The audio replay will be available through November 8, 2022. Also, a webcast of the call will be posted in the Investor Relations section of Washington Trust's website, https://ir.washtrust.com, and will be available through December 31, 2022.

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Washington Trust
October 24, 2022
Background
Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company. Founded in 1800, Washington Trust is the oldest community bank in the nation, the largest state-chartered bank headquartered in Rhode Island and one of the Northeast's premier financial services companies. Washington Trust offers a full range of financial services, including commercial banking, mortgage banking, personal banking and wealth management and trust services through its offices located in Rhode Island, Connecticut and Massachusetts. The Corporation’s common stock trades on NASDAQ under the symbol WASH. Investor information is available on the Corporation’s website at https://ir.washtrust.com.

Forward-Looking Statements
This press release contains statements that are “forward-looking statements.” We may also make forward-looking statements in other documents we file with the U.S. Securities and Exchange Commission ("SEC"), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters. You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control. These risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements.

Some of the factors that might cause these differences include the following:
changes in political, business and economic conditions, including inflation;
interest rate changes or volatility, as well as changes in the balance and mix of loans and deposits;
changes in loan demand and collectability;
the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments;
ongoing volatility in national and international financial markets;
reductions in the market value or outflows of wealth management AUA;
decreases in the value of securities and other assets;
increases in defaults and charge-off rates;
changes in the size and nature of our competition;
changes in legislation or regulation and accounting principles, policies and guidelines;
operational risks including, but not limited to, changes in information technology, cybersecurity incidents, fraud, natural disasters, war, terrorism, civil unrest, the ongoing COVID-19 pandemic, and future pandemics;
reputational risks; and
changes in the assumptions used in making such forward-looking statements.

In addition, the factors described under “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as updated by our Quarterly Reports on Form 10-Q and other filings submitted to the SEC, may result in these differences. You should carefully review all of these factors and you should be aware that there may be other factors that could cause these differences. These forward-looking statements were based on information, plans and estimates at the date of this report, and we assume no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Supplemental Information - Explanation of Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. Washington Trust's management believes that the supplemental non-GAAP information, which consists of measurements and ratios based on tangible equity and tangible assets, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

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Washington Trust Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; Dollars in thousands)
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Assets:
Cash and due from banks$130,066 $95,544 $224,807 $175,259 $297,039 
Short-term investments2,773 3,079 3,289 3,234 3,349 
Mortgage loans held for sale, at fair value
24,054 22,656 15,612 40,196 48,705 
Available for sale debt securities, at fair value982,573 1,020,469 1,008,184 1,042,859 1,045,833 
Federal Home Loan Bank stock, at cost32,940 16,300 8,452 13,031 15,094 
Loans:
Total loans
4,848,873 4,479,822 4,283,852 4,272,925 4,286,404 
Less: allowance for credit losses on loans
36,863 36,317 39,236 39,088 41,711 
Net loans
4,812,010 4,443,505 4,244,616 4,233,837 4,244,693 
Premises and equipment, net30,152 29,694 28,878 28,908 28,488 
Operating lease right-of-use assets27,788 28,098 28,816 26,692 27,518 
Investment in bank-owned life insurance101,491 100,807 93,192 92,592 92,974 
Goodwill63,909 63,909 63,909 63,909 63,909 
Identifiable intangible assets, net4,766 4,981 5,198 5,414 5,631 
Other assets195,529 153,849 123,046 125,196 129,410 
Total assets
$6,408,051 $5,982,891 $5,847,999 $5,851,127 $6,002,643 
Liabilities:
Deposits:
Noninterest-bearing deposits
$938,572 $888,981 $911,990 $945,229 $950,974 
Interest-bearing deposits
4,131,285 4,117,648 4,215,960 4,034,822 4,107,168 
Total deposits
5,069,857 5,006,629 5,127,950 4,980,051 5,058,142 
Federal Home Loan Bank advances700,000 328,000 55,000 145,000 222,592 
Junior subordinated debentures22,681 22,681 22,681 22,681 22,681 
Operating lease liabilities30,189 30,491 31,169 29,010 29,810 
Other liabilities153,050 118,456 98,007 109,577 114,100 
Total liabilities
5,975,777 5,506,257 5,334,807 5,286,319 5,447,325 
Shareholders’ Equity:
Common stock
1,085 1,085 1,085 1,085 1,085 
Paid-in capital127,055 126,079 127,355 126,511 126,265 
Retained earnings485,163 475,889 465,295 458,310 447,566 
Accumulated other comprehensive (loss) income(171,755)(118,041)(79,451)(19,981)(18,128)
Treasury stock, at cost(9,274)(8,378)(1,092)(1,117)(1,470)
Total shareholders’ equity
432,274 476,634 513,192 564,808 555,318 
Total liabilities and shareholders’ equity
$6,408,051 $5,982,891 $5,847,999 $5,851,127 $6,002,643 


