UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

þ QUARTERLY REPORT PURSUANT TO SECTION 13 ORor 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 3031, ~~2010~~2011


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ~~________~~ to ~~_______~~

Commission File Number: 1-14659

WILMINGTON TRUST CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		51-0328154
Delaware (State or other jurisdiction of incorporation or organization)		51-0328154 (I.R.S. Employer Identification No.)
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
Rodney Square North, 1100 North Market Street,
Wilmington, Delaware		19890
Wilmington, Delaware (Address of principal executive offices)		19890 (Zip Code)
(Address of principal executive offices)		(Zip Code)

(302) 651-1000
(Registrant’s telephone number, including area code)

None
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer þ	Accelerated filer o	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class		Outstanding as of ~~September~~March 3031, ~~2010~~2011
Common stock — Par Value $1.00		91,~~483~~514,~~687~~375 shares

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

TABLE OF CONTENTS

	Page
PART 1. FINANCIAL INFORMATION
PART I. FINANCIAL INFORMATION
Item 1 Financial Statements (unaudited)
Consolidated Statements of Condition		1
Consolidated Statements of Income		3
Consolidated Statements of Changes in Stockholders’ Equity		5
Consolidated Statements of Cash Flows		6
Notes to Consolidated Financial Statements		8
Item 2 Management’s Discussion and Analysis of Financial Condition and Results of Operations		60
Company overview		5160
Results for the three and nine months ended September 30, 2010		52
Executive summary		61
The Regional Banking business		59
Results for the three months ended March 31, 2011		64
Net interest income		66
The Regional Banking business		65
Net interest margin		67
Net interest income		69
Net interest margin		69
Noninterest income		73
Corporate Client Services business		74
Wealth Advisory Services business		7675
Assets under management and administration		7876
Affiliate money managers		7978
Noninterest expense		8178
Income taxes		8379
Capital resources		8480
Liquidity and funding		8984
Credit risk and asset quality		9489
Derivatives, hedging instruments, other off-balance-sheet arrangements, and other contractual obligations		~~110~~105
Other information		~~112~~107
Item 3 Quantitative and Qualitative Disclosures About Market Risk		~~114~~109
Item 4 Controls and Procedures		~~119~~114
PART II. OTHER INFORMATION
Item 1 Legal Proceedings		~~120~~115
Item 1A Risk Factors		~~120~~118
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds		~~125~~118
Item 3 Defaults upon Senior Securities		~~126~~119
Item 4 Submission of Matters to a Vote of Security Holders		126
Item 4 Other Information		119
Item 5 Other Information		126
Item 5 Exhibits		119
Item 6 Exhibits		127
Exhibit 31
Exhibit 32
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

PART 1I — FINANCIAL INFORMATION


ITEM 1.		FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)

	September 30,			December 31,
	March 31,			December 31,
(in millions, except share amounts)	2010			2009
(dollars in millions)	2011			2010
ASSETS
Cash and due from banks	$	~~199~~166.7		$	~~202~~153.95
Interest-bearing deposits in other banks		~~812~~2,423.83			~~165~~2,091.48
Federal funds sold and securities purchased under agreements to resell		~~25.0~~—			1530.10
Investment securities available for sale		~~624~~394.69			~~747~~486.69
Investment securities held to maturity (fair value of $100.3 in 2010 and $101.8 in 2009)		102.9			112.9
Investment securities held to maturity (fair value of $109.2 in 2011 and $101.3 in 2010)		102.7			101.8
Total investment securities		~~727~~497.56			~~860~~588.57
Federal Home Loan Bank and Federal Reserve Bank stock, at cost		3241.45			2635.86
Loans:
Commercial, financial, and agricultural loans		2,~~373~~027.42			2,~~627~~178.06
Real estate — construction loans		1,~~681~~300.65			1,~~956~~429.41
Commercial mortgage loans		21,~~048~~918.61			21,~~102~~959.35
Total commercial loans		65,~~103~~245.68			65,~~685~~567.72
Residential mortgage loans		~~415~~425.76			~~431~~434.06
Consumer loans		1,~~195~~061.17			1,~~408~~134.93
Loans secured with investments		~~412~~377.34			~~441~~389.68
Total retail loans		21,~~023~~864.17			21,~~281~~958.57
Total loans, net of unearned income of $5.0 in 2010 and $6.4 in 2009		8,126.7			8,967.2
Total loans, net of unearned income of $4.2 in 2011 and $4.3 in 2010		7,110.5			7,525.9
Reserve for loan losses		(~~510~~409.45	)		(~~251~~440.58	)
Net loans		76,~~616~~701.30			87,~~715~~085.71
Premises and equipment, net		135.6			146.8
Loans held for sale		24.4			52.5
Goodwill, net of accumulated amortization of $29.8 in 2010 and 2009		362.1			363.2
Premises and equipment, net		131.4			133.2
Other intangible assets, net of accumulated amortization of $48.8 in 2010 and $49.9 in 2009		30.8			40.2
Goodwill, net of accumulated amortization of $29.8 in 2011 and 2010		336.8			336.3
Accrued interest receivable		23.5			66.9
Other intangible assets, net of accumulated amortization of $52.6 in 2011 and $50.7 in 2010		27.5			29.2
Other assets		435.6			493.6
Accrued interest receivable		20.3			20.8
Total assets	$	10,401.3		$	11,097.1
Other assets		357.7			375.9
Total assets	$	10,728.2		$	10,932.6

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED) — (Continued)

	September 30,			December 31,
	March 31,			December 31,
(in millions, except share amounts)	2010			2009
(dollars in millions)	2011			2010
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand deposits	$	1,~~369~~476.37		$	1,~~470~~092.6
Interest-bearing deposits:
Savings deposits		~~889~~923.94			~~921~~914.50
Interest-bearing demand deposits		3,~~648~~830.38			34,~~590~~078.73
Certificates under $100,000		~~991~~930.07			~~1,000~~961.67
Local certificates $100,000 and over		~~105~~96.06			~~136~~96.95
Total core deposits		7,~~003~~258.52			7,~~120~~143.31
National brokered certificates		1,~~287~~581.4			1,~~270~~832.60
Total deposits		8,~~290~~839.96			8,~~390~~975.91
Short-term borrowings:
Federal funds purchased and securities sold under agreements to repurchase		~~161~~85.6			~~574~~122.83
Other debt		280.98			~~29.~~0.9
Total short-term borrowings		~~190~~86.54			~~603~~123.82
Accrued interest payable		2628.67			5619.76
Other liabilities		~~329~~361.97			~~295~~368.70
Long-term debt		~~494~~595.5			~~442~~595.90
Total liabilities		9,~~332~~911.49			910,~~790~~080.09
Stockholders’ equity:
Wilmington Trust stockholders’ equity:
Preferred stock: $1.00 par value, 1,000,000 shares authorized, 330,000 5% cumulative shares issued and outstanding		~~324~~325.64			~~323~~325.30
Common stock: $1.00 par value, 150,000,000 shares authorized, 100,234,596 shares issued in 2010 and 78,528,346 shares in 2009		100.2			78.5
Common stock: $1.00 par value, 150,000,000 shares authorized, 100,234,596 shares issued		100.2			100.2
Capital surplus		461.29			~~214~~463.87
Retained earnings		~~574~~322.56			~~1,101~~360.57
Accumulated other comprehensive loss		(~~108~~110.17	)		(~~116~~112.34	)
Total contributed capital and retained earnings		1,~~352~~099.4			1,~~601~~137.82
Less: treasury stock: 8,750,909 shares in 2010 and 9,131,360 shares in 2009, at cost		(283.5	)		(295.1	)
Less: treasury stock: 8,720,221 shares in 2011 and 8,804,231 shares in 2010, at cost		(283.1	)		(285.5	)
Total Wilmington Trust stockholders’ equity		1,068.9			1,306.7
Total stockholders’ equity		816.3			851.7
Noncontrolling interest		—			0.4
Total liabilities and stockholders’ equity	$	10,728.2		$	10,932.6
Total stockholders’ equity		1,068.9			1,307.1
Total liabilities and stockholders’ equity	$	10,401.3		$	11,097.1

