-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RTy+EO3ZgIA4/UOqNj2UOgo/UiOYQPTt4EuO9h1oFElI7Jf5T5NfFxTFLusR1rKB mmWQQGeTM70/HL/525abhg== 0001157523-03-005469.txt : 20031016 0001157523-03-005469.hdr.sgml : 20031016 20031016162020 ACCESSION NUMBER: 0001157523-03-005469 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031016 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031016 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WASHINGTON TRUST BANCORP INC CENTRAL INDEX KEY: 0000737468 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 050404671 STATE OF INCORPORATION: RI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-13091 FILM NUMBER: 03944063 BUSINESS ADDRESS: STREET 1: 23 BROAD ST CITY: WESTERLY STATE: RI ZIP: 02891 BUSINESS PHONE: 4013481200 8-K 1 a4494673.txt WASHINGTON TRUST 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) October 16, 2003 WASHINGTON TRUST BANCORP, INC. ----------------------------- (Exact Name of Registrant as Specified in Charter) Rhode Island 0-13091 05-0404671 --------------------------------- ----------------------- ----------------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 23 Broad Street, Westerly, Rhode Island 02891 ------------------------------------------------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (401) 348-1200 Former name or address, if changed from last report: N/A Item 7. Financial Statements and Exhibits - ------------------------------------------ (c) Exhibit Exhibit No. Exhibit 99.1 Press Release dated October 16, 2003 Item 12. Results of Operations and Financial Condition - ------------------------------------------------------ On October 16, 2003, Washington Trust Bancorp, Inc. issued a press release in which it disclosed unaudited financial information related to third quarter consolidated earnings. A copy of the press release relating to such announcement, dated October 16, 2003, is attached hereto as Exhibit 99.1 and is incorporated herein by reference. EXHIBIT INDEX Exhibit No. Exhibit 99.1 Press Release dated October 16, 2003 This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. WASHINGTON TRUST BANCORP, INC. Date: October 16, 2003 By: John C. Warren - ----------------------- ------------------------------------ John C. Warren Chairman and Chief Executive Officer EX-99 3 a4494673ex99.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 Washington Trust Announces Earnings WESTERLY, R.I.--(BUSINESS WIRE)--Oct. 16, 2003--Washington Trust Bancorp, Inc. (NASDAQ: WASH), parent company of The Washington Trust Company, today reported net income of $4.7 million for the three months ended September 30, 2003, up 5 percent from the $4.5 million reported for the third quarter of 2002. The Corporation earned 35 cents per share on a diluted basis for the three months ended September 30, 2003, compared to 34 cents per diluted share for the third quarter of 2002. The return on average assets and return on average equity for the three months ended September 30, 2003 were 1.02% and 14.30%, compared to 1.09% and 14.47%, respectively, for the three months ended September 30, 2002. "Our third quarter earnings reflect the strength of our balance sheet," stated John C. Warren, Washington Trust's Chairman and Chief Executive Officer. "We continue to grow our core deposit base and build a diversified loan portfolio, while maintaining excellent asset quality. We refinanced a record number of mortgages year-to-date, however, recent interest rate increases have slowed refinancing activity significantly. Demand for our home equity line of credit remains strong." Warren also announced that two new directors have joined the boards of Washington Trust Bancorp, Inc. and The Washington Trust Company: Barry G. Hittner, of Counsel with the Providence, RI law firm of Cameron & Mittleman LLP; and Kathleen McKeough, Senior Vice President of Human Resources with GTECH Holdings Corporation. Warren commented, "Both Barry and Kathleen bring a wealth of talent and professional experience to Washington Trust and we're proud to have them as part of our team." Net income for the nine months ended September 30, 2003 amounted to $14.1 million, up 15 percent from the $12.3 million reported for the same period in 2002. On a diluted earnings per share basis, the Corporation earned $1.05 for the nine months ended September 30, 2003, up 9 percent from the 96 cents earned for the same period in 2002. Excluding the 2003 debt prepayment penalties of $649 