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Washington Trust Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; Dollars and shares in thousands, except per share amounts)
For the Three Months EndedFor the Nine Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Interest income:
Interest and fees on loans
$45,125 $36,602 $33,930 $36,882 $35,691 $115,657 $104,670 
Interest on mortgage loans held for sale
361 258 232 387 298 851 1,144 
Taxable interest on debt securities
6,061 4,918 4,230 3,929 3,683 15,209 10,366 
Dividends on Federal Home Loan Bank stock
88 63 67 98 95 218 338 
Other interest income
503 188 78 60 56 769 121 
Total interest and dividend income
52,138 42,029 38,537 41,356 39,823 132,704 116,639 
Interest expense:
Deposits
6,656 3,963 3,103 2,977 2,789 13,722 9,413 
Federal Home Loan Bank advances
3,234 413 244 547 872 3,891 3,253 
Junior subordinated debentures
206 138 99 92 92 443 278 
Total interest expense10,096 4,514 3,446 3,616 3,753 18,056 12,944 
Net interest income42,042 37,515 35,091 37,740 36,070 114,648 103,695 
Provision for credit losses800 (3,000)100 (2,822)— (2,100)(2,000)
Net interest income after provision for credit losses41,242 40,515 34,991 40,562 36,070 116,748 105,695 
Noninterest income:
Wealth management revenues
9,525 10,066 10,531 10,504 10,455 30,122 30,778 
Mortgage banking revenues
2,047 2,082 3,501 4,332 6,373 7,630 24,294 
Card interchange fees
1,287 1,303 1,164 1,282 1,265 3,754 3,714 
Service charges on deposit accounts
819 763 668 766 673 2,250 1,917 
Loan related derivative income
1,041 669 301 1,972 728 2,011 2,370 
Income from bank-owned life insurance
684 615 601 1,144 618 1,900 1,781 
Other income
400 354 393 307 408 1,147 2,233 
Total noninterest income
15,803 15,852 17,159 20,307 20,520 48,814 67,087 
Noninterest expense:
Salaries and employee benefits
21,609 20,381 21,002 21,524 22,162 62,992 65,771 
Outsourced services
3,552 3,375 3,242 3,585 3,294 10,169 9,711 
Net occupancy
2,234 2,174 2,300 2,145 2,134 6,708 6,304 
Equipment
939 938 918 959 977 2,795 2,946 
Legal, audit and professional fees
693 677 770 817 767 2,140 2,042 
FDIC deposit insurance costs
430 402 366 391 482 1,198 1,201 
Advertising and promotion
799 724 351 502 559 1,874 1,341 
Amortization of intangibles
215 216 217 216 223 648 674 
Debt prepayment penalties
— — — 2,700 — — 4,230 
Other expenses
2,596 2,190 2,053 2,380 1,922 6,839 6,025 
Total noninterest expense
33,067 31,077 31,219 35,219 32,520 95,363 100,245 
Income before income taxes23,978 25,290 20,931 25,650 24,070 70,199 72,537 
Income tax expense5,310 5,333 4,448 5,462 5,319 15,091 15,855 
Net income
$18,668 $19,957 $16,483 $20,188 $18,751 $55,108 $56,682 
Net income available to common shareholders$18,615 $19,900 $16,429 $20,128 $18,697 $54,944 $56,520 
Weighted average common shares outstanding:
  Basic17,174 17,303 17,331 17,328 17,320 17,269 17,303 
  Diluted17,298 17,414 17,482 17,469 17,444 17,389 17,451 
Earnings per common share:
  Basic$1.08 $1.15 $0.95 $1.16 $1.08 $3.18 $3.27 
  Diluted$1.08 $1.14 $0.94 $1.15 $1.07 $3.16 $3.24 
Cash dividends declared per share$0.54 $0.54 $0.54 $0.54 $0.52 $1.62 $1.56 
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Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited; Dollars and shares in thousands, except per share amounts)
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Share and Equity Related Data:
Book value per share$25.17 $27.73 $29.61 $32.59 $32.06 
Tangible book value per share - Non-GAAP (1)
$21.17 $23.72 $25.62 $28.59 $28.05 
Market value per share$46.48 $48.37 $52.50 $56.37 $52.98 
Shares issued at end of period17,363 17,363 17,363 17,363 17,363 
Shares outstanding at end of period17,171 17,190 17,332 17,331 17,320 
Capital Ratios (2):
Tier 1 risk-based capital 11.97 %12.78 %13.32 %13.24 %13.01 %
Total risk-based capital 12.65 %13.51 %14.15 %14.01 %13.83 %
Tier 1 leverage ratio8.99 %9.42 %9.46 %9.36 %9.12 %
Common equity tier 111.50 %12.28 %12.79 %12.71 %12.47 %
Balance Sheet Ratios:
Equity to assets6.75 %7.97 %8.78 %9.65 %9.25 %
Tangible equity to tangible assets - Non-GAAP (1)
5.74 %6.89 %7.68 %8.57 %8.19 %
Loans to deposits (3)
95.4 %89.2 %83.1 %85.8 %84.9 %
For the Nine Months Ended
For the Three Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Performance Ratios (4):
Net interest margin (5)
2.82 %2.71 %2.57 %2.71 %2.58 %2.71 %2.55 %
Return on average assets (net income divided by average assets)
1.19 %1.37 %1.14 %1.36 %1.26 %1.23 %1.30 %
Return on average tangible assets - Non-GAAP (1)
1.20 %1.39 %1.15 %1.38 %1.27 %1.25 %1.32 %
Return on average equity (net income available for common shareholders divided by average equity)
15.16 %16.11 %12.04 %14.34 %13.37 %14.35 %13.93 %
Return on average tangible equity - Non-GAAP (1)
17.65 %18.71 %13.77 %16.39 %15.29 %16.59 %15.98 %
Efficiency ratio (6)
57.2 %58.2 %59.7 %60.7 %57.5 %58.3 %58.7 %
(1)See the section labeled “Supplemental Information - Calculation of Non-GAAP Financial Measures” at the end of this document.
(2)Estimated for September 30, 2022 and actuals for prior periods.
(3)Period-end balances of net loans and mortgage loans held for sale as a percentage of total deposits.
(4)Annualized based on the actual number of days in the period.
(5)Fully taxable equivalent (FTE) net interest income as a percentage of average-earnings assets.
(6)Total noninterest expense as percentage of total revenues (net interest income and noninterest income).

