Wilmington Trust Shares Rise On Analyst Upgrade

BOSTON (AP) — Shares of Wilmington Trust Corp. rose Thursday after an upgrade by a SunTrust Robinson Humphrey analyst, who said the regional bank is seeing credit trends improve and is unlikely to make a near-term stock offering to raise capital.

Mac Hodgson raised his rating on the shares to "Buy" from "Neutral." He also revised his earnings outlook for Wilmington Trust and set an initial $16 price target for the shares.

Shares of Wilmington Trust rose 65 cents, or 5.1 percent, to $13.38 in morning trading.

Hodgson said in a research note that he expects credit trends to improve for Wilmington Trust in the current quarter compared with the second quarter, when the Delaware-based bank saw a nearly 32 percent increase in non-performing assets — loans that are considered past due — compared with this year's first quarter. Wilmington Trust also recorded securities losses of $23.4 million on pooled trust-preferred investment securities.

But Hodgson, who recently made a field visit to discuss the company's prospects with management, said he doesn't expect non-performing assets to jump sharply in the third quarter. He also doesn't see the company making an "outsized" loan-loss provision, "as management indicated that it is seeing some stability in its markets, and commercial real estate is holding up well."