SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15d of the
Securities Exchange Act of 1934
Date of Report (Date of
earliest event reported)
October 17, 2003
WILMINGTON TRUST CORPORATION
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its chapter)
Commission File Number 1-14659
Delaware 51-0328154
---------------------------------------------- ------------------------------------
(State or other jurisdiction of incorporation) (IRS Employer Identification Number)
Wilmington Trust Corporation
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890
---------------------------------------- ---------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (302) 651-1000
--------------------------------------------------------------------------------
(Former names or former address, if changed since last report)
Item 12. Results of Operations and Financial Condition.
The press release of Wilmington Trust Corporation reporting its financial
condition and results of operations for the third quarter of 2003 is attached
hereto as Exhibit A and is being furnished pursuant to Item 12 of form 8-K.
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WILMINGTON TRUST CORPORATION
Dated: October 17, 2003
By: /s/ David R. Gibson
----------------------------------
Name: David R. Gibson,
Title: Executive Vice President and
Chief Financial Officer
(Authorized Officer and Principal
Financial Officer)
2
EXHIBIT A
FOR IMMEDIATE RELEASE Contact: Ellen J. Roberts
Investor Relations
(302) 651-8069
eroberts@wilmingtontrust.com
WILMINGTON TRUST REPORTS THIRD QUARTER EPS OF $0.52
Wilmington, Del., October 17, 2003 - Wilmington Trust Corporation (NYSE: WL)
today reported third quarter 2003 earnings, on a diluted basis, of $0.52 per
share, and net income of $34.4 million. This was level with third quarter 2002,
when earnings per share were $0.52 and net income was $34.5 million.
Loan balances continued to grow, advisory revenue increased, and expenses
continued to decline. These achievements were offset by compression in the net
interest margin.
"Advisory revenue rose on the combination of solid business development, rising
equity markets, and improved results from our affiliate money managers," said
Ted T. Cecala, Wilmington Trust chairman and chief executive officer. "In our
banking business, we marked the 10th consecutive quarter of increased loan
balances, but a lower net interest margin caused net interest income to
decline."
Third quarter 2003 was the first quarter to reflect fully the decrease in
interest rates that the Federal Reserve instituted in June. Low interest rates
and the company's asset sensitivity caused the net interest margin to fall to
3.45%. This was 17 basis points lower than for the second quarter of 2003 and 57
basis points lower than for the third quarter of 2002.
Loan balances were $6.1 billion, which was higher than for both the prior
quarter and the year-ago quarter. Loan balances rose on both a period-end as
well as an average basis. Credit quality remained stable.
1
Assets under management at Wilmington Trust and affiliate managers Cramer
Rosenthal McGlynn and Roxbury Capital Management totaled $30.7 billion. Combined
assets under management were 3.0% higher than at June 30, 2003, and 7.0% higher
than at September 30, 2002.
Advisory revenue totaled $53.1 million, which was 7.3% higher than for the prior
quarter and 1% higher than for the year-ago quarter. Most of the growth occurred
in the Wealth Advisory Services business. Revenue from affiliate money manager
Cramer Rosenthal McGlynn rose 18.2% from the prior quarter. Affiliate manager
Roxbury Capital Management reduced its loss from $1.2 million for the prior
quarter to $100,000 for the 2003 third quarter.
Expenses totaled $75.2 million, which was 2.5% lower than for the prior quarter
as well as for the prior-year quarter. The decrease was due to the continuing
emphasis on expense reduction initiatives.
On an annualized basis, the third quarter 2003 return on average assets was
1.58% and return on average stockholders' equity was 17.64%, compared with 1.77%
and 18.66%, respectively, for the 2002 third quarter.
In other news, the Board of Directors declared a regular quarterly dividend of
$0.27 per share, up 5.9% from the $0.255 per share paid in the third quarter of
2002. The dividend is payable on November 17, 2003, to shareholders of record on
November 3, 2003.
NET INTEREST MARGIN COMPRESSION IN LINE WITH PROJECTIONS
With interest rates at historic lows, the yields on loans and investments fell
for the sixth consecutive quarter, and deposit pricing remained at record-low
levels. Even though loan balances rose, loan yields declined because
refinancings and payoffs of older loans with higher yields offset new loans that
were added at current rates.
The average yield on assets from which the company earned revenue dropped 30
basis points from the prior quarter, but the average cost of funds used to
support those assets fell only 13
2
basis points. Compared to the year-ago quarter, the average asset yield was 109
basis points lower, while the average cost of funds was only 52 basis points
lower. These disparities were the primary cause of the decline in the net
interest margin.
In the investment portfolio, although average balances increased to $1.9
billion, the period-end balance declined 8.8% from the second quarter to $1.8
billion. Most of this decrease was in mortgage-backed securities. The company's
overall exposure to mortgage-related instruments remained stable, as changes in
the investment portfolio offset sales and refinancings in the residential
mortgage portfolio.
Compared to the year-ago third quarter, investment portfolio balances were
higher because they included the invested proceeds of the April 2003 issue of
$250 million in 10-year subordinated notes. The average life of the entire
portfolio is 5.18 years and the duration is 2.57.
"We expect the net interest margin to stabilize in the fourth quarter, barring
no additional interest rate movements by the Federal Reserve," Cecala said.
LOAN BALANCES RISE FOR 10TH CONSECUTIVE QUARTER
Economic indicators, such as housing activity and unemployment rates, continued
to be stronger in the Delaware Valley region, where the company's regional
banking business is concentrated, than in many other parts of the United States.