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Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited; Dollars in thousands)
For the Three Months EndedFor the Nine Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Wealth Management Results
Wealth Management Revenues:
Asset-based revenues$9,302 $9,641 $10,211 $10,417 $10,224 $29,154 $29,798 
Transaction-based revenues223 425 320 87 231 968 980 
Total wealth management revenues$9,525 $10,066 $10,531 $10,504 $10,455 $30,122 $30,778 
Assets Under Administration (AUA):
Balance at beginning of period$6,650,097 $7,492,893 $7,784,211 $7,443,396 $7,441,519 $7,784,211 $6,866,737 
Net investment (depreciation) appreciation & income(239,762)(816,290)(388,733)358,796 (4,830)(1,444,785)572,506 
Net client asset (outflows) inflows(87,578)(26,506)97,415 (17,981)6,707 (16,669)4,153 
Balance at end of period$6,322,757 $6,650,097 $7,492,893 $7,784,211 $7,443,396 $6,322,757 $7,443,396 
Percentage of AUA that are managed assets
91%91%92%92%91%91%91%
Mortgage Banking Results
Mortgage Banking Revenues:
Realized gains on loan sales, net (1)
$1,718 $1,917 $3,327 $5,695 $5,750 $6,962 $28,057 
Changes in fair value, net (2)
(226)(330)(242)(1,594)467 (798)(3,964)
Loan servicing fee income, net (3)
555 495 416 231 156 1,466 201 
Total mortgage banking revenues$2,047 $2,082 $3,501 $4,332 $6,373 $7,630 $24,294 
Residential Mortgage Loan Originations:
Originations for retention in portfolio (4)
$225,132 $263,762 $164,401 $174,438 $205,293 $653,295 $581,905 
Originations for sale to secondary market (5)
77,242 86,459 106,619 188,735 190,702 270,320 744,589 
Total mortgage loan originations$302,374 $350,221 $271,020 $363,173 $395,995 $923,615 $1,326,494 
Residential Mortgage Loans Sold:
Sold with servicing rights retained$34,659 $23,478 $14,627 $21,180 $108,445 $72,764 $570,370 
Sold with servicing rights released (5)
40,665 56,263 115,501 175,818 65,416 212,429 186,068 
Total mortgage loans sold$75,324 $79,741 $130,128 $196,998 $173,861 $285,193 $756,438 
(1)Includes gains on loan sales, commission income on loans originated for others, servicing right gains, and gains (losses) on forward loan commitments.
(2)Represents fair value changes on mortgage loans held for sale and forward loan commitments.
(3)Represents loan servicing fee income, net of servicing right amortization and valuation adjustments.
(4)Includes the full commitment amount of homeowner construction loans.
(5)Includes brokered loans (loans originated for others).

