After several years of momentum with increased earnings and expansion, Westerly-based Washington Trust Bancorp Inc. hit a $2.8 million pothole in the first quarter of 2013, but helped balance that dip with solid growth in commercial loans and strong mortgage production in a three-state region.
Washington Trust Bancorp, parent company of The Washington Trust Co., reported net income of $7.4 million for the first quarter of 2013, or 45 cents per diluted share, a decline of 12.1 percent from the first three months of 2012. The bank had first quarter 2012 net income of $8.4 million, or 51 cents per diluted share. Fourth quarter 2012 net income was $9 million, or 55 cents per diluted share.
The bank reported an increase of $25.5 million, or 2 percent, in its commercial loan portfolio, which helped offset a decline in interest-earning assets from a year earlier. As a result, however, total interest and noninterest income amounted to $44.7 million, a decline of 0.5 percent.
“We’ve been very successful in penetrating the commercial market in Connecticut, Massachusetts and Rhode Island,” Washington Trust Chairman, President and CEO Joseph J. MarcAurele said in a review of first quarter 2013 earnings.
Despite that success, the bank could not escape some of the lingering effects of the Great Recession, as it took a $2.8 million impairment charge on a collateralized debt obligation that was liquidated. The net after-tax impact was $1.9 million or 11 cents per diluted share.
“We were affected this quarter by one specific write-down of a nonrecurring nature with one security within our securities portfolio,” said MarcAurele. “The write-down we experienced this quarter was not the result of core earnings changes. Net of that event, we would have made more money this quarter than we made last quarter.