See Notes to Consolidated Financial Statements

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

	For the three months ended						~~For the nine months ended~~
	September 30,						September 30,
	March 31,
(in millions, except share amounts)	2010			2009			2010			2009
(dollars in millions, except per share amounts)	2011			2010
NET INTEREST INCOME
Interest and fees on loans	$	8468.19		$	9891.94		$	~~266.1~~		$	~~304.6~~
Interest and dividends on investment securities:
Taxable interest		54.21			65.85			~~15.7~~			~~27.8~~
Tax-exempt interest		—0.1			0.1			~~0.2~~			~~0.3~~
Dividends		0.31			0.3			~~0.9~~			~~1.1~~
Interest on deposits in other banks		01.42			0.2			~~0.7~~			~~0.5~~
Interest on federal funds sold and securities purchased under agreements to resell		—			—			—			0.1
Total interest income		74.4			97.5
Dividends on Federal Home Loan Bank and Federal Reserve Bank stock		—			—			0.2			0.3
Interest on deposits		14.0			14.2
Total interest income		90.0			106.3			283.8			334.7
Interest on short-term borrowings		—			0.7
Interest on deposits		13.7			17.3			40.9			66.4
Interest on long-term debt		8.2			7.9
Interest on short-term borrowings		0.6			0.6			1.9			3.0
Total interest expense		22.2			22.8
Interest on long-term debt		8.0			8.4			23.8			25.1
Net interest income		52.2			74.7
Total interest expense		22.3			26.3			66.6			94.5
Provision for loan losses		(41.3	)		(77.4	)
Net interest income		67.7			80.0			217.2			240.2
Net interest income/(loss) after provision for loan losses		10.9			(2.7	)
Provision for loan losses		(281.5	)		(38.7	)		(564.1	)		(122.2	)
NONINTEREST INCOME
Net interest (loss)/income after provision for loan losses		(213.8	)		41.3			(346.9	)		118.0
Advisory fees:
NONINTEREST INCOME
Wealth Advisory Services:
Advisory fees:
Trust and investment advisory fees		34.2			34.4
Wealth Advisory Services:
Mutual fund fees		0.6			0.9
Trust and investment advisory fees		32.2			33.4			99.8			96.0
Planning and other services		6.6			8.8
Mutual fund fees		1.2			2.4			3.3			15.1
Total Wealth Advisory Services		41.4			44.1
Planning and other services		6.0			10.0			21.4			31.2
Corporate Client Services:
Total Wealth Advisory Services		39.4			45.8			124.5			142.3
Global corporate trust services		23.0			23.0
Corporate Client Services:
Retirement services		23.7			21.5
Global corporate trust services		23.5			23.5			71.7			64.0
Investment/cash management services		3.8			3.5
Retirement services		20.9			16.7			63.9			49.4
Total Corporate Client Services		50.5			48.0
Investment/cash management services		3.9			3.8			12.0			11.6
Cramer Rosenthal McGlynn		5.3			4.7
Total Corporate Client Services		48.3			44.0			147.6			125.0
Roxbury Capital Management		—			0.1
Cramer Rosenthal McGlynn		4.8			5.3			13.7			13.3
Total advisory fees		97.2			96.9
Roxbury Capital Management		—			(0.6	)		0.3			(2.0	)
Amortization of affiliate intangibles		(1.5	)		(1.9	)
Total advisory fees		92.5			94.5			286.1			278.6
Total advisory fees after amortization of affiliate intangibles		95.7			95.0
Amortization of affiliate intangibles		(1.5	)		(2.1	)		(5.1	)		(6.5	)
Service charges on deposit accounts		6.8			7.7
Total advisory fees after amortization of affiliate intangibles		91.0			92.4			281.0			272.1
Loan fees and late charges		1.3			1.7
Service charges on deposit accounts		7.5			8.1			22.7			23.5
Card fees		2.3			2.2
Loan fees and late charges		1.7			2.0			5.0			6.3
Other noninterest income		1.4			0.7
Card fees		2.5			2.4			7.8			7.2
Securities gains, net of losses		—			0.2
Other noninterest income		0.9			0.8			2.9			4.7
Total other-than-temporary impairment losses		(5.0	)		(29.9	)
Securities gains, net of losses		3.4			1.5			3.8			13.6
Amount of loss recognized in other comprehensive income (before taxes)		—			11.9
Total other-than-temporary impairment losses		(7.0	)		(57.5	)		(48.2	)		(129.7	)
Net other-than-temporary impairment losses recognized in income		(5.0	)		(18.0	)
Amount of loss recognized in other comprehensive income (before taxes)		2.6			19.4			18.0			63.7
Total noninterest income		102.5			89.5
Net other-than-temporary impairment losses recognized in income		(4.4	)		(38.1	)		(30.2	)		(66.0	)
Net interest and noninterest income	$	113.4		$	86.8
Total noninterest income		102.6			69.1			293.0			261.4
Net interest and noninterest (loss)/income	$	(111.2	)	$	110.4		$	(53.9	)	$	379.4

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) — (Continued)

	For the three months ended						~~For the nine months ended~~
	September 30,						September 30,
	March 31,
(in millions, except share amounts)	2010			2009			2010			2009
(dollars in millions, except per share amounts)	2011			2010
NONINTEREST EXPENSE
Salaries and wages	$	5049.98		$	49.32		$	~~149.4~~		$	~~147.1~~
Incentives and bonuses		711.40			9.7.1			~~26.2~~			~~22.4~~
Employment benefits		1417.54			1416.01			~~44.2~~			~~44.9~~
Total staffing-related expense		7278.82			7372.04			~~219.8~~			~~214.4~~
Net occupancy		78.40			78.71			~~22.7~~			~~23.3~~
Furniture, equipment, and supplies		910.34			10.12			~~29.4~~			~~30.4~~
Advertising and contributions		12.84			1.47			~~5.5~~			~~5.7~~
Servicing and consulting fees		5.40			3.15			~~13.1~~			~~10.7~~
Subadvisor expense		1113.51			811.85			~~35.0~~			~~25.1~~
Travel, entertainment, and training		2.02			1.87			~~6.2~~			~~5.5~~
Originating and processing fees		2.87			2.49			~~8.5~~			~~7.8~~
Insurance		69.36			56.6			~~20.1~~			~~20.1~~
Conversion errors		—			—			—			2.8
Legal and auditing fees		5.8			2.7
Legal and auditing fees		2.9			2.9			9.8			8.9
OREO and loans held for sale write-downs/losses and reserve for unfunded lending commitments		0.1			1.8
OREO write-downs/losses and reserve for unfunded lending commitments		21.0			2.4			39.5			1.1
Other noninterest expense		8.8			8.4
Other noninterest expense		10.2			7.8			29.5			26.2
Total noninterest expense		146.3			131.5
Total noninterest expense		153.4			127.0			439.1			382.0
NET (LOSS)/INCOME
NET (LOSS)/INCOME
Loss before income taxes and noncontrolling interest		(32.9	)		(44.7	)
Loss before income taxes and noncontrolling interest		(264.6	)		(16.6	)		(493.0	)		(2.6	)
Income tax expense/(benefit)		0.6			(16.4	)
Income tax expense/(benefit)		100.7			(10.8	)		17.0			(9.8	)
Net loss before noncontrolling interest		(33.5	)		(28.3	)
Net (loss)/income before noncontrolling interest		(365.3	)		(5.8	)		(510.0	)		7.2
Net income attributable to noncontrolling interest		—			0.9
Net income attributable to noncontrolling interest		—			0.1			0.9			0.4
Net loss attributable to Wilmington Trust Corporation		(33.5	)		(29.2	)
Net (loss)/income attributable to Wilmington Trust Corporation		(365.3	)		(5.9	)		(510.9	)		6.8
Dividends and accretion on preferred stock		4.6			4.6
Dividends and accretion on preferred stock		4.6			4.5			13.6			13.6
Net loss available to common stockholders	$	(38.1	)	$	(33.8	)
Net loss available to common shareholders	$	(369.9	)	$	(10.4	)	$	(524.5	)	$	(6.8	)
Net loss per common share:
Net loss per common share:
Basic	$	(0.42	)	$	(0.44	)
Basic	$	(4.06	)	$	(0.15	)	$	(6.09	)	$	(0.10	)
Diluted	$	(0.42	)	$	(0.44	)
Diluted	$	(4.06	)	$	(0.15	)	$	(6.09	)	$	(0.10	)
Weighted average common shares outstanding (in thousands):
Weighted average common shares outstanding (in thousands):
Basic		90,976			76,465
Basic		91,009			68,979			86,140			68,963
Diluted		90,976			76,465
Diluted		91,009			68,979			86,140			68,963

See Notes to Consolidated Financial Statements

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

	Wilmington Trust Corporation
											Accumulated
											other
	Preferred		Common		Capital			Retained			comprehensive			Treasury			Noncontrolling
(in millions, except share amounts)	stock		stock 1		surplus			earnings			loss 2			stock			interest			Total
(dollars in millions, except per share amounts)	stock		stock 1		surplus			earnings			loss 2			stock			interest			Total
2011
Balance at January 1, 2011	$	325.0	$	100.2	$	463.7		$	360.7		$	(112.4	)	$	(285.5	)	$	—		$	851.7
Comprehensive loss
Net loss 3		—		—		—			(33.5	)		—			—			—			(33.5	)
Other comprehensive income 2		—		—		—			—			1.7			—			—			1.7
Total comprehensive loss																					(31.8	)
Cash dividend paid on preferred stock		—		—		—			(4.2	)		—			—			—			(4.2	)
Common stock issued under employment benefit plans and to the Board of Directors (93,694 shares)		—		—		(2.5	)		—			—			2.5			—			—
Stock-based compensation expense		—		—		0.7			—			—			—			—			0.7
Preferred stock discount accretion		0.4		—		—			(0.4	)		—			—			—			—
Acquisition of treasury stock (9,684 shares)		—		—		—			—			—			(0.1	)		—			(0.1	)
Balance at March 31, 2011	$	325.4	$	100.2	$	461.9		$	322.6		$	(110.7	)	$	(283.1	)	$	—		$	816.3
2010
Balance at January 1, 2010	$	323.3	$	78.5	$	214.8		$	1,101.5		$	(116.3	)	$	(295.1	)	$	0.4		$	1,307.1
Comprehensive loss
Net loss 3		—		—		—			(~~510~~29.92	)		—			—			—			(~~510~~29.92	)
Other comprehensive income		—		—		—			—			8.2			—			—			8.2
Other comprehensive income 2		—		—		—			—			6.7			—			—			6.7
Total comprehensive loss																					(~~502~~22.75	)
Cash dividend paid: $0.03 per common share		—		—		—			(2.5	)		—			—			—			(2.5	)
Cash dividend paid: $0.01 per common share		—		—		—			(0.6	)		—			—			—			(0.6	)
Cash dividend paid on preferred stock		—		—		—			(124.32	)		—			—			—			(124.32	)
Common stock issued (21,706,250 shares issued)		—		21.7		252.2			—			—			—			—			273.9
Common stock issued (21,706,250 shares)		—		21.7		251.6			—			—			—			—			273.3
Common stock issued under employment benefit plans and to the Board of Directors (483,506 shares issued)		—		—		(10.3	)		—			—			13.3			—			3.0
Common stock issued under employment benefit plans and to the Board of Directors (102,757 shares)		—		—		(2.6	)		—			—			2.6			—			—
Stock-based compensation expense		—		—		31.54			—			—			—			—			31.54
Preferred stock discount accretion		10.34		—		—			(10.34	)		—			—			—			—
Cancellation of restricted stock		—		—		1.0			—			—			(1.0	)		—			—
Acquisition of treasury stock (1,967 shares)		—		—		—			—			—			(0.1	)		—			(0.1	)
Acquisition of treasury stock (43,510 shares acquired)		—		—		—			—			—			(0.7	)		—			(0.7	)
Net income attributable to noncontrolling interest		—		—		—			—			—			—			0.9			0.9
Decrease in noncontrolling interest		—		—		—			—			—			—			(1.3	)		(1.3	)
Balance at September 30, 2010	$	324.6	$	100.2	$	461.2		$	574.5		$	(108.1	)	$	(283.5	)	$	—		$	1,068.9
Balance at March 31, 2010	$	323.7	$	100.2	$	465.2		$	1,067.1		$	(109.6	)	$	(292.6	)	$	—		$	1,554.0
2009
Balance at January 1, 2009	$	321.5	$	78.5	$	216.4		$	1,103.7		$	(84.5	)	$	(301.7	)	$	0.2		$	1,334.1
Comprehensive income
Net income 3		—		—		—			6.8			—			—			—			6.8
Other comprehensive income		—		—		—			—			6.0			—			—			6.0
Total comprehensive income																					12.8
Cash dividend paid: $0.355 per common share		—		—		—			(24.6	)		—			—			—			(24.6	)
Cash dividend paid on preferred stock		—		—		—			(11.1	)		—			—			—			(11.1	)
Adoption of FSP-FAS 115-2 and FAS 124-2		—		—		—			44.5			(44.5	)		—			—			—
Common stock issued under employment benefit plans and to the Board of Directors (317,930 shares issued)		—		—		(6.7	)		—			—			7.0			—			0.3
Stock-based compensation expense		—		—		4.0			—			—			—			—			4.0
Preferred stock discount accretion		1.3		—		—			(1.3	)		—			—			—			—
Cancellation of restricted stock		—		—		0.7			—			—			(0.7	)		—			—
Deferred tax adjustment for stock-based compensation		—		—		(0.9	)		—			—			—			—			(0.9	)
Acquisition of treasury stock (3,039 shares acquired)		—		—		—			—			—			—			—			—
Distributions to noncontrolling interest		—		—		—			—			—			—			(0.1	)		(0.1	)
Net income attributable to noncontrolling interest		—		—		—			—			—			—			0.4			0.4
Balance at September 30, 2009	$	322.8	$	78.5	$	213.5		$	1,118.0		$	(123.0	)	$	(295.4	)	$	0.5		$	1,314.9

