Try our mobile app
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:
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:
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:
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:
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:
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:
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 | % ofTotal | 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 | |||||||||
AverageBalance | Interest | Yield/ Rate | AverageBalance | Interest | Yield/ Rate | AverageBalance | 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
View original content to download multimedia:https://www.prnewswire.com/news-releases/washington-trust-reports-first-quarter-2022-earnings-301531430.html
SOURCE Washington Trust Bancorp, Inc.
