Wilmington (NYSE:WL)
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Wilmington Trust Corporation (NYSE:WL) reported net income of $22.9
million for the 2008 third quarter, or $0.34 per share (on a diluted
basis). Third quarter results were reduced by a $19.7 million securities
loss on perpetual preferred stocks issued by the Federal National
Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage
Corporation (Freddie Mac). On an after-tax basis, this charge reduced
third quarter net income by $12.5 million, or $0.19 per share (on a
diluted basis). The company initially disclosed this loss in a filing
with the Securities and Exchange Commission on September 11, 2008.
On an operating basis (excluding the securities loss), net income for
the 2008 third quarter was $35.4 million, or $0.53 per share (on a
diluted basis). Management believes that operating results present a
more relevant measure of ongoing business trends and offer a better
basis of comparison with prior periods. The financial statements in this
report include a reconciliation of results that include securities
losses and impairment charges (reported results) with those that do not
(operating results).
“In the face of extraordinary market
conditions, we continued to focus on our clients, our business plan, and
opportunities for growth, and these efforts were evident in all three of
our businesses,” said Ted T. Cecala,
Wilmington Trust chairman and chief executive officer. “Compared
to the year-ago third quarter, advisory revenue was up 14%, and loan
balances were 15% higher, on average. In addition, the net interest
margin stabilized, and credit quality remained in line with our
historical experience.”
On October 16, 2008, the Board of Directors declared a regular quarterly
cash dividend of $0.345 per share. This amount reflects the 3% increase
the Board approved in April 2008, which marked the 27th consecutive year
that Wilmington Trust has raised its cash dividend. The quarterly
dividend will be paid on November 17, 2008, to stockholders of record on
November 3, 2008.
Significant factors in 2008 third
quarter results
On average, $373.1 million of loans were added during the 2008 third
quarter, and loan balances were $9.46 billion.
Loan growth, plus stability in the net interest margin, generated net
interest income that was 7% higher than for the 2008 second quarter.
Net charge-offs were lower than for the 2008 second quarter, but the
combination of loan growth and higher levels of nonperforming loans
caused an increase in the provision for loan losses.
Corporate Client Services (CCS) revenue was 46% higher than for the
year-ago third quarter, with all components of the business
contributing to the growth.
Wealth Advisory Services (WAS) revenue was 2% higher than for the
year-ago third quarter, and down slightly from the 2008 second
quarter, as financial market volatility reduced trust and investment
advisory revenue.
Affiliate money manager Roxbury Capital Management (RCM) returned to
profitability.
On a combined basis, advisory fees from CCS, WAS, and the affiliate
money managers generated 52% of total net interest and noninterest
income for the quarter (excluding securities losses and after
amortization and the provision for loan losses), and 30% of pre-tax
operating net income.
Operating expenses and the number of staff members were higher than
for the year-ago third quarter, mainly because the year-ago figures
did not reflect the acquisition of AST Capital Trust Company (AST),
which added approximately 179 staff members in Phoenix, Arizona, and
Wilmington, Delaware.
Compared to the 2008 second quarter, operating expenses were 2%
higher. Most of this increase was in salaries and primarily reflected
the additions of:
WAS staff in the family office practice and Boston office.
CCS capital markets and retirement services staff.
Regional Banking staff in the Maryland, New Jersey, and
Pennsylvania markets.
All regulatory capital ratios continued to exceed the amounts required
by the Federal Reserve Board to be considered a well-capitalized
institution.
Corporate Client Services
Capital markets revenue was 17% higher than for the year-ago third
quarter, due to demand for services that support tender option bonds,
repackaged corporate and municipal debt, and corporate defaults and
bankruptcies. This activity was not strong enough to offset the absence
of capital markets transactions in the 2008 third quarter, which is why
revenue from these services was slightly lower on a linked-quarter basis.
Retirement services revenue reflected the April 2008 acquisition of AST,
which assumed the Wilmington Trust name in August 2008. The 2008 third
quarter marked the first full quarter of revenue and expenses from this
acquisition.
Continued weakness in the capital markets overall also affected entity
management revenue, which was up 4% from the year-ago third quarter, but
11% lower than for the 2008 second quarter.
Demand remained high for CCS investment and cash management services.
Revenue from these services was up 17% from the year-ago third quarter
and 3% from the 2008 second quarter.
The CCS business produced 14% of the company’s
total pre-tax operating net income for the 2008 third quarter.
Wealth Advisory Services
Significant volatility in the financial markets masked new business
development in WAS. Trust and investment advisory revenue was 3% lower
than for the year-ago third quarter, and 2% lower than for the 2008
second quarter. In comparison, at September 30, 2008, the Standard & Poor’s
500 Index was 24% lower than at September 30, 2007, and 9% lower than at
June 30, 2008. Management uses the S&P 500 as a benchmark for comparison
because its composition mirrors, to a large extent, the mix of equities
in client portfolios.
Revenue from planning and other services was 9% higher than for the
year-ago third quarter, primarily reflecting demand for family office
services. Compared to the 2008 second quarter, planning revenue was
unchanged, as new business development was offset by lower revenue from
tax services, which typically are highest in the second quarter of each
year.
Mutual fund fees were 28% higher than for the year-ago third quarter,
and 6% higher than for the 2008 second quarter. The increase resulted
mainly from asset inflows in the Wilmington U.S. Government Money Market
Fund and the Wilmington Tax-Exempt Money Market Fund, as some clients
opted to place funds in less volatile instruments than equities.
Most of Wilmington Trust’s mutual funds are
money market funds. Three of these funds – the
Wilmington Prime Money Market Fund, the Wilmington U.S. Government Money
Market Fund, and the Wilmington Tax-Exempt Money Market Fund –
have applied to participate in the new insurance protection available
under the U.S. Treasury Department’s
Temporary Money Market Guarantee Program. These funds are managed to
maintain a stable $1.00 share price. While none has ever slipped from
that level, the company’s participation in
the voluntary Treasury Department program is designed to offer mutual
fund shareholders additional assurance in light of the extraordinary
market conditions that prompted the creation of the program. More
information about this is available at www.wilmingtontrust.com
under Media/Press Releases/October 3.
Regional Banking
The Regional Banking business continued to benefit from economic
conditions in the mid-Atlantic region, where unemployment rates
remained below the U.S. average. Delaware’s
unemployment rate for August 2008 (the most recent data available) was
4.9%, compared with the U.S. average of 6.1%. The August unemployment
rate was 5.8% for Pennsylvania, 5.9% for New Jersey, and 4.5% for
Maryland.
Loan balances, on average, were $9.46 billion. This was 15% higher
than for the year-ago third quarter, and 4% higher than for the 2008
second quarter.
At period-end, loan balances were $9.59 billion, up 15% year-over-year
and up 3% from the 2008 second quarter. The Delaware market accounted
for approximately 54% of total period-end loans; the Pennsylvania
market accounted for approximately 24%; and the Maryland market
accounted for approximately 10%.
Commercial loan balances were $6.55 billion, on average, for the 2008
third quarter. This was 17% higher than for the year-ago third
quarter, and 5% higher than for the 2008 second quarter. At
period-end, commercial loan balances were $6.67 billion. The Delaware
market accounted for approximately 55% of commercial loans at
period-end; the Pennsylvania market accounted for approximately 27%;
and the Maryland market accounted for approximately 9%.
The largest linked-quarter increase in loan balances (on a
dollar-amount basis) was in commercial and industrial loans (recorded
as commercial, financial, and agricultural loans). These loans were to
clients mainly in the Delaware and Pennsylvania markets, and
represented a variety of industry sectors.
