WASH
$49.12
Washington TR Bncorp
$.81
1.68%
Earnings Details
1st Quarter March 2022
Monday, April 25, 2022 8:00:00 AM
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Summary

Washington TR Bncorp (WASH) Recent Earnings

Washington TR Bncorp (WASH) reported 1st Quarter March 2022 earnings of $0.94 per share on revenue of $55.7 million. The consensus earnings estimate was $0.91 per share on revenue of $35.0 million. Revenue fell 13.0% compared to the same quarter a year ago.

Washington Trust Bancorp Inc. through its subsidiaries offers financial services to individuals and businesses, including wealth management, through its offices in Rhode Island, eastern Massachusetts and southeastern Connecticut.

Results
Reported Earnings
$0.94
Earnings Whisper
-
Consensus Estimate
$0.91
Reported Revenue
$55.7 Mil
Revenue Estimate
$35.0 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Washington Trust Reports First Quarter 2022 Earnings

WESTERLY, R.I., April 25, 2022 /PRNewswire/ -- Washington Trust Bancorp, Inc. (Nasdaq: WASH), parent company of The Washington Trust Company, today announced first quarter 2022 net income of $16.5 million, or $0.94 per diluted share, compared to net income of $20.2 million, or $1.15 per diluted share, for the fourth quarter of 2021.

"Washington Trust posted solid first quarter results and, while overall earnings were impacted by market volatility and economic uncertainty, our balance sheet, capital position, and credit quality remain strong," stated Edward O. Handy III, Washington Trust Chairman and Chief Executive Officer.  "We successfully met the challenges posed by the COVID-19 pandemic and believe our diversified business model positions us well in a rising rate environment."

Selected financial highlights for the first quarter include:

  • Returns on average equity and average assets for the first quarter were 12.04% and 1.14%, respectively, compared to 14.34% and 1.36%, respectively, for the preceding quarter.

  • Asset and credit quality metrics remained strong. In the first quarter a modest $100 thousand provision for credit losses (or charge) was recognized, following a $2.8 million release of credit loss reserves in the preceding quarter. Net recoveries in the first quarter were $148 thousand.

  • Wealth management revenues reached a quarterly high of $10.5 million. New business activity was strong in the first quarter.

  • Total loans excluding Paycheck Protection Program ("PPP") loans amounted to an all-time high $4.3 billion, up by $36 million, or 1%, from the end of the preceding quarter.

  • In-market deposits (total deposits less out-of-market wholesale brokered deposits) amounted to a record $4.7 billion at March 31, 2022, up by $261 million, or 6%, from the end of the preceding quarter.

Net Interest Income

Net interest income was $35.1 million for the first quarter of 2022, down by $2.6 million, or 7%, from the fourth quarter of 2021.  The net interest margin was 2.57% for the first quarter, down by 14 basis points from the preceding quarter.  Net interest income and the net interest margin were impacted by accelerated net deferred fee amortization associated with PPP loans that were forgiven by the Small Business Administration, as well as commercial loan prepayment fee income.  In the first quarter of 2022, accelerated net deferred fee amortization on PPP loans amounted to $819 thousand, or 6 basis points, compared to $1.2 million, or 9 basis points, in the preceding quarter.  Commercial loan prepayment fee income amounted to $76 thousand, or 0 basis points, in the first quarter of 2022, compared to $2.2 million, or 16 basis points, in the preceding quarter.  Excluding the impact of these items for both periods, the net interest margin was 2.51% in the first quarter of 2022, up by 5 basis points, from 2.46% in the preceding quarter.  Linked quarter changes included:

  • Average interest-earning assets increased by $7 million. The yield on interest-earning assets for the first quarter was 2.83%, down by 14 basis points from the preceding quarter. Excluding the impact of accelerated net deferred fee amortization on PPP loans and commercial loan prepayment fee income for both periods, the yield on interest-earning assets was 2.76%, up by 4 basis points from the preceding quarter, reflecting the impact of higher market interest rates.

  • Average interest-bearing liabilities increased by $40 million, due to an increase of $216 million in average in-market deposits, partially offset by a decrease of $176 million in average wholesale funding balances. The cost of interest-bearing liabilities for the first quarter of 2022 was 0.33%, down by 1 basis point from the preceding quarter.

Noninterest Income

Noninterest income totaled $17.2 million for the first quarter of 2022, down by $3.1 million, or 16%, from the fourth quarter of 2021.  Linked quarter changes included:

  • Wealth management revenues amounted to $10.5 million in the first quarter of 2022, up by $27 thousand, or 0.3%, on a linked quarter basis. This included an increase in transaction-based revenues of $233 thousand, or 268%, from the preceding quarter, reflecting seasonal tax reporting and preparation fees that are generally concentrated in the first half of the calendar year. This increase was partially offset by a decrease in asset-based revenues, which declined by $206 thousand, or 2%, from the preceding quarter.