The relative health of the regional economy and its diversification among the
financial services, life sciences, technology, manufacturing, retail,
agricultural, and tourism sectors were factors in the growth in loan balances,
which rose for the 10th consecutive quarter.
Loan balances were $6.1 billion. Most of the growth was in the commercial loan
portfolio.
Commercial loan balances, on average, were $3.9 billion, which was
nearly 1% higher than for the 2003 second quarter and nearly 11% higher than for
the 2002 third quarter. Approximately 51% of the commercial loan growth came
from the Delaware market, where Wilmington Trust is the dominant banking
company. Approximately 49% of the commercial growth came from the
3
southeastern Pennsylvania market. In contrast, for the year-ago quarter, only
16% of new commercial loans were generated in the southeastern Pennsylvania
market.
More than half of the current quarter increase in commercial loan balances
occurred in the construction and real estate portfolio. Construction and real
estate balances, on average, were 5.8% higher than for the prior quarter and
39.3% higher than for the prior-year quarter. These loans were booked across a
variety of residential, hotel, industrial, and retail projects on both a
construction and permanent-financing basis.
Retail loan balances, on average, were $2.2 billion, which was slightly lower
than for the prior quarter and 3.6% lower than for the year-ago quarter. Almost
all of the decrease occurred in residential mortgage balances, which continued
to decline due to prepayments and the ongoing sale of all new residential
mortgage production into the secondary market.
The growth trend in core deposit balances that has occurred over the past 9
quarters continued, and core deposit balances, on average, rose to $4.4 billion,
which was 3.3% higher than for the prior quarter, and 11.5% higher than for the
prior-year quarter.
NET CHARGE-OFFS, NONACCRUING LOANS, AND OREO DECLINE
Credit quality remained stable. Net charge-offs totaled $2.0 million, which was
less than half of what they were for the prior quarter and year-ago quarter. The
net charge-off ratio was 3 basis points, which was lower than for the prior
quarter and prior-year quarter. Year to date, the net charge-off ratio is 17
basis points, versus 19 basis points for the first 9 months of 2002.
Nonaccruing loans totaled $50.2 million. This was a $10.2 million decrease from
the prior quarter, which occurred because a payment was received on a $20
million commercial loan that was transferred to nonaccruing status at the end of
the 2003 first quarter.
4
Other real estate owned (OREO) declined to $1.6 million for the current quarter
from $3.2 million for the prior quarter. This decline reflected the successful
work out of a residential resort project that was classified as OREO in December
2002.
The loan loss reserve ratio was 1.50%. This was an increase of 6 basis points
from the prior quarter, when the reserve ratio was 1.44%.
The percentage of loans rated pass by the internal risk rating analysis
increased from both the prior quarter and the prior-year quarter. The percentage
of loans rated pass has been higher than 95% since 2000 and higher than 92%
since 1998.
The composition of the loan portfolio remained relatively unchanged and well
diversified across commercial and consumer lines.
LOAN PORTFOLIO COMPOSITION 9/30/03 6/30/03 3/31/03
---------------------------------------- --------- --------- ---------
Commercial, financial, and agricultural 36% 37% 36%
Real estate - construction 11 10 10
Commercial mortgage 17 17 18
Residential mortgage 9 10 10
Consumer 27 26 26
ADVISORY REVENUE RISES ON SALES ACTIVITY AND EQUITY MARKET PERFORMANCE
Advisory revenue totaled $53.1 million, which was 7.3% higher than for the prior
quarter and 1% higher than for the year-ago quarter. Most of the linked-quarter
increase and all of the prior year increase in total advisory revenue occurred
in the Wealth Advisory Services business.
Advisory revenue accounted for 41% of total third quarter net interest and
noninterest income. Total noninterest income, including service charges and
other noninterest income, accounted for 51.5% of total third quarter net
interest and noninterest income. These percentages were slightly higher than for
the 2002 third quarter.
5
Assets under management at Wilmington Trust were $23.6 billion, which was 4.0%
higher than for the prior quarter and 11.8% higher than for the prior-year
quarter.
Revenue from the Wealth Advisory Services business totaled $35.5 million. This
was 7.3% more than for the prior quarter and 13.8% more than for the prior-year
quarter. In comparison, the Standard & Poor's 500 increased, on average, 5.5%
from the prior quarter and 8.9% from the prior-year quarter.
The increase in revenue, which resulted from a combination of business
development with new and existing clients, as well as from asset appreciation,
was broad-based and occurred in all major components of the Wealth Advisory
business. The largest increases, both from the prior quarter and prior-year
quarter, came from asset management, trust administration, and financial
planning fees.
Compared to the prior-year quarter, sales results were particularly strong from
the Florida and Pennsylvania markets, and from Delaware-based fees, which
represent clients throughout the U.S. By the end of the 2003 third quarter,
sales in Florida and Pennsylvania had already exceeded the full-year 2002 levels
achieved in those markets.
Approximately 70% of Wealth Advisory income is derived from the market value of
assets under management. Wealth Advisory fees are priced at the beginning of
each month based on market valuations at the end of the previous month.
In other Wealth Advisory Services activity during the third quarter, the
California headquarters office was relocated from Santa Monica to Century City.
In the Corporate Client Services business, revenue was $16.4 million, compared
with $16.5 million for the 2003 second quarter and $17.2 million for the 2002
third quarter. "This business has counter-cyclical elements that got caught
between the economic downturn and the economic recovery," Cecala said. "As
prospects for the recovery began to improve in the third quarter,
bankruptcy-related business waned. We saw a pick-up in the more traditional
capital markets structures that we service, but not to the level we
anticipated."
