Washington Trust Bancorp Inc. Delivers Strong Q3 2026 Performance: Solid Earnings, Margin Expansion, and Prudent Growth
Washington Trust Bancorp Inc., a leading community bank in Rhode Island and Southeastern Massachusetts, has reported strong financial results for the third quarter of 2026, marking another successful period of growth and earnings.
In its Q3 2026 conference call transcript, Washington Trust's Chairman and Chief Executive Officer, Ned Handy, highlighted the company's continued expansion into new markets, including two new branches set to open in Rhode Island over the coming months. The company is committed to providing trusted advice, comprehensive solutions, convenience, and personalized service to individuals, families, and businesses in these markets.
Washington Trust's third quarter net income was $19.4 million or $1.01 per share, up by $3.4 million or $0.18 from the preceding quarter. Pre-provision pre-tax net revenue (PPNR) was up 20% from Q2 and up by 26% year-over-year, reflecting the company's continued growth momentum.
Net interest income was a significant highlight of the quarter, totaling $44.7 million, up by 7% from Q2 and up by 15% year-over-year. The margin expansion was driven by a strong loan portfolio, with total commercial loans increasing by $62 million or 2.3%, driven by growth in the CRE (Commercial Real Estate) portfolio.
Non-interest income also showed encouraging growth, totaling $9.5 million, up by $1.6 million or 9% compared to Q2 and up by 15% year-over-year. Wealth management revenues were down by 1% compared to Q2 but up by 7% year-over-year, while mortgage banking revenues totaled $3.2 million, down by 9% from the second quarter and down by 10% year-over-year, reflecting a decrease in the mortgage pipeline as well as rising market interest rates.
Loan-related derivative income was a notable bright spot, up by $924,000, while income from bank-owned life insurance was also up largely due to the recognition of a gain of $954,000 in the third quarter. Non-interest expense totaled $38.8 million in the third quarter, up by $200,000 or half a percent.
Washington Trust's balance sheet also showed positive trends, with total loans up by 1% from June 30 and deposits up by $77 million or 1% from the end of the second quarter and up by $213 million or 4% year-over-year. Total equity amounted to $531 million, down by $23 million from the end of the second quarter.
Overall, Washington Trust Bancorp Inc.'s Q3 2026 performance demonstrates the company's ability to deliver strong earnings, margin expansion, and prudent growth while maintaining a solid capital position. The company's commitment to expanding its presence in new markets and providing exceptional service to customers is likely to drive continued success in the future.
