Washington Trust Bancorp, Inc.

Good morning and welcome to Washington Trust Pancorp, Inc. conference call. My name is Vaishnavi and I will be your operator today. If participants need assistance during the call at any time, please press star and zero. Participants interested in asking a question at the end of the call should press star and then one to get into the queue. Today's call is being recorded. And now I will turn the call over to Elizabeth B. Echol, Senior Vice President, Chief Marketing and Corporate Communications Officer. Ms. Echol?

Thank you. Good morning and welcome to Washington Trust Bancorp Inc. second quarter 2021 conference call. Joining us on today's call are members of Washington Trust Executive Team, Ned Handy, Chairman and Chief Executive Officer, Mark Gim, President and Chief Operating Officer, Ron Osberg, Senior Executive Vice President, Chief Financial Officer and Treasurer, and Bill Ray, Senior Executive Vice President and Chief Risk Officer. As a reminder, today's call may contain forward-looking statements, and actual results could differ materially from what is discussed today. Our complete Safe Harbor Statement appears in our earnings press release, as well as in other documents filed with the SEC. You may view these materials, as well as our Safe Harbor Statement in its entirety, on our investor relations site at ir.washtrust.com. Washington Trust trades on NASDAQ under the symbol WASH. I'm now pleased to introduce the host of today's call, Washington Trust Chairman and CEO, Ned Handy.

Thank you, Beth, and good morning, everybody. Thank you for joining our second quarter call. I hope everyone's doing well and has remained healthy since our last call. We appreciate your continued interest in Washington Trust. Today's agenda is similar to past calls. I'll provide an overview of our second quarter highlights, and then Ron Osberg will review our financial performance. After our prepared remarks, Mark Gimm and Bill Ray will join us to answer any questions you may have about the quarter. I'm pleased to report that Washington Trust posted strong second quarter results with net income of $17.5 million, or $1 per diluted share. Meaningful quarter-over-quarter increases in net interest income, wealth management revenues, and loan-related derivative fees were offset by lower mortgage banking revenues. Non-interest expenses were well managed in the quarter, and our returns and capital levels reflect the successful quarter. Ron will provide more detail in a moment. We are increasingly optimistic about where we, our customers, and the economies in which we operate stand with regards to the pandemic. As we contemplate the new work environment, we think first about what is safest for everybody, and then we turn to what is most effective and efficient for our customers. We will implement all of the best practices we've learned throughout the pandemic, and we'll find the appropriate balance between technology-assisted flexibility, outstanding customer service, culture-enhancing practices, and continued dedication to delivering consistent, strong results. I continue to feel great pride in the way our employees adjusted and adapted without ever losing sight of what matters most to our customers and the communities we serve. We were recently named by Forbes as one of America's best in state banks for 2021. This award, based on a survey of our customers, recognizes the strength of our franchise based on factors such as trust, products, branch services, digital services, and financial advice. Additionally, we were also recognized by Providence Business News as one of the best places to work and one of the healthiest employers in Rhode Island. We're very proud of these acknowledgements and believe that when we take great care of our customers and our employees, it translates into growth and profit for our shareholders. We were pleased that Lisa Stanton joined our board in April. Lisa has deep experience in the payment space and in various aspects of data security. Lisa was most recently General Manager, Enterprise Strategy for American Express. We very much look forward to her contributions. It's a digital world, and we recognize that the ever-spreading technology ecosystem poses both opportunities and challenges. So we continue to invest in improving our customers' experience across delivery channels and in our evolving hybrid work environment. At the same time, we are investing to protect our customers' data privacy while educating them about the increasing risks of cyber fraud that accompany the shift to digital commerce. Our business model has consistently provided a diverse stream of earnings for us through various economic cycles, and that has served us well during the crisis. Our commitment to strong credit practices has helped to minimize potential costs associated with the pandemic. We opened our new branch location in East Greenwich, Rhode Island, our first in that vibrant market. We're very pleased with the first few months of operations. We continue to believe we have deposit market share opportunity in Rhode Island and believe that physical presence matters in tandem with enhanced digital connection and service points. In-market deposits were up 12% from a year ago. We also saw continued reduction of cost in both our in-market deposit base and our wholesale funding base. Ron will comment on the margin impact. Turning to lending, Total loans amounted to $4.3 billion at June 30th, up 3% from the end of the first quarter, with residential mortgage and commercial real estate growth outstripping reductions from PPP forgiveness. We processed forgiveness of about $85 million in PPP loans in the second quarter. Commercial pipelines continue to improve and have returned to pre-pandemic levels. We've seen a resurgence in CREE, in warehouse and multifamily in particular, and are seeing commercial lending activity pick up as the economy begins to recover. Mortgage sales volume in the quarter remains strong at $291 million, essentially even with Q1. Consistent with that, we've seen in the industry and our market area, market pricing has reduced our sales yields from very elevated levels realized over the past several quarters. Residential mortgage originations at $489 million, continued to be very strong in the second quarter, with an increasing percentage of these originations heading for portfolio. Our mortgage team continues to work diligently. The pipeline and application activity remains strong and at higher than pre-pandemic levels. It appears, however, that we are beginning to see indications of normalizing in the industry, although it's too soon to forecast the pace and the impact. Our Wealth Management Division's assets under administration reached a record $7.4 billion at June 30th, up 6% from March 31st. This growth reflects financial market appreciation as well as strong business development and client retention efforts, net of routine client asset flows. Wealth Management revenues were $10.4 million for the second quarter, up 5% from the preceding quarter, providing a key source of non-interest income. We're very pleased with our Wealth Management Division's second quarter performance. I'll now turn the call over to Ron for a more detailed review of our financial performance. Ron?