The increase in commercial mortgages reflected business from clients
who, until recent changes in the credit markets, had found more
favorable financing terms with specialty mortgage lenders.
Consumer loan balances were $1.78 billion, on average, up 16% from the
year-ago third quarter and 3% from the 2008 second quarter. Most of
this growth was in home equity lines of credit and indirect loans.
Consumer loans, on average (in millions)
2008 Q3
2008 Q2
2007 Q3
Home equity lines of credit
$
349.7
$
327.2
$
298.2
Indirect loans
952.3
889.6
715.8
Credit card loans
67.3
67.4
64.8
Other consumer loans1
411.0
445.6
454.2
Total consumer loans
$
1,780.3
$
1,729.8
$
1,533.0
1Includes home equity loans, installment
loans, and other types of loans to individuals.
On average, core deposits were up 8% from the year-ago third quarter,
mainly due to increases in savings deposits generated by WTDirect, the
company’s online distribution channel.
Compared to the 2008 second quarter, core deposits were slightly
higher.
Credit quality in the 2008 third
quarter
Compared to the 2008 second quarter, net charge-offs decreased, but
nonperforming asset levels increased. The combination of this increase
and loan growth, plus risk rating downgrades, caused the provision and
reserve for loan losses to increase. The percentage of loans with pass
ratings in the internal risk rating analysis remained at 96%.
The provision for loan losses was $19.6 million, up from $18.5 million
for the 2008 second quarter. The reserve for loan losses increased to
$122.2 million from $113.1 million at June 30, 2008. The loan loss
reserve ratio increased 5 basis points from the 2008 second quarter to
1.27%.
Nonaccruing loans were $28.5 million higher than for the 2008 second
quarter. Two client relationships accounted for most of this increase.
These relationships were with commercial real estate construction
clients with single-family housing projects in central and southern
Delaware.
Other real estate owned decreased $2.2 million from June 30, 2008, due
to the successful disposition of properties in a luxury home development
in Montgomery County, Pennsylvania.
Loans past due 90 days or more were $6.9 million higher than for the
2008 second quarter. Approximately $4.9 million of this amount was for a
commercial construction/real estate loan to a Maryland-based client.
Total net charge-offs for the 2008 third quarter were $10.5 million,
down from $11.8 million for the 2008 second quarter, mainly because
there were no commercial real estate/construction charge-offs. There was
a $2.0 million increase in commercial, financial, and agricultural loan
charge-offs. This increase was associated mainly with one previously
nonaccruing loan to a sports equipment retailer.
The net charge-off ratio for the second quarter was 11 basis points,
down from 13 basis points for the 2008 second quarter. The year-to-date
net charge-off ratio was 30 basis points.
Commercial loan charge-offs are inherently unpredictable, mainly because:
Negotiations with commercial borrowers can affect the timing and
extent of charge-offs, or avert them altogether.
Associated legal proceedings can also affect the timing and extent of
charge-offs.
On a percentage basis, the composition of the loan portfolio remained
relatively unchanged. Additional disclosures about credit quality appear
in the financial statement section of this release.
Net interest margin
The net interest margin was 3.27%, which was 10 basis points higher than
for the 2008 second quarter, but 46 basis points lower than for the
year-ago third quarter. These changes reflected the company’s
asset-sensitivity and the market interest rate environment.
Between late September 2007 and May 2008, the Federal Open Market
Committee (FOMC) reduced rates seven times for a total of 325 basis
points. With most of the company’s floating
rate loans repricing within 30 days of a rate change, loan yields began
to reflect the downward pricing adjustments in the 2007 fourth quarter
and continued in the first half of 2008.
Most of the corresponding decreases in funding costs did not begin until
the 2008 first quarter, however, because funding costs typically take 90
to 120 days to reprice. Funding costs continued to lag loan repricing
for most of the second quarter. In the third quarter, as market interest
rates remained stable, the disparity between the repricing of loans and
the repricing of funding costs narrowed substantially.
The FOMC’s 50-basis-point rate reduction on
October 8 will compress the margin. It is difficult to forecast
accurately how other aspects of current dislocation within the credit
markets, especially the disparity between the federal funds target rate
and the 30-day London interbank offered rate (Libor), also might affect
the margin. At September 30, 2008, the federal funds target rate was
2.00%, while the 30-day Libor was 3.93%.
The pricing on approximately 40% of Wilmington Trust’s
commercial loans is tied to the 30-day Libor. In the near term, upward
repricing of these loans will offset some of the margin compression that
will be caused by the recent FOMC rate reduction. Eventually, however,
higher Libor rates will be a factor in funding costs, which will cause
the margin to narrow. The exact path and speed with which Libor adjusts
will affect the extent and timing of the effect on the margin.
Should term Libor rates return to their historic relationship with
federal fund rates, management expects approximately 7 basis points of
margin compression over a 12-month period after all loan and funding
repricing has occurred. More information about asset/liability matching
and funding sources is in the supplemental information statement in this
release.
Common equity offering
On September 22, 2008, Wilmington Trust initiated an at-the-market
offering of its common stock. This offering is described in a base
prospectus and prospectus supplement filed with the Securities and
Exchange Commission on September 22, 2008. These documents are available
at www.wilmingtontrust.com
under Investor Relations/SEC Filings.
Under this offering, Wilmington Trust may issue shares for up to an
aggregate sales price of $150 million. The proceeds of this offering
will be used for general corporate purposes.
Sales of these shares will occur through ordinary brokers’
transactions on the New York Stock Exchange or otherwise at market
prices prevailing at the time of the sale, at prices related to the
prevailing market prices, at negotiated prices, with Merrill Lynch
acting as sales agent. Wilmington Trust and Merrill Lynch will determine
jointly, as often as daily, how many shares to sell under this offering
and at what price to sell them. Shares will be available under this
offering until the aggregate sales price of $150 million is reached, or
until Wilmington Trust or Merrill Lynch decide to terminate it.
During the 2008 third quarter, 695,900 shares were issued under this
offering. Gross proceeds were $20.8 million, with an average sale price
of $29.95 per share. Net of commissions, proceeds totaled $20.4 million,
with an average sale price of $29.35 per share.
Investment securities portfolio
Wilmington Trust maintains an investment securities portfolio for its
own account to generate cash flow, to help manage interest rate risk,
and to provide collateral for deposits and other liabilities. There are
no client funds in this portfolio.
At September 30, 2008, the value of the investments in this portfolio
was $1.46 billion, which was 4% lower than at June 30, 2008. Two types
of investments accounted for most of this decrease:
Perpetual preferred stock issued by Fannie Mae and Freddie Mac, which
is included in the preferred stock recorded on the balance sheet.
Trust-preferred securities (TruPS), which are included in the amount
on the balance sheet recorded as other securities.
Fannie Mae and Freddie Mac securities
loss
On September 7, 2008, the U.S. government placed Fannie Mae and Freddie
Mac into conservatorship. This action triggered impairment testing under
U.S. generally accepted accounting principles (GAAP). As a result,
management determined that the value of Wilmington Trust’s
investments in perpetual preferred stock issued by Fannie Mae and
Freddie Mac had declined from $21.1 million at June 30, 2008, to $1.4
million as of September 10, 2008.
Management further determined that this decline, or impairment, was
other-than-temporary under GAAP. The $19.7 million decrease was recorded
as a securities loss for the 2008 third quarter. This charge did not
affect client funds, the company’s ability to
pay dividends, or the company’s status as a
well-capitalized institution under Federal Reserve Board guidelines.