6
Revenue from capital markets activities was $8.8 million, which was equal to
the prior quarter amount and $1.5 million lower than for the prior-year quarter,
when approximately $1 million in bankruptcy-related fees was recorded. Entity
management services generated $5.2 million of revenue, which was level with the
prior quarter and 10.6% higher than for the prior-year quarter. Activity in
European markets accounted for this increase. Corporate retirement services
revenue was $2.4 million, which was 4.3% ahead of the prior quarter and 9.1%
ahead of the prior-year quarter.
Corporate Client services are performed on a fee-for-service basis that is
priced according to the complexity of the services provided. Most are performed
under multiyear contracts and generate an annuity-like stream of revenue.
Approximately 25% of Corporate Client revenue is tied to asset valuations; most
of that is associated with retirement plan assets for which the company serves
as trustee.
At affiliate money manager Cramer Rosenthal McGlynn (CRM), assets under
management rose to $4.0 billion on a combination of market appreciation and new
business development. CRM's assets were 5.2% higher than for the prior quarter
and 8.1% higher than for the prior-year quarter. Revenue from CRM was $1.3
million, which was 18.2% higher than for the prior quarter, but 27.8% lower than
the $1.8 million reported for the prior-year quarter. The year-over-year
decrease was due to lower incentive payments related to hedge funds.
Results from affiliate money manager Roxbury Capital Management (RCM) remained
lower than the year-ago level, but improved significantly from the prior
quarter. RCM recorded a loss of $100,000 for the 2003 third quarter, compared to
a loss of $1.2 million for the 2003 second quarter. Monthly outflows continued
to slow, expenses were lower, and the small-cap product that was launched in
June 2002 continued to attract new assets. Assets under management at RCM were
$3.1 billion, which was 6% lower than for the prior quarter and 20.5% lower than
for the prior-year quarter. "Roxbury has taken the necessary steps to return to
a positive operating margin," Cecala said. "We expect that Roxbury will return
to profitability by the end of the year."
7
On a combined basis, revenue from the two affiliate money managers totaled $1.2
million for the 2003 third quarter, compared with $4.2 million for the 2002
third quarter. The difference represented approximately $0.03 per share.
EXPENSE MANAGEMENT INITIATIVES CONTINUE
As a result of the expense management initiatives begun at the end of the first
quarter, expenses fell to $75.2 million. This was $1.9 million, or 2.5%, lower
than for both the prior quarter and the prior-year quarter.
Salary expense totaled $31.5 million, which was slightly higher than for the
prior quarter and 4% higher than for the prior-year quarter. Incentives and
bonus expense totaled $5.4 million. This was $2 million, or 27%, lower than for
the 2002 third quarter.
Employment benefit expense was slightly lower on a linked-quarter basis, but
12.8% higher than for the year-ago quarter, due to increased health insurance
and pension costs.
At September 30, the number of full-time equivalent staff was 2,302, which was
17 fewer than at June 30, 2003, and 49 fewer than at September 30, 2002.
Furniture, equipment, and supplies expense declined 9.6% from the prior quarter
and 19.5% from the prior-year quarter, primarily due to the roll-off of
depreciation on desktop operating systems.
For the first nine months of 2003, expenses totaled $231.9 million, compared
with $228.2 million for the first nine months of 2002. "We continue to seek ways
to minimize our expense growth," Cecala said. "Based on our year-to-date
experience, we expect that expenses for the full year 2003 will be less than the
$310 million we recorded for full-year 2002."
8
CONFERENCE CALL TODAY
Management will discuss results in a conference call today at 10:00 a.m. (EDT).
To access the call, dial 800-475-2151. Supporting materials, financial
statements, and simultaneous streaming of the conference call audio will be
available online at wilmingtontrust.com. A rebroadcast of the conference call
will be available from 12:00 noon (EDT) today until 5:00 p.m. (EDT) on Friday,
October 24, by calling 877-519-4471 and using PIN number 4221131. To access the
rebroadcast from outside the United States, dial 973-341-3080 and use the same
PIN number.
FORWARD LOOKING STATEMENTS
This release contains forward-looking statements which reflect the company's
current expectations about its future performance. These statements rely on a
number of assumptions and estimates and are subject to various risks and
uncertainties that could cause actual results to differ materially from
expectations. Factors that could affect the company's future financial results
are discussed more fully in the reports the company files with the Securities
and Exchange Commission. The company disclaims any obligation or intent to
update the forward-looking statements in order to reflect events or
circumstances after the date of this release.
ABOUT WILMINGTON TRUST
Wilmington Trust Corporation (NYSE: WL) is a financial services holding company
that provides wealth management and specialized corporate services to clients
throughout the U.S. and in more than 50 other countries, and commercial banking
services throughout the Delaware Valley region. Its wholly owned bank
subsidiary, Wilmington Trust Company, which celebrates its 100th anniversary in
2003, is the 15th largest personal trust provider in the United States.
Wilmington Trust and its affiliates have offices in California, Delaware,
Florida, Georgia, Maryland, Nevada, New York, Pennsylvania, Tennessee, the
Cayman Islands, the Channel Islands, and London, and other affiliates in Dublin
and Milan. For more information, visit
www.wilmingtontrust.com.