1		Shares outstanding were 91,~~483~~514,~~687~~375 and 6991,~~389~~197,~~934~~969 at ~~September~~March 3031, ~~2010~~2011, and ~~September~~March 3031, ~~2009~~2010, respectively.
2		See Note 4 for additional information on other comprehensive income.
3		Net (loss~~)/income~~ attributable to Wilmington Trust Corporation.

See Notes to Consolidated Financial Statements

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	For the nine months ended
	For the three months ended
	September 30,
	March 31,
(in millions)	~~2010~~2011			~~2009~~2010
OPERATING ACTIVITIES
Net (loss)/income before noncontrolling interest	$	(510.0	)	$	7.2
Net loss before noncontrolling interest	$	(33.5	)	$	(28.3	)
Adjustments to reconcile net (loss)/income to net cash provided by operating activities:
Adjustments to reconcile net loss to net cash provided by operating activities:
Provision for loan losses		~~564~~41.13			~~122~~77.24
Provision for depreciation and other amortization		144.78			165.61
Amortization of other intangible assets		6.1.8			72.53
Amortization of discounts and premiums on investment securities available for sale		0.83			10.53
Accretion of discounts and premiums on investment securities held to maturity		(0.61	)		(0.3	)
Tax refund received		330.54			—33.5
Increase in deferred income taxes		(5510.24	)		(122.0	)
Deferred tax asset valuation allowance		~~189~~11.54			—
Employer pension contribution		—			(10.0	)
Originations of residential mortgages		(25.5	)		(32.8	)
Originations of residential mortgages		(117.4	)		(216.3	)
Gross proceeds from sales of residential mortgages		25.8			33.4
Gross proceeds from sales of residential mortgages		119.4			348.0
Gains on sales of residential mortgages		(0.3	)		(0.6	)
Gains on sales of residential mortgages		(2.0	)		(2.8	)
Write-downs on other real estate owned and loans held for sale		5.2			—
Sales/write downs on other real estate owned		19.8			5.5
Sale proceeds and payments made on other real estate owned and loans held for sale		28.5			2.0
Securities (gains)/losses:
Other-than-temporary impairment		305.20			6618.0
Other		~~(3.8~~—	)		(130.62	)
Amortization of gain on interest rate floors		(51.40	)		(92.41	)
Stock-based compensation expense		30.57			41.04
Increase in other assets		(39.4	)		(23.9	)
Decrease in other assets		16.3			34.4
Decrease in other liabilities		(6.3	)		(79.1	)
Increase/(decrease) in other liabilities		35.6			(12.9	)
Net cash provided by operating activities	$	~~241~~106.5		$	~~222~~108.16
INVESTING ACTIVITIES
Proceeds from sales of investment securities available for sale	$	~~87.8~~—		$	~~410~~0.52
Proceeds from maturities of investment securities available for sale		~~741~~88.37			~~713~~203.17
Proceeds from maturities of investment securities held to maturity		40.34			31.43
Purchases of investment securities available for sale		~~(705.1~~—	)		(~~398~~112.35	)
Purchases of investment securities held to maturity		(0.6	)		(0.7	)
Purchases of Federal Home Loan Bank and Federal Reserve Bank stock, at cost		(5.9	)		—
Purchases of Federal Home Loan Bank and Federal Reserve Bank stock, at cost		(5.6	)		(6.7	)
Decrease in cash due to divestiture of Grant Tani Barash & Altman		—			(3.2	)
Decrease in cash due to divestiture of Grant Tani Barash & Altman		(3.2	)		—
Purchase of residential mortgages		—			(1.7	)
Cash paid for acquisitions		—			(6.1	)
Net decrease in loans		303.9			208.9
Purchase of residential mortgages		(1.7	)		(5.5	)
Purchases of premises and equipment		(3.0	)		(3.5	)
Net decrease in loans		505.3			397.0
Dispositions of premises and equipment		0.1			—
Purchases of premises and equipment		(8.8	)		(12.5	)
Net cash provided by investing activities	$	384.2		$	293.2
Dispositions of premises and equipment		1.2			0.4
FINANCING ACTIVITIES
Net cash provided by investing activities	$	614.9		$	1,094.6
Net increase/(decrease) in demand, savings, and interest-bearing demand deposits	$	146.0		$	(394.6	)
Net decrease in certificates of deposit		(281.5	)		(173.0	)
Net decrease in federal funds purchased and securities sold under agreements to repurchase		(36.7	)		(146.3	)
Proceeds from issuance of common stock		—			274.0
Stock issuance costs		—			(0.7	)
Cash dividends		(4.2	)		(4.8	)
Acquisition of treasury stock		(0.1	)		(0.1	)
Net cash used for financing activities	$	(176.5	)	$	(445.5	)
Effect of foreign currency translation on cash		0.5			(0.9	)
Increase/(decrease) in cash and cash equivalents		314.7			(44.6	)
Cash and cash equivalents at beginning of period		2,275.3			383.4
Cash and cash equivalents at end of period	$	2,590.0		$	338.8

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) — (Continued)

	For the nine months ended
	September 30,
(in millions)	2010			2009
FINANCING ACTIVITIES
Net (decrease)/increase in demand, savings, and interest-bearing demand deposits	$	(75.3	)	$	632.6
Net decrease in certificates of deposit		(24.7	)		(1,620.0	)
Net decrease in federal funds purchased and securities sold under agreements to repurchase		(413.2	)		(324.7	)
Net decrease in U.S. Treasury demand deposits		—			(6.4	)
Proceeds from issuance of common stock		274.0			—
Stock issuance costs		(0.1	)		—
Net increase/(decrease) in line of credit		50.0			(20.0	)
Proceeds from common stock issued under employment benefits plans		2.8			—
Cash dividends		(14.8	)		(35.7	)
Distributions to minority shareholders		—			(0.1	)
Acquisition of treasury stock		(0.7	)		(0.8	)
Net cash used for financing activities	$	(202.0	)	$	(1,375.1	)
Effect of foreign currency translation on cash		(0.3	)		0.9
Increase/(decrease) in cash and cash equivalents		654.1			(57.5	)
Cash and cash equivalents at beginning of period		383.4			476.7
Cash and cash equivalents at end of period	$	1,037.5		$	419.2

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

	For the nine months ended
	For the three months ended
	September 30,
	March 31,
(in millions)	~~2010~~2011		~~2009~~2010
Cash paid for:
Interest	$	9613.61	$	9822.30
Taxes	$	0.23	$	~~44.6~~—
Non-cash items:
Loans transferred to other real estate owned	$	2328.37	$	1813.86
Net loans transferred out of loans held for sale	$	1.7	$	—

See Notes to Consolidated Financial Statements

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. ~~Recent~~ ~~events~~Proposed Merger with M&T Bank Corporation

ADVERSE FINANCIAL CONDITION Our full-year 2010 losses were primarily the result of two factors. First, we continued to experience ~~see~~ credit deterioration in our loan portfolio, reflecting the extent of our exposure to real estate construction lending and its concentration in Delaware. Second, our continued losses required us to establish a significant deferred tax asset valuation ~~adjustment~~allowance.

~~There~~Throughout is2010, there was no significant economic or real estate recovery on the horizon in our markets. Therefore, we ~~have~~had little assurance that the credit quality of our loan portfolio ~~will~~ would strengthen significantly in the near term, or that our capital position ~~will~~would not erode further. These risks ~~increase~~caused ~~the~~our ~~possibility~~securities ofto ~~downgrades~~be downgraded by ~~the~~ credit rating agencies orand increased the possibility of adverse regulatory actions which could compromise our businesses.