In addition to the Fannie Mae and Freddie Mac securities, Wilmington
Trust’s investment securities portfolio
includes perpetual preferred stocks issued by two money center banks and
one other company. These stocks are held as available-for-sale. At
September 30, 2008, the combined value of all these perpetual preferred
stocks was $19.4 million. This represented approximately 1% of
Wilmington Trust’s total investment
securities portfolio.
Trust-preferred securities
Wilmington Trust’s TruPS portfolio consists
of 38 pooled issues and 9 single-issue securities. The single issues are
from money center and large regional banks. The pooled instruments
consist of securities issued by banks, insurance companies, and other
financial institutions. The pooled TruPS generally are secured by
over-collateralization or default protection provided by subordinated
tranches. All of the TruPS in the portfolio are structured as “payment-in-kind”
securities. This means that, should an issuer defer a scheduled interest
payment, the principal held by the investor increases by the amount of
the deferred payment.
At June 30, 2008, the estimated fair value of the TruPS portfolio was
$227.2 million. On July 31, 2008, management changed the accounting
treatment for the TruPS portfolio from “available
for sale” to “held
to maturity,” because the company has the
ability and intent to hold these securities until they mature. As of
that date, the estimated fair value of these securities was $189.1
million, and the $38.1 million decline in value from June 30, 2008, was
recorded on the balance sheet.
As of September 30, 2008, the estimated fair value of the TruPS
portfolio was $207.9 million, and there were no other-than-temporary
impairments among the securities in this portfolio. No further
adjustments for changes in the fair value of TruPS were reflected on the
balance sheet, because the TruPS are recorded as held-to-maturity
securities.
Conference call
Management will discuss 2008 third quarter results and outlook for the
future in a conference call today at 10:00 a.m. (Eastern). Supporting
materials, financial statements, and audio streaming will be available
at www.wilmingtontrust.com.
To access the call from within the United States and Canada, dial
877-407-8031. Callers outside the United States and Canada should dial
201-689-8031. No passcode is necessary.
A rebroadcast of the conference call will be available from 1:00 p.m.
(Eastern) today until 11:59 p.m. (Eastern) on Friday, October 24. To
access the rebroadcast from within the United States and Canada, dial
877-660-6853. Callers outside the United States and Canada should dial
201-612-7415. All callers will need to use account # 286 and replay ID #
299744 to access the rebroadcast.
Forward-looking statements
This report contains forward-looking statements that reflect our current
expectations about our future performance. These statements rely on a
number of assumptions and estimates and are subject to various risks and
uncertainties that could cause our actual results to differ from our
expectations. Factors that could affect our future financial results
include, among other things, changes in national or regional economic
conditions; changes in market interest rates; significant changes in
banking laws or regulations; increased competition in our businesses;
higher-than-expected credit losses; the effects of acquisitions; the
effects of integrating acquired entities; a substantial and permanent
loss of either client accounts and/or assets under management at
Wilmington Trust and/or our affiliate money managers, Cramer Rosenthal
McGlynn and Roxbury Capital Management; unanticipated changes in
regulatory, judicial, or legislative tax treatment of business
transactions; and economic uncertainty created by unrest in other parts
of the world.
About Wilmington Trust
Wilmington Trust Corporation (NYSE: WL) is a financial services holding
company that provides Regional Banking services throughout the Delaware
Valley region, Wealth Advisory Services for high-net-worth clients in 36
countries, and Corporate Client Services for institutional clients in 86
countries. Its wholly owned bank subsidiary, Wilmington Trust Company,
which was founded in 1903, is one of the largest personal trust
providers in the United States and the leading retail and commercial
bank in Delaware. Wilmington Trust Corporation and its affiliates have
offices in Arizona, California, Connecticut, Delaware, Florida, Georgia,
Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New York,
Pennsylvania, South Carolina, Vermont, the Cayman Islands, the Channel
Islands, London, Dublin, Frankfurt, and Luxembourg. For more
information, visit www.wilmingtontrust.com.
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
HIGHLIGHTS
Three Months Ended
Nine Months Ended
Sept. 30, 2008
Sept. 30, 2007
%Change
Sept. 30, 2008
Sept. 30, 2007
%Change
OPERATING RESULTS (in millions)
Net interest income
$
91.1
$
94.1
(3.2
)
$
263.1
$
277.7
(5.3
)
Provision for loan losses
(19.6
)
(8.9
)
120.2
(48.0
)
(19.0
)
152.6
Noninterest income
87.8
94.8
(7.4
)
283.7
283.2
0.2
Noninterest expense
123.9
110.8
11.8
427.9
327.2
30.8
Net income
22.9
46.2
(50.4
)
44.9
138.0
(67.5
)
PER SHARE DATA
Basic net income
$
0.34
$
0.68
(50.0
)
$
0.67
$
2.02
(66.8
)
Diluted net income
0.34
0.67
(49.3
)
0.67
1.99
(66.3
)
Dividends paid
0.345
0.335
3.0
1.025
0.985
4.1
Book value at period end
15.60
16.23
(3.9
)
15.60
16.23
(3.9
)
Closing price at period end
28.83
38.90
(25.9
)
28.83
38.90
(25.9
)
Market range:
High
46.75
42.14
10.9
46.75
44.55
4.9
Low
20.50
36.46
(43.8
)
20.50
36.46
(43.8
)
AVERAGE SHARES OUTSTANDING (in thousands)
Basic
67,231
67,698
(0.7
)
67,155
68,206
(1.5
)
Diluted
67,269
68,582
(1.9
)
67,400
69,222
(2.6
)