# # #
9
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
INCOME STATEMENT
Three Months Ended
----------------------------------------------------------------------
Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30,
(in millions, except per share amounts) 2003 2003 2003 2002 2002
---------------------------------------------------------------------------------------------------------------------------
Net Interest Income
Interest income $ 90.5 $ 94.7 $ 92.8 $ 96.9 $ 100.1
Interest expense 22.4 24.5 24.5 27.0 29.3
---------------------------------------------------------------------------------------------------------------------------
Net interest income 68.1 70.2 68.3 69.9 70.8
Provision for loan losses (5.7) (5.9) (4.9) (5.5) (5.1)
---------------------------------------------------------------------------------------------------------------------------
Net interest income after provision
for loan losses 62.4 64.3 63.4 64.4 65.7
----------------------------------------------------------------------
Noninterest Income
Advisory fees:
Wealth advisory services 35.5 33.1 33.6 32.7 31.2
Corporate client services 16.4 16.5 14.9 18.2 17.2
Cramer Rosenthal McGlynn 1.3 1.1 0.7 1.2 1.8
Roxbury Capital Management (0.1) (1.2) (0.9) (1.4) 2.4
---------------------------------------------------------------------------------------------------------------------------
Advisory fees 53.1 49.5 48.3 50.7 52.6
Amortization of other intangibles (0.7) (0.3) (0.3) (0.3) (0.7)
---------------------------------------------------------------------------------------------------------------------------
Advisory fees after amortization
of other intangibles 52.4 49.2 48.0 50.4 51.9
----------------------------------------------------------------------
Service charges on deposit accounts 8.6 7.8 7.3 7.8 7.8
Other noninterest income 5.3 6.0 5.8 7.5 5.8
Securities gains ---- ---- ---- 2.0 ----
---------------------------------------------------------------------------------------------------------------------------
Total noninterest income 66.3 63.0 61.1 67.7 65.5
----------------------------------------------------------------------
Net interest and noninterest income 128.7 127.3 124.5 132.1 131.2
----------------------------------------------------------------------
Noninterest Expense
Salaries and wages 31.5 31.2 29.8 30.3 30.3
Incentives and bonuses 5.4 4.3 9.5 6.6 7.4
Employment benefits 8.8 8.9 9.6 8.6 7.8
Net occupancy 4.8 5.0 5.4 5.6 5.3
Furniture, equipment, and supplies 6.6 7.3 7.3 7.6 8.2
Other noninterest expense 18.1 20.4 18.0 23.0 18.1
---------------------------------------------------------------------------------------------------------------------------
Total noninterest expense 75.2 77.1 79.6 81.7 77.1
----------------------------------------------------------------------
Income before income taxes and
minority interest 53.5 50.2 44.9 50.4 54.1
Applicable income taxes 18.8 17.4 15.3 17.9 19.4
---------------------------------------------------------------------------------------------------------------------------
Net income before minority interest 34.7 32.8 29.6 32.5 34.7
Minority interest 0.3 0.2 0.2 0.2 0.2
---------------------------------------------------------------------------------------------------------------------------
Net income $ 34.4 $ 32.6 $ 29.4 $ 32.3 $ 34.5
======================================================================
Net income per share
Basic $ 0.52 $ 0.50 $ 0.45 $ 0.49 $ 0.53
Diluted 0.52 0.49 0.44 0.49 0.52
Weighted average shares outstanding (in thousands)
Basic 65,956 65,790 65,692 65,584 65,631
Diluted 66,670 66,195 66,174 66,148 66,174
Net income as a percentage of:
Average assets 1.58% 1.53% 1.46% 1.60% 1.77%
Average stockholders' equity 17.64 17.04 15.97 17.30 18.66
Three Months Ended
--------------------
% Change
From:
--------------------
Prior Prior
(in millions, except per share amounts) Quarter Year
------------------------------------------- ------- -----
Net Interest Income
Interest income (4.4) (9.6)
Interest expense (8.6) (23.5)
Net interest income (3.0) (3.8)
Provision for loan losses (3.4) 11.8
Net interest income after provision
for loan losses (3.0) (5.0)
Noninterest Income
Advisory fees:
Wealth advisory services 7.3 13.8
Corporate client services (0.6) (4.7)
Cramer Rosenthal McGlynn 18.2 (27.8)
Roxbury Capital Management (91.7) --
Advisory fees 7.3 1.0
Amortization of other intangibles 133.3 --
Advisory fees after amortization
of other intangibles 6.5 1.0
Service charges on deposit accounts 10.3 10.3
Other noninterest income (11.7) (8.6)
Securities gains -- --
Total noninterest income 5.2 1.2
Net interest and noninterest income 1.1 (1.9)
Noninterest Expense
Salaries and wages 1.0 4.0
Incentives and bonuses 25.6 (27.0)
Employment benefits (1.1) 12.8
Net occupancy (4.0) (9.4)
Furniture, equipment, and supplies (9.6) (19.5)
Other noninterest expense (11.3) --
Total noninterest expense (2.5) (2.5)
Income before income taxes and
minority interest 6.6 (1.1)
Applicable income taxes 8.0 (3.1)
Net income before minority interest 5.8 --
Minority interest 50.0 50.0
Net income 5.5 (0.3)
Net income per share
Basic 4.0 (1.9)
Diluted 6.1 --
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
INCOME STATEMENT
Nine Months Ended
--------------------------------------
Sept. 30, Sept. 30, %
(in millions, except per share amounts) 2003 2002 Change
-------------------------------------------------------------------------------------------
Net Interest Income
Interest income $ 278.1 $ 295.9 (6.0)