thousand after tax (5 cents per diluted share) and the 2002 acquisition related charges of $417 thousand after tax (3 cents per diluted share) reported previously, earnings for the nine months ended September 30, 2003 were $14.7 million, or $1.10 per diluted share, as compared to $12.7 million, or 99 cents per diluted share, for the corresponding period in 2002. The Corporation's rates of return on average assets and equity for the nine months ended September 30, 2003 were 1.03% and 14.14%, respectively. Comparable amounts for 2002 were 1.08% and 14.33%. Net interest income for the third quarter of 2003 amounted to $11.7 million, compared to the $11.9 million earned in the third quarter of 2002. The decrease is attributable to a narrowed net interest margin, which declined from 3.16% in the third quarter of 2002 to 2.75% in the same period of 2003. The most significant reason for the net interest margin decline is the low level of market interest rates experienced in 2003, which has resulted in a high level of refinancing activity in mortgage loans and commercial loans as well as prepayments of mortgage-backed securities. Net interest income for the nine months ended September 30, 2003 amounted to $35.9 million, up 9 percent from the $32.9 million reported for the corresponding 2002 period. The year to date increase in net interest income was due to earning asset growth including assets acquired through the April 2002 acquisition of First Financial Corp. The net interest margin for the nine months ended September 30, 2003 amounted to 2.89%, down 29 basis points from the 3.18% reported for the same period a year ago. The net interest margin reflects a decline in yields on loans and securities offset somewhat by lower funding costs of interest-bearing deposits and Federal Home Loan Bank advances. Noninterest income, excluding net realized gains on securities, totaled $7.4 million for the quarter ended September 30, 2003, up 22 percent from the $6.1 million reported for the third quarter of 2002. For the nine months ended September 30, 2003, noninterest income amounted to $20.2 million, an increase of 23 percent from the comparable 2002 amount of $16.4 million. The growth in noninterest income was attributable to increases in gains on loan sales and service charges on deposits. For the first nine months of 2003, gains on loan sales amounted to $4.1 million, an increase of $2.5 million, or 167 percent, from the same period in 2002. As a result of the decline in interest rates during most of 2003, the Corporation experienced heavy residential mortgage activity, predominantly refinancing, which increased the amount of loans sold into the secondary market. The Corporation has recently experienced a decline in the level of residential mortgage origination activity and expects to realize a lower level of gains on loan sales in the fourth quarter of 2003. For the nine months ended September 30, 2003, service charges on deposit accounts amounted to $3.7 million, up $902 thousand, or 32 percent, from the corresponding period in 2002. Revenue from trust and investment management services continues to be the largest component of noninterest income. Trust and investment management income, which is closely tied to the performance of the financial markets, totaled $8.0 million for the nine months ended September 30, 2003, up $269 thousand, or 3 percent, from the corresponding period in 2002. Trust and investment assets under administration amounted to $1.618 billion at September 30, 2003, compared to $1.524 billion at December 31, 2002. For the third quarter of 2003, noninterest expenses totaled $12.2 million, up $861 thousand from the amount of noninterest expenses reported for third quarter of 2002. For the nine months ended September 30, 2003, noninterest expenses amounted to $35.1 million, up $3.7 million from the comparable 2002 amount (excluding the 2003 debt prepayment penalties and 2002 acquisition related charges) primarily due to normal growth and higher operating costs resulting from the acquisition of First Financial Corp. Salaries and benefits, the largest component of total noninterest expense, amounted to $20.1 million for the nine months ended September 30, 2003, compared to the $17.6 million reported for the first nine months of 2002. In the first nine months of 2003, total loans increased $123.2 million to $918.4 million at September 30, 2003. Total residential real estate loans amounted to $372.1 million at