    Wealth management AUA amounted to $7.5 billion at March 31, 2022, down by $291 million, or 4%, from December 31, 2021. The decrease reflected net investment depreciation of $389 million, partially offset by net client asset inflows of $97 million in the first quarter of 2022. The average balance of AUA for the first quarter of 2022 decreased by approximately $83 million, or 1%, from the average balance for the preceding quarter.

  • Mortgage banking revenues totaled $3.5 million for the first quarter of 2022, down by $831 thousand, or 19%, from the fourth quarter of 2021, reflecting a lower volume of loans sold to the secondary market and a lower sales yield, partially offset by changes in the fair value of mortgage loan commitments. Realized gains on sales of loans decreased by $2.4 million, or 42%. Mortgage loans sold to the secondary market amounted to $130 million in the first quarter of 2021, down by $67 million, or 34%, from the preceding quarter.

  • Loan related derivative income was $301 thousand in the first quarter of 2022, down by $1.7 million from the preceding quarter, reflecting a lower volume of commercial borrower interest rate swap transactions.

  • Income from bank-owned life insurance totaled $601 thousand in the first quarter of 2022, down by $543 thousand, or 47%, from the preceding quarter. This decline was due to the recognition of $526 thousand in the fourth quarter of 2021 of non-taxable income associated with the receipt of life insurance proceeds.

Noninterest Expense

Noninterest expense totaled $31.2 million for the first quarter of 2022, down by $4.0 million, or 11%, from the fourth quarter of 2021.  Included in noninterest expense for the fourth quarter of 2021 was debt prepayment penalty expense of $2.7 million, resulting from prepaying higher-yielding FHLB advances.  There was no debt prepayment penalty expense recognized in the first quarter of 2022.  Excluding the impact of debt prepayment penalty expense, noninterest expense was down by $1.3 million, or 4%, from the fourth quarter of 2021.  Linked quarter changes included:

  • Salaries and employee benefits expense, the largest component of noninterest expense, amounted to $21.0 million for the first quarter of 2022, down by $522 thousand, or 2%, from the preceding quarter, reflecting volume-related decreases in mortgage originator compensation expense and lower performance-based compensation accruals, which were partially offset by higher payroll taxes associated with the start of a new calendar year.

  • Outsourced services expense decreased by $343 thousand, or 10%, largely reflecting a lower volume of commercial borrower loan related derivative transactions.

Income Tax

Income tax expense totaled $4.4 million for the first quarter of 2022, down by $1.0 million from the preceding quarter, largely due to a lower level of pre-tax income.  The effective tax rate for both the first quarter of 2022 and the fourth quarter of 2021 was 21.3%.  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 $1.0 billion at March 31, 2022, down by $35 million, or 3%, from December 31, 2021, reflecting a temporary decline in fair value of available for sale securities and routine pay-downs on mortgage-backed securities.  These decreases were 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 first quarter 2022 totaled $75 million, with a weighted average yield of 2.41%.  Securities represented 17% of total assets at March 31, 2022, compared to 18% of total assets at December 31, 2021.

Loans

Total loans amounted to $4.3 billion at March 31, 2022, up by $11 million, or 0.3%, from the end of the preceding quarter.  Linked quarter changes included:

  • Commercial loans decreased by $37 million, or 2%, from December 31, 2021, which included a net reduction in PPP loans of $25 million. Excluding PPP loans, commercial loans decreased by $12 million, or 1%, from December 31, 2021, reflecting payoffs and pay-downs of approximately $122 million, partially offset by commercial loan originations and advances of approximately $110 million.

    As of March 31, 2022, the carrying value of PPP loans was $13 million and included net unamortized loan origination fee balances of $425 thousand.

  • Residential real estate loans increased by $51 million, or 3%, from December 31, 2021. In the first quarter of 2022, residential real estate loans originated for portfolio amounted to $164 million.

  • The consumer loan portfolio decreased by $3 million, or 1%, from the balance at December 31, 2021.

Deposits and Borrowings

At March 31, 2022, in-market deposits, which exclude wholesale brokered time deposits, amounted to $4.7 billion, up by $261 million, or 6%, from the end of the preceding quarter, concentrated in money market accounts.  Wholesale brokered time deposits amounted to $402 million, down by $113 million, or 22%, from December 31, 2021.  Total deposits amounted to $5.1 billion at March 31, 2022, up by $148 million, or 3%, from the end of the preceding quarter.

FHLB advances totaled $55 million at March 31, 2022, down by $90 million, or 62%, from December 31, 2021, as lower levels of wholesale funding were needed given the in-market deposits increase.