AVERAGE BALANCE SHEET (in millions)
Investment portfolio
$
1,461.7
$
1,776.9
(17.7
)
$
1,601.5
$
1,877.5
(14.7
)
Loans
9,459.0
8,260.3
14.5
9,062.0
8,163.6
11.0
Earning assets
11,076.0
10,075.0
9.9
10,778.2
10,089.9
6.8
Core deposits
5,430.0
5,045.5
7.6
5,323.1
5,029.1
5.8
Stockholders' equity
1,021.3
1,087.8
(6.1
)
1,088.5
1,090.1
(0.1
)
STATISTICS AND RATIOS (net income annualized)
Return on average stockholders' equity
8.92
%
16.85
%
(47.1
)
5.51
%
16.93
%
(67.5
)
Return on average assets
0.76
%
1.67
%
(54.5
)
0.51
%
1.68
%
(69.6
)
Net interest margin (taxable equivalent)
3.27
%
3.73
%
(12.3
)
3.27
%
3.71
%
(11.9
)
Dividend payout ratio
101.31
%
49.35
%
105.3
153.67
%
48.84
%
214.6
Full-time equivalent headcount
2,925
2,658
10.0
2,925
2,658
10.0
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
QUARTERLY INCOME STATEMENT
Three Months Ended
% Change From
(In millions)
Sept. 30,2008
June 30,
2008
Mar. 31,
2008
Dec. 31,
2007
Sept. 30,
2007
Prior
Quarter
Prior
Year
NET INTEREST INCOME
Interest income
$
152.1
$
150.0
$
162.4
$
177.9
$
183.4
1.4
(17.1
)
Interest expense
61.0
64.8
75.5
86.8
89.3
(5.9
)
(31.7
)
Net interest income
91.1
85.2
86.9
91.1
94.1
6.9
(3.2
)
Provision for loan losses
(19.6
)
(18.5
)
(10.0
)
(9.2
)
(8.9
)
5.9
120.2
Net interest income after provision for loan losses
71.5
66.7
76.9
81.9
85.2
7.2
(16.1
)
NONINTEREST INCOME
Advisory fees:
Wealth Advisory Services
Trust and investment advisory fees
39.3
40.2
39.2
42.9
40.5
(2.2
)
(3.0
)
Mutual fund fees
6.8
6.4
6.4
5.9
5.3
6.2
28.3
Planning and other services
11.2
11.2
10.1
10.3
10.3
----
8.7
Total Wealth Advisory Services
57.3
57.8
55.7
59.1
56.1
(0.9
)
2.1
Corporate Client Services
Capital markets services
11.9
12.2
11.6
11.4
10.2
(2.5
)
16.7
Entity management services
7.7
8.6
7.9
8.1
7.4
(10.5
)
4.1
Retirement services
11.3
7.5
3.2
3.3
3.0
50.7
276.7
Investment/cash management services
3.5
3.4
3.3
3.4
3.0
2.9
16.7
Total Corporate Client Services
34.4
31.7
26.0
26.2
23.6
8.5
45.8
Cramer Rosenthal McGlynn
3.8
5.5
4.0
5.5
4.2
(30.9
)
(9.5
)
Roxbury Capital Management
0.4
(1.1
)
0.3
0.4
0.4
----
----
Advisory fees
95.9
93.9
86.0
91.2
84.3
2.1
13.8
Amortization of affiliate intangibles
(2.2
)
(2.0
)
(1.2
)
(1.3
)
(1.2
)
10.0
83.3
Advisory fees after amortization of affiliate intangibles
93.7
91.9
84.8
89.9
83.1
2.0
12.8
Service charges on deposit accounts
7.7
7.5
7.6
7.3
7.2
2.7
6.9
Other noninterest income
6.1
6.3
10.4
5.3
4.7
(3.2
)
29.8
Securities gains/(losses)
(19.7
)
(12.5
)
----
0.2
(0.2
)
(57.6
)
N/M
Total noninterest income
87.8
93.2
102.8
102.7
94.8
(5.8
)
(7.4
)
Net interest and noninterest income
159.3
159.9
179.7
184.6
180.0
(0.4
)
(11.5
)
NONINTEREST EXPENSE
Salaries and wages
50.6
48.3
45.7
45.0
44.1
4.8
14.7
Incentives and bonuses
11.8
13.2
14.5
11.5
10.0
(10.6
)
18.0
Employment benefits
12.8
12.4
14.3
12.0
12.7
3.2
0.8
Net occupancy
7.9
8.0
7.5
7.4
7.3
(1.3
)
8.2
Furniture, equipment, and supplies
11.7
10.3
9.8
9.7
10.0
13.6
17.0
Other noninterest expense:
Advertising and contributions
2.6
3.0
2.1
3.2
2.0
(13.3
)
30.0
Servicing and consulting fees
2.9
3.2
2.5
3.4
2.6
(9.4
)
11.5
Subadvisor expense
4.7
3.5
2.7
2.8
2.7
34.3
74.1
Travel, entertainment, and training
3.2
2.9
2.4
3.3
2.8
10.3
14.3
Originating and processing fees
2.8
2.6
2.4
2.9
2.8
7.7
----
Other expense
12.9
14.2
11.6
15.7
13.8
(9.2
)
(6.5
)
Total other noninterest expense
29.1
29.4
23.7
31.3
26.7
(1.0
)
9.0
Total noninterest expense before impairment
123.9
121.6
115.5
116.9
110.8
1.9
11.8
Impairment write-down
----
66.9
----
----
----
(100.0
)
----
Total noninterest expense
123.9
188.5
115.5
116.9
110.8
(34.3
)
11.8
Income before income taxes and minority interest
35.4
(28.6
)
64.2
67.7
69.2
----
(48.8
)
Applicable income taxes
12.3
(9.3
)
22.7
23.6
22.9
----
(46.3
)
Net income before minority interest
23.1
(19.3
)
41.5
44.1
46.3
----
(50.1
)
Minority interest
0.2
0.2
0.1
0.1
0.1
----
100.0
Net income
$
22.9
$
(19.5
)
$
41.4
$
44.0
$
46.2
----
(50.4
)
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
YEAR-TO-DATE INCOME STATEMENT
Nine Months Ended
(In millions)
Sept. 30,
2008
Sept. 30,
2007
%
Change
NET INTEREST INCOME
Interest income
$
464.3
$
544.2
(14.7
)
Interest expense
201.2
266.5
(24.5
)
Net interest income
263.1
277.7
(5.3
)
Provision for loan losses
(48.0
)
(19.0
)
152.6
Net interest income after provision for loan losses
215.1
258.7
(16.9
)
NONINTEREST INCOME
Advisory fees:
Wealth Advisory Services
Trust and investment advisory fees
118.7
115.8
2.5
Mutual fund fees
19.6
15.4
27.3
Planning and other services
32.5
29.8
9.1
Total Wealth Advisory Services
170.8
161.0
6.1
Corporate Client Services
Capital markets services
35.6
31.5
13.0
Entity management services
24.2
21.9
10.5
Retirement services
22.0
9.6
129.2
Investment/cash management services
10.3
9.4
9.6
Total Corporate Client Services
92.1
72.4
27.2
Cramer Rosenthal McGlynn
13.3
15.2
(12.5
)
Roxbury Capital Management
(0.4
)
0.7
----
Advisory fees
275.8
249.3
10.6
Amortization of affiliate intangibles
(5.4
)
(3.4
)
58.8
Advisory fees after amortization of affiliate intangibles
270.4
245.9
10.0
Service charges on deposit accounts
22.7
21.0
8.1
Other noninterest income
22.8
16.4
39.0
Securities gains/(losses)
(32.2
)
(0.1
)
N/M
Total noninterest income
283.7
283.2
0.2
Net interest and noninterest income
498.8
541.9
(8.0
)
NONINTEREST EXPENSE
Salaries and wages
144.6
127.7
13.2
Incentives and bonuses
39.5
35.4
11.6
Employment benefits
39.5
38.9
1.5
Net occupancy
23.5
20.9
12.4
Furniture, equipment, and supplies
31.6
29.5
7.1
Other noninterest expense:
Advertising and contributions
7.7
7.5
2.7
Servicing and consulting fees
8.7
7.8
11.5
Subadvisor expense
10.8
7.7
40.3
Travel, entertainment, and training
8.5
7.4
14.9
Originating and processing fees
7.8
8.0
(2.5
)
Other expense
38.8
36.4
6.6
Total other noninterest expense
82.3
74.8
10.0
Total noninterest expense before impairment
361.0
327.2
10.3
Impairment write-down
66.9
----
----
Total noninterest expense
427.9
327.2
30.8
Income before income taxes and minority interest
70.9
214.7
(67.0
)
Applicable income taxes
25.5
75.9
(66.4
)
Net income before minority interest
45.4
138.8
(67.3
)
Minority interest
0.5
0.8
(37.5
)
Net income
$
44.9
$
138.0
(67.5
)
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
COMPARISON OF RESULTS WITH AND WITHOUT THE IMPAIRMENT WRITE-DOWN
Three months ended September 30, 2008
Nine months ended September 30, 2008
With
Without
With
Without
impairment
impairment
Impairment
impairment
impairment
Impairment
OPERATING RESULTS (in millions)
Net interest income
$
91.1
$
91.1
$
----
$
263.1
$
263.1
$
----
Provision for loan losses
(19.6
)
(19.6
)
----
(48.0
)
(48.0
)
----
Noninterest income
87.8
107.5
(19.7
)
283.7
316.0
(32.3
)
Noninterest expense
123.9
123.9
----
427.9
361.0
66.9
Income before taxes and minority interest
35.4
55.1
(19.7
)
70.9
170.1
(99.2
)
Applicable income taxes
12.3
19.5
(7.2
)
25.5
60.8
(35.3
)
Net income before minority interest
23.1
35.6
(12.5
)
45.4
109.3
(63.9
)
Minority interest
0.2
0.2
----
0.5
0.5
----
Net income
$
22.9
$
35.4
$
(12.5
)
$
44.9
$
108.8
$
(63.9
)
PER SHARE DATA
Diluted shares outstanding (in millions)
67.3
67.3
----
67.4
67.4
----
Per-share earnings
$
0.34
$
0.53
$
(0.19
)
$
0.67
$
1.62
$
(0.95
)
STATISTICS AND RATIOS (dollars in millions)
Total assets, on average
$
12,043.5
$
12,104.5
$
(61.0
)
$
11,745.1
$
11,768.5
$
(23.4
)
Stockholders' equity, on average
1,021.3
1,064.6
(43.3
)
1,088.5
1,104.9
(16.4
)
Return on average assets
0.76
%
1.16
%
(0.40
)%
0.51
%
1.23
%
(0.72
)%
Return on equity
8.92
%
13.23
%
(4.31
)%
5.51
%
13.15
%
(7.64
)%
Net interest before provision and noninterest income
$
178.9
$
198.6
$
(19.7
)
$
546.8
$
579.1
$
(32.3
)
Tax equivalent interest income
0.6
0.6
----
2.2
2.2
----
$
179.5
$
199.2
$
(19.7
)
$
549.0
$
581.3
$
(32.3
)
Noninterest expense
$
123.9
$
123.9
$
----
$
427.9
$
361.0
$
66.9
Efficiency ratio
69.03
%
62.20
%
6.83
%
77.94
%
62.10
%
15.84
%
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
STATEMENT OF CONDITION
% Change From
Sept. 30,
June 30,
Mar. 31,
Dec. 31,
Sept. 30,
Prior
Prior
(In millions)
2008
2008
2008
2007
2007
Quarter
Year
ASSETS
Cash and due from banks
$
231.1
$
249.3
$
291.0
$
260.5
$
286.3
(7.3
)
(19.3
)
Interest-bearing deposits in other banks
80.1
167.8
3.7
4.4
2.9
(52.3
)
N/M
Federal funds sold and securities purchased under agreements to
resell
----
110.7
264.6
129.6
13.6
(100.0
)
(100.0
)
Investment securities:
U.S. Treasury
91.2
48.6
56.8
60.2
101.9
87.7
(10.5
)
Government agencies
453.5
473.5
473.9
647.0
701.4
(4.2
)
(35.3
)
Obligations of state and political subdivisions
7.0
7.3
7.3
17.8
18.5
(4.1
)
(62.2
)
Preferred stock
19.4
41.7
43.3
44.9
62.6
(53.5
)
(69.0
)
Mortgage-backed securities
673.6
702.7
740.1
730.6
581.9
(4.1
)
15.8
Other securities
215.3
252.8
307.5
346.3
365.0
(14.8
)
(41.0
)
Total investment securities
1,460.0
1,526.6
1,628.9
1,846.8
1,831.3
(4.4
)
(20.3
)
FHLB and FRB stock, at cost
16.4
22.4
22.8
22.4
20.1
(26.8
)
(18.4
)
Loans:
Commercial, financial, and agricultural
2,965.2
2,808.6
2,654.4
2,594.9
2,529.0
5.6
17.2
Real estate - construction
1,908.7
1,847.0
1,809.7
1,780.4
1,759.9
3.3
8.5
Mortgage - commercial
1,800.7
1,704.0
1,593.8
1,463.4
1,388.8
5.7
29.7
Total commercial loans
6,674.6
6,359.6
6,057.9
5,838.7
5,677.7
5.0
17.6
Mortgage - residential
562.9
561.1
559.6
562.0
566.3
0.3
(0.6
)
Consumer
1,782.9
1,790.3
1,679.5
1,571.6
1,546.0
(0.4
)
15.3
Secured with liquid collateral
564.6
569.4
500.4
503.5
546.5
(0.8
)
3.3
Total retail loans
2,910.4
2,920.8
2,739.5
2,637.1
2,658.8
(0.4
)
9.5
Total loans net of unearned income
9,585.0
9,280.4
8,797.4
8,475.8
8,336.5
3.3
15.0
Reserve for loan losses
(122.2
)
(113.1
)
(106.4
)
(101.1
)
(101.6
)
8.0
20.3
Net loans
9,462.8
9,167.3
8,691.0
8,374.7
8,234.9
3.2
14.9
Premises and equipment
152.1
154.1
153.2
152.1
148.9
(1.3
)
2.1
Goodwill
343.3
345.2
332.4
330.0
329.0
(0.6
)
4.3
Other intangibles
47.3
49.7
37.0
38.3
38.7
(4.8
)
22.2
Other assets
341.0
340.2
279.1
326.9
281.4
0.2
21.2
Total assets
$
12,134.1
$
12,133.3
$
11,703.7
$
11,485.7
$
11,187.1
----
8.5
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand
$
879.6
$
994.5
$
778.6
$
966.2
$
827.8
(11.6
)
6.3
Interest-bearing:
Savings
799.6
798.9
780.2
659.8
580.1
0.1
37.8
Interest-bearing demand
2,594.4
2,692.3
2,502.6
2,471.8
2,346.7
(3.6
)
10.6
Certificates under $100,000
998.1
977.6
1,012.0
1,011.4
1,002.4
2.1
(0.4
)
Local certificates $100,000 and over
267.8
278.0
316.1
356.3
389.6
(3.7
)
(31.3
)
Total core deposits
5,539.5
5,741.3
5,389.5
5,465.5
5,146.6
(3.5
)
7.6
National certificates $100,000 and over
3,101.7
2,874.4
2,676.5
2,392.0
2,353.1
7.9
31.8
Total deposits
8,641.2
8,615.7
8,066.0
7,857.5
7,499.7
0.3
15.2
Short-term borrowings:
Federal funds purchased and securities sold under agreements to
repurchase
1,745.4
1,695.4
1,777.2
1,775.3
1,915.5
2.9
(8.9
)
U.S. Treasury demand
7.5
70.3
62.5
77.3
40.9
(89.3
)
(81.7
)
Line of credit and other debt
20.0
10.0
134.9
139.5
134.0
100.0
(85.1
)
Total short-term borrowings
1,772.9
1,775.7
1,974.6
1,992.1
2,090.4
(0.2
)
(15.2
)
Other liabilities
189.4
207.5
250.9
247.9
231.4
(8.7
)
(18.2
)
Long-term debt
468.3
467.8
268.5
267.8
267.5
0.1
75.1
Total liabilities
11,071.8
11,066.7
10,560.0
10,365.3
10,089.0
----
9.7
Minority interest
0.2
0.2
0.2
0.1
0.1
----
100.0
Stockholders' equity
1,062.1
1,066.4
1,143.5
1,120.3
1,098.0
(0.4
)
(3.3
)
Total liabilities and stockholders' equity
$
12,134.1
$
12,133.3
$
11,703.7
$
11,485.7
$
11,187.1
----
8.5
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