September 30, 2003, up $91.2 million, or 32 percent, from the balance at December 31, 2002. The Corporation purchased a total of $104.5 million of mainly fixed rate residential mortgages from other financial institutions. The purchases of loans were funded with Federal Home Loan advances and brokered certificates of deposit. Consumer loans increased $18.7 million, or 14 percent, from the balance at December 31, 2002, primarily due to growth in home equity lines. Commercial loans increased $13.3 million, or 3 percent, to $395.5 million at September 30, 2003. Total securities were $844.5 million at September 30, 2003, up $48.7 million from the December 31, 2002 balance. The increase in securities was primarily due to purchases of mortgage-backed securities, U.S. government agency securities and corporate bonds. Total deposits at September 30, 2003 amounted to $1.185 billion, up $74.4 million, or 7 percent, from the December 31, 2002 balance of $1.110 billion. Demand deposits rose $39.4 million, or 25 percent, in the first nine months of 2003 and totaled $197.0 million at September 30, 2003. Savings deposits increased $21.0 million from December 31, 2002 and amounted to $492.3 million at September 30, 2003. Time deposits amounted to $495.6 million at September 30, 2003, up $14.0 million from the December 31, 2002 balance of $481.6 million primarily due to increases in brokered certificates of deposit. Total brokered certificates of deposit amounted to $106.7 million at September 30, 2003, compared to $56.5 million at December 31, 2002. In the nine months ended September 30, 2003, Federal Home Loan Bank advances increased $110.6 million to $590.7 million at September 30, 2003. Asset quality continues to be strong, as measured by the level of nonperforming assets. Nonaccrual loans as a percentage of total loans at September 30, 2003 were .36%, compared to .53% at December 31, 2002. Similarly, nonperforming assets (nonaccrual loans and property acquired through foreclosure) as a percent of total assets at September 30, 2003 amounted to .17%, as compared to .24% at December 31, 2002. The Corporation's allowance for loan losses amounted to $15.8 million at September 30, 2003, compared to $15.5 million at December 31, 2002. Total shareholders' equity amounted to $136.0 million at September 30, 2003, up from $128.7 million at December 31, 2002. Book value per share as of September 30, 2003 and December 31, 2002 amounted to $10.34 and $9.87, respectively. Washington Trust Bancorp, Inc. Chairman and Chief Executive Officer, John C. Warren, and David V. Devault, Executive Vice President, Treasurer, and Chief Financial Officer will host a conference call on Friday, October 17, at 8:30 a.m. (Eastern Daylight Time) to discuss the Corporation's third quarter earnings. Access to the call is available in a listen-only mode on Washington Trust's web site, http://investorrelations.washtrust.com. A replay of the call will be posted in this same section of the web site shortly after conclusion of the call. Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company, a Rhode Island state-chartered bank founded in 1800. The Bank offers a full range of financial services, including trust and investment management, through its offices in Rhode Island and southeastern Connecticut. Washington Trust Bancorp, Inc.'s common stock trades on The Nasdaq Stock Market(R) under the symbol WASH. Investor information is available on the Corporation's web site: www.washtrust.com. Note: This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The Corporation's management uses these non-GAAP measures in its analysis of the Corporation's performance. These measures typically adjust GAAP performance measures to exclude the effects of charges and expenses related to the consummation of acquisitions and costs related to the integration of merged entities. These non-GAAP measures also may exclude other significant gains or losses that are unusual in nature. Because these items and their impact on the Corporation's performance are difficult to predict, management believes that presentations of financial measures excluding the impact of these items provide useful supplemental information that is essential to a proper understanding of the operating results of the Corporation's core businesses. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other Corporations. A quantitative reconciliation of the differences between the non-GAAP financial information discussed herein and the most directly comparable financial information calculated and presented in accordance with GAAP is contained in the Financial Summary statements attached to this press release. This report contains certain statements that may be considered "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Corporation's actual results, performance or achievements could differ materially from those projected in the forward-looking statements as a result, among other factors, of changes in general national or regional economic conditions, changes in interest rates, reductions in the market value of trust and investment assets under management, reductions in deposit levels necessitating increased borrowing to fund loans and investments, changes in the size and nature of the Corporation's competition, changes in loan default and charge-off rates and changes in the assumptions used in making such forward-looking statements. Washington Trust Bancorp, Inc. and Subsidiary FINANCIAL SUMMARY THREE MONTHS ENDED (Dollars and shares in thousands, SEP. 30, SEP. 30, JUN. 30, except per share amounts) 2003 2002 2003 OPERATING RESULTS Net interest income $11,727 $11,938 $12,282 Provision for loan losses 100 100 160 Net realized (losses) gains on securities - (52) 400 Other noninterest income 7,447 6,081 6,955 Noninterest expenses 12,190 11,329 12,848 Income tax expense 2,144 2,027 2,055 Net income 4,740 4,511 4,574 PER SHARE Basic earnings $0.36 $0.35 $0.35 Diluted earnings $0.35 $0.34 $0.34 Dividends declared $0.16 $0.14 $0.15 SHARES OUTSTANDING Weighted Average: Basic 13,133.8 13,032.9 13,089.4 Diluted 13,486.8 13,254.3 13,304.9 AVERAGE BALANCE SHEET Federal funds sold and other short-term investments $18,451 $16,065 $15,447 Taxable debt securities 787,056 705,165 784,166 Nontaxable debt securities 15,964 19,557 16,137 Corporate stocks and Federal Home Loan Bank stock 51,859 43,888 51,795 Loans: Commercial 393,224 375,379 395,967 Residential 315,193 247,364 296,484 Consumer 146,834 124,951 137,929 Total loans 855,251 747,694 830,380 Earning assets 1,728,581 1,532,369 1,697,925 Total assets 1,850,939 1,649,761 1,819,463 Deposits: Demand 193,908 168,209 166,156 Savings 491,690 446,075 472,358 Time 477,485 479,570 479,266 Total deposits 1,163,083 1,093,854 1,117,780 Federal Home Loan Bank advances 537,486 412,367 549,161 Shareholders' equity 132,559 124,741 134,814 KEY RATIOS Return on average assets 1.02% 1.09% 1.01% Return on average equity 14.30% 14.47% 13.57% Interest rate spread (taxable equivalent basis) 2.45% 2.76% 2.67% Net interest margin (taxable equivalent basis) 2.75% 3.16% 2.96% ALLOWANCE FOR LOAN LOSSES Balance at beginning of period $15,742 $15,466 $15,495 Allowance on acquired loans - - - Provision charged to earnings 100 100 160 Net (charge-offs) recoveries (29) 94 87 Balance at end of period $15,813 $15,660 $15,742 Washington Trust Bancorp, Inc. and Subsidiary FINANCIAL SUMMARY THREE MONTHS ENDED (Dollars and shares in thousands, SEP. 30, SEP. 30, JUN. 30, except per share amounts) 2003 2002 2003 EARNINGS AND RATIOS EXCLUDING SPECIAL ITEMS (Non GAAP Financial Information): Noninterest expenses (1) $12,190 $11,329 $11,907 Return on average assets (2) 1.02% 1.09% 1.15% Return on average equity (2) 14.30% 14.47% 15.50% Reconciliation Table - Non GAAP Financial Information Net income, including special items $4,740 $4,511 $4,574 Add back special items, net of tax: Debt prepayment penalties - - 649 Acquisition costs - - - Net income, excluding special items $4,740 $4,511 $5,223 Basic earnings per share $0.36 $0.35 $0.35 Effects of special items, net of tax - - 0.05 Basic earnings per share, excluding special items $0.36 $0.35 $0.40 Diluted earnings per share $0.35 $0.34 $0.34 Effects of special items, net of tax - - 0.05 Diluted earnings per share, excluding special items $0.35 $0.34 $0.39 Return on average assets 1.02% 1.09% 1.01% Effects of special items, net of tax - - 0.14% Return on average assets, excluding special items 1.02% 1.09% 1.15% Return on average equity 14.30% 14.47% 13.57% Effects of special items, net of tax - - 1.93% Return on average equity, excluding special items 14.30% 14.47% 15.50% (1) Excludes second quarter 2003 Federal Home Loan Bank debt prepayment penalties of $941 thousand (pretax) and second quarter 2002 First Financial Corp. acquisition costs of $605 thousand (pretax). (2) Excludes second quarter 2003 Federal Home Loan Bank debt prepayment penalties of $649 thousand after