Asset Quality

Total nonaccrual loans amounted to $12.6 million, or 0.29% of total loans, at March 31, 2022, compared to $14.2 million, or 0.33% of total loans, at December 31, 2021.

Total past due loans amounted to $7.0 million, or 0.16% of total loans, at March 31, 2022, compared to $10.4 million, or 0.24% of total loans, at December 31, 2021.

As of March 31, 2022, there were no active loan payment deferral modifications made in response to the COVID-19 pandemic.

The allowance for credit losses ("ACL") on loans amounted to $39.2 million, or 0.92% of total loans, at March 31, 2022, compared to $39.1 million, or 0.91% of total loans, at December 31, 2021.  The ACL on unfunded commitments, included in other liabilities on the Consolidated Balance Sheets, amounted to $2.3 million at March 31, 2022, compared to $2.2 million at December 31, 2021.

There was a positive $100 thousand provision for credit losses (or a charge) recognized in the first quarter of 2022, compared to a negative $2.8 million provision for credit losses (or a benefit) recognized in the preceding quarter.  In the first quarter of 2022, the provision related to an increase in the ACL on unfunded commitments.  There was no provision for credit losses on loans recognized in the first quarter of 2022, reflecting continued low loss rates, strong asset and credit quality metrics, as well as our current estimate of forecasted economic conditions.  In the first quarter of 2022, net recoveries of $148 thousand were recognized, compared to net recoveries of $27 thousand in the preceding quarter.

Capital and Dividends

Total shareholders' equity was $513.2 million at March 31, 2022, down by $51.6 million, or 9%, from December 31, 2021.  The decline reflected a decrease of $59.5 million in the accumulated other comprehensive income component of shareholders' equity, largely due to a temporary decrease in the fair value of available for sale securities, as well as $9.5 million in dividend declarations.  These decreases were partially offset by net income of $16.5 million.

Capital levels at March 31, 2022 exceeded the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 14.15% at March 31, 2022, compared to 14.01% at December 31, 2021.

Book value per share was $29.61 at March 31, 2022, compared to $32.59 at December 31, 2021.

The Board of Directors declared a quarterly dividend of 54 cents per share for the quarter ended March 31, 2022.  The dividend was paid on April 8, 2022 to shareholders of record on April 1, 2022.

Conference Call

Washington Trust will host a conference call to discuss its first quarter results, business highlights and outlook on Monday, April 25, 2022 at 10:00 a.m. (Eastern Time).  Individuals may dial in to the call at 1-844-200-6205 and enter Access Code 058066.  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 958451.  The audio replay will be available through May 9, 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 June 30, 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:

  • ongoing disruptions in our business and operations, and changes in consumer behavior due to the ongoing COVID-19 pandemic;
  • changes in political, business and economic conditions, including inflation, or legislative or regulatory initiatives;
  • the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments;
  • volatility in national and international financial markets;
  • interest rate changes or volatility, as well as changes in the balance and mix of loans and deposits;
  • reductions in the market value or outflows of wealth management assets under administration;
  • decreases in the value of securities and other assets;
  • changes in loan demand and collectability;
  • 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 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.

 

Washington Trust Bancorp, Inc. and Subsidiaries


CONDENSED CONSOLIDATED BALANCE SHEETS


(Unaudited; Dollars in thousands)










Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Assets:







Cash and due from banks

$224,807

$175,259

$297,039

$127,743

$166,960


Short-term investments

3,289

3,234

3,349

4,463

3,783


Mortgage loans held for sale, at fair value

15,612

40,196

48,705

31,492

77,450


Available for sale debt securities, at fair value

1,008,184

1,042,859

1,045,833

1,052,577

948,094


Federal Home Loan Bank stock, at cost

8,452

13,031

15,094

22,757

24,772


Loans:







  Total loans

4,283,852

4,272,925

4,286,404

4,299,800

4,194,666


  Less: allowance for credit losses on loans

39,236

39,088

41,711

41,879

42,137


  Net loans

4,244,616

4,233,837

4,244,693

4,257,921

4,152,529


Premises and equipment, net

28,878

28,908

28,488

29,031

28,953


Operating lease right-of-use assets

28,816

26,692

27,518

28,329

28,761


Investment in bank-owned life insurance

93,192

92,592

92,974

92,355

84,749


Goodwill

63,909

63,909

63,909

63,909

63,909


Identifiable intangible assets, net

5,198

5,414

5,631

5,853

6,079


Other assets

123,046

125,196

129,410

135,550

133,350


  Total assets

$5,847,999

$5,851,127

$6,002,643

$5,851,980

$5,719,389


Liabilities:







Deposits:







  Noninterest-bearing deposits

$911,990

$945,229

$950,974

$901,801

$932,999


  Interest-bearing deposits

4,215,960

4,034,822

4,107,168

3,823,858

3,616,143


  Total deposits

5,127,950

4,980,051

5,058,142

4,725,659

4,549,142


Federal Home Loan Bank advances

55,000

145,000

222,592

408,592

466,912


Junior subordinated debentures

22,681

22,681

22,681

22,681

22,681


Operating lease liabilities

31,169

29,010

29,810

30,558

30,974


Other liabilities

98,007

109,577

114,100

116,634

116,081


  Total liabilities

5,334,807

5,286,319

5,447,325

5,304,124

5,185,790


Shareholders' Equity:







Common stock

1,085

1,085

1,085

1,085

1,085


Paid-in capital

127,355

126,511

126,265

125,442

124,882


Retained earnings

465,295

458,310

447,566

437,927

429,598


Accumulated other comprehensive (loss) income

(79,451)

(19,981)

(18,128)

(15,128)

(20,006)


Treasury stock, at cost

(1,092)

(1,117)

(1,470)

(1,470)

(1,960)


  Total shareholders' equity

513,192

564,808

555,318

547,856

533,599


  Total liabilities and shareholders' equity

$5,847,999

$5,851,127

$6,002,643

$5,851,980

$5,719,389


 

Washington Trust Bancorp, Inc. and Subsidiaries


CONSOLIDATED STATEMENTS OF INCOME


(Unaudited; Dollars and shares in thousands, except per share amounts)



For the Three Months Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Interest income:







  Interest and fees on loans

$33,930

$36,882

$35,691

$34,820

$34,159


  Interest on mortgage loans held for sale

232

387

298

405

441


  Taxable interest on debt securities

4,230

3,929

3,683

3,441

3,242


  Dividends on Federal Home Loan Bank stock

67

98

95

110

133


  Other interest income

78

60

56

32

33


  Total interest and dividend income

38,537

41,356

39,823

38,808

38,008


Interest expense:







  Deposits

3,103

2,977

2,789

2,961

3,663


  Federal Home Loan Bank advances

244

547

872

1,001

1,380


  Junior subordinated debentures

99

92

92

92

94


  Total interest expense

3,446

3,616

3,753

4,054

5,137


Net interest income

35,091

37,740

36,070

34,754

32,871


Provision for credit losses

100

(2,822)

(2,000)


Net interest income after provision for credit losses

34,991

40,562

36,070

34,754

34,871


Noninterest income:







  Wealth management revenues

10,531

10,504

10,455

10,428

9,895


  Mortgage banking revenues

3,501

4,332

6,373

5,994

11,927


  Card interchange fees

1,164

1,282

1,265

1,316

1,133


  Service charges on deposit accounts

668

766

673

635

609


  Loan related derivative income

301

1,972

728

1,175

467


  Income from bank-owned life insurance

601

1,144

618

607

556


  Other income

393

307

408

438

1,387


  Total noninterest income

17,159

20,307

20,520

20,593

25,974


Noninterest expense:







  Salaries and employee benefits

21,002

21,524

22,162

22,082

21,527


  Outsourced services

3,242

3,585

3,294

3,217

3,200


  Net occupancy

2,300

2,145

2,134

2,042

2,128


  Equipment

918

959

977

975

994


  Legal, audit and professional fees

770

817

767

678

597


  FDIC deposit insurance costs

366

391

482

374

345


  Advertising and promotion

351

502

559

560

222


  Amortization of intangibles

217

216

223

225

226


  Debt prepayment penalties

2,700

895

3,335


  Other expenses

2,053

2,380

1,922

1,964

2,139


  Total noninterest expense

31,219

35,219

32,520

33,012

34,713


Income before income taxes

20,931

25,650

24,070

22,335

26,132


Income tax expense

4,448

5,462

5,319

4,875

5,661


  Net income

$16,483

$20,188

$18,751

$17,460

$20,471









Net income available to common shareholders

$16,429

$20,128

$18,697

$17,408

$20,415









Weighted average common shares outstanding:







  Basic

17,331

17,328

17,320

17,314

17,275


  Diluted

17,482

17,469

17,444

17,436

17,431


Earnings per common share:







  Basic

$0.95

$1.16

$1.08

$1.01

$1.18


  Diluted

$0.94

$1.15

$1.07

$1.00

$1.17









Cash dividends declared per share

$0.54

$0.54

$0.52

$0.52

$0.52


 

Washington Trust Bancorp, Inc. and Subsidiaries


SELECTED FINANCIAL HIGHLIGHTS


(Unaudited; Dollars and shares in thousands, except per share amounts)






Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Share and Equity Related Data:







Book value per share

$29.61

$32.59

$32.06

$31.63

$30.83


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

$25.62

$28.59

$28.05

$27.60

$26.79


Market value per share

$52.50

$56.37

$52.98

$51.35

$51.63


Shares issued at end of period

17,363

17,363

17,363

17,363

17,363


Shares outstanding at end of period

17,332

17,331

17,320

17,320

17,306









Capital Ratios (2):