For all these reasons, management and the Board of Directors ~~have~~ carefully studied the company’s strategic options. In the process, we reviewed a wide range of alternatives. Based on discussions that we had with our regulators, we believed that, without a change -of -control transaction acceptable to our regulators, we would ~~likely~~ face imminent significant regulatory actions, which would result in our inability to conduct business ~~prospects~~in ~~likely~~a ~~worsening~~manner ~~dramatically.~~consistent with historical practice. Ultimately, the Board determined that the best option for our ~~shareholders~~stockholders, as well as our clients and the employees of Wilmington Trust, was a merger with M&T Bank Corporation (M&T). ~~On November 1, 2010, we announced~~ that we have signed a definitive merger agreement with M&T. In the merger, our common shareholders will receive 0.051372 shares of M&T common stock for each share of our common stock they hold. Our outstanding Series A Preferred Stock issued to the U.S. Department of the Treasury under the CPP will be exchanged for one-one hundredth (1/100) of a share of M&T preferred stock with substantially the same rights, powers, and preferences, and the warrant issued to the U.S. Department of the Treasury in connection with the issuance of the Series A Preferred Stock will be converted automatically into a warrant to purchase M&T common stock, subject to appropriate adjustments. The merger agreement contains certain customary covenants restricting the conduct of our business, other than in the ordinary course consistent with past practice, until the closing of the merger. The closing of the merger is subject to certain conditions, including approval by our shareholders and regulators. Subject to the satisfaction of these conditions, the merger is expected to close in mid-2011, and we will become a wholly-owned subsidiary of M&T. The merger agreement also contains certain termination provisions and, under specified circumstances, we would be required to pay M&T a termination fee of $30 million. This description is only a summary and is qualified in its entirety by the text of the merger agreement, which is incorporated herein by reference. A copy of the merger agreement has been filed with the SEC on Form 8-K dated November 1, 2010.

THE PROPOSED MERGER

On November 1, 2010, we announced that we signed a definitive merger agreement with M&T. In the merger, our common stockholders will receive 0.051372 shares of M&T common stock for each share of our common stock they hold. Our outstanding Series A Preferred Stock issued to the U.S. Department of the Treasury under the CPP will be exchanged for one-one hundredth (1/100) of a share of M&T preferred stock with substantially the same rights, powers, and preferences, and the warrants issued to the U.S. Department of the Treasury in connection with the issuance of the Series A Preferred Stock will be converted automatically into a warrant to purchase M&T common stock, subject to appropriate adjustments. The merger agreement contains certain customary covenants restricting the conduct of our business, other than in the ordinary course consistent with past practice, until the closing of the merger. The closing of the merger is subject to certain conditions, including approval by our stockholders and regulators. Our stockholders approved the merger on March 22, 2011 and we have obtained all necessary approvals to close the merger from our regulators. Subject to the terms and conditions of the merger agreement, we expect to close the merger on May 16, 2011, at which point we will become a wholly-owned subsidiary of MT&T. The merger agreement also contains a material adverse events clause and certain termination provisions and, under specified circumstances, we would be required to pay M&T a termination fee of $30 million.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

2. Accounting and reporting policies

We maintain our accounting records and prepare our financial statements in accordance with U.S. generally accepted accounting principles ~~(GAAP)~~ and reporting practices prescribed for the banking industry. Using these principles, we make subjective judgments about uncertainties and trends, and we make estimates and assumptions about the amounts we report in our financial statements and notes, including amounts for revenue recognition, the reserve for loan losses, pension and other benefit plans, stock-based employee compensation, investment securities valuations, goodwill impairment, loan origination fees and costs, income taxes, and other items. We evaluate these estimates on an ongoing basis.

The precision of these estimates and the possibility that they may change in the future are subject to various risks and uncertainties, and depend on a number of assumptions, estimates, expectations, assessments of potential developments, other underlying variables, and a range of possible outcomes. Circumstances that differ significantly from our judgments and estimates could cause our actual financial results to differ from our expectations.

Our financial results could be affected adversely by, among other things, failure to consummate a change-of-control transaction on a timely basis; additional regulatory restrictions or failure to comply with existing regulatory restrictions,; changes in national or regional economic conditions; continued declines in the collateral values supporting our loans; deterioration in the credit quality of our borrowers; changes in our regulatory requirements; downgrades by the credit rating agencies; a change in conclusion about the realization of our deferred tax asset; changes in market interest rates or credit markets generally; fluctuations in equity or fixed income markets; changes in the market values of, or expected cash flows from, securities in our investment portfolio; significant changes in banking laws or regulations or the application of such laws or regulations to our businesses; changes in accounting policies, procedures, or guidelines; increased competition for business; higher-than-expected credit losses; the effects of our proposed merger with M&T, and restrictions on our businesses contained in the merger agreement with M&T; the effects of integrating our businesses with those of M&T after the merger is completed; a substantial and permanent loss of either client accounts and/or assets under management at Wilmington Trust and/or affiliate money managers Cramer Rosenthal McGlynn (CRM) and Roxbury Capital Management (RCM); changes in the regulatory, judicial, legislative, or tax treatment of business transactions; new litigation or developments in existing litigation; and economic uncertainty created by domestic or foreign unrest, hostilities, terrorism, or war.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We may use the following abbreviations throughout this report:

~~ARB: Accounting Research Bulletin~~ ASC: Accounting Standards Codification ASU: Accounting Standards Update CPP: U.S. Department of the Treasury Capital Purchase Program ~~EITF: Emerging Issues Task Force~~ ESPP: Employee Stock Purchase Plan FASB: Financial Accounting Standards Board FHLB: Federal Home Loan Bank of Pittsburgh FIN: FASB Interpretation (Number) FOMC: Federal Open Market Committee FRB: Federal Reserve Bank ~~FSP: FASB Staff Position~~ GAAP: U.S. generally accepted accounting principles IRS: Internal Revenue Service NYSE: New York Stock Exchange OREO: Other real estate owned OCI: Other comprehensive income OTTI: Other-than-temporarily impaired SEC: Securities and Exchange Commission SERP: Supplemental Executive Retirement Plan SFAS: Statements of Financial Accounting Standards TARP: U.S. Department of the Treasury Troubled Asset Relief Program

Throughout this report, we use “net (loss)/income” to mean “net (loss)/income attributable to Wilmington Trust Corporation.”

We have applied our critical accounting policies and estimation methods consistently in all periods presented in this report and we have discussed these policies with our Audit Committee. The information in this report has not been audited. It includes all adjustments of a normal recurring nature that we believe are necessary for fair presentation. We have reclassified certain prior-year amounts to conform to the current-year presentation. The consolidated financial statements in this report should be read in conjunction with the “Consolidated Financial Statements” and the “Notes to Consolidated Financial Statements” in our ~~2009~~2010 Annual Report on Form 10-K.

Our consolidated financial statements include the accounts of Wilmington Trust Corporation, our wholly-owned subsidiaries, and the subsidiaries in which we are majority owner. We eliminate intercompany balances and transactions in consolidation.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~Our~~Although ~~consolidated~~we ~~financial~~are ~~statements~~majority ~~include~~owner ~~the~~of ~~accounts~~CRM, ofwe ~~Wilmington~~do ~~Trust~~not ~~Corporation,~~consolidate ~~our~~CRM’s results because CRM principals ~~wholly-owned~~retain ~~subsidiaries,~~control ~~and~~over ~~the~~certain ~~subsidiaries~~governance inmatters. ~~which~~We do not consolidate RCM’s results because we are not majority owner. Weand ~~eliminate~~RCM principals retain control over certain governance matters. For ~~intercompany~~information ~~balances~~on how we account for CRM, RCM, and ~~transactions~~other subsidiaries and affiliates, read Note 4, “Affiliates and acquisitions,” in ~~consolidation~~our 2010 Annual Report on Form 10-K.

Although we are majority owner of CRM, we do not consolidate CRM’s results because CRM principals retain control over certain governance matters. We do not consolidate RCM’s results because we are not majority owner and RCM principals retain control over certain governance matters. For information on how we account for CRM, RCM, and other subsidiaries and affiliates, read Note 4, “Affiliates and acquisitions,” in our 2009 Annual Report on Form 10-K.

On February 16, 2010, we entered into an agreement with the principals of Grant Tani Barash & Altman, LLC (GTBA) and related parties, in which we sold 80% of our limited liability company interests in GTBA to those principals. This transaction resulted in a $0.1 million net loss, which we recorded in the 2010 first quarter. The agreement also limited future profit distributions to us. We account for our remaining ownership interest in GTBA under the cost method of accounting. We consolidated GTBA’s results in our financial statements until February 16, 2010.

GTBA contribution to Wilmington Trust’s financial statements

	Between
	Jan. 1 and Feb. 16,				~~First 9 months~~
(dollars in millions)	2010		~~2009 Q3~~		~~of 2009~~
Revenue (net of amortization)	$	2.2	$	~~3.2~~	$	~~10.0~~
Expense	$	1.8	$	~~2.8~~	$	~~8.5~~
Noncontrolling interest	$	0.9	$	~~0.1~~	$	~~0.4~~

~~As part of our construction project financing, we employ interest reserves~~3. ~~Using~~Stock-based ~~interest~~compensation ~~reserves~~plans benefits both us and our borrowers, because interest reserves provide borrowers with temporary sources of cash flow which they can use to make interest payments during the development/construction phases of projects. We allow payments from interest reserves as they reach various stages of completion, and because we expect that cash flows will be positive once sales begin and/or stabilization occurs. We record these payments as interest income and we capitalize them by increasing the loan principal due from the borrower. We monitor loans with interest reserves throughout the project’s life and periodically evaluate the loan for an appropriate risk rating, interest accrual status, and classification as a troubled restructured loan. We may suspend interest accrual on loans that are not currently delinquent, but which have risk rating classifications of substandard or lower. We place loans and lines of credit with risk ratings of substandard or lower, and which depend on interest reserves for future interest payments, on nonaccruing status. At times, we may modify the terms

The Compensation Committee and the Select Committee of our Board of Directors administer a long-term incentive plan, an executive incentive plan, an employee stock purchase plan (ESPP), and a directors’ deferred fee plan. We account for our stock-based compensation plans in accordance with ASC 718, “Stock Compensation.” For more information about these plans, how we determine valuations of stock-based awards, and about how our merger agreement with M&T affects our ability to grant shares under these plans, read Note 20, “Stock-based compensation plans,” in our 2010 Annual Report on Form 10-K.