-9-


Washington Trust Bancorp, Inc. and Subsidiaries
END OF PERIOD LOAN COMPOSITION
(Unaudited; Dollars in thousands)
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Loans:
Commercial real estate (1)$1,762,687 $1,609,618 $1,628,620 $1,639,062 $1,661,785 
Commercial & industrial652,758 620,270 614,892 641,555 682,774 
Total commercial2,415,445 2,229,888 2,243,512 2,280,617 2,344,559 
Residential real estate (2)2,144,098 1,966,341 1,777,974 1,726,975 1,672,364 
Home equity273,742 267,785 246,097 247,697 249,874 
Other15,588 15,808 16,269 17,636 19,607 
Total consumer289,330 283,593 262,366 265,333 269,481 
Total loans$4,848,873 $4,479,822 $4,283,852 $4,272,925 $4,286,404 
(1)Commercial real estate loans consist of commercial mortgages and construction and development loans. Commercial mortgages are loans secured by income producing property.
(2)Residential real estate loans consist of mortgage and homeowner construction loans secured by one- to four-family residential properties.

September 30, 2022December 31, 2021
CountBalance% of TotalCountBalance% of Total
Commercial Real Estate Portfolio Segmentation:
Retail 109 $441,631 25 %121 $389,487 24 %
Multi-family dwelling 123 429,796 24 127 474,229 29 
Office 55 253,816 14 57 216,602 13 
Hospitality32 196,503 11 31 184,990 11 
Industrial and warehouse 39 176,081 10 35 137,254 
Healthcare15 138,475 13 128,189 
Commercial mixed use 20 43,235 20 38,978 
Other36 83,150 36 69,333 
Commercial real estate loans
429 $1,762,687 100 %440 $1,639,062 100 %
Commercial & Industrial Portfolio Segmentation:
Healthcare and social assistance70 $194,128 30 %101 $174,376 27 %
Owner occupied and other real estate162 71,431 11 185 72,957 11 
Manufacturing54 55,489 65 55,341 
Transportation and warehousing
20 50,597 31 35,064 
Retail55 49,365 79 47,290 
Educational services20 48,208 28 52,211 
Finance and insurance58 31,579 59 31,279 
Entertainment and recreation
24 26,050 37 32,087 
Information
22,258 14 25,045 
Accommodation and food services49 17,499 114 28,320 
Professional, scientific and technical
37 6,357 69 8,912 
Public administration
12 4,223 16 5,441 
Other
164 75,574 10 281 73,232 13 
Commercial & industrial loans
733 $652,758 100 %1,079 $641,555 100 %

-10-


Washington Trust Bancorp, Inc. and Subsidiaries
END OF PERIOD LOAN AND DEPOSIT COMPOSITION
(Unaudited; Dollars in thousands)
September 30, 2022December 31, 2021
Balance% of TotalBalance% of Total
Commercial Real Estate Loans by Property Location:
Connecticut$674,816 38 %$643,182 39 %
Massachusetts529,364 30 464,018 28 
Rhode Island396,869 23 408,496 25 
Subtotal
1,601,049 91 1,515,696 92 
All other states161,638 123,366 
Total commercial real estate loans
$1,762,687 100 %$1,639,062 100 %
Residential Real Estate Loans by Property Location:
Massachusetts
$1,552,728 72 %$1,207,789 70 %
Rhode Island
423,070 20 365,831 21 
Connecticut
143,701 132,430 
Subtotal
2,119,499 99 1,706,050 99 
All other states
24,599 20,925 
Total residential real estate loans
$2,144,098 100 %$1,726,975 100 %

Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Deposits:
Noninterest-bearing demand deposits$938,572 $888,981 $911,990 $945,229 $950,974 
Interest-bearing demand deposits (in-market)273,231 258,451 248,914 251,032 238,317 
NOW accounts869,984 887,678 893,603 867,138 817,937 
Money market accounts1,146,826 1,139,676 1,295,339 1,072,864 1,046,324 
Savings accounts600,568 572,251 566,461 555,177 540,306 
Time deposits (in-market)797,505 800,898 809,858 773,383 709,288 
In-market deposits
4,626,686 4,547,935 4,726,165 4,464,823 4,303,146 
Wholesale brokered demand deposits31,044 31,003 — — — 
Wholesale brokered time deposits412,127 427,691 401,785 515,228 754,996 
Wholesale brokered deposits443,171 458,694 401,785 515,228 754,996 
Total deposits
$5,069,857 $5,006,629 $5,127,950 $4,980,051 $5,058,142 
-11-


Washington Trust Bancorp, Inc. and Subsidiaries
CREDIT & ASSET QUALITY DATA
(Unaudited; Dollars in thousands)
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Asset Quality Ratios:
Nonperforming assets to total assets0.19 %0.21 %0.22 %0.24 %0.18 %
Nonaccrual loans to total loans0.25 %0.28 %0.29 %0.33 %0.26 %
Total past due loans to total loans0.16 %0.19 %0.16 %0.24 %0.22 %
Allowance for credit losses on loans to nonaccrual loans304.10 %292.55 %311.67 %275.21 %380.02 %
Allowance for credit losses on loans to total loans0.76 %0.81 %0.92 %0.91 %0.97 %
Nonperforming Assets:
Commercial real estate$— $— $— $— $— 
Commercial & industrial— — — — — 
Total commercial— — — — — 
Residential real estate11,700 11,815 11,916 13,576 10,321 
Home equity 422 599 673 627 655 
Other consumer— — — — — 
Total consumer422 599 673 627 655 
Total nonaccrual loans12,122 12,414 12,589 14,203 10,976 
Other real estate owned— — — — — 
Total nonperforming assets$12,122 $12,414 $12,589 $14,203 $10,976 
Past Due Loans (30 days or more past due):
Commercial real estate$— $— $— $— $— 
Commercial & industrial108 
Total commercial108 
Residential real estate7,256 7,794 6,467 9,622 8,698 
Home equity252 728 431 765 824 
Other consumer17 28 30 21 24 
Total consumer269 756 461 786 848 
Total past due loans$7,529 $8,557 $7,036 $10,411 $9,548 
Accruing loans 90 days or more past due$— $— $— $— $— 
Nonaccrual loans included in past due loans$7,059 $6,817 $5,707 $9,359 $6,930 
Troubled Debt Restructurings ("TDR"):
Accruing TDRs$7,214 $9,607 $16,303 $16,328 $7,979 
Nonaccrual TDRs2,890 2,906 2,789 2,819 1,732 
Total TDRs$10,104 $12,513 $19,092 $19,147 $9,711 
-12-


Washington Trust Bancorp, Inc. and Subsidiaries
CREDIT & ASSET QUALITY DATA
(Unaudited; Dollars in thousands)
For the Three Months EndedFor the Nine Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Nonaccrual Loan Activity:
Balance at beginning of period$12,414 $12,589 $14,203 $10,976 $10,481 $14,203 $13,197 
Additions to nonaccrual status521 158 427 3,959 2,583 1,106 3,854 
Loans returned to accruing status(400)(236)(63)(339)— (699)(877)
Loans charged-off(63)(23)(36)(31)(249)(122)(630)
Payments, payoffs and other changes(350)(74)(1,942)(362)(1,839)(2,366)(4,568)
Balance at end of period$12,122 $12,414 $12,589 $14,203 $10,976 $12,122 $10,976 
Allowance for Credit Losses on Loans:
Balance at beginning of period$36,317 $39,236 $39,088 $41,711 $41,879 $39,088 $44,106 
Provision for credit losses on loans (1)
600 (2,929)— (2,650)— (2,329)(1,951)
Charge-offs(63)(23)(36)(33)(249)(122)(630)
Recoveries33 184 60 81 226 186 
Balance at end of period$36,863 $36,317 $39,236 $39,088 $41,711 $36,863 $41,711 
Allowance for Credit Losses on Unfunded Commitments:
Balance at beginning of period$2,190 $2,261 $2,161 $2,333 $2,333 $2,161 $2,382 
Provision for credit losses on unfunded commitments (1)
200 (71)100 (172)— 229 (49)
Balance at end of period (2)
$2,390 $2,190 $2,261 $2,161 $2,333 $2,390 $2,333 
(1)    Included in provision for credit losses in the Consolidated Statements of Income.
(2)     Included in other liabilities in the Consolidated Balance Sheets.

For the Three Months EndedFor the Nine Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Net Loan Charge-Offs (Recoveries):
Commercial real estate$— $— ($145)$— $— ($145)$— 
Commercial & industrial(11)(1)(35)(2)(3)301 
Total commercial(11)(146)(35)(2)(148)301 
Residential real estate— — (21)(4)52 (21)22 
Home equity— (2)(2)(12)110 (4)104 
Other consumer45 21 24 69 17 
Total consumer45 19 12 118 65 121 
Total$54 ($10)($148)($27)$168 ($104)$444 
Net charge-offs (recoveries) to average loans - annualized— %— %(0.01 %)— %0.02 %— %0.01 %

-13-


The following table presents average balance and interest rate information. Tax-exempt income is converted to a fully taxable equivalent (“FTE”) basis using the statutory federal income tax rate adjusted for applicable state income taxes net of the related federal tax benefit. Unrealized gains (losses) on available for sale securities and changes in fair value on mortgage loans held for sale are excluded from the average balance and yield calculations. Nonaccrual loans, as well as interest recognized on these loans, are included in amounts presented for loans.
Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis)
(Unaudited; Dollars in thousands)
For the Three Months EndedSeptember 30, 2022June 30, 2022Change
Average BalanceInterestYield/
Rate
Average BalanceInterestYield/
Rate
Average BalanceInterestYield/
Rate
Assets:
Cash, federal funds sold and short-term investments
$92,708 $503 2.15 %$110,424 $188 0.68 %($17,716)$315 1.47 %
Mortgage loans held for sale34,503 361 4.15 26,914 258 3.84 7,589 103 0.31 
Taxable debt securities1,150,674 6,061 2.09 1,096,611 4,918 1.80 54,063 1,143 0.29 
FHLB stock25,377 88 1.38 9,420 63 2.68 15,957 25 (1.30)
Commercial real estate1,692,374 17,974 4.21 1,619,325 13,495 3.34 73,049 4,479 0.87 
Commercial & industrial630,360 7,114 4.48 620,543 6,115 3.95 9,817 999 0.53 
Total commercial
2,322,734 25,088 4.29 2,239,868 19,610 3.51 82,866 5,478 0.78 
Residential real estate
2,045,833 17,379 3.37 1,836,245 15,010 3.28 209,588 2,369 0.09 
Home equity269,654 2,804 4.13 256,771 2,075 3.24 12,883 729 0.89 
Other15,299 171 4.43 15,770 183 4.65 (471)(12)(0.22)
Total consumer284,953 2,975 4.14 272,541 2,258 3.32 12,412 717 0.82 
Total loans
4,653,520 45,442 3.87 4,348,654 36,878 3.40 304,866 8,564 0.47 
Total interest-earning assets
5,956,782 52,455 3.49 5,592,023 42,305 3.03 364,759 10,150 0.46 
Noninterest-earning assets259,347 249,309 10,038 
Total assets
$6,216,129 $5,841,332 $374,797 
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits (in-market)$267,670 $822 1.22 %$248,764 $222 0.36 %$18,906 $600 0.86 %
NOW accounts871,038 212 0.10 883,251 151 0.07 (12,213)61 0.03 
Money market accounts1,137,875 2,231 0.78 1,268,496 1,139 0.36 (130,621)1,092 0.42 
Savings accounts582,513 100 0.07 566,307 119 0.08 16,206 (19)(0.01)
Time deposits (in-market)797,199 1,983 0.99 809,697 1,951 0.97 (12,498)32 0.02 
Interest-bearing in-market deposits3,656,295 5,348 0.58 3,776,515 3,582 0.38 (120,220)1,766 0.20 
Wholesale brokered demand deposits31,014 166 2.12 20,233 46 0.91 10,781 120 1.21 
Wholesale brokered time deposits381,984 1,142 1.19 352,438 335 0.38 29,546 807 0.81 
Wholesale brokered deposits412,998 1,308 1.26 372,671 381 0.41 40,327 927 0.85 
Total interest-bearing deposits4,069,293 6,656 0.65 4,149,186 3,963 0.38 (79,893)2,693 0.27 
FHLB advances549,729 3,234 2.33 151,736 413 1.09 397,993 2,821 1.24 
Junior subordinated debentures22,681 206 3.60 22,681 138 2.44 — 68 1.16 
Total interest-bearing liabilities4,641,703 10,096 0.86 4,323,603 4,514 0.42 318,100 5,582 0.44 
Noninterest-bearing demand deposits944,153 891,883 52,270 
Other liabilities143,043 130,273 12,770 
Shareholders' equity487,230 495,573 (8,343)
Total liabilities and shareholders' equity$6,216,129 $5,841,332 $374,797 
Net interest income (FTE)$42,359 $37,791 $4,568 
Interest rate spread2.63 %2.61 %0.02 %
Net interest margin2.82 %2.71 %0.11 %

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:
For the Three Months EndedSep 30, 2022Jun 30, 2022Change
Commercial loans$317 $276 $41 
Total$317 $276 $41 
-14-


Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis)
(Unaudited; Dollars in thousands)
For the Nine Months Ended September 30, 2022September 30, 2021Change
Average BalanceInterestYield/
Rate
Average BalanceInterestYield/
 Rate
Average BalanceInterestYield/
 Rate
Assets:
Cash, federal funds sold and short-term investments
$128,606 $769 0.80 %$160,350 $121 0.10 %($31,744)$648 0.70 %
Mortgage loans for sale29,985 851 3.79 53,307 1,144 2.87 (23,322)(293)0.92 
Taxable debt securities1,106,632 15,209 1.84 997,741 10,366 1.39 108,891 4,843 0.45 
FHLB stock15,745 218 1.85 24,265 338 1.86 (8,520)(120)(0.01)
Commercial real estate1,648,061 43,360 3.52 1,638,200 35,269 2.88 9,861 8,091 0.64 
Commercial & industrial628,574 19,456 4.14 794,091 23,865 4.02 (165,517)(4,409)0.12 
Total commercial
2,276,635 62,816 3.69 2,432,291 59,134 3.25 (155,656)3,682 0.44 
Residential real estate
1,875,175 46,376 3.31 1,531,529 39,248 3.43 343,646 7,128 (0.12)
Home equity257,814 6,753 3.50 255,959 6,220 3.25 1,855 533 0.25 
Other15,995 550 4.60 20,301 742 4.89 (4,306)(192)(0.29)
Total consumer273,809 7,303 3.57 276,260 6,962 3.37 (2,451)341 0.20 
Total loans4,425,619 116,495 3.52 4,240,080 105,344 3.32 185,539 11,151 0.20 
Total interest-earning assets
5,706,587 133,542 3.13 5,475,743 117,313 2.86 230,844 16,229 0.27 
Noninterest-earning assets268,744 346,514 (77,770)
Total assets
$5,975,331 $5,822,257 $153,074 
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits (in-market)$255,014 $1,114 0.58 %$190,979 $196 0.14 %$64,035 $918 0.44 %
NOW accounts867,464 492 0.08 747,385 350 0.06 120,079 142 0.02 
Money market accounts1,193,599 3,984 0.45 958,812 1,852 0.26 234,787 2,132 0.19 
Savings accounts570,129 246 0.06 513,110 211 0.05 57,019 35 0.01 
Time deposits (in-market)800,037 5,997 1.00 687,278 5,822 1.13 112,759 175 (0.13)
Interest-bearing in-market deposits3,686,243 11,833 0.43 3,097,564 8,431 0.36 588,679 3,402 0.07 
Wholesale brokered demand deposits17,197 212 1.65 — — — 17,197 212 1.65 
Wholesale brokered time deposits396,465 1,677 0.57 655,165 982 0.20 (258,700)695 0.37 
Wholesale brokered deposits413,662 1,889 0.61 655,165 982 0.20 (241,503)907 0.41 
Total interest-bearing deposits4,099,905 13,722 0.45 3,752,729 9,413 0.34 347,176 4,309 0.11 
FHLB advances285,590 3,891 1.82 438,213 3,253 0.99 (152,623)638 0.83 
Junior subordinated debentures22,681 443 2.61 22,681 278 1.64 — 165 0.97 
Total interest-bearing liabilities4,408,176 18,056 0.55 4,213,623 12,944 0.41 194,553 5,112 0.14 
Noninterest-bearing demand deposits925,433 918,760 6,673 
Other liabilities129,967 147,244 (17,277)
Shareholders' equity511,755 542,630 (30,875)
Total liabilities and shareholders' equity$5,975,331 $5,822,257 $153,074 
Net interest income (FTE)$115,486 $104,369 $11,117 
Interest rate spread2.58 %2.45 %0.13 %
Net interest margin2.71 %2.55 %0.16 %

