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Sep 30
Washington Trust Q3 2025 Earnings Report
Washington Trust reported its third quarter 2025 results, showing a decrease in net income and diluted EPS compared to the previous quarter, despite growth in net interest income, wealth management, and mortgage banking revenues.
Key Takeaways
Washington Trust Bancorp, Inc. reported third quarter 2025 net income of $10.8 million, or $0.56 per diluted share, a decrease from $13.2 million, or $0.68 per diluted share, in the second quarter of 2025. The company expanded its net interest income and margin, grew wealth management and mortgage banking revenues, and achieved strong in-market deposit growth. However, a significant increase in the provision for credit losses, primarily due to charge-offs on two commercial loan relationships totaling $11.3 million, impacted profitability.
Net income for Q3 2025 was $10.8 million, down from $13.2 million in Q2 2025.
Diluted EPS was $0.56, a decrease from $0.68 in the prior quarter.
Net interest margin expanded to 2.40%, up 4 basis points from the previous quarter and 55 basis points year-over-year.
A provision for credit losses on loans of $7.0 million was recognized, significantly higher than $650 thousand in Q2 2025, mainly due to charge-offs on two commercial loan relationships.
Washington Trust
Washington Trust
Washington Trust Revenue by Segment
Washington Trust Revenue by Geographic Location
Revenue by Segment
Wealth Management Revenues Revenue
CapyFin.comMortgage Banking Revenues Revenue
CapyFin.comRevenue by Geographic Location
Connecticut Commercial Real Estate Revenue
CapyFin.comMassachusetts Commercial Real Estate Revenue
CapyFin.comRhode Island Commercial Real Estate Revenue
CapyFin.comAll Other States Commercial Real Estate Revenue
CapyFin.comMassachusetts Residential Real Estate Revenue
CapyFin.comRhode Island Residential Real Estate Revenue
CapyFin.comConnecticut Residential Real Estate Revenue
CapyFin.comAll Other States Residential Real Estate Revenue
CapyFin.com Forward Guidance
Washington Trust expects its full-year 2025 effective tax rate to be approximately 22.5%. The company is confident in its current portfolio quality and expects to continue its long track record of strong credit performance, despite recent charge-offs. The remaining carrying value of $1.0 million from a charged-off commercial loan is expected to be collected in the fourth quarter of 2025.
Positive Outlook
- Expected full-year 2025 effective tax rate of approximately 22.5%.
- Confidence in current portfolio quality and continued strong credit performance.
- Expectation to collect the remaining $1.0 million from a charged-off commercial loan in Q4 2025.
- Strategic investments made to drive future growth, including a new senior executive for commercial banking.
- Acquisition of Lighthouse Financial Management, LLC client accounts, adding approximately $195 million of managed assets.
Challenges Ahead
- No specific negative forward guidance was provided in the report, beyond the impact of past credit losses.
- Potential for future credit losses to be higher than currently expected due to changes in economic assumptions or adverse economic developments.
- Ongoing volatility in national and international financial markets could impact future performance.
- Reductions in the market value or outflows of wealth management AUA could negatively affect revenue.
- Changes in interest rates or volatility could impact net interest income and margin.