The common shares we issue as stock-based compensation come from our treasury, which held approximately 8.7 million shares at March 31, 2011. This is more than adequate to meet the requirements of our current stock-based compensation plans.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

of loans with interest reserves. These modifications may include maturity extensions, renewals, changes in the loan’s interest rate, additional collateral requirements, and/or additional capital infusions into the project by the borrower to reduce debt or to support future debt service. These modifications typically result from delays or other issues in the underlying construction projects, such as slower-than-anticipated sell-outs of the projects, insufficient leasing activity, and/or depreciation in the values of the collateral securing the loans. Under such circumstances, we believe that working with a borrower to restructure a loan provides us with a better likelihood of recovering our loan. At September 30, 2010, we had $368.3 million of loans that were supported by $29.3 million of interest reserve balances. Included in the $368.3 million of loans were $92.0 million of nonaccruing loans that were supported by interest reserves. At year-end 2009, we had $566.1 million of loans that were supported by $43.7 million of interest reserve balances. Included in the $566.1 million of loans were $67.1 million of nonaccruing loans that were supported by interest reserves.

3. Stock-based compensation plans

The Compensation Committee and the Select Committee of our Board of Directors administer a long-term incentive plan, an executive incentive plan, an employee stock purchase plan (ESPP), and a directors’ deferred fee plan. We account for our stock-based compensation plans in accordance with ASC 718, “Stock Compensation.” For more information about these plans and how we determine valuations of stock-based awards, read Note 19, “Stock-based compensation plans,” in our 2009 Annual Report on Form 10-K.

The common shares we issue as stock-based compensation come from our treasury, which held approximately 8.8 million shares at September 30, 2010. This is more than adequate to meet the requirements of our current stock-based compensation plans.

Stock-based compensation expense

	For the three months ended					~~For the nine months ended~~
	September 30,					September 30,
	March 31,
(in millions)	~~2010~~2011			~~2009~~2010		~~2010~~			~~2009~~
Compensation expense:
Common stock options	$	0.34		$	0.86	$	~~1.6~~		$	~~2.5~~
Restricted common stock		(10.17	)		0.45		~~1.3~~			~~1.3~~
Employee stock purchase plan		(0.24	)		0.3		~~0.6~~			~~0.2~~
Total compensation expense	$	(0.67	)	$	1.54	$	~~3.5~~		$	~~4.0~~
Tax expense/(benefit)		0.4			—		(1.1	)		(0.9	)
Tax benefit1		0.4			0.4
Net income effect	$	(0.23	)	$	1.50	$	~~2.4~~		$	~~3.1~~

12 1 Deferred tax assets related to the tax benefit shown are offset by a valuation allowance.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Stock options

Stock option valuation assumptions

	For the three months ended			~~For the nine months ended~~
	September 30,			September 30,
	March 31,
	2010		2009	2010		2009
	20111			2010
Risk-free interest rate	~~1.52%~~	—	~~2.57% – 2.85%~~	~~1.52% – 3.72%~~	2.23% – 3.72	~~2.11~~% ~~– 3.35%~~
Volatility of Corporation’s common stock	~~47.32%~~	—	~~40.38% – 41.84%~~	~~34.06% – 47.32%~~	34.06% – 44.50	~~29.86~~% ~~– 41.84%~~
Expected dividend yield	~~0.39%~~	—	~~5.16% – 6.38%~~	~~0.39% – 2.96%~~	1.42% – 2.96	~~5.16~~% ~~– 8.67%~~
Expected life of options	~~4.6 years~~	—	~~4.9 years~~	~~4.6 to 8.7 years~~	4.6 to 8.7 years	~~4.9 to 8.6 years~~


¹		No stock options were granted during the first three months of 2011.

For the valuation assumptions in the table above:

•

We used the Black-Scholes valuation method.

•

The risk-free interest rate was the U.S. Treasury rate commensurate with the expected life of options on the date of each grant.

•

We based the volatility of our stock on historical volatility over a span of time equal to the expected life of the options.

•

We based the expected life of stock option awards on historical experience. Expected life is the period of time we estimate that granted stock options will remain outstanding.

Stock-based compensation expense for incentive stock options and the ESPP affects our income tax expense and effective tax rate, because we are not allowed a tax deduction unless the award recipient or ESPP subscriber makes a disqualifying disposition ~~following~~upon exercise. As a participant in the CPP, we may not deduct compensation of more than $500,000 paid to any named executive officer identified in Item 11 of our ~~proxy~~2010 ~~statement~~Annual Report on Form 10-K for any year in which the U.S. Treasury holds any debt or equity security we issued ~~to it~~ under the CPP.

~~No stock options were exercised during the three or nine months ended September 30, 2010 or 2009.~~12

Long-term incentive plan option activity

				Weighted		Weighted
	Common			average		average	Aggregate
	stock			exercise		remaining	intrinsic value
For the nine months ended September 30, 2010	options			price		contractual term	(in millions)
Outstanding at January 1, 2010		7,432,171		$	31.67
Granted		723,000		$	12.86
Exercised		—		$	—
Expired		(561,306	)	$	29.13
Forfeited		(330,216	)	$	20.55
Outstanding at September 30, 2010		7,263,649		$	30.50	5.3 years	$	—
Exercisable at September 30, 2010		4,806,959		$	36.21	3.7 years	$	—

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

No stock options were exercised during the three months ended March 31, 2011 or 2010.

Long-term incentive plan option activity


				Weighted		Weighted
	Common			average		average	Aggregate
	stock			exercise		remaining	intrinsic value
For the three months ended March 31, 2011	options			price		contractual term	(in millions) ¹
Options outstanding at January 1, 2011		7,133,788		$	30.48
Options granted		—		$	—
Options exercised		—		$	—
Options expired		(580,775	)	$	32.75
Options forfeited		(93,700	)	$	16.56

Options outstanding at March 31, 2011		6,459,313		$	30.47	5.1 years	$	—
Options exercisable at March 31, 2011		4,953,113		$	36.11	4.1 years	$	—


¹		At March 31, 2011, the closing price of our common stock was $4.52, which was less than the strike price for all options.

Unvested stock options

At ~~September~~March 3031, ~~2010~~2011, total unrecognized compensation cost related to unvested common stock ~~options~~ options was $32.65 million, which we expect to record over a weighted average period of 1.4 years. Unvested ~~Stock~~stock options ~~awarded~~will ~~since~~be wecancelled ~~became~~for ano ~~participant~~consideration inupon ~~the~~consummation ~~CPP~~of doour ~~not~~merger ~~vest~~with ~~until~~M&T. If the ~~stated~~merger ~~vesting period~~is orconsummated, inwe ~~certain~~expect ~~circumstances,~~our ~~until~~future ~~the~~expense ~~U.S.~~related ~~Treasury~~to nothese ~~longer~~options ~~holds any debt or equity securities we issued~~ to itbe ~~under the CPP, whichever is later~~zero.

Restricted common stock grants

We measure the fair value of restricted common stock by ~~the~~its last sale price ofon ~~our~~the ~~common~~date ~~stock~~of on the restricted ~~grant~~stock ~~date~~grant. We amortize the value of restricted stock grants into stock-based ~~compensation~~ compensation expense on a straight-line basis over the requisite service period for the entire award. AtWe recorded $0.7 million of expense for restricted stock grants during the three months ~~September~~ended March 3031, ~~2010~~2011. At March 31, 2011, total unrecognized compensation cost related to restricted stock grants was $42.09 million, which we expect to record over a weighted average period of 1.41 years.

Under our incentive plans, the vesting period for some of our restricted stock awards can accelerate upon retirement and in certain other circumstances. When we award restricted stock to people from whom we may not receive services in the future, such as those who are eligible for retirement, we recognize the ~~associated~~ expense of restricted stock grants when we make the award, instead of amortizing the expense over the vesting period of the award. ~~Restricted stock awarded to certain officers since we~~ ~~became a participant in the CPP does not vest until the stated vesting period or until the U.S. Treasury no longer holds any debt or equity securities we issued under the CPP, whichever is later.~~

InRestricted stock awarded to certain officers since we became a participant in the ~~third~~CPP ~~quarter~~does ofnot ~~2010,~~vest until the stated vesting period or until the U.S. Treasury no longer holds any debt or equity securities we ~~had~~issued $1under the CPP, whichever is later.~~1 million~~ ofIn ~~negative~~addition, under other regulatory restrictions to which we are subject, restricted stock ~~expense,~~may ~~which~~not vest upon retirement without prior ~~included~~approval aof $1our regulators.~~6 million~~ ~~expense~~Further, ~~reversal~~most ~~related~~unvested restricted stock awards are scheduled to ~~the~~vest upon ~~cancellation~~or immediately following consummation of ~~restricted~~our ~~stock~~merger with M&T.

~~Restricted common stock activity~~13

	Restricted			Weighted average fair
For the nine months ended September 30, 2010	common shares			value at grant date
Outstanding at January 1, 2010		417,009		$	18.36
Granted		249,507		$	14.45
Vested		(132,326	)	$	17.14
Forfeited		(59,545	)	$	27.53
Outstanding at September 30, 2010		474,645		$	15.49

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Restricted stock activity


				Weighted average fair
For the three months ended March 31, 2011	Number of shares			value at grant date
Restricted shares outstanding at January 1, 2011		458,082		$	15.51
Restricted shares granted		93,694		$	4.40
Restricted shares vested		(43,588	)	$	20.64
Restricted shares forfeited		—		$	—

Restricted shares outstanding at March 31, 2011		508,188		$	13.02

Employee stock purchase plan (ESPP)

For the ESPP, we ~~record~~base stock-based compensation expense ~~based~~ on the fair value of plan participants’ options to purchase shares, amortized over the plan’s fiscal year. We use the Black-Scholes method to determine the fair value of these options. For the ~~nine~~three months ended ~~September~~ March 3031, ~~2010~~2011, ~~total~~the total recognized compensation cost related to the ESPP was $(0.6 4) million. ~~and~~On March 23, 2011, in ~~total~~accordance ~~unrecognized~~with ~~compensation~~our ~~cost~~merger ~~was~~agreement $0with M&T, our Board of Directors authorized the termination of the ESPP effective immediately preceding the closing of our merger with M&T.~~5 million~~ Because the ESPP will terminate prior to the closing of our merger with M&T, we expect our future expense related to this plan to be zero.