income taxes and second quarter 2002 First Financial Corp. acquisition costs of $417 thousand after income taxes. Washington Trust Bancorp, Inc. and Subsidiary FINANCIAL SUMMARY NINE MONTHS ENDED (Dollars and shares in thousands, SEP. 30, SEP. 30, except per share amounts) 2003 2002 OPERATING RESULTS Net interest income $35,938 $32,943 Provision for loan losses 360 300 Net realized gains on securities 630 620 Other noninterest income 20,205 16,422 Noninterest expenses 36,016 31,967 Income tax expense 6,333 5,439 Net income 14,064 12,279 PER SHARE Basic earnings $1.07 $0.97 Diluted earnings $1.05 $0.96 Dividends declared $0.46 $0.42 SHARES OUTSTANDING Weighted Average: Basic 13,094.5 12,635.9 Diluted 13,341.8 12,833.7 AVERAGE BALANCE SHEET Federal funds sold and other short-term investments $16,293 $14,188 Taxable debt securities 778,815 654,018 Nontaxable debt securities 16,515 19,790 Corporate stocks and Federal Home Loan Bank stock 50,573 43,214 Loans: Commercial 392,926 328,408 Residential 301,402 240,858 Consumer 139,321 117,905 Total loans 833,649 687,171 Earning assets 1,695,845 1,418,381 Total assets 1,816,512 1,521,242 Deposits: Demand 172,141 144,965 Savings 474,725 377,464 Time 479,490 443,690 Total deposits 1,126,356 966,119 Federal Home Loan Bank advances 539,799 424,828 Shareholders' equity 132,634 114,216 KEY RATIOS Return on average assets 1.03% 1.08% Return on average equity 14.14% 14.33% Interest rate spread (taxable equivalent basis) 2.59% 2.76% Net interest margin (taxable equivalent basis) 2.89% 3.18% ALLOWANCE FOR LOAN LOSSES Balance at beginning of period $15,487 $13,593 Allowance on acquired loans - 1,829 Provision charged to earnings 360 300 Net (charge-offs) recoveries (34) (62) Balance at end of period $15,813 $15,660 Washington Trust Bancorp, Inc. and Subsidiary FINANCIAL SUMMARY NINE MONTHS ENDED (Dollars and shares in thousands, SEP. 30, SEP. 30, except per share amounts) 2003 2002 EARNINGS AND RATIOS EXCLUDING SPECIAL ITEMS (Non GAAP Financial Information): Noninterest expenses (1) $35,075 $31,362 Return on average assets (2) 1.08% 1.11% Return on average equity (2) 14.79% 14.82% Reconciliation Table - Non GAAP Financial Information Net income, including special items $14,064 $12,279 Add back special items, net of tax: Debt prepayment penalties 649 - Acquisition costs - 417 Net income, excluding special items $14,713 $12,696 Basic earnings per share $1.07 $0.97 Effects of special items, net of tax 0.05 0.03 Basic earnings per share, excluding special items $1.12 $1.00 Diluted earnings per share $1.05 $0.96 Effects of special items, net of tax 0.05 0.03 Diluted earnings per share, excluding special items $1.10 $0.99 Return on average assets 1.03% 1.08% Effects of special items, net of tax 0.05% 0.03% Return on average assets, excluding special items 1.08% 1.11% Return on average equity 14.14% 14.33% Effects of special items, net of tax 0.65% 0.49% Return on average equity, excluding special items 14.79% 14.82% (1) Excludes second quarter 2003 Federal Home Loan Bank debt prepayment penalties of $941 thousand (pretax) and second quarter 2002 First Financial Corp. acquisition costs of $605 thousand (pretax). (2) Excludes second quarter 2003 Federal Home Loan Bank debt prepayment penalties of $649 thousand after income taxes and second quarter 2002 First Financial Corp. acquisition costs of $417 thousand after income taxes. Washington Trust Bancorp, Inc. and Subsidiary FINANCIAL SUMMARY (Dollars and shares in thousands, SEP. 30, SEP. 30, DEC. 31, except per share amounts) 2003 2002 2002 PERIOD END BALANCE SHEET Assets $1,931,190 $1,684,582 $1,745,661 Total securities 844,490 775,255 795,833 Loans: Commercial 395,511 379,061 382,169 Residential 372,105 248,178 280,886 Consumer 150,739 129,739 132,071 Total loans 918,355 756,978 795,126 Deposits: Demand 196,952 175,245 157,539 Savings 492,322 454,437 471,354 Time 495,594 479,743 481,600 Total deposits 1,184,868 1,109,425 1,110,493 Federal Home Loan Bank advances 590,675 425,725 480,080 Shareholders' equity 136,006 125,335 128,721 CAPITAL RATIOS Tier 1 risk-based capital 10.00% 10.20% 10.13% Total risk-based capital 11.49% 11.58% 11.55% Tier 1 leverage ratio 5.72% 5.68% 5.63% SHARE INFORMATION Shares outstanding at end of period 13,153.7 13,035.0 13,042.4 Book value per share $10.34 $9.62 $9.87 Tangible book value per share $8.46 $7.64 $7.93 Market value per share $24.01 $19.74 $19.53 CREDIT QUALITY Nonaccrual loans $3,345 $4,292 $4,177 