Washington Trust(US:WASH)2025-10-21 13:30Financial Data and Key Metrics Changes - The company reported a net income of $10.8 million or $0.56 per share for Q3 2025, down from $13.2 million or $0.68 per share in the previous quarter [5][6] - Pre-provision pre-tax revenue (PP&R) increased by 17% from Q2 and 48% year-over-year [6] - Net interest income for Q3 was $38.8 million, up by $1.6 million or 4% from the previous quarter and by $6.6 million or 20% year-over-year [6][7] - Non-interest income comprised 31% of revenue in Q3, up 3% compared to Q2 and up 8% year-over-year [6] - Non-interest expense totaled $35.7 million in Q3, down by $804,000 or 2% [7] Business Line Data and Key Metrics Changes - Wealth management revenues increased by 3%, with a 6% rise in asset-based revenues due to market appreciation and the acquisition of $195 million in managed assets [6][7] - Mortgage banking revenues totaled $3.5 million, up 15% for the quarter and 22% year-over-year [7] Market Data and Key Metrics Changes - End-of-period assets under administration (AUA) reached $7.7 billion, up $501 million or 7% [7] - In-market deposits increased by $179 million or 4% from the end of Q2 and by $431 million or 9% year-over-year [7][8] Company Strategy and Development Direction - The company completed an asset purchase from Lighthouse Financial Management, adding approximately $195 million in AUM and expanding its wealth management team [4] - The hiring of Jim Brown as Senior Executive Vice President and Chief Commercial Banking Officer is aimed at strengthening commercial relationships and integrating services [4] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current portfolio quality despite elevated provisions for credit losses due to resolved credit exposures [3][5] - The company anticipates low single-digit loan growth for the year, with a healthy pipeline of $180 million [5][6] - Management expects margin expansion of approximately 5 basis points in Q4 [5][6] Other Important Information - The company repurchased 237,000 shares at an average price of $27.18 per share, totaling $6.4 million, and an additional 21,000 shares in October [8] - The effective tax rate for the full year is expected to be 22.5% [7] Q&A Session Summary Question: Remaining shared national credits size - The remaining shared national credits amount to about $173 million, split between CNI and commercial real estate [17] Question: Change in specific reserves on a credit - The change was due to reduced recovery expectations from a Chapter 11 situation, leading to a significant loss [18] Question: Confidence in appraisals of other office properties - Confidence is based on different properties in various markets, with some showing leasing momentum [19][20] Question: Client flows in wealth management - The company is no longer disclosing client flows to align with peers [26] Question: Loan growth expectations - The company expects low single-digit growth for the year, with a healthy pipeline [36] Question: Future buybacks - The company plans to pause buybacks for now to evaluate capital deployment for growth [40] Question: Breakdown of shared national credits - The breakdown is $90 million in commercial real estate and $84 million in C&I [49] Question: NDFI exposure - The company has no NDFI exposure [51] Question: Special mention loans - The $22 million in special mention loans relates to two Class A office buildings with occupancy issues [52] Question: Maturity of a specific loan - The maturity of the discussed loan is in October 2027 [63]