ESPP Activity


	Shares reserved for			Subscriptions			Price per
	future subscriptions			outstanding			share
Balance at January 1, 2010		547,059			251,143
Forfeitures		26,881			(26,881	)	$	12.67
Shares issued		—			(224,262	)	$	12.67
Subscriptions entered into on June 1, 2010		(217,119	)		217,119		$	12.45
Forfeitures		154,798			(154,798	)	$	12.45

Balance at January 1, 2011		511,619			62,321
Forfeitures		57,581			(57,581	)	$	12.45

Balance at March 31, 2011		569,200			4,740

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ESPP Activity

	Shares reserved for			Subscriptions			Price per
	future subscriptions			outstanding			share
Balance at January 1, 2009		709,842			90,158
Forfeitures		88,360			(88,360	)	$	27.67
Shares issued		—			(1,798	)	$	27.67
Subscriptions entered into on June 1, 2009		(285,745	)		285,745		$	12.67
Forfeitures		34,602			(34,602	)	$	12.67
Balance at January 1, 2010		547,059			251,143
Forfeitures		26,881			(26,881	)	$	12.67
Shares issued		—			(224,262	)	$	12.67
Subscriptions entered into on June 1, 2010		(217,119	)		217,119		$	12.45
Forfeitures		26,113			(26,113	)	$	12.45
Balance at September 30, 2010		382,934			191,006

4. Comprehensive (loss)/income

	For the three						For the nine
	For the three months
	months ended						months ended
	ended March 31,
	September 30,						September 30,
(in millions)	2011			2010
(in millions)	2010			2009			2010			2009
Net loss before noncontrolling interest	$	(33.5	)	$	(28.3	)
Net (loss)/income before noncontrolling interest	$	(365.3	)	$	(5.8	)	$	(510.0	)	$	7.2
Other comprehensive income, net of tax1:
Other comprehensive (loss)/income, net of tax:
Net unrealized (losses)/gains on securities, net of taxes of $(0.3) and $1.0		(0.4	)		1.9
Net unrealized (losses)/gains on securities, net of taxes of $(0.1), $2.1, $1.3, and $4.3		(0.4	)		4.2			2.2			7.9
Reclassification adjustment for securities losses included in net income, net of taxes of $0.0 and $(0.1)		—			(0.1	)
Net unrealized gain/(loss) on equity method investment, net of taxes of $0.0, $0.0, $0.0, and $(0.2)		—			—			0.1			(0.4	)
Non-credit portion of OTTI held-to-maturity investment securities recognized in other comprehensive income (OCI), net of taxes of $0.0 and $(4.3)		—			(7.6	)
Reclassification adjustment for securities gains included in net income, net of taxes of $(1.3), $(0.5), $(1.4), and $(3.3)		(2.1	)		(1.0	)		(2.4	)		(5.8	)
Accretion of non-credit portion of OTTI investment security losses that were recognized previously in OCI, net of taxes of $(0.1) and $(0.1)		(0.2	)		(0.2	)
Non-credit portion of OTTI held-to-maturity investment securities recognized in other comprehensive income (OCI), net of taxes of $(0.9), $(7.0), $(6.5), and $(22.9)		(1.7	)		(12.4	)		(11.5	)		(40.8	)
Reclassification of unrealized losses recorded previously at the time of transfer to held-to-maturity, net of taxes of $0.0 and $2.2		—			3.8
Accretion of non-credit portion of OTTI investment security losses that were recognized previously in OCI, net of taxes of $(0.1), $(0.1), $(0.4), and $(0.1)		(0.2	)		(0.2	)		(0.7	)		(0.1	)
Reclassification adjustment of current period other-than-temporary impairment that was previously recognized in OCI, net of taxes of $1.1 and $6.1		1.8			11.0
Reclassification of unrealized losses recorded previously at the time of transfer to held-to-maturity, net of taxes of $0.0, $3.0, $2.7, and $12.2		—			5.3			4.9			21.6
Reclassification from accumulated OCI into earnings of discontinued cash flow hedges, net of taxes of $(0.4) and $(0.7)		(0.7	)		(1.4	)
Reclassification adjustment of current period other-than-temporary impairment that was previously recognized in OCI, net of taxes of $1.6, $10.5, $10.4, and $14.8		2.8			18.8			18.7			26.5
Foreign currency translation adjustments, net of taxes of $0.3 and $(0.6)		0.5			(1.1	)
Reclassification from accumulated OCI into earnings of discontinued cash flow hedges, net of taxes of $(0.5), $(1.0), $(1.9), and $(3.4)		(0.9	)		(1.8	)		(3.5	)		(6.0	)
SERP liability adjustment, net of taxes of $0.0 and $0.1		0.3			0.2
Foreign currency translation adjustments, net of taxes of $0.6, $(0.1), $(0.3), and $0.7		1.1			(0.3	)		(0.6	)		1.3
Minimum pension liability adjustment, net of taxes of $0.2 and $0.0		0.4			0.2
SERP1 liability adjustment, net of taxes of $0.2, $0.1, $0.4, and $0.9		0.1			0.1			0.6			1.5
Total other comprehensive income		1.7			6.7
Minimum pension liability adjustment, net of taxes of $0.0, $0.2, $0.1, and $0.4		0.2			0.1			0.4			0.3
Comprehensive loss before the noncontrolling interest	$	(31.8	)	$	(21.6	)
Comprehensive (loss)/income before the noncontrolling interest	$	(366.4	)	$	7.0		$	(501.8	)	$	13.2
Comprehensive income attributable to the noncontrolling interest		—			0.9
Comprehensive income attributable to the noncontrolling interest		—			0.1			0.9			0.4
Comprehensive loss attributable to Wilmington Trust Corporation	$	(31.8	)	$	(22.5	)
Comprehensive (loss)/income attributable to Wilmington Trust Corporation	$	(366.4	)	$	6.9		$	(502.7	)	$	12.8

1 ~~Supplemental~~Deferred ~~executive~~tax ~~retirement~~assets ~~plan~~related to the tax effects shown are offset by a valuation allowance.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

5. Earnings per share

Computation of basic and diluted earnings per share

	For the three						For the nine
	For the three months
	months ended						months ended
	ended March 31,
	September 30,						September 30,
(in millions, except per share amounts)	2011			2010
(in millions, except per share amounts)	2010			2009			2010			2009
Net loss	$	(33.5	)	$	(29.2	)
Net (loss)/income	$	(365.3	)	$	(5.9	)	$	(510.9	)	$	6.8
Dividends and accretion on preferred stock		4.6			4.6
Dividends and accretion on preferred stock		4.6			4.5			13.6			13.6
Net loss available to common shareholders	$	(38.1	)	$	(33.8	)
Net loss available to common shareholders	$	(369.9	)	$	(10.4	)	$	(524.5	)	$	(6.8	)
Average common shares issued and outstanding		91.0			76.5
Average common shares issued and outstanding		91.0			69.0			86.1			69.0
Dilutive common shares from employee stock options, unvested restricted stock, ESPP subscriptions, and stock warrants		—			—
Dilutive common shares from employee stock options, unvested restricted stock, ESPP subscriptions, and stock warrants		—			—			—			—
Total diluted common shares issued and outstanding		91.0			76.5
Total diluted common shares issued and outstanding		91.0			69.0			86.1			69.0
Basic loss per common share	$	(0.42	)	$	(0.44	)
Basic loss per common share	$	(4.06	)	$	(0.15	)	$	(6.09	)	$	(0.10	)
Diluted loss per common share1	$	(0.42	)	$	(0.44	)
Diluted loss per common share1	$	(4.06	)	$	(0.15	)	$	(6.09	)	$	(0.10	)
Cash dividends declared per common share	$	—		$	0.01
Cash dividends declared per common share	$	0.01		$	0.01		$	0.03		$	0.355
Anti-dilutive equity instruments excluded from calculation		8.8	2		10.3
Anti-dilutive equity instruments excluded from calculation		9.8			10.1			10.2			10.1

1 To calculate diluted earnings per share, we applied the two-class method under the assumption that all potentially dilutive securities other than the unvested restricted stock had been exercised. For the purposes of this calculation, dilutive shares were determined in accordance with the treasury method.


¹		To calculate diluted earnings per share, we applied the two-class method under the assumption that all potentially dilutive securities other than the unvested restricted stock had been exercised. For the purposes of this calculation, dilutive shares were determined in accordance with the treasury method.

²		At March 31, 2011, the closing price of our common stock was less than the strike price for all share equivalents.

6. Fair value measurement of assets and liabilities

In accordance with ASC 825, “Financial Instruments,” we disclose the estimated fair values of certain financial instruments, whether or not we recognize them at fair value in our Consolidated Statements of Condition. This note summarizes the methods and assumptions we use to estimate fair value.

Fair value generally is the exchange price on which a willing buyer and a willing seller would agree when market conditions are not distressed. Because of the uncertainties inherent in determining fair value, fair -value estimates may not be precise. Many of our fair -value estimates are based on highly subjective judgments and assumptions we make about market information and economic conditions. Changes in market interest rates or any of the assumptions underlying our estimates could cause our estimates to change significantly.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We measure the fair values of assets and liabilities in accordance with ASC 820, “Fair Value Measurements and Disclosures.” ASC 820 establishes a three-level hierarchy that prioritizes the factors (inputs) used to calculate the fair value of assets and liabilities:

•

Level 1. Level 1 inputs are unadjusted quoted prices, such as NYSE closing prices, in active markets for identical assets. Level 1 is the highest priority in the hierarchy.

•

Level 2. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as other significant inputs that are observable at commonly quoted intervals, such as interest rates, foreign exchange rates, and yield curves.

•

Level 3. Level 3 inputs are unobservable inputs. Typically, our own assumptions determine these inputs, since there is little, if any, related market activity. Level 3 is the lowest priority in the hierarchy.

If we use multiple input levels to calculate the fair value of an asset or liability, then the lowest-level significant input determines the level for the entire fair value measurement of that asset or liability. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and it considers factors specific to the asset or liability.

In accordance with GAAP, we may be required to measure certain assets and liabilities at fair value on a nonrecurring basis. These adjustments typically relate to lower-of-cost or fair value accounting, or write-downs of individual assets due to impairment.

Following is a summary of how we determine fair values and the inputs we use to calculate them.

Cash and due from banks, short-term investments, accrued interest receivable, short-term borrowings, and accrued interest payable. Since these instruments have short maturities, their fair values are approximately the same as their carrying values.