Tier 1 risk-based capital

13.32%

13.24%

13.01%

12.82%

12.99%


Total risk-based capital

14.15%

14.01%

13.83%

13.65%

13.85%


Tier 1 leverage ratio

9.46%

9.36%

9.12%

9.07%

9.11%


Common equity tier 1

12.79%

12.71%

12.47%

12.28%

12.43%









Balance Sheet Ratios:







Equity to assets

8.78%

9.65%

9.25%

9.36%

9.33%


Tangible equity to tangible assets - Non-GAAP (1)

7.68%

8.57%

8.19%

8.27%

8.21%


Loans to deposits (3)

83.1%

85.8%

84.9%

90.8%

93.0%






For the Three Months Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Performance Ratios (4):







Net interest margin (5)

2.57%

2.71%

2.58%

2.55%

2.51%


Return on average assets (net income divided by average assets)

1.14%

1.36%

1.26%

1.20%

1.45%


Return on average tangible assets - Non-GAAP (1)

1.15%

1.38%

1.27%

1.22%

1.47%


Return on average equity (net income available for common shareholders divided by average equity)

12.04%

14.34%

13.37%

12.92%

15.55%


Return on average tangible equity - Non-GAAP (1)

13.77%

16.39%

15.29%

14.84%

17.91%


Efficiency ratio (6)

59.7%

60.7%

57.5%

59.6%

59.0%





(1)

See the section labeled "Supplemental Information - Calculation of Non-GAAP Financial Measures" at the end of this document.


(2)

Estimated for March 31, 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).


 

Washington Trust Bancorp, Inc. and Subsidiaries


SELECTED FINANCIAL HIGHLIGHTS


(Unaudited; Dollars in thousands)






For the Three Months Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Wealth Management Results







Wealth Management Revenues:







Asset-based revenues

$10,211

$10,417

$10,224

$9,991

$9,583


Transaction-based revenues

320

87

231

437

312


Total wealth management revenues

$10,531

$10,504

$10,455

$10,428

$9,895









Assets Under Administration (AUA):







Balance at beginning of period

$7,784,211

$7,443,396

$7,441,519

$7,049,226

$6,866,737


Net investment (depreciation) appreciation & income

(388,733)

358,796

(4,830)

368,383

208,953


Net client asset inflows (outflows)

97,415

(17,981)

6,707

23,910

(26,464)


Balance at end of period

$7,492,893

$7,784,211

$7,443,396

$7,441,519

$7,049,226









Percentage of AUA that are managed assets

92%

92%

91%

92%

91%









Mortgage Banking Results







Mortgage Banking Revenues:







Realized gains on loan sales, net (1)

$3,327

$5,695

$5,750

$8,562

$13,745


Changes in fair value, net (2)

(242)

(1,594)

467

(2,543)

(1,888)


Loan servicing fee income, net (3)

416

231

156

(25)

70


Total mortgage banking revenues

$3,501

$4,332

$6,373

$5,994

$11,927









Residential Mortgage Loan Originations:







Originations for retention in portfolio (4)

$164,401

$174,438

$205,293

$244,821

$131,791


Originations for sale to secondary market (5)

106,619

188,735

190,702

244,562

309,325


Total mortgage loan originations

$271,020

$363,173

$395,995

$489,383

$441,116









Residential Mortgage Loans Sold:







Sold with servicing rights retained

$14,627

$21,180

$108,445

$235,280

$226,645


Sold with servicing rights released (5)

115,501

175,818

65,416

55,278

65,374


Total mortgage loans sold

$130,128

$196,998

$173,861

$290,558

$292,019





(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).


 

Washington Trust Bancorp, Inc. and Subsidiaries


END OF PERIOD LOAN COMPOSITION


(Unaudited; Dollars in thousands)






Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Loans:







Commercial real estate (1)

$1,628,620

$1,639,062

$1,661,785

$1,669,624

$1,618,540


Commercial & industrial

614,892

641,555

682,774

764,509

840,585


Total commercial

2,243,512

2,280,617

2,344,559

2,434,133

2,459,125









Residential real estate (2)

1,777,974

1,726,975

1,672,364

1,590,389

1,457,490









Home equity

246,097

247,697

249,874

254,802

256,799


Other

16,269

17,636

19,607

20,476

21,252


Total consumer

262,366

265,333

269,481

275,278

278,051


Total loans

$4,283,852

$4,272,925

$4,286,404

$4,299,800

$4,194,666





(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.


