Washington Trust(US:WASH)2025-10-21 13:32Financial 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 [4][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 up by $6.6 million or 20% year-over-year [6][7] - Non-interest income comprised 31% of revenue in Q3, up 3% from Q2 and 8% year-over-year [7] - 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 reached $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) totaled $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 is focused on long-term value creation and has made key investments to drive growth, including an asset purchase from Lighthouse Financial management [5] - The hiring of Jim Brown as Senior Executive Vice President and Chief Commercial Banking Officer aims to strengthen commercial relationships and integrate services with the wealth division [5] 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 [4][6] - The company anticipates low single-digit loan growth for the year, with a healthy pipeline of approximately $180 million [35] - Management expects margin expansion of about 5 basis points in Q4 [27] 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 commercial and industrial (CNI) and commercial real estate [17][47] 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 [25] Question: Margin expectations - The company anticipates a margin expansion of about 5 basis points in Q4 [27] Question: Buyback plans - The company is pausing buybacks to evaluate capital levels for growth opportunities [38][46] Question: Breakdown of shared national credits - The breakdown includes $90 million in commercial real estate and $84 million in commercial and industrial [47] Question: NDFI exposure - The company has no NDFI exposure [49]