Investment securities. We review our debt and equity investment securities at least quarterly to determine their fair values. The key determinants of fair value are market interest rates, credit spreads, and investor perceptions. When market interest rates rise or credit spreads widen, the fair values of debt and equity securities typically decline and unrealized losses increase. Conversely, when market interest rates fall or credit spreads tighten, the fair values of debt and equity securities typically increase. As a security’s fair value rises, unrealized losses may decrease or unrealized gains may increase.

To determine the fair values of most of our investment securities, we consider a variety of factors and use criteria specified by the SEC and FASB. We use financial market data, credit data, cash flow projections, and other analytics generated internally and by third parties. Where possible, we draw parallels from the trades and quotes of securities with similar features. If these trades and quotes are not available, we base fair values on the market prices of comparable instruments as quoted by broker-dealers, with adjustments for maturity dates, underlying assets, credit ratings, and other items, if necessary.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

ToWe ~~determine~~base the fair-value ~~values~~estimates of ~~most~~our ofcollateralized ~~our~~mortgage ~~investment~~obligations and mortgage-backed debt securities, weon ~~consider~~the aquoted ~~variety~~prices of ~~factors and~~similar ~~use~~issues. ~~criteria~~We ~~specified~~base by the ~~SEC~~fair-value estimates ~~and~~of ~~FASB.~~our Weobligations ~~use~~of ~~financial~~state ~~market~~and ~~data,~~political ~~credit~~subdivisions ~~data,~~(municipal ~~cash~~bonds) on the quoted ~~flow~~prices ~~projections,~~of similar issues and ~~other~~index ~~analytics~~rates, ~~generated~~taking ~~internally~~into ~~and~~account byany ~~third~~estimated ~~parties~~prepayment rates. ~~Where possible,~~We wethen ~~draw~~make ~~parallels~~sector ~~from~~spread, ~~the~~credit ~~trades~~rating spread, and ~~quotes~~coupon ofstructure ~~securities~~spread ~~with~~adjustments ~~similar~~to ~~features.~~the quoted Ifprices of these ~~trades and~~similar ~~quotes~~issues ~~are~~and ~~not~~index ~~available,~~rates. weWe base the fair-value ~~values~~estimates of our government agency securities on the ~~market~~quoted ~~prices~~price of ~~comparable~~the ~~instruments~~issue asor, if this is not available, the quoted byprice ~~broker-dealers,~~of ~~with~~a ~~adjustments~~similar ~~for~~issue. ~~maturity~~We ~~dates,~~base ~~underlying~~the ~~assets,~~fair-value ~~credit~~estimates ~~ratings,~~of our preferred stocks on the ~~and~~quoted ~~other~~prices ~~items,~~of ifthe ~~necessary~~stocks.

We base the fair value estimates of our collateralized mortgage obligations and mortgage-backed debt securities on the quoted prices of similar issues. We base the fair-value estimates of our obligations of state and political subdivisions (municipal bonds) on the quoted prices of similar issues and index rates, taking into account any estimated prepayment rates. We then make sector spread, credit rating spread, and coupon structure spread adjustments to the quoted prices of these similar issues and index rates. We base the fair-value estimates of our government agency securities on the quoted price of the issue or, if this is not available, the quoted price of a similar issue. We base the fair value estimates of our preferred stocks, on the quoted prices of the stocks.

Because the market for pooled trust-preferred securities (TruPS) remains illiquid, we use mainly Level 3 inputs obtained from brokers or third-party advisors to determine the fair values of these securities. We also use an internal model that reflects liquidity and credit risk to discount cash flow projections provided by the third-party advisors.

The base cash flow for these calculations is the remaining expected future cash flow of each pooled TruPS, based on its contractual terms, and adjusted for current and expected future defaults. We adjust our default assumptions each quarter based on, among other factors, the current financial sector environment, developments related to the financial institutions whose securities underlie the pooled TruPS, and estimates of loss severity. We also adjust the discount rate for appropriate risk premiums, including liquidity risk and credit risk. Based on changes in certain yield curves related to the financial sector, and other factors, we estimate the associated risk premium for ~~each~~ each individual security and adjust its discount rate accordingly.

While estimating fair values and the inputs to fair value calculations in illiquid markets is inherently uncertain, we believe that our methodology applies assumptions that market participants would find relevant, and that it provides the best estimate of fair value at each reporting period.

For more information about our investment securities, read Note 1112, “Investment securities,” in ~~this~~these ~~report~~financial statements.

FHLB and FRB stock. The fair value of FHLB and FRB stock is assumed to equal its cost basis, since the stock is nonmarketable but redeemable at its par value.

Derivative financial instruments. We base the fair-value estimates of derivative instruments on pricing models that use assumptions about market conditions and risks that are current as of the reporting date.

We use data provided by an independent third-party advisor to determine the fair values of our interest rate swaps and use a standard methodology that nets the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). We base the variable cash payments (or receipts) on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Derivative financial instruments. We base the fair value estimates of derivative instruments on pricing models that use assumptions about market conditions and risks that are current as of the reporting date.

To comply with ASC 820, we incorporate credit valuation adjustments to reflect both our nonperformance risk and the respective counterparty’s nonperformance risk. In adjusting the fair value of our derivative contracts for the effects of nonperformance risk, we consider the effects of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

Most of the inputs we use to value our swap contracts are Level 2 inputs. For credit valuation adjustments, we use some Level 3 inputs, such as internal estimates of current credit spreads for our swap clients, to evaluate the likelihood of default by us and our counterparties. For more information about our use of derivatives, read Note 7, “Derivative and hedging activities,” in ~~this~~ ~~report~~these financial statements.

At times, we may use interest rate swaps and floors, primarily to hedge the interest rate risk associated with floating rate commercial loans and subordinated long-term debt. In accordance with ASC 815, “Derivatives and Hedging,” the estimated fair values of these instruments represent the amounts we would have expected to receive or pay to terminate such agreements.

Loans. To determine the fair values of loans that are not impaired, we use discounted cash ~~flow~~ flow analyses, which we present net of the reserve for loan losses. In these analyses, we use ~~discount~~ discount rates that are similar to the interest rates and terms currently being offered to borrowers. ~~For the September 30, 2010~~ The fair values that are shown in the table below, weinclude ~~added~~ risk premiums that were added to the discount rates used for loans with ~~watch-list~~watchlist or substandard-accruing ratings to reflect the uncertainty of the cash flows within these portfolios. These methodologies are consistent with the guidance in ASC 825-10-55-3, and we believe our disclosures provide fair values that are more indicative of an entry price. This technique does not contemplate an exit price. We do not record loans at fair value on a recurring basis. We record fair value adjustments to loans on a nonrecurring basis to reflect full and partial charge-offs due to impairment. For impaired loans, we use a variety of techniques to measure fair value, such as using the current appraised value of the collateral, discounting the contractual cash flows, and analyzing market data that we may adjust due to the specific characteristics of the loan or collateral.

Loans held for sale. The fair value of loans held for sale was determined based on third-party written offers, third-party broker estimates, or other means such as appraisal data.

Deposits. The fair values of demand deposits equal the amount payable on demand as of the reporting date. The carrying amounts for variable rate deposits approximate their fair values as of the reporting date. To estimate the fair values of fixed rate CDs, we use a discounted cash flow analysis that incorporates prevailing market rates for CDs with comparable maturities.

Long-term debt. Under the guidance of ASC 820, “Fair Value Measurements and Disclosures,” we base the fair value of long-term debt on recent market activity in our own debt issuances.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Deposits. The fair values of demand deposits equal the amount payable on demand as of the reporting date. The carrying amounts for variable rate deposits approximate their fair values as of the reporting date. To estimate the fair values of fixed rate CDs, we use a discounted cash flow analysis that incorporates prevailing market rates for CDs with comparable maturities.

Long-term debt. Under the guidance of ASU 2009-05, “Measuring Liabilities at Fair Value,” we base the fair value of long-term debt on recent market activity in our own debt issuances.

Commitments to extend credit and letters of credit. The fair values of loan commitments and letters of credit approximate the fees we charge for providing these services.

Carrying values and estimated fair values

	As of September 30, 2010				As of December 31, 2009
	As of March 31, 2011				As of December 31, 2010
	Carrying		Fair		Carrying		Fair
(in millions)	value		value		value		value
Financial assets:
Cash and due from banks	$	~~199~~166.7	$	~~199~~166.7	$	~~202~~153.95	$	~~202~~153.95
Short-term investments		~~837~~2,423.83		~~837~~2,423.83		~~180~~2,121.58		~~180~~2,121.58
Investment securities		~~727~~497.56		~~724~~504.91		~~860~~588.57		~~849~~588.42
FHLB and FRB stock		3241.45		3241.45		2635.86		2635.86
Loans, net of reserves		76,~~616~~701.30		76,~~560~~595.08		87,~~715~~085.71		86,~~579~~993.65
Interest rate swap contracts		51.0		51.0		45.0		45.0
Loans held for sale		24.4		24.4		52.5		52.5
Accrued interest receivable		23.5		23.5		66.9		66.9
Interest rate swap contracts		34.5		34.5		40.1		40.1
Accrued interest receivable		20.3		20.3		20.8		20.8
Financial liabilities:
Deposits	$	8,~~290~~839.96	$	8,~~362~~919.84	$	8,~~390~~975.91	$	89,~~459~~053.51
Short-term borrowings		~~190~~86.54		~~190~~86.54		~~603~~123.82		~~603~~123.82
Interest rate swap contracts		5336.40		5336.40		4541.78		4541.78
Accrued interest payable		2628.67		2628.67		5619.76		5619.76
Long-term debt		~~494~~595.5		~~498~~628.98		~~442~~595.90		~~432~~630.26

Fair values measured on a recurring basis

To determine fair values measured on a recurring basis at ~~September~~March 3031, ~~2010~~2011:

•

We used Level 1 and Level 2 inputs for investment securities. To determine the proper level of detail for disclosure, we considered the nature of each type of security listed and its associated risk, as well as its industry sector, vintage, geographic concentration, credit quality, and economic characteristics.

•

We used Level 2 inputs for interest rate swap contracts. Credit valuation adjustments did not significantly change the overall valuation of these contracts.

