WESTERLY – Washington Trust Bancorp Inc., the parent company of The Washington Trust Co., on Monday reported a profit of $10.8 million in the second quarter, down 3.5% from the $11.2 million it posted in the same period a year ago due to continued higher interest expenses on deposits.
Earnings per diluted share were 63 cents, down from 66 cents a year ago.
Washington Trust is the third-largest bank in Rhode Island in terms of deposits in the market, behind only Citizens Bank and Bank of America Corp.
Revenue for Washington Trust – interest and dividend income and noninterest income – was $102.6 million, up 14.6% from $89.5 million in the same quarter last year. The gains were mostly from interest and fees on loans, which increased $10.8 million, or 16.5%, to $76.2 million.
At the same time, however, total interest expenses jumped 30.4% to $54.4 million, from $41.7 million a year ago.
Edward O. Handy III, Washington Trust’s chairman and CEO, said in a news release that the quarterly results reflect “our continued focus on successfully managing through current economic conditions while positioning the company for future growth.
“We recorded consistent earnings, maintained credit quality and managed expenses,” he said. “We also introduced new technology and invested in a marketing campaign designed to generate deposit growth.”
Wealth management revenue in the quarter increased 6.9% to $9.7 million, from $9 million.
Net interest margin – a key metric – was 1.83%, down from 2.03% reported a year ago.
Total deposits amounted to $4.9 billion in the quarter, down from $5.3 billion in the same quarter last year.
In-market deposits, which exclude wholesale brokered deposits, amounted to $4.6 billion, down slightly from $4.7 billion a year ago. As of June 30, in-market deposits were approximately 61% retail and 39% commercial. The average size of in-market deposit accounts was approximately $35,000 at the end of the quarter.
Total loans amounted to $5.6 billion, up 3.7% from $5.4 billion a year ago.
Nonaccrual loans – typically those more than 90 days overdue – were $30.5 million, or 0.54% of total loans for the quarter. That’s up from $10.4 million, or 0.19% of total loans from a year ago but on par with this year’s first quarter results of $30.7 million, or 0.54% of total loans.