 


March 31, 2022


December 31, 2021



Count

Balance

% of Total


Count

Balance

% of Total


Commercial Real Estate Portfolio Segmentation:









Multi-family dwelling

125

$443,571

27%


127

$474,229

29%


Retail

117

380,588

23


121

389,487

24


Office

59

219,551

13


57

216,602

13


Hospitality

32

193,213

12


31

184,990

11


Industrial and warehouse

36

143,441

9


35

137,254

8


Healthcare

15

134,713

8


13

128,189

8


Commercial mixed use

20

38,731

2


20

38,978

2


Other

36

74,812

6


36

69,333

5


  Commercial real estate loans

440

$1,628,620

100%


440

$1,639,062

100%











Commercial & Industrial Portfolio Segmentation:









Healthcare and social assistance

72

$175,988

29%


101

$174,376

27%


Owner occupied and other real estate

170

67,651

11


185

72,957

11


Manufacturing

52

55,868

9


65

55,341

9


Educational services

22

50,939

8


28

52,211

8


Retail

71

43,436

7


79

47,290

7


Transportation and warehousing

25

34,605

6


31

35,064

5


Finance and insurance

59

35,477

6


59

31,279

5


Entertainment and recreation

28

29,297

5


37

32,087

5


Information

10

23,377

4


14

25,045

4


Accommodation and food services

71

19,589

3


114

28,320

4


Professional, scientific and technical

46

6,781

1


69

8,912

1


Public administration

15

5,340

1


16

5,441

1


Other

202

66,544

10


281

73,232

13


  Commercial & industrial loans

843

$614,892

100%


1,079

$641,555

100%


 

Washington Trust Bancorp, Inc. and Subsidiaries


END OF PERIOD LOAN AND DEPOSIT COMPOSITION


(Unaudited; Dollars in thousands)










March 31, 2022


December 31, 2021



Balance

% of
Total


Balance

% of
Total


Commercial Real Estate Loans by Property Location:







Connecticut

$618,315

38%


$643,182

39%


Massachusetts

472,902

29


464,018

28


Rhode Island

394,011

24


408,496

25


Subtotal

1,485,228

91


1,515,696

92


All other states

143,392

9


123,366

8


  Total commercial real estate loans

$1,628,620

100%


$1,639,062

100%









Residential Real Estate Loans by Property Location:







Massachusetts

$1,250,376

70%


$1,207,789

70%


Rhode Island

371,463

21


365,831

21


Connecticut

133,815

8


132,430

8


  Subtotal

1,755,654

99


1,706,050

99


All other states

22,320

1


20,925

1


  Total residential real estate loans

$1,777,974

100%


$1,726,975

100%


 


Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Deposits:







Noninterest-bearing demand deposits

$911,990

$945,229

$950,974

$901,801

$932,999


Interest-bearing demand deposits

248,914

251,032

238,317

174,165

171,571


NOW accounts

893,603

867,138

817,937

774,693

745,376


Money market accounts

1,295,339

1,072,864

1,046,324

941,511

950,413


Savings accounts

566,461

555,177

540,306

524,155

511,759


Time deposits (in-market)

809,858

773,383

709,288

677,061

701,524


  In-market deposits

4,726,165

4,464,823

4,303,146

3,993,386

4,013,642


Wholesale brokered time deposits

401,785

515,228

754,996

732,273

535,500


  Total deposits

$5,127,950

$4,980,051

$5,058,142

$4,725,659

$4,549,142


 

Washington Trust Bancorp, Inc. and Subsidiaries


CREDIT & ASSET QUALITY DATA


(Unaudited; Dollars in thousands)






Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Asset Quality Ratios:







Nonperforming assets to total assets

0.22%

0.24%

0.18%

0.18%

0.23%


Nonaccrual loans to total loans

0.29%

0.33%

0.26%

0.24%

0.31%


Total past due loans to total loans

0.16%

0.24%

0.22%

0.20%

0.26%


Allowance for credit losses on loans to nonaccrual loans

311.67%

275.21%

380.02%

399.57%

324.56%


Allowance for credit losses on loans to total loans

0.92%

0.91%

0.97%

0.97%

1.00%









Nonperforming Assets:







Commercial real estate

$—

$—

$—

$—

$—


Commercial & industrial

539


  Total commercial

539


Residential real estate

11,916

13,576

10,321

8,926

11,748


Home equity

673

627

655

1,016

1,147


Other consumer

88


  Total consumer

673

627

655

1,016

1,235


Total nonaccrual loans

12,589

14,203

10,976

10,481

12,983


Other real estate owned


Total nonperforming assets

$12,589

$14,203

$10,976

$10,481

$12,983









Past Due Loans (30 days or more past due):







Commercial real estate

$—

$—

$—

$—

$—


Commercial & industrial

108

3

2

540

1


  Total commercial

108

3

2

540

1


Residential real estate

6,467

9,622

8,698

6,656

9,661


Home equity

431

765

824

1,231

1,131


Other consumer

30

21

24

28

119


  Total consumer

461

786

848

1,259

1,250


Total past due loans

$7,036

$10,411

$9,548

$8,455

$10,912









Accruing loans 90 days or more past due

$—

$—

$—

$—

$—


Nonaccrual loans included in past due loans

$5,707

$9,359

$6,930

$5,773

$8,356









Troubled Debt Restructurings ("TDR"):







Accruing TDRs

$16,303

$16,328

$7,979

$8,541

$12,358


Nonaccrual TDRs

2,789

2,819

1,732

2,278

1,935


Total TDRs

$19,092

$19,147

$9,711

$10,819

$14,293


 

Washington Trust Bancorp, Inc. and Subsidiaries


CREDIT & ASSET QUALITY DATA


(Unaudited; Dollars in thousands)



For the Three Months Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Nonaccrual Loan Activity:







Balance at beginning of period

$14,203

$10,976

$10,481

$12,983

$13,197


Additions to nonaccrual status

427

3,959

2,583

537

734


Loans returned to accruing status

(63)

(339)

(874)

(3)


Loans charged-off

(36)

(31)

(249)

(317)

(64)


Payments, payoffs and other changes

(1,942)

(362)

(1,839)

(1,848)

(881)


Balance at end of period

$12,589

$14,203

$10,976

$10,481

$12,983









Allowance for Credit Losses on Loans:







Balance at beginning of period

$39,088

$41,711

$41,879

$42,137

$44,106


Provision for credit losses on loans (1)

(2,650)

(1,951)


Charge-offs

(36)

(33)

(249)

(317)

(64)


Recoveries

184

60

81

59

46


Balance at end of period

$39,236

$39,088

$41,711

$41,879

$42,137









Allowance for Credit Losses on Unfunded Commitments:






Balance at beginning of period

$2,161

$2,333

$2,333

$2,333

$2,382


Provision for credit losses on unfunded commitments (1)

100

(172)

(49)


Balance at end of period (2)

$2,261

$2,161

$2,333

$2,333

$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 Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Net Loan Charge-Offs (Recoveries):







Commercial real estate

($145)

$—

$—

$—

$—


Commercial & industrial

(1)

(35)

(2)

302

1


  Total commercial

(146)

(35)

(2)

302

1


Residential real estate

(21)

(4)

52

(47)

17


Home equity

(2)

(12)

110

(4)

(2)


Other consumer

21

24

8

7

2


  Total consumer

19

12

118

3


Total

($148)

($27)

$168

$258

$18









Net charge-offs (recoveries) to average loans - annualized

(0.01%)

—%

0.02%

0.02%

—%


 

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 Ended

March 31, 2022


December 31, 2021


Change



Average
Balance

Interest

Yield/

Rate


Average
Balance

Interest

Yield/

Rate


Average
Balance

Interest

Yield/

Rate



Assets:













Cash, federal funds sold and short-term investments

$183,684

$78

0.17%


$190,291

$60

0.13%


($6,607)

$18

0.04%


Mortgage loans held for sale

28,471

232

3.30


50,425

387

3.04


(21,954)

(155)

0.26


Taxable debt securities

1,071,745

4,230

1.60


1,060,045

3,929

1.47


11,700

301

0.13


FHLB stock

12,294

67

2.21


12,986

98

2.99


(692)

(31)

(0.78)


Commercial real estate

1,631,819

11,891

2.96


1,657,669

14,281

3.42


(25,850)

(2,390)

(0.46)


Commercial & industrial

634,869

6,226

3.98


630,805

6,960

4.38


4,064

(734)

(0.40)


  Total commercial

2,266,688

18,117

3.24


2,288,474

21,241

3.68


(21,786)

(3,124)

(0.44)


Residential real estate

1,740,087

13,987

3.26


1,689,949

13,636

3.20


50,138

351

0.06


Home equity

246,766

1,875

3.08


249,336

1,992

3.17


(2,570)

(117)

(0.09)


Other

16,933

195

4.67


18,171

224

4.89


(1,238)

(29)

(0.22)


  Total consumer

263,699

2,070

3.18


267,507

2,216

3.29


(3,808)

(146)

(0.11)


  Total loans

4,270,474

34,174

3.25


4,245,930

37,093

3.47


24,544

(2,919)

(0.22)


  Total interest-earning assets

5,566,668

38,781

2.83


5,559,677

41,567

2.97


6,991

(2,786)

(0.14)


Noninterest-earning assets

298,000




324,904




(26,904)




Total assets

$5,864,668




$5,884,581




($19,913)




Liabilities and Shareholders' Equity:













Interest-bearing demand deposits

$248,395

$70

0.11%


$238,390

$63

0.10%


$10,005

$7

0.01%


NOW accounts

847,848

130

0.06


819,590

142

0.07


28,258

(12)