• There were no transfers between Level 1 and Level 2 induring the first ~~nine~~three months of ~~2010~~2011.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Fair value of assets and liabilities measured on a recurring basis as of ~~September~~March 3031, ~~2010~~2011

	Quoted
	Quoted prices
	prices in
	in active
	active		Significant
	markets for		Significant other		Significant
	markets for		other		Significant
	identical		observable		unobservable
	instruments		inputs		inputs
(in millions)	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Investment securities available for sale:
U.S. Treasury securities	$	~~173~~31.28	$	—	$	—	$	~~173~~31.28
Government agency securities		—		~~240~~190.14		—		~~240~~190.14
Obligations of state and political subdivisions		—		59.0		—		59.0
Collateralized mortgage obligations:
Secured by residential mortgages		—		3421.19		—		3421.19
Mortgage-backed debt securities:
Residential mortgage-backed securities		—		~~160~~133.90		—		~~160~~133.90
Preferred stock:
Large financial institutions		—		1.95		—		1.95
Small financial institutions		—		3.0		—		3.0
Total preferred stock		—		4.95		—		4.95
Other marketable equity securities:
Mutual funds		—		3.0		—		3.0
Other		—		31.43		—		31.43
Total other marketable equity securities		—		6.4.3		—		6.4.3
Total investment securities available for sale		~~173~~31.28		~~451~~363.41		—		~~624~~394.69
Interest rate swap contracts		—		5134.05		—		5134.05
Total assets	$	~~173~~31.28	$	~~502~~397.46	$	—	$	~~675~~429.64
Liabilities:
Interest rate swap contracts	$	—	$	5336.40	$	—	$	5336.40
Total liabilities	$	—	$	5336.40	$	—	$	5336.40

Fair values measured on a nonrecurring basis

To determine fair values measured on a nonrecurring basis at ~~September~~March 3031, ~~2010~~2011:

• For loans, we used Level 2 or Level 3 inputs, consisting principally of third-party appraisals, and the previously described techniques. Loan amounts are based mainly on the fair value of the loan’s collateral or the loan balance, whichever is lower. Typically, loans measured at fair value on a nonrecurring basis are loans for which we have recorded a partial charge-off in the current period. These amounts do not include fully charged-off loans, because we carry fully charged-off loans at zero on our balance sheet. Also, according to ASC 820, measurements for impaired loans that are determined using a present value technique are not considered fair value measurements under the standard and, therefore, are not included. Because an appraisal values the underlying collateral and not the specific loan, and because the real estate market is not consistent or active for all property types, we consider third-party appraisals to meet the definition of Level 2 inputs as described in ASC 820. Internal appraisals may be considered Level 2 or Level 3 inputs, depending on the factors used in the calculation. We make no adjustments to third-party appraised values, other than costs to sell, in estimating the fair value of the loans.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

•

For loans held for sale, we used a Level 2 input consisting of either an offer price that a third party gave to us on these specific loans, a quote from a third-party broker, or other means, such as appraisal data.

•

For OREO, we used Level 2 or Level 3 inputs, which consist of appraisals or internal estimates of fair value. We record OREO on our balance sheet at the related loan balance or the fair value of the property, net of cost to sell, whichever is lower. We consider third-party appraisals to meet the definition of Level 2 inputs.

•

For TruPS, we used Level 2 and Level 3 inputs, as continued illiquidity in the market for these instruments made it difficult to determine their valuation. We use input information, provided by third-party advisors and brokers in an internal model that considers liquidity and credit risk, to discount cash flow projections.

At ~~September~~March 3031, ~~2010~~2011, all of our held-to-maturity (HTM) investment securities with fair values measured on a nonrecurring basis were OTTI TruPS. For more information about these securities, read Note 1112, “Investment securities,” in ~~this~~these ~~report~~financial statements.

Fair value of assets and liabilities measured on a nonrecurring basis as of ~~September~~March 3031, ~~2010~~2011

	Quoted prices
	Quoted prices in		Significant
	in active		Significant
	active markets for		other		Significant
	markets for		other		Significant
	identical		observable		unobservable
	instruments		inputs		inputs
(in millions)	(Level 1)		(Level 2)		(Level 3)		Total
Loans	$	016.56	$	5440.73	$	6414.63	$	~~119~~71.82
OREO		—		13.7		—		13.7
Loans held for sale		—		24.4		—		24.4
OREO		—		25.3		—		25.3
Investment securities held to maturity:
Pooled trust-preferred securities		—		—17.6		~~16.3~~—		1617.36
Total assets	$	016.56	$	68107.46	$	8014.93	$	~~149~~138.85
Liabilities	$	—	$	—	$	—	$	—

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

7. Derivative and hedging activities

We may use derivative financial instruments, primarily interest rate swaps and floors, to help manage (hedge) the effects that changes in market interest rates may have on net interest income, the fair value of assets and liabilities, and cash flows. We do not hold or issue derivative financial instruments for trading purposes. We account for derivative financial instruments in accordance with ASC 815, “Derivatives and Hedging,” and calculate their fair values in accordance with ASC 820, “Fair Value Measurements and Disclosures.”

As of ~~September~~March 3031, ~~2010~~2011, we had:

• A total notional amount of $1~~,139~~.204 ~~million~~billion in interest rate swap contracts.

•

No other derivative instruments.

Fair value of derivative instruments

	At September 30,		At December 31,
	At March 31,		At December 31,
(in millions)	~~2010~~2011		~~2009~~2010
Asset derivatives recorded in other assets:
Interest rate swap contracts	$	5134.05	$	4540.01
Total asset derivatives	$	5134.05	$	4540.01
Liability derivatives recorded in other liabilities:
Interest rate swap contracts	$	5336.40	$	4541.78
Total liability derivatives	$	5336.40	$	4541.78

We use interest rate swaps to allow commercial borrowers to manage their interest rate risk. When we enter into an interest rate swap contract with a commercial loan client, we simultaneously enter into a “mirror” swap contract with a third party (counterparty). We retain the credit risk inherent in making a commercial loan. The swap with the counterparty effectively exchanges the client’s fixed rate loan payments for floating rate loan payments. These counterparties are large international money center banks. Our arrangements with some of these counterparties require us to post collateral when our swaps are in a liability position. When our swaps are in an asset position, we retain the credit risk that is associated with the potential failure of these counterparties, and our arrangements with some of these counterparties allow us to request collateral.

As of ~~September~~March 3031, ~~2010~~2011:

• We had ~~125~~118 client swap contracts with a total notional amount of $~~569~~519.67 million and an equal amount of “mirror” swap contracts with third-party financial institutions, for a total notional amount of $1~~,139~~.204 ~~million~~billion in swaps associated with loans to clients.

•

All of our interest rate swaps were associated with loans to commercial clients.

•

Most of our “mirror” counterparty swaps were in liability positions.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We have not designated our client swap contracts and the related “mirror” swaps as hedging instruments under ASC 815, and we have not applied hedge accounting to these instruments. We record gains and losses associated with these contracts in our income statement in the “other noninterest income” line. We do not offset amounts for the right to reclaim collateral (a receivable) or the obligation to return collateral (a payable) against fair value amounts recognized for derivative instruments executed with the same counterparty. At September 30, 2010, we had $15.7 million of cash collateral posted with our counterparties, compared to $9.7 million at December 31, 2009. These balances are recorded as receivables in the “other assets” line of our statement of condition.

Client swap contract gain/(loss) recognized in other noninterest income

	For the three months ended						~~For the nine months ended~~
	September 30,						September 30,
	March 31,
(in millions)	~~2010~~2011			~~2009~~2010			~~2010~~			~~2009~~
Interest rate swap contracts in asset positions	$	0(5.6	)	$	30.12		$	~~6.0~~		$	~~(20.3~~	)
Interest rate swap contracts in liability positions		(05.8	)		(31.50	)		~~(7.7~~	)		~~20.2~~
Total	$	(0.2	)	$	(0.48	)	$	~~(1.7~~	)	$	~~(0.1~~	)

We have not designated our client swap contracts and the related “mirror” swaps as hedging instruments under ASC 815, and we have not applied hedge accounting to these instruments. We record gains and losses associated with these contracts in our income statement in the “other noninterest income” line. We do not offset amounts for the right to reclaim collateral (a receivable) or the obligation to return collateral (a payable) against fair value amounts recognized for derivative instruments executed with the same counterparty. At March 31, 2011, we had $14.2 million of cash collateral posted with our counterparties, compared with $17.0 million at December 31, 2010. These balances are recorded in the “interest-bearing deposits in other banks” line of our statement of condition.

All of our “mirror” (non-client) swap derivative contracts have credit risk contingent features that, if triggered, could require us to post collateral or make payments in full settlement of our obligations to the third parties. Collateral requirements are based on contractual arrangements and vary by counterparty. The amount of collateral we are required to post is based on:

The termination values (fair value excluding the credit valuation adjustment) of the swaps,

Thresholds defined in the swap contracts, and

The risk associated with the securities that we pledge, which may result in collateral postings that exceed the termination values of the collateralized swaps.

These credit risk contingent features include:

• Cross-default provisions. The agreements with each of our non-client swap derivative counterparties contain cross-default provisions. If we were to default on certain ~~of our~~ obligations, independent of our swap obligations, then we also could be declared in default on our derivative obligations and the swap arrangement could terminate.

•

Credit rating contingent features resulting in a collateral call. The agreements with some of our non-client swap derivative counterparties contain provisions which could increase the amount of collateral we are required to post if certain credit rating agencies downgrade our credit ratings.

•

Credit rating contingent features resulting in swap termination. The agreement with one of our non-client swap derivative counterparties contains a provision under which the counterparty could terminate the swap agreement if our credit ratings fall below investment grade. Currently, certain of our credit ratings are below investment grade.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

•At ~~Credit~~March 31, rating contingent features resulting in swap termination. The agreement with one of our non-client swap derivative counterparties contains a provision under which the counterparty could terminate the swap agreement if our credit ratings fall below investment grade.2011:

At• ~~September 30~~The aggregate fair value of all derivative instruments with credit risk-related contingent features that were in liability positions was $36.0 million, ~~2010:~~ for which we had posted collateral of $36.4 million in cash and mortgage-related securities in the normal course of business.

• The aