Loans (Tables)

9 Months Ended

Sep. 30, 2023

The following table presents a summary of loans:


(Dollars in thousands)	September 30, 2023	December 31, 2022
Commercial:


Commercial real estate (1)	$2,063,383	$1,829,304
Commercial & industrial (2)	611,565	656,397
Total commercial	2,674,948	2,485,701
Residential Real Estate:


Residential real estate (3)	2,611,100	2,323,002
Consumer:


Home equity	305,683	285,715
Other (4)	19,384	15,721
Total consumer	325,067	301,436
Total loans (5)	$5,611,115	$5,110,139

(1)CRE consists of commercial mortgages primarily secured by income-producing property, as well as construction and development loans. Construction and development loans are made to businesses for land development or the on-site construction of industrial, commercial, or residential buildings.

(2)C&I consists of loans to businesses and individuals, a portion of which are fully or partially collateralized by real estate.

(3)Residential real estate consists of mortgage and homeowner construction loans secured by one- to four-family residential properties.

(4)Other consists of loans to individuals secured by general aviation aircraft and other personal installment loans.

(5)Includes net unamortized loan origination costs of $12.8 million and $11.6 million, respectively, at September 30, 2023 and December 31, 2022 and net unamortized premiums on loans purchased from and serviced by other financial institutions of $296 thousand and $318 thousand, respectively, at September 30, 2023 and December 31, 2022.

Past Due Loans

The following tables present an aging analysis of past due loans, segregated by class of loans:


(Dollars in thousands)	Days Past Due
September 30, 2023	30-59	60-89	Over 90	Total Past Due	Current	Total Loans
Commercial:
Commercial real estate	$—	$—	$—	$—	$2,063,383	$2,063,383
Commercial & industrial	3	1	—	4	611,561	611,565
Total commercial	3	1	—	4	2,674,944	2,674,948
Residential Real Estate:
Residential real estate	3,789	2,562	1,434	7,785	2,603,315	2,611,100
Consumer:
Home equity	1,823	62	40	1,925	303,758	305,683
Other	16	3	—	19	19,365	19,384
Total consumer	1,839	65	40	1,944	323,123	325,067
Total loans	$5,631	$2,628	$1,474	$9,733	$5,601,382	$5,611,115


(Dollars in thousands)	Days Past Due
December 31, 2022	30-59	60-89	Over 90	Total Past Due	Current	Total Loans
Commercial:
Commercial real estate	$1,187	$—	$—	$1,187	$1,828,117	$1,829,304
Commercial & industrial	265	—	—	265	656,132	656,397
Total commercial	1,452	—	—	1,452	2,484,249	2,485,701
Residential Real Estate:
Residential real estate	4,793	303	3,779	8,875	2,314,127	2,323,002
Consumer:
Home equity	1,103	132	—	1,235	284,480	285,715
Other	16	—	—	16	15,705	15,721
Total consumer	1,119	132	—	1,251	300,185	301,436
Total loans	$7,364	$435	$3,779	$11,578	$5,098,561	$5,110,139

Included in past due loans as of September 30, 2023 and December 31, 2022, were nonaccrual loans of $5.7 million and $7.2 million, respectively. In addition, all loans 90 days or more past due at September 30, 2023 and December 31, 2022 were classified as nonaccrual.

Nonaccrual Loans

The following table is a summary of nonaccrual loans, segregated by class of loans:


(Dollars in thousands)	September 30, 2023	December 31, 2022
Commercial:
Commercial real estate	$22,609	$—
Commercial & industrial	696	—
Total commercial	23,305	—
Residential Real Estate:
Residential real estate	9,446	11,894
Consumer:
Home equity	901	952
Other	—	—
Total consumer	901	952
Total nonaccrual loans	$33,652	$12,846
Accruing loans 90 days or more past due	$—	$—

The following table presents interest income recognized on nonaccrual loans:


(Dollars in thousands)	Three Months		Nine Months

Periods ended September 30,	2023	2022	2023	2022
Commercial:
Commercial real estate	$474	$—	$1,344	$—
Commercial & industrial	9	—	35	—
Total commercial	483	—	1,379	—
Residential Real Estate:
Residential real estate	82	77	341	242
Consumer:
Home equity	22	9	59	21
Other	1	—	3	3
Total consumer	23	9	62	24
Total	$588	$86	$1,782	$266

Summary of TLMs

The following tables present the carrying value at September 30, 2023, of TLMs made during the periods indicated, segregated by class of loans and type of concession granted:


(Dollars in thousands)
Three months ended September 30, 2023	Maturity Extension	Total	% (1)
Commercial:
Commercial real estate	$13,963	$13,963	1	%
Commercial & industrial	—	—	—
Total commercial	13,963	13,963	1






Total	$13,963	$13,963	—	%

(1)Represents the period end total carrying value of TLMs as a percentage of the period end total loan balance by class.


(Dollars in thousands)
Nine months ended September 30, 2023	Maturity Extension	Total	% (1)
Commercial:
Commercial real estate	$13,963	$13,963	1	%
Commercial & industrial	—	—	—
Total commercial	13,963	13,963	1






Total	$13,963	$13,963	—	%

(1)Represents the period end total carrying value of TLMs as a percentage of the period end total loan balance by class.

The following tables present the financial effect of TLMs made during the periods indicated, segregated by class of loans:

Three months ended September 30, 2023

Weighted Average Maturity Extension
(in months)

Commercial:

Commercial real estate

Commercial & industrial

Total commercial

Total

Nine months ended September 30, 2023

Weighted Average Maturity Extension
(in months)

Commercial:

Commercial real estate

Commercial & industrial

Total commercial

Total

Aging of TLMs

The following table presents an aging analysis as of the date indicated, of TLMs that have been modified in the past nine months:


(Dollars in thousands)	Days Past Due
September 30, 2023	30-59	60-89	Over 90	Total Past Due	Current	Total Loans
Commercial:
Commercial real estate	$—	$—	$—	$—	$13,963	$13,963
Commercial & industrial	—	—	—	—	—	—
Total commercial	—	—	—	—	13,963	13,963






Total loans	$—	$—	$—	$—	$13,963	$13,963

Collateral Dependent Individually Analyzed Loans

The following table presents the carrying value of collateral dependent individually analyzed loans:


(Dollars in thousands)	September 30, 2023		December 31, 2022
	Carrying Value	Related Allowance	Carrying Value	Related Allowance
Commercial:
Commercial real estate (1)	$22,610	$596	$2,103	$—
Commercial & industrial (2)	696	—	—	—
Total commercial	23,306	596	2,103	—
Residential Real Estate:
Residential real estate (3)	1,131	—	5,760	—
Consumer:
Home equity (3)	—	—	592	—
Other	—	—	—	—
Total consumer	—	—	592	—
Total	$24,437	$596	$8,455	$—

(1) Secured by income-producing property.

(2) Secured by business assets.

(3) Secured by one- to four-family residential properties.

Credit Quality Indicators

The following table includes information on credit quality indicators and gross charge-offs for the Corporation’s loan portfolio, segregated by class of loans as of September 30, 2023:


(Dollars in thousands)	Term Loans Amortized Cost by Origination Year
	2023	2022	2021	2020	2019	Prior	Revolving Loans Amortized Cost	Revolving Loans Converted to Term Loans	Total
Commercial:
CRE:
Pass	$302,233	$583,256	$410,502	$177,443	$168,873	$336,078	$11,100	$1,123	$1,990,608
Special Mention	2,328	—	—	15	11,232	16,724	—	—	30,299
Classified	13,963	—	16,340	—	3,527	8,646	—	—	42,476
Total CRE	318,524	583,256	426,842	177,458	183,632	361,448	11,100	1,123	2,063,383
CRE gross charge-offs	—	—	—	—	—	—	—	—	—

C&I:
Pass	52,415	127,319	54,688	50,663	74,709	150,767	87,783	623	598,967
Special Mention	11,258	—	—	—	182	—	—	267	11,707
Classified	—	—	195	—	696	—	—	—	891
Total C&I	63,673	127,319	54,883	50,663	75,587	150,767	87,783	890	611,565





C&I gross charge-offs (1)	25	—	—	—	—	—	—	—	25

Residential Real Estate:
Residential real estate:
Current	403,050	819,106	675,297	259,565	116,126	330,171	—	—	2,603,315
Past Due	—	—	—	893	—	6,892	—	—	7,785
Total residential real estate	403,050	819,106	675,297	260,458	116,126	337,063	—	—	2,611,100
Residential real estate gross charge-offs	—	—	—	—	—	—	—	—	—

Consumer:
Home equity:
Current	21,023	15,936	7,473	3,023	2,145	4,577	238,970	10,611	303,758
Past Due	—	—	—	—	—	358	314	1,253	1,925
Total home equity	21,023	15,936	7,473	3,023	2,145	4,935	239,284	11,864	305,683
Home equity gross charge-offs	—	—	—	—	—	—	—	—	—

Other:
Current	6,197	3,674	3,758	1,045	143	4,307	241	—	19,365
Past Due	16	—	—	—	—	—	3	—	19
Total other	6,213	3,674	3,758	1,045	143	4,307	244	—	19,384




Other gross charge-offs (1)	124	—	8	—	—	—	—	—	132

Total loans	$812,483	$1,549,291	$1,168,253	$492,647	$377,633	$858,520	$338,411	$13,877	$5,611,115
Total gross charge-offs	$149	$—	$8	$—	$—	$—	$—	$—	$157

(1)Gross charge-offs in 2023 represent charge-offs of business and consumer account overdraft balances.

The following table includes information on credit quality indicators for the Corporation’s loan portfolio, segregated by class of loans as of December 31, 2022:


(Dollars in thousands)	Term Loans Amortized Cost by Origination Year
	2022	2021	2020	2019	2018	Prior	Revolving Loans Amortized Cost	Revolving Loans Converted to Term Loans	Total
Commercial:
CRE:
Pass	$591,596	$383,062	$177,286	$170,259	$148,371	$242,061	$6,243	$1,437	$1,720,315
Special Mention	20,579	22,324	328	24,270	28,676	10,564	146	—	106,887
Classified	—	—	503	—	1,187	412	—	—	2,102
Total CRE	612,175	405,386	178,117	194,529	178,234	253,037	6,389	1,437	1,829,304
C&I:
Pass	127,152	63,180	71,265	86,470	85,011	114,241	90,987	745	639,051
Special Mention	13,566	—	—	—	1,427	—	1,426	—	16,419
Classified	—	225	—	7	—	—	695	—	927
Total C&I	140,718	63,405	71,265	86,477	86,438	114,241	93,108	745	656,397





Residential Real Estate:
Residential real estate:
Current	838,566	707,760	277,613	123,098	72,541	294,549	—	—	2,314,127
Past Due	—	600	—	266	2,315	5,694	—	—	8,875
Total residential real estate	838,566	708,360	277,613	123,364	74,856	300,243	—	—	2,323,002
Consumer:
Home equity:
Current	20,665	8,308	3,742	2,406	1,947	3,139	235,004	9,268	284,479
Past Due	—	—	—	—	68	98	548	522	1,236
Total home equity	20,665	8,308	3,742	2,406	2,015	3,237	235,552	9,790	285,715
Other:
Current	4,231	4,287	1,676	299	235	4,726	251	—	15,705
Past Due	16	—	—	—	—	—	—	—	16
Total other	4,247	4,287	1,676	299	235	4,726	251	—	15,721




Total Loans	$1,616,371	$1,189,746	$532,413	$407,075	$341,778	$675,484	$335,300	$11,972	$5,110,139

Consistent with industry practice, Washington Trust may renew commercial loans at or immediately prior to their maturity. In the tables above, renewals subject to full credit evaluation before being granted are reported as originations in the period renewed.