Business Segments

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

Business Segments

Business Segments

The Corporation manages its operations through two reportable business segments, consisting of Commercial Banking and Wealth Management Services. The Corporation’s reportable business segments are determined by the Senior Executive Vice President, Chief Financial Officer and Treasurer, the designated CODM.

An allocation methodology is utilized to allocate income and expenses to the business segments. Direct activities are assigned to the appropriate business segment to which the activity relates. Indirect activities, such as corporate, technology and other support functions, are allocated to business segments primarily based upon full-time equivalent employee computations.

The Commercial Banking segment includes commercial, residential, and consumer lending activities; mortgage banking activities; deposit generation; cash management activities; banking activities, including customer support and the operation of ATMs, telephone banking, internet banking, and mobile banking services; as well as investment portfolio and wholesale funding activities.

The Wealth Management Services segment includes investment management; holistic financial planning services; personal trust and estate services, including services as trustee, personal representative, and custodian; settlement of decedents’ estates; and institutional trust services, including custody and fiduciary services.

The CODM evaluates the financial performance of each business segment, which is measured based upon the business segment’s net income. Components of net income for the business segments that are reviewed by the CODM include net interest income, provision for credit losses, noninterest income, noninterest expense, and income tax expense. The CODM, in conjunction with management committees (such as the ALCO) and certain members of executive management, evaluates financial performance to make decisions related to the products and services that are offered, pricing, and the allocation of resources, for each business segment.

The following tables presents the components of net income (loss), as well as other supplemental information for Washington Trust’s reportable business segments:

(Dollars in thousands)
Year ended December 31, 2024	Commercial Banking	Wealth Management Services	Consolidated Total
Total interest income and dividend income	$340,678	$—	$340,678
Total interest expense	212,230	—	212,230
Net interest income	128,448	—	128,448
Provision for credit losses	2,400	—	2,400
Net interest income after provision for credit losses	126,048	—	126,048
Noninterest (loss) income	(69,609)	41,812	(27,797)
Noninterest expenses:
Salaries and employee benefits	66,482	19,778	86,260
Outsourced services	12,340	3,918	16,258
Net occupancy	8,726	1,059	9,785
Equipment	3,486	352	3,838
Legal, audit and professional fees	2,473	655	3,128
FDIC deposit insurance costs	5,513	—	5,513
Advertising and promotion	2,252	374	2,626
Amortization of intangibles	—	826	826
Other expenses	7,517	1,318	8,835
Total noninterest expense	108,789	28,280	137,069
(Loss) income before income taxes	(52,350)	13,532	(38,818)
Income tax (benefit) expense	(13,530)	2,771	(10,759)
Net (loss) income	($38,820)	$10,761	($28,059)
Supplemental Information:
Total assets at period end	$6,870,612	$60,035	$6,930,647
Expenditures for long-lived assets	3,862	139	4,001
Depreciation expense (1)	3,530	404	3,934

(1)Included in net occupancy and equipment expenses in the table above.

The sale of securities and reclassification of residential mortgage loans to held for sale in connection with the balance sheet repositioning transactions that were executed in December 2024 impacted the results for the Commercial Banking segment. See additional discussion of the impact of these transactions in Notes 3 and 10.

(Dollars in thousands)
Year ended December 31, 2023	Commercial Banking	Wealth Management Services	Consolidated Total
Total interest and dividend income	$308,622	$37	$308,659
Total interest expense	171,561	—	171,561
Net interest income	137,061	37	137,098
Provision for credit losses	3,200	—	3,200
Net interest income after provision for credit losses	133,861	37	133,898
Noninterest income	20,006	36,134	56,140
Noninterest expenses:
Salaries and employee benefits	62,013	20,445	82,458
Outsourced services	10,972	3,549	14,521
Net occupancy	8,313	1,323	9,636
Equipment	3,841	477	4,318
Legal, audit and professional fees	2,751	1,140	3,891
FDIC deposit insurance costs	4,667	—	4,667
Advertising and promotion	2,140	422	2,562
Amortization of intangibles	—	843	843
Other expenses	8,269	2,392	10,661
Total noninterest expense	102,966	30,591	133,557
Income before income taxes	50,901	5,580	56,481
Income tax expense	7,028	1,277	8,305
Net income	$43,873	$4,303	$48,176
Supplemental Information:
Total assets at period end	$7,146,096	$56,751	$7,202,847
Expenditures for long-lived assets	5,013	35	5,048
Depreciation expense (1)	3,460	545	4,005

(1)Included in net occupancy and equipment expenses in the statement of operations above.

(Dollars in thousands)
Year ended December 31, 2022	Commercial Banking	Wealth Management Services	Consolidated Total
Total interest and dividend income	$194,449	$16	$194,465
Total interest expense	38,409	66	38,475
Net interest income (expense)	156,040	(50)	155,990
Provision for credit losses	(1,300)	—	(1,300)
Net interest income (expense) after provision for credit losses	157,340	(50)	157,290
Noninterest income	23,088	39,514	62,602
Noninterest expenses:
Salaries and employee benefits	62,026	21,778	83,804
Outsourced services	10,333	3,404	13,737
Net occupancy	7,696	1,430	9,126
Equipment	3,324	473	3,797
Legal, audit and professional fees	2,344	783	3,127
FDIC deposit insurance costs	1,687	—	1,687
Advertising and promotion	2,138	449	2,587
Amortization of intangibles	—	860	860
Other expenses	7,425	2,572	9,997
Total noninterest expense	96,973	31,749	128,722
Income before income taxes	83,455	7,715	91,170
Income tax expense	17,557	1,932	19,489
Net income	$65,898	$5,783	$71,681
Supplemental Information:
Total assets at period end	$6,585,310	$74,741	$6,660,051
Expenditures for long-lived assets	5,475	664	6,139
Depreciation expense (1)	2,948	517	3,465

(1)Included in net occupancy and equipment expenses in the statement of operations above.