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By Michael Souza
PBN Staff Writer
WESTERLY – Washington Trust Bancorp Inc., the parent company of The Washington Trust Co., reported net income of $7.8 million for the fourth quarter, a record for the period, compared with $7.2 million in the 2010 fourth quarter and third-quarter net income of $7.6 million.
The bank reported earnings per diluted share of 47 cents for the period, compared 44 cents in the year-earlier quarter and 46 cents in the third quarter.
For 2011, net income totaled $29.7 million, or $1.82 per diluted share, compared with $24.1 million, or $1.49 per diluted share, for 2010.
“Washington Trust had a strong fourth-quarter performance, contributing to record net income for the fourth quarter and for the year 2011,” Joseph J. MarcAurele, Washington Trust chairman, president and CEO said in a news release. “We surpassed $3 billion in assets for the first time in the corporation’s 211-year history, and saw growth along all business lines. Washington Trust’s continued profitability in these challenging times is a testament to our corporation’s solid foundation and reputation.”
The bank’s performance metrics also improved on the year, as the returns on average equity and average assets for 2011 were 10.61 percent and 1.02 percent, respectively, compared with 9.09 percent and 0.82 percent, respectively, for 2010. Net interest margin increased to 3.22 percent for the quarter, an increase from 3.05 percent at the end of 2010.
Non-interest income played an important role in the bank’s performance, as it increased 10.6 percent to $14.8 million in the fourth quarter compared with a year earlier and 8.9 percent on the year to $52.8 million, mostly because of growth in mortgage banking revenue. Net gains on loan sales and commissions on loans increased $1.9 million compared to the third quarter. The increase reflects a high volume of residential mortgage loan refinancing and sales activity as consumers continue to take advantage of low interest rates.
Total nonperforming assets, however, increased to $24.8 million by year’s end as opposed to $23.0 million in 2010, indicating a still-struggling economy.
From the third to the fourth quarter, total loans increased $59 million, led by growth in the commercial loan portfolio. “We feel very good about the quarter and the year-end figures,” MarcAurele said in a phone interview with Providence Business News. “We finished the year very strong, particularly on the loan growth side. We’re more optimistic than we’ve felt in the last few years.”