AVERAGE STATEMENT OF CONDITION
2008
2008
2008
2007
2007
% Change From
Third
Second
First
Fourth
Third
Prior
Prior
(In millions)
Quarter
Quarter
Quarter
Quarter
Quarter
Quarter
Year
ASSETS
Cash and due from banks
$
221.5
$
251.7
$
216.9
$
209.6
$
208.1
(12.0
)
6.4
Interest-bearing deposits in other banks
101.7
63.1
3.4
3.7
4.1
61.2
N/M
Federal funds sold and securities purchased under agreements to
resell
32.9
38.0
35.1
28.2
23.2
(13.4
)
41.8
Investment securities:
U.S. Treasury
50.4
50.9
60.5
80.5
103.3
(1.0
)
(51.2
)
Government agencies
459.8
497.5
553.2
619.5
631.4
(7.6
)
(27.2
)
Obligations of state and political subdivisions
7.1
7.3
14.3
18.2
18.7
(2.7
)
(62.0
)
Preferred stock
32.9
44.8
46.0
49.0
62.5
(26.6
)
(47.4
)
Mortgage-backed securities
684.1
725.2
734.4
697.0
590.4
(5.7
)
15.9
Other securities
227.4
272.8
337.5
359.4
370.6
(16.6
)
(38.6
)
Total investment securities
1,461.7
1,598.5
1,745.9
1,823.6
1,776.9
(8.6
)
(17.7
)
FHLB and FRB stock, at cost
20.7
26.5
22.4
23.2
10.5
(21.9
)
97.1
Loans:
Commercial, financial, and agricultural
2,915.8
2,765.4
2,602.1
2,521.5
2,454.9
5.4
18.8
Real estate - construction
1,877.8
1,837.1
1,804.9
1,790.2
1,769.2
2.2
6.1
Mortgage - commercial
1,757.9
1,654.1
1,528.2
1,423.5
1,387.3
6.3
26.7
Total commercial loans
6,551.5
6,256.6
5,935.2
5,735.2
5,611.4
4.7
16.8
Mortgage - residential
560.9
560.5
562.8
564.5
564.4
0.1
(0.6
)
Consumer
1,780.3
1,729.8
1,653.1
1,556.5
1,533.0
2.9
16.1
Secured with liquid collateral
566.3
539.0
485.7
499.5
551.5
5.1
2.7
Total retail loans
2,907.5
2,829.3
2,701.6
2,620.5
2,648.9
2.8
9.8
Total loans net of unearned income
9,459.0
9,085.9
8,636.8
8,355.7
8,260.3
4.1
14.5
Reserve for loan losses
(111.0
)
(104.1
)
(99.8
)
(99.4
)
(95.8
)
6.6
15.9
Net loans
9,348.0
8,981.8
8,537.0
8,256.3
8,164.5
4.1
14.5
Premises and equipment
153.5
154.4
152.9
150.9
148.5
(0.6
)
3.4
Goodwill
345.5
393.1
329.9
329.1
328.3
(12.1
)
5.2
Other intangibles
48.7
36.8
37.7
38.2
39.4
32.3
23.6
Other assets
309.3
281.5
282.0
263.2
259.8
9.9
19.1
Total assets
$
12,043.5
$
11,825.4
$
11,363.2
$
11,126.0
$
10,963.3
1.8
9.9
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand
$
838.8
$
870.2
$
726.4
$
723.5
$
714.9
(3.6
)
17.3
Interest-bearing:
Savings
807.8
795.2
714.8
627.3
540.9
1.6
49.3
Interest-bearing demand
2,511.7
2,417.0
2,368.2
2,347.6
2,405.8
3.9
4.4
Certificates under $100,000
979.8
988.2
1,016.0
1,005.4
1,007.7
(0.9
)
(2.8
)
Local certificates $100,000 and over
291.9
306.9
335.3
390.7
376.2
(4.9
)
(22.4
)
Total core deposits
5,430.0
5,377.5
5,160.7
5,094.5
5,045.5
1.0
7.6
National certificates $100,000 and over
3,197.1
2,719.2
2,770.5
2,369.1
2,817.9
17.6
13.5
Total deposits
8,627.1
8,096.7
7,931.2
7,463.6
7,863.4
6.6
9.7
Short-term borrowings:
Federal funds purchased and securities sold under agreements to
repurchase
1,686.1
1,847.9
1,625.6
1,907.4
1,370.4
(8.8
)
23.0
U.S. Treasury demand
7.6
11.6
12.8
12.3
11.0
(34.5
)
(30.9
)
Line of credit and other debt
11.9
50.1
136.3
136.8
139.9
(76.2
)
(91.5
)
Total short-term borrowings
1,705.6
1,909.6
1,774.7
2,056.5
1,521.3
(10.7
)
12.1
Other liabilities
221.3
232.1
263.5
244.4
223.4
(4.7
)
(0.9
)
Long-term debt
468.0
467.4
268.2
267.7
267.2
0.1
75.1
Total liabilities
11,022.0
10,705.8
10,237.6
10,032.2
9,875.3
3.0
11.6
Minority interest
0.2
0.2
0.1
0.1
0.2
----
----
Stockholders' equity
1,021.3
1,119.4
1,125.5
1,093.7
1,087.8
(8.8
)
(6.1
)
Total liabilities and stockholders' equity
$
12,043.5
$
11,825.4
$
11,363.2
$
11,126.0
$
10,963.3
1.8
9.9
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
YIELDS AND RATES
2008
2008
2008
2007
2007
Third
Second
First
Fourth
Third
YIELDS/RATES (tax-equivalent basis)
Quarter
Quarter
Quarter
Quarter
Quarter
EARNING ASSETS:
Interest-bearing time deposits in other banks
1.93
%
2.09
%
6.33
%
8.08
%
4.95
%
Federal funds sold and securities purchased under agreements to
resell
2.57
2.01
3.15
4.18
6.60
Total investment securities
4.70
4.69
4.95
5.03
4.95
FHLB and FRB stock, at cost
3.74
3.00
5.38
2.29
3.38
Commercial, financial, and agricultural
5.69
5.94
6.64
7.39
7.91
Real estate - construction
5.26
5.38
6.53
7.82
8.41
Mortgage - commercial
5.71
5.87
6.72
7.64
8.04
Total commercial loans
5.57
5.76
6.63
7.59
8.10
Mortgage - residential
5.64
5.83
5.82
5.80
5.74
Consumer
6.28
6.34
6.92
7.33
7.48
Secured with liquid collateral
4.00
4.09
5.27
6.51
6.88
Total retail loans
5.71
5.81
6.40
6.84
6.98
Total loans
5.61
5.77
6.56
7.36
7.74
Total earning assets
5.44
5.56
6.27
6.92
7.23
FUNDS USED TO SUPPORT EARNING ASSETS:
Core deposits
Savings
2.21
2.17
2.65
2.92
2.63
Interest-bearing demand
0.70
0.75
1.05
1.26
1.45
Certificates under $100,000
3.08
3.64
4.18
4.27
4.23
Local certificates $100,000 and over
3.08
3.82
4.44
4.85
4.78
Core interest-bearing deposits
1.62
1.85
2.28
2.51
2.54
National certificates $100,000 and over
3.05
3.53
4.44
5.23
5.41
Total interest-bearing deposits
2.21
2.48
3.11
3.46
3.67
Short-term borrowings
2.21
2.47
3.53
4.64
5.00
Long-term debt
7.07
7.25
6.29
5.78
6.02
Total interest-bearing liabilities
2.44
2.71
3.28
3.80
3.97
Total funds used to support earning assets
2.17
2.39
2.90
3.36
3.50
Net interest margin (tax-equivalent basis)
3.27
3.17
3.37
3.56
3.73
Year-to-date net interest margin
3.27
3.27
3.37
3.67
3.71
Prime rate
5.00
5.08
6.27
7.58
8.18
Tax-equivalent net interest income (in millions)
$
91.7
$
86.0
$
87.7
$
92.0
$
95.1
Average earning assets at historical cost
$
11,166.1
$
10,896.5
$
10,468.0
$
10,258.9
$
10,113.9
Average fair valuation adjustment on investment securities
available for sale
(90.1
)
(84.5
)
(24.4
)
(24.5
)
(38.9
)
Average earning assets
$
11,076.0
$
10,812.0
$
10,443.6
$
10,234.4
$
10,075.0
Average rates are calculated using average balances based on
historical cost and do not reflect fair valuation adjustments.
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
CREDIT QUALITY
Three Months Ended
(Dollars in millions)
Sept.30, 2008
June30, 2008
Mar. 31,
2008
Dec. 31,
2007
Sept. 30,
2007
NONPERFORMING ASSETS AT PERIOD-END
Nonaccruing loans:
Commercial, financial, and agricultural
$
28.4
$
27.0
$
25.6
$
23.8
$
12.1
Commercial real estate - construction
41.0
22.6
9.9
9.9
21.2
Commercial mortgage
8.6
8.1
8.2
7.1
8.7
Consumer and other retail
22.1
13.9
9.7
7.0
12.1
Total nonaccruing loans
100.1
71.6
53.4
47.8
54.1
Renegotiated loans
0.1
0.2
24.1
23.7
19.2
Total nonaccruing loans and renegotiated loans
100.2
71.8
77.5
71.5
73.3
Other real estate owned (OREO)
14.5
16.7
0.2
9.1
0.2
Total nonperforming loans
114.7
88.5
77.7
80.6
73.5
Loans past due 90 days or more:
Commercial, financial, and agricultural
6.5
6.1
3.7
2.4
9.4
Commercial real estate - construction
5.2
0.6
0.3
0.7
0.7
Commercial mortgage
2.1
1.3
----
1.3
1.1
Consumer and other retail
14.9
13.8
10.6
9.3
5.8
Total loans past due 90 days or more
28.7
21.8
14.6
13.7
17.0
NET CHARGE-OFFS
Loans charged off:
Commercial, financial, and agricultural
$
4.9
$
2.9
$
0.7
$
1.3
$
0.6
Commercial real estate - construction
----
5.2
0.3
2.3
0.6
Commercial mortgage
1.0
0.1
----
1.2
0.1
Consumer and other retail
5.8
6.0
5.4
6.7
5.5
Total loans charged off
11.7
14.2
6.4
11.5
6.8
Recoveries on loans previously charged off:
Commercial, financial, and agricultural
0.2
0.2
0.1
----
0.2
Commercial real estate - construction
----
----
----
----
----
Commercial mortgage
----
0.8
----
----
----
Consumer and other retail
1.0
1.4
1.6
1.8
1.8
Total recoveries
1.2
2.4
1.7
1.8
2.0
Net loans charged off
10.5
11.8
4.7
9.7
4.8
RATIOS
Period-end reserve to loans
1.27
%
1.22
%
1.21
%
1.19
%
1.22
%
Period-end non-performing assets to loans
1.20
0.95
0.88
0.95
0.88
Period-end loans past due 90 days to total loans
0.30
0.23
0.17
0.16
0.20
Quarterly net charge-offs to average loans (not annualized)
0.11
0.13
0.05
0.12
0.06
Year-to-date net charge-offs to average loans
0.30
0.19
0.05
0.26
0.14
INTERNAL RISK RATING
Pass
96.08
%
96.28
%
95.62
%
96.03
%
96.01
%
Watchlisted
2.25
2.29
2.98
2.69
2.62
Substandard
1.66
1.42
1.39
1.27
1.36
Doubtful
0.01
0.01
0.01
0.01
0.01
LOAN PORTFOLIO COMPOSITION
Commercial, financial, and agricultural
31
%
30
%
30
%
31
%
30
%
Commercial real estate - construction
20
20
21
21
21
Commercial mortgage
19
18
18
17
17
Residential mortgage
6
6
6
6
7
Consumer
18
20
19
19
18
Secured by liquid collateral
6
6
6
6
7
COMMERCIAL REAL ESTATE - CONSTRUCTION DETAIL
Project type:
Residential real estate construction
52
%
53
%
53
%
52
%
54
%
Land development
22
22
21
21
19
Retail and office
14
13
13
14
13
Owner-occupied
3
4
5
5
6
Multi-family
2
2
2
2
2
Other
7
6
6
6
6
Geographic location:
Delaware
61
%
61
%
61
%
61
%
59
%
Pennsylvania
23
24
25
25
27
Maryland
6
6
6
7
7
New Jersey
7
6
5
4
4
Other
3
3
3
3
3
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
SUPPLEMENTAL INFORMATION
Three Months Ended
% Change From:
Sept. 30,
June 30,
Mar. 31,
Dec. 31,
Sept. 30,
Prior
Prior
2008
2008
2008
2007
2007
Quarter
Year
NET INCOME
Net income per share
Basic
$
0.34
$
(0.29
)
$
0.62
$
0.66
$
0.68
----
(50.0
)
Diluted
0.34
(0.29
)
0.62
0.65
0.67
----
(49.3
)
Weighted average shares outstanding (in thousands)
Basic
67,231
67,167
67,067
67,174
67,698
Diluted
67,269
67,167
67,338
67,749
68,582
Net income as a percentage of:
Average assets
0.76
%
(0.66
)%
1.47
%
1.57
%
1.67
%
Average stockholders' equity
8.92
(7.01
)
14.79
15.96
16.85
ASSETS UNDER MANAGEMENT * (in billions)
Wilmington Trust
$
37.1
$
38.4
$
35.0
$
35.9
$
34.5
(3.4
)
7.5
Roxbury Capital Management
1.9
2.1
2.1
2.5
2.8
(9.5
)
(32.1
)
Cramer Rosenthal McGlynn
10.1
11.2
10.9
11.4
11.8
(9.8
)
(14.4
)
Combined assets under management
$
49.1
$
51.7
$
48.0
$
49.8
$
49.1
(5.0
)
----
* Assets under management include estimates for values associated
with certain assets that lack readily ascertainable values, such as
limited partnership interests.