Other real estate owned, net 23 12 86 Nonperforming assets to total assets 0.17% 0.26% 0.24% Nonaccrual loans to total loans 0.36% 0.57% 0.53% Allowance for loan losses to nonaccrual loans 472.74% 364.86% 370.78% Allowance for loan losses to total loans 1.72% 2.07% 1.95% ASSETS UNDER MANAGEMENT Market value $1,618,239 $1,548,975 $1,524,126 Washington Trust Bancorp, Inc. and Subsidiary CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (Unaudited) Sept. 30, Dec. 31, 2003 2002 Assets: Cash and due from banks $42,858 $39,298 Federal funds sold and other short-term investments 12,600 11,750 Mortgage loans held for sale 5,740 4,566 Securities: Available for sale, at fair value 658,732 553,556 Held to maturity, at cost; fair value $190,429 in 2003 and $250,446 in 2002 185,758 242,277 Total securities 844,490 795,833 Federal Home Loan Bank stock, at cost 29,628 24,582 Loans 918,355 795,126 Less allowance for loan losses 15,813 15,487 Net loans 902,542 779,639 Premises and equipment, net 25,145 24,415 Accrued interest receivable 7,969 7,773 Goodwill and other intangibles 24,724 25,260 Other assets 35,494 32,545 Total assets $1,931,190 $1,745,661 Liabilities: Deposits: Demand $196,952 $157,539 Savings 492,322 471,354 Time 495,594 481,600 Total deposits 1,184,868 1,110,493 Dividends payable 2,105 1,825 Federal Home Loan Bank advances 590,675 480,080 Other borrowings 1,859 9,183 Accrued expenses and other liabilities 15,677 15,359 Total liabilities 1,795,184 1,616,940 Shareholders' Equity: Common stock of $.0625 par value; authorized 30 million shares; issued 13,159,959 shares in 2003 and 13,086,795 shares in 2002 822 818 Paid-in capital 29,495 28,767 Retained earnings 98,745 90,717 Unamortized employee restricted stock (28) (24) Accumulated other comprehensive income 7,095 9,294 Treasury stock, at cost; 6,281 shares in 2003 and 44,361 in 2002 (123) (851) Total shareholders' equity 136,006 128,721 Total liabilities and shareholders' equity $1,931,190 $1,745,661 Washington Trust Bancorp, Inc. and Subsidiary CONSOLIDATED STATEMENTS OF INCOME (Dollars and shares in thousands, except per share amounts) (Unaudited) Three Months Nine Months Periods ended September 30, 2003 2002 2003 2002 Interest income: Interest and fees on loans $12,568 $12,958 $38,067 $36,762 Interest on securities 7,592 9,342 24,480 26,837 Dividends on corporate stock and Federal Home Loan Bank stock 528 500 1,546 1,480 Interest on federal funds sold and other short-term investments 35 63 111 171 Total interest income 20,723 22,863 64,204 65,250 Interest expense: Savings deposits 724 1,773 2,554 3,926 Time deposits 3,740 4,161 11,473 12,624 Federal Home Loan Bank advances 4,514 4,963 14,184 15,692 Other 18 28 55 65 Total interest expense 8,996 10,925 28,266 32,307 Net interest income 11,727 11,938 35,938 32,943 Provision for loan losses 100 100 360 300 Net interest income after provision for loan losses 11,627 11,838 35,578 32,643 Noninterest income: Trust and investment management 2,692 2,468 7,969 7,700 Service charges on deposit accounts 1,242 986 3,690 2,788 Net gains on loan sales 1,383 608 4,062 1,522 Merchant processing fees 1,412 1,221 2,731 2,443 Income from bank-owned life insurance 298 291 845 864 Net realized (losses) gains on securities - (52) 630 620 Other income 420 507 908 1,105 Total noninterest income 7,447 6,029 20,835 17,042 Noninterest expense: Salaries and employee benefits 6,974 6,047 20,127 17,630 Net occupancy 671 675 2,169 1,970 Equipment 830 887 2,504 2,470 Merchant processing costs 1,139 965 2,184 1,936 Legal, audit and professional fees 394 815 990 1,209 Advertising and promotion 261 271 1,073 947 Outsourced services 328 244 1,024 772 Debt prepayment penalties - - 941 - Amortization of intangibles 180 220 539 441 Acquisition related expenses - - - 605 Other 1,413 1,205 4,465 3,987 Total noninterest expense 12,190 11,329 36,016 31,967 Income before income taxes 6,884 6,538 20,397 17,718 Income tax expense 2,144 2,027 6,333 5,439 Net income $4,740 $4,511 $14,064 $12,279 Weighted average shares outstanding - basic 13,133.8 13,032.9 13,094.5 12,635.9 Weighted average shares outstanding - diluted 13,486.8 13,254.3 13,341.8 12,833.7 Per share information: Basic earnings per share $.36 $.35 $1.07 $.97 Diluted earnings per share $.35 $.34 $1.05 $.96 Cash dividends declared per share $.16 $.14 $.46 $.42 CONTACT: Washington Trust Bancorp, Inc. Elizabeth B. Eckel, 401/348-1309 ebeckel@washtrust.com -----END PRIVACY-ENHANCED MESSAGE-----