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:
For the Nine Months Ended Sep 30, 2022Sep 30, 2021Change
Commercial loans$838 $674 $164 
Total$838 $674 $164 
-15-


Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures
(Unaudited; Dollars in thousands, except per share amounts)
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Tangible Book Value per Share:
Total shareholders' equity, as reported$432,274 $476,634 $513,192 $564,808 $555,318 
Less:
Goodwill
63,909 63,909 63,909 63,909 63,909 
Identifiable intangible assets, net
4,766 4,981 5,198 5,414 5,631 
Total tangible shareholders' equity$363,599 $407,744 $444,085 $495,485 $485,778 
Shares outstanding, as reported17,171 17,190 17,332 17,331 17,320 
Book value per share - GAAP$25.17 $27.73 $29.61 $32.59 $32.06 
Tangible book value per share - Non-GAAP$21.18 $23.72 $25.62 $28.59 $28.05 
Tangible Equity to Tangible Assets:
Total tangible shareholders' equity$363,599 $407,744 $444,085 $495,485 $485,778 
Total assets, as reported$6,408,051 $5,982,891 $5,847,999 $5,851,127 $6,002,643 
Less:
Goodwill
63,909 63,909 63,909 63,909 63,909 
Identifiable intangible assets, net
4,766 4,981 5,198 5,414 5,631 
Total tangible assets$6,339,376 $5,914,001 $5,778,892 $5,781,804 $5,933,103 
Equity to assets - GAAP6.75 %7.97 %8.78 %9.65 %9.25 %
Tangible equity to tangible assets - Non-GAAP5.74 %6.89 %7.68 %8.57 %8.19 %
For the Three Months EndedFor the Nine Months Ended
Sep 30,
2022
Jun 30,
2022
Mar 31,
2022
Dec 31,
2021
Sep 30,
2021
Sep 30,
2022
Sep 30,
2021
Return on Average Tangible Assets:
Net income, as reported$18,668 $19,957 $16,483 $20,188 $18,751 $55,108 $56,682 
Total average assets, as reported$6,216,129 $5,841,332 $5,864,668 $5,884,581 $5,919,137 $5,975,331 $5,822,257 
Less average balances of:
Goodwill
63,909 63,909 63,909 63,909 63,909 63,909 63,909 
Identifiable intangible assets, net
4,871 5,086 5,303 5,526 5,739 5,085 5,962 
Total average tangible assets$6,147,349 $5,772,337 $5,795,456 $5,815,146 $5,849,489 $5,906,337 $5,752,386 
Return on average assets - GAAP1.19 %1.37 %1.14 %1.36 %1.26 %1.23 %1.30 %
Return on average tangible assets - Non-GAAP
1.20 %1.39 %1.15 %1.38 %1.27 %1.25 %1.32 %
Return on Average Tangible Equity:
Net income available to common shareholders, as reported
$18,615 $19,900 $16,429 $20,128 $18,697 $54,944 $56,520 
Total average equity, as reported$487,230 $495,573 $553,185 $556,765 $554,847 $511,755 $542,630 
Less average balances of:
Goodwill
63,909 63,909 63,909 63,909 63,909 63,909 63,909 
Identifiable intangible assets, net
4,871 5,086 5,303 5,526 5,739 5,085 5,962 
Total average tangible equity$418,450 $426,578 $483,973 $487,330 $485,199 $442,761 $472,759 
Return on average equity - GAAP15.16 %16.11 %12.04 %14.34 %13.37 %14.35 %13.93 %
Return on average tangible equity - Non-GAAP
17.65 %18.71 %13.77 %16.39 %15.29 %16.59 %15.98 %
-16-