ASSETS UNDER ADMINISTRATION ** (in billions)
Wilmington Trust
$
139.9
$
146.6
$
120.7
$
124.3
$
121.6
(4.6
)
15.0
** Includes Wilmington Trust assets under management
INVESTMENT MIX OF ASSETS MANAGED BY WILMINGTON TRUST
Equities
41
%
44
%
45
%
47
%
49
%
Fixed income
26
24
22
23
23
Other
33
32
33
30
28
CAPITAL (in millions, except per share amounts)
Average stockholders' equity
$
1,021.3
$
1,119.4
$
1,125.5
$
1,093.7
$
1,087.8
(8.8
)
(6.1
)
Period-end primary capital
1,184.3
1,179.5
1,249.9
1,221.4
1,199.6
0.4
(1.3
)
Per share:
Book value
15.60
15.85
16.99
16.70
16.23
(1.6
)
(3.9
)
Quarterly dividends declared
0.345
0.345
0.335
0.335
0.335
----
3.0
Year-to-date dividends declared
1.025
0.68
0.335
1.32
0.985
Average stockholders' equity to assets
8.48
%
9.47
%
9.90
%
9.83
%
9.92
%
Total risk-based capital ratio
11.24
11.14
11.17
11.21
11.54
Tier 1 risk-based capital ratio
6.77
6.74
7.73
7.73
7.96
Tier 1 leverage capital ratio
6.52
6.45
7.23
7.18
7.31
INVESTMENT SECURITIES PORTFOLIO
Average life (in years)
6.13
6.16
4.47
4.45
4.66
Average duration
1.84
2.58
1.90
1.97
1.85
Percentage invested in fixed rate instruments
85
%
83
%
81
%
82
%
81
%
FUNDING (on average)
Percentage from core deposits
53
%
54
%
53
%
54
%
54
%
Percentage from national funding
31
27
29
25
30
Percentage from short-term borrowings
16
19
18
21
16
ASSET - LIABILITY MATCHING
As a percentage of total balances at period-end:
Loans outstanding with floating rates
73
%
72
%
71
%
71
%
71
%
Commercial loans with floating rates
88
87
86
85
86
Commercial loans tied to a prime rate
54
56
58
59
60
Commercial loans tied to the 30-day LIBOR
40
38
35
36
35
National CDs and short-term borrowings maturing in 90 days or less
95
%
92
%
83
%
75
%
78
%
FULL-TIME EQUIVALENT HEADCOUNT
Full-time equivalent headcount
2,925
2,879
2,704
2,672
2,658
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
QUARTERLY BUSINESS SEGMENT REPORT
Three Months Ended
(In millions)
Sept. 30,2008
June 30,2008
Mar. 31,2008
Dec. 31,2007
Sept. 30,2007
REGIONAL BANKING
Net interest income
$
85.6
$
80.8
$
80.2
$
84.3
$
87.6
Provision for loan losses
(18.0
)
(17.1
)
(9.3
)
(7.0
)
(7.8
)
Noninterest income
14.0
13.9
18.0
13.2
12.1
Noninterest expense
42.9
41.9
41.5
45.3
42.6
Income before taxes & minority interest
38.7
35.7
47.4
45.2
49.3
Regional Banking efficiency ratio
42.86
%
43.87
%
41.92
%
46.04
%
42.35
%
WEALTH ADVISORY SERVICES
Net interest income
$
4.9
$
5.2
$
6.1
$
6.4
$
6.3
Provision for loan losses
(1.6
)
(1.4
)
(0.7
)
(2.2
)
(1.1
)
Noninterest income
53.8
54.7
52.8
56.1
53.2
Noninterest expense
50.5
50.9
50.8
48.9
46.5
Income before taxes & minority interest
6.6
7.6
7.4
11.4
11.9
Wealth Advisory Services efficiency ratio
86.03
%
84.97
%
86.25
%
78.24
%
78.02
%
CORPORATE CLIENT SERVICES
Net interest income
$
2.4
$
1.8
$
3.0
$
3.3
$
3.2
Provision for loan losses
----
----
----
----
----
Noninterest income
35.7
33.0
28.0
27.7
25.1
Noninterest expense
30.5
28.8
23.2
22.7
21.7
Income before taxes & minority interest
7.6
6.0
7.8
8.3
6.6
Corporate Client Services efficiency ratio
79.84
%
82.76
%
74.84
%
73.23
%
76.68
%
AFFILIATE MANAGERS *
Net interest income
$
(1.8
)
$
(2.6
)
$
(2.4
)
$
(2.9
)
$
(3.0
)
Provision for loan losses
----
----
----
----
----
Noninterest income
4.0
4.2
4.0
5.7
4.4
Noninterest expense
----
----
----
----
----
Income before taxes & minority interest
2.2
1.6
1.6
2.8
1.4
TOTAL WILMINGTON TRUST CORPORATION
Net interest income
$
91.1
$
85.2
$
86.9
$
91.1
$
94.1
Provision for loan losses
(19.6
)
(18.5
)
(10.0
)
(9.2
)
(8.9
)
Noninterest income
107.5
105.8
102.8
102.7
94.8
Noninterest expense
123.9
121.6
115.5
116.9
110.8
Income before taxes & minority interest
$
55.1
$
50.9
$
64.2
$
67.7
$
69.2
Investment securities impairment charge
$
(19.7
)
$
(12.6
)
$
----
$
----
$
----
Roxbury Capital Management impairment charge
----
(66.9
)
----
----
----
Reported income before taxes & minority interest
$
35.4
$
(28.6
)
$
64.2
$
67.7
$
69.2
Corporation efficiency ratio
69.03
%
105.19
%
60.63
%
60.04
%
58.35
%
* Affiliate managers comprise Cramer Rosenthal McGlynn and Roxbury
Capital Management.
Segment data for prior periods may differ from previously
published figures due to changes in reporting methodology and/or
organizational structure.
WILMINGTON TRUST CORPORATION QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2008
YEAR-TO-DATE BUSINESS SEGMENT REPORT
Nine Months Ended
Sept. 30,
Sept. 30,
$
%
(In millions)
2008
2007
Change
Change
REGIONAL BANKING
Net interest income
$
246.5
$
257.8
$
(11.3
)
(4.4
)
Provision for loan losses
(44.4
)
(17.5
)
26.9
153.7
Noninterest income
45.8
38.2
7.6
19.9
Noninterest expense
126.2
124.6
1.6
1.3
Income before taxes & minority interest
121.7
153.9
(32.2
)
(20.9
)
Regional Banking efficiency ratio
42.88
%
41.71
%
WEALTH ADVISORY SERVICES
Net interest income
$
16.1
$
18.7
$
(2.6
)
(13.9
)
Provision for loan losses
(3.6
)
(1.5
)
2.1
140.0
Noninterest income
161.3
153.5
7.8
5.1
Noninterest expense
152.2
139.3
12.9
9.3
Income before taxes & minority interest
21.6
31.4
(9.8
)
(31.2
)
Wealth Advisory Services efficiency ratio
85.75
%
80.80
%
CORPORATE CLIENT SERVICES
Net interest income
$
7.2
$
10.4
$
(3.2
)
(30.8
)
Provision for loan losses
----
----
----
----
Noninterest income
96.7
76.3
20.4
26.7
Noninterest expense
82.6
63.3
19.3
30.5
Income before taxes & minority interest
21.3
23.4
(2.1
)
(9.0
)
Corporate Client Services efficiency ratio
79.42
%
72.93
%
AFFILIATE MANAGERS *
Net interest income
$
(6.7
)
$
(9.2
)
$
2.5
27.2
Provision for loan losses
----
----
----
----
Noninterest income
12.2
15.2
(3.0
)
(19.7
)
Noninterest expense
----
----
----
----
Income before taxes & minority interest
5.5
6.0
(0.5
)
(8.3
)
TOTAL WILMINGTON TRUST CORPORATION
Net interest income
$
263.1
$
277.7
$
(14.6
)
(5.3
)
Provision for loan losses
(48.0
)
(19.0
)
29.0
152.6
Noninterest income
316.0
283.2
32.8
11.6
Noninterest expense
361.0
327.2
33.8
10.3
Income before taxes & minority interest
$
170.1
$
214.7
$
(44.6
)
(20.8
)
Investment securities impairment charge
$
(32.3
)
$
----
$
(32.3
)
----
Roxbury Capital Management impairment charge
(66.9
)
----
(66.9
)
----
Reported income before taxes & minority interest
$
70.9
$
214.7
$
(143.8
)
(67.0
)
Corporation efficiency ratio
77.94
%
58.02
%
* Affiliate managers comprise Cramer Rosenthal McGlynn and Roxbury
Capital Management.
Segment data for prior periods may differ from previously published
figures due to changes in reporting methodology and/or
organizational structure.