(0.01)


Money market accounts

1,174,833

615

0.21


1,059,846

561

0.21


114,987

54


Savings accounts

561,339

71

0.05


544,981

70

0.05


16,358

1


Time deposits (in-market)

793,169

2,017

1.03


746,887

1,927

1.02


46,282

90

0.01


  Total interest-bearing in-market deposits

3,625,584

2,903

0.32


3,409,694

2,763

0.32


215,890

140


Wholesale brokered time deposits

455,785

200

0.18


611,467

214

0.14


(155,682)

(14)

0.04


Total interest-bearing deposits

4,081,369

3,103

0.31


4,021,161

2,977

0.29


60,208

126

0.02


FHLB advances

150,922

244

0.66


171,079

547

1.27


(20,157)

(303)

(0.61)


Junior subordinated debentures

22,681

99

1.77


22,681

92

1.61


7

0.16


  Total interest-bearing liabilities

4,254,972

3,446

0.33


4,214,921

3,616

0.34


40,051

(170)

(0.01)


Noninterest-bearing demand deposits

940,220




981,706




(41,486)




Other liabilities

116,291




131,189




(14,898)




Shareholders' equity

553,185




556,765




(3,580)




  Total liabilities and shareholders' equity

$5,864,668




$5,884,581




($19,913)




  Net interest income (FTE)


$35,335




$37,951




($2,616)



Interest rate spread



2.50%




2.63%




(0.13%)


Net interest margin



2.57%




2.71%




(0.14%)


 

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

For the Three Months Ended

Mar 31,
2022

Dec 31,
2021

Change


Commercial loans

$244

$211

$33


Total

$244

$211

$33


 

Washington Trust Bancorp, Inc. and Subsidiaries


SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures


(Unaudited; Dollars in thousands, except per share amounts)






Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Tangible Book Value per Share:







Total shareholders' equity, as reported

$513,192

$564,808

$555,318

$547,856

$533,599


Less:







  Goodwill

63,909

63,909

63,909

63,909

63,909


  Identifiable intangible assets, net

5,198

5,414

5,631

5,853

6,079


Total tangible shareholders' equity

$444,085

$495,485

$485,778

$478,094

$463,611









Shares outstanding, as reported

17,332

17,331

17,320

17,320

17,306









Book value per share - GAAP

$29.61

$32.59

$32.06

$31.63

$30.83


Tangible book value per share - Non-GAAP

$25.62

$28.59

$28.05

$27.60

$26.79









Tangible Equity to Tangible Assets:







Total tangible shareholders' equity

$444,085

$495,485

$485,778

$478,094

$463,611









Total assets, as reported

$5,847,999

$5,851,127

$6,002,643

$5,851,980

$5,719,389


Less:







  Goodwill

63,909

63,909

63,909

63,909

63,909


  Identifiable intangible assets, net

5,198

5,414

5,631

5,853

6,079


Total tangible assets

$5,778,892

$5,781,804

$5,933,103

$5,782,218

$5,649,401









Equity to assets - GAAP

8.78%

9.65%

9.25%

9.36%

9.33%


Tangible equity to tangible assets - Non-GAAP

7.68%

8.57%

8.19%

8.27%

8.21%





For the Three Months Ended



Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Jun 30,
2021

Mar 31,
2021


Return on Average Tangible Assets:







Net income, as reported

$16,483

$20,188

$18,751

$17,460

$20,471









Total average assets, as reported

$5,864,668

$5,884,581

$5,919,137

$5,833,425

$5,711,931


Less average balances of:







  Goodwill

63,909

63,909

63,909

63,909

63,909


  Identifiable intangible assets, net

5,303

5,526

5,739

5,963

6,189


Total average tangible assets

$5,795,456

$5,815,146

$5,849,489

$5,763,553

$5,641,833









Return on average assets - GAAP

1.14%

1.36%

1.26%

1.20%

1.45%


Return on average tangible assets - Non-GAAP

1.15%

1.38%

1.27%

1.22%

1.47%









Return on Average Tangible Equity:







Net income available to common shareholders, as reported

$16,429

$20,128

$18,697

$17,408

$20,415









Total average equity, as reported

$553,185

$556,765

$554,847

$540,524

$532,271


Less average balances of:







  Goodwill

63,909

63,909

63,909

63,909

63,909


  Identifiable intangible assets, net

5,303

5,526

5,739

5,963

6,189


Total average tangible equity

$483,973

$487,330

$485,199

$470,652

$462,173









Return on average equity - GAAP

12.04%

14.34%

13.37%

12.92%

15.55%


Return on average tangible equity - Non-GAAP

13.77%

16.39%

15.29%

14.84%

17.91%


 

Category: Earnings

 

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SOURCE Washington Trust Bancorp, Inc.