Interest expense 71.4 89.3 (20.0)
-----------------------------------------------------------------------------
Net interest income 206.7 206.6 --
Provision for loan losses (16.6) (16.5) 0.6
-----------------------------------------------------------------------------
Net interest income after provision
for loan losses 190.1 190.1 --
------------------------
Noninterest Income
Advisory fees:
Wealth advisory services 102.3 94.2 8.6
Corporate client services 47.8 46.0 3.9
Cramer Rosenthal McGlynn 3.2 6.5 (50.8)
Roxbury Capital Management (2.3) 10.0 --
-----------------------------------------------------------------------------
Advisory fees 151.0 156.7 (3.6)
Amortization of other intangibles (1.4) (0.9) 55.6
-----------------------------------------------------------------------------
Total advisory fees after amortization
of other intangibles 149.6 155.8 (4.0)
------------------------
Service charges on deposit accounts 23.7 22.1 7.2
Other noninterest income 17.2 16.5 4.2
Securities gains -- -- --
-----------------------------------------------------------------------------
Total noninterest income 190.5 194.4 (2.0)
------------------------
Net interest and noninterest income 380.6 384.5 (1.0)
------------------------
Noninterest Expense
Salaries and wages 92.5 89.2 3.7
Incentives and bonuses 19.2 23.7 (19.0)
Employment benefits 27.3 24.1 13.3
Net occupancy 15.2 14.8 2.7
Furniture, equipment, and supplies 21.1 24.3 (13.2)
Other noninterest expense 56.6 52.1 8.6
-----------------------------------------------------------------------------
Total noninterest expense 231.9 228.2 1.6
------------------------
Income before income taxes and
minority interest 148.7 156.3 (4.9)
Applicable income taxes 51.5 55.1 (6.5)
-----------------------------------------------------------------------------
Net income before minority interest 97.2 101.2 (4.0)
Minority interest 0.8 0.3 166.7
-----------------------------------------------------------------------------
Net income $ 96.4 $ 100.9 (4.5)
========================
Net income per share
Basic $ 1.46 $ 1.54 (5.2)
Diluted 1.45 1.52 (4.6)
Weighted average shares outstanding (in thousands)
Basic 65,814 65,628
Diluted 66,348 66,354
Net income as a percentage of:
Average assets 1.52% 1.79%
Average stockholders' equity 16.90 18.93
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
STATEMENT OF CONDITION
Sept. 30, June 30, Mar. 31, Dec. 31, Sept. 30,
(in millions) 2003 2003 2003 2002 2002
--------------------------------------------------------------------------------------------------------------------
Assets
Cash and due from banks $ 228.5 $ 214.5 $ 207.3 $ 248.9 $ 253.1
------------------------------------------------------------------
Federal funds sold and securities
purchased under agreements to resell 477.7 180.9 3.8 ---- 105.4
------------------------------------------------------------------
Investment securities:
U.S. Treasury and government agencies 515.1 548.6 451.5 489.6 593.4
Obligations of state and political 16.1 16.6 16.6 16.6 17.3
subdivisions
Preferred stock 119.4 122.4 119.2 111.8 93.5
Mortgage-backed securities 883.4 1,039.1 707.2 507.8 450.8
Other securities 262.5 244.2 250.2 222.9 200.1
--------------------------------------------------------------------------------------------------------------------
Total investment securities 1,796.5 1,970.9 1,544.7 1,348.7 1,355.1
------------------------------------------------------------------
Loans:
Commercial, financial and agricultural * 2,216.0 2,219.6 2,153.6 2,137.1 2,132.5
Real estate - construction * 663.4 602.1 604.0 591.9 450.4
Mortgage-commercial * 1,052.6 1,038.0 1,055.0 1,065.9 969.0
--------------------------------------------------------------------------------------------------------------------
Total commercial loans 3,932.0 3,859.7 3,812.6 3,794.9 3,551.9
------------------------------------------------------------------
Mortgage-residential 545.9 592.3 627.1 677.2 740.9
Consumer 1,055.5 1,037.0 1,029.4 1,046.7 1,067.7
Secured with liquid collateral 565.8 574.6 539.1 506.3 500.5
--------------------------------------------------------------------------------------------------------------------
Total retail loans 2,167.2 2,203.9 2,195.6 2,230.2 2,309.1
------------------------------------------------------------------
Total loans net of unearned income 6,099.2 6,063.6 6,008.2 6,025.1 5,861.0
Reserve for loan losses (91.2) (87.6) (86.0) (85.2) (86.8)
--------------------------------------------------------------------------------------------------------------------
Net loans 6,008.0 5,976.0 5,922.2 5,939.9 5,774.2
------------------------------------------------------------------
Premises and equipment 152.0 152.1 154.0 155.2 138.2
Goodwill 242.8 247.3 240.1 240.2 239.5
Other intangibles 24.2 21.3 21.4 21.7 17.5
Other assets 170.2 176.2 174.5 176.7 158.3
--------------------------------------------------------------------------------------------------------------------
Total assets $ 9,099.9 $ 8,939.2 $ 8,268.0 $ 8,131.3 $ 8,041.3
==================================================================
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand: $ 1,440.0 $ 944.4 $ 919.1 $ 1,189.6 $ 919.4
Interest-bearing:
Savings 364.9 368.7 366.5 349.3 343.3
Interest-bearing demand 2,246.9 2,302.5 2,129.9 1,833.6 1,846.0
Certificates under $100,000 805.6 836.7 867.5 884.1 898.6
Local certificates $100,000 and over 129.1 125.8 136.9 135.3 176.5
--------------------------------------------------------------------------------------------------------------------
Total core deposits 4,986.5 4,578.1 4,419.9 4,391.9 4,183.8
National certificates $100,000 and over 1,784.2 1,910.2 2,157.2 1,945.2 1,913.2
--------------------------------------------------------------------------------------------------------------------
Total deposits 6,770.7 6,488.3 6,577.1 6,337.1 6,097.0
------------------------------------------------------------------
Short-term borrowings:
Federal funds purchased and securities sold
under agreements to repurchase 938.8 1,083.4 627.9 692.8 814.5
U.S. Treasury demand 55.6 32.5 10.7 41.9 91.7
--------------------------------------------------------------------------------------------------------------------
Total short-term borrowings 994.4 1,115.9 638.6 734.7 906.2
------------------------------------------------------------------
Other liabilities 140.2 133.2 137.0 157.7 138.3
Long-term debt 410.7 420.8 160.5 160.5 160.5
--------------------------------------------------------------------------------------------------------------------
Total liabilities 8,316.0 8,158.2 7,513.2 7,390.0 7,302.0
Minority interest 0.3 (0.1) -- -- --
Stockholders' equity 783.6 781.1 754.8 741.3 739.3
--------------------------------------------------------------------------------------------------------------------
Total liabilities and stockholders'
equity $ 9,099.9 $ 8,939.2 $ 8,268.0 $ 8,131.3 $ 8,041.3
==================================================================
% Change From
------------------------
Prior Prior
(in millions) Quarter Year
--------------------------------------------------------------------------
Assets
Cash and due from banks 6.5 (9.7)
Federal funds sold and securities
purchased under agreements to resell 164.1 353.2
Investment securities:
U.S. Treasury and government agencies (6.1) (13.2)
Obligations of state and political
subdivisions (3.0) (6.9)
Preferred stock (2.5) 27.7
Mortgage-backed securities (15.0) 96.0
Other securities 7.5 31.2
Total investment securities (8.8) 32.6
Loans:
Commercial, financial and agricultural * (0.2) 3.9
Real estate - construction * 10.2 47.3
Mortgage-commercial * 1.4 8.6
Total commercial loans 1.9 10.7
Mortgage-residential (7.8) (26.3)
Consumer 1.8 (1.1)
Secured with liquid collateral (1.5) 13.0
Total retail loans (1.7) (6.1)
Total loans net of unearned income 0.6 4.1
Reserve for loan losses 4.1 5.1
Net loans 0.5 4.0
Premises and equipment (0.1) 10.0
Goodwill (1.8) 1.4
Other intangibles 13.6 38.3
Other assets (3.4) 7.5
Total assets 1.8 13.2
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand: 52.5 56.6
Interest-bearing:
Savings (1.0) 6.3
Interest-bearing demand (2.4) 21.7
Certificates under $ 100,000 (3.7) (10.3)
Local certificates $100,000 and over 2.6 (26.9)
Total core deposits 8.9 19.2
National certificates $100,000 and over (6.6) (6.7)
Total deposits 4.4 11.0
Short-term borrowings:
Federal funds purchased and securities sold
under agreements to repurchase (13.3) 15.3
U.S. Treasury demand 71.1 (39.4)
Total short-term borrowings (10.9) 9.7
Other liabilities 5.3 1.4
Long-term debt (2.4) 155.9
Total liabilities 1.9 13.9
Minority interest -- --
Stockholders' equity 0.3 6.0
Total liabilities and stockholders'
equity 1.8 13.2
* Certain commercial loan balances reclassified
-----------------------------------------------
Commercial loan balances for the 2003 first quarter reflect changes that were
made after an analysis of ledger coding revealed inconsistencies in the
categories in which loans were recorded. This resulted in a reclassification of
approximately $192 million, or 5%, of the commercial portfolio. The $192 million
was moved out of the general commercial and industrial category. Approximately
$90 million of that amount was reclassified as commercial real estate loans, and
the remaining $102 million was moved into the commercial mortgage category.
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
AVERAGE STATEMENT OF CONDITION
% Change From
2003 2003 2003 2002 2002 ------------------
Third Second First Fourth Third Prior Prior
(in millions) Quarter Quarter Quarter Quarter Quarter Quarter Year
------------------------------------------------------------------------------------------------------------- -------- --------
Assets
Cash and due from banks $ 190.5 $ 182.4 $ 187.0 $ 201.1 $ 185.9 4.4 2.5
-------------------------------------------------------------
Federal funds sold and securities
purchased under agreements to resell 35.6 38.4 24.1 63.5 16.4 (7.3) 117.1
-------------------------------------------------------------
Investment securities:
U.S. Treasury and government agencies 517.1 528.8 461.0 588.4 591.9 (2.2) (12.6)
Obligations of state and
political subdivisions 16.2 16.6 16.5 16.8 17.2 (2.4) (5.8)
Preferred stock 120.7 120.1 114.0 99.4 85.4 0.5 41.3
Mortgage-backed securities 961.2 888.8 642.6 434.5 447.6 8.1 114.7
Other securities 249.9 240.9 227.5 213.9 189.0 3.7 32.2
-------------------------------------------------------------------------------------------------------------
Total investment securities 1,865.1 1,795.2 1,461.6 1,353.0 1,331.1 3.9 40.1
-------------------------------------------------------------
Loans:
Commercial, financial and agricultural 2,202.2 2,190.8 2,214.8 2,208.4 2,055.7 0.5 7.1
Real estate - construction 624.9 590.8 544.6 469.3 448.7 5.8 39.3
Mortgage-commercial 1,039.4 1,054.6 1,008.0 980.3 986.1 (1.4) 5.4
-------------------------------------------------------------------------------------------------------------
Total commercial loans 3,866.5 3,836.2 3,767.4 3,658.0 3,490.5 0.8 10.8
-------------------------------------------------------------
Mortgage-residential 573.9 604.7 649.0 708.9 759.0 (5.1) (24.4)
Consumer 1,031.3 1,031.4 1,028.3 1,031.9 1,027.8 -- 0.3
Secured with liquid collateral 583.6 565.4 532.9 499.2 483.0 3.2 20.8
-------------------------------------------------------------------------------------------------------------
Total retail loans 2,188.8 2,201.5 2,210.2 2,240.0 2,269.8 (0.6) (3.6)
-------------------------------------------------------------
Total loans net of unearned income 6,055.3 6,037.7 5,977.6 5,898.0 5,760.3 0.3 5.1
Reserve for loan losses (87.1) (84.7) (84.5) (84.9) (85.9) 2.8 1.4
-------------------------------------------------------------------------------------------------------------
Net loans 5,968.2 5,953.0 5,893.1 5,813.1 5,674.4 0.3 5.2
-------------------------------------------------------------
Premises and equipment 153.0 153.7 154.9 144.0 138.9 (0.5) 10.2
Goodwill 247.4 245.8 240.2 240.5 245.2 0.7 0.9
Other intangibles 21.2 21.3 21.6 16.6 11.1 (0.5) 91.0
Other assets 176.7 177.6 176.7 159.5 150.3 (0.5) 17.6
-------------------------------------------------------------------------------------------------------------
Total assets $ 8,657.7 $ 8,567.4 $ 8,159.2 $ 7,991.3 $ 7,753.3 1.1 11.7
========= ========== ========== ========== ==========
Liabilities and Stockholders' Equity
Deposits:
Noninterest-bearing demand $ 866.8 $ 796.4 $ 800.7 $ 970.3 $ 777.3 8.8 11.5
Interest-bearing:
Savings 368.8 369.4 357.3 346.5 355.8 (0.2) 3.7
Interest-bearing demand 2,244.7 2,127.0 2,062.9 1,812.6 1,767.7 5.5 27.0
Certificates under $100,000 817.6 851.5 874.6 891.6 891.8 (4.0) (8.3)
Local CDs $100,000 and over 128.4 139.6 151.1 168.7 178.8 (8.0) (28.2)
-------------------------------------------------------------------------------------------------------------
Total core deposits 4,426.3 4,283.9 4,246.6 4,189.7 3,971.4 3.3 11.5
National CDs $100,000 and over 1,780.9 1,979.5 2,066.3 1,987.4 2,027.0 (10.0) (12.1)
-------------------------------------------------------------------------------------------------------------
Total deposits 6,207.2 6,263.4 6,312.9 6,177.1 5,998.4 (0.9) 3.5
-------------------------------------------------------------
Short-term borrowings:
Federal funds purchased and securities
sold under agreements to repurchase 1,115.2 985.3 778.7 753.0 705.3 13.2 58.1
U.S. Treasury demand 20.0 8.4 8.1 16.3 27.3 138.1 (26.7)
-------------------------------------------------------------------------------------------------------------
Total short-term borrowings 1,135.2 993.7 786.8 769.3 732.6 14.2 55.0
-------------------------------------------------------------
Other liabilities 136.1 135.0 152.5 143.5 128.2 0.8 6.2
Long-term debt 405.4 407.9 160.5 160.5 160.5 (0.6) 152.6
-------------------------------------------------------------
Total liabilities 7,883.9 7,800.0 7,412.7 7,250.4 7,019.7 1.1 12.3
Minority interest -- 0.1 0.1 0.1 0.1 (100.0) (100.0)
Stockholders' equity 773.8 767.3 746.4 740.8 733.5 0.8 5.5
-------------------------------------------------------------------------------------------------------------
Total liabilities and
stockholders' equity $ 8,657.7 $ 8,567.4 $ 8,159.2 $ 7,991.3 $ 7,753.3 1.1 11.7
========= ========== ========== ========== ==========
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
RATES
2003 2003 2003 2002 2002
Third Second First Fourth Third
YIELDS/RATES (TAX-EQUIVALENT BASIS) Quarter Quarter Quarter Quarter Quarter
------------------------------------------------ -------- ------- ------- ------- -------
Earning assets:
FEDERAL FUNDS SOLD AND SECURITIES
PURCHASED UNDER AGREEMENTS TO RESELL 1.12% 1.32% 1.40% 1.65% 2.77%
U.S. Treasury and government agencies 3.22 3.29 3.73 4.14 4.27
Obligations of state and political subdivisions 8.99 9.01 8.97 9.04 8.97
Preferred stock 7.39 7.40 7.68 7.99 8.13
Mortgage-backed securities 3.64 4.47 4.97 5.38 5.68
Other securities 2.88 2.93 3.17 3.58 3.55
TOTAL INVESTMENT SECURITIES 3.71 4.15 4.55 4.80 4.95
Commercial, financial and agricultural 4.18 4.45 4.53 4.83 5.20
Real estate - construction 4.37 4.56 4.45 4.62 5.23
Mortgage-commercial 5.08 5.47 5.63 5.88 6.34
TOTAL COMMERCIAL LOANS 4.45 4.75 4.81 5.08 5.53
Mortgage-residential 6.63 6.77 6.82 6.83 6.82
Consumer 6.58 6.68 6.85 7.03 7.20
Secured with liquid collateral 2.52 2.73 2.87 3.17 3.35
TOTAL RETAIL LOANS 5.51 5.69 5.88 6.11 6.25
TOTAL LOANS 4.85 5.09 5.21 5.47 5.81
TOTAL EARNING ASSETS 4.56 4.86 5.07 5.32 5.65
Funds used to support earning assets
Savings 0.13 0.15 0.23 0.24 0.25
Interest-bearing demand 0.39 0.45 0.47 0.51 0.60
Certificates under $100,000 2.50 2.80 3.05 3.29 3.46
Local certificates $100,000 and over 1.60 1.78 1.99 2.38 2.36
CORE INTEREST-BEARING DEPOSITS 0.89 1.05 1.17 1.35 1.46
National certificates $100,000 and over 1.48 1.56 1.69 1.92 2.14
TOTAL INTEREST-BEARING DEPOSITS 1.09 1.23 1.36 1.57 1.72
Federal funds purchased and securities sold
under agreements to repurchase 1.39 1.54 1.64 1.86 2.04
U.S. Treasury demand 0.76 1.04 0.99 1.22 1.51
TOTAL SHORT-TERM BORROWINGS 1.38 1.54 1.64 1.85 2.02
Long-term debt 3.63 3.62 6.58 6.61 6.61
TOTAL INTEREST-BEARING LIABILITIES 1.29 1.42 1.52 1.73 1.89
TOTAL FUNDS USED TO SUPPORT
EARNING ASSETS 1.11 1.24 1.32 1.46 1.63
NET INTEREST MARGIN (TAX-EQUIVALENT BASIS) 3.45 3.62 3.75 3.86 4.02
Tax-equivalent net interest income
income (in millions) $ 69.3 $ 71.4 $ 69.6 $ 71.2 $ 72.1
Average rates are calculated using average balances based on historical cost
and do not reflect market valuation adjustments.
WILMINGTON TRUST CORPORATION
QUARTERLY SUMMARY
As of and for the nine months ended September 30, 2003
SUPPLEMENTAL
Three Months Ended
---------------------------------------------------------------------------------
% Change From:
--------------
Prior
September 30, June 30, Mar. 31, Dec. 31, Sept. 30, Prior Year
2003 2003 2003 2002 2002 Quarter Quarter
------------- -------- -------- -------- --------- ------- -------
OTHER NONINTEREST EXPENSE (in millions)
Advertising and contributions $ 1.4 $ 2.8 $ 1.9 $ 2.8 $ 2.1 (50.0) (33.3)
Servicing and consulting fees 4.0 3.9 4.0 4.7 3.2 2.6 25.0
Travel, entertainment, and training 1.8 1.9 1.5 2.0 2.0 (5.3) (10.0)
Originating and processing fees 2.1 1.8 1.8 2.0 1.7 16.7 23.5
Other noninterest expense 8.8 10.0 8.8 11.5 9.1 (12.0) (3.3)
------- ------- -------- -------- --------
Total $ 18.1 $ 20.4 $ 18.0 $ 23.0 $ 18.1 (11.3) --
======= ======= ======== ======== ========
Staffing (FTE) 2,302 2,319 2,342 2,361 2,351
ASSETS UNDER MANAGEMENT (in billions)
Wilmington Trust $ 23.6 $ 22.7 $ 21.6 $ 21.0 $ 21.1 4.0 11.8
Roxbury Capital Management 3.1 3.3 3.2 3.7 3.9 (6.1) (20.5)
Cramer Rosenthal McGlynn 4.0 3.8 3.2 3.5 3.7 5.3 8.1
------- ------- -------- -------- --------
Combined assets under management $ 30.7 $ 29.8 $ 28.0 $ 28.2 $ 28.7 3.0 7.0
======= ======= ======== ======== ========
A routine analysis of assets under management determined that certain investment
consulting assets had been reported both by Wilmington Trust and one of its
affiliates. The problem has been corrected and the reported amounts were revised
accordingly.
CAPITAL (in millions, except per share amounts)
Average stockholders' equity $ 773.8 $ 767.3 $ 746.4 $ 740.8 $ 733.5 0.8 5.5
Period-end primary capital 874.8 868.9 840.8 826.4 826.0 0.7 5.9
Per share:
Book value 11.87 11.85 11.49 11.30 11.28 0.2 5.2
Dividends declared 0.27 0.27 0.255 0.255 0.255 -- 5.9
Average stockholders' equity to assets 8.94% 8.96% 9.15% 9.27% 9.46%
Total risk-based capital ratio 12.15 11.90 10.20 10.19 10.57
Tier 1 risk-based capital ratio 7.27 7.09 7.11 7.07 7.36
Tier 1 leverage capital ratio 6.19 6.01 6.15 6.11 6.25
CREDIT QUALITY (in millions)
Period-end reserve for loan losses $ 91.2 $ 87.6 $ 86.0 $ 85.2 $ 86.8
Period-end non-performing assets:
Nonaccrual 50.2 60.4 64.6 42.4 44.4
OREO 1.6 3.2 3.9 3.1 0.3
Period-end past due 90 days 7.3 7.1 8.3 12.5 22.3
Period-end renegotiated loans -- -- -- -- --
Gross charge-offs 3.3 5.1 5.3 7.9 5.8
Recoveries 1.3 0.7 1.2 0.8 0.8
Net charge-offs 2.0 4.4 4.1 7.1 5.0
Ratios:
Period-end reserve to loans 1.50% 1.44% 1.43% 1.41% 1.48%
Period-end non-performing assets to loans 0.85 1.05 1.14 0.76 0.76
Period-end loans past due 90 days to
total loans 0.12 0.12 0.14 0.21 0.38
Net charge-offs to average loans 0.03 0.07 0.07 0.12 0.09
INTERNAL RISK RATING
Pass 95.81% 95.62% 95.52% 95.65% 95.62%
Watchlisted 2.53 2.60 2.48 2.57 2.29
Substandard 1.25 1.23 1.79 1.53 1.83
Doubtful 0.41 0.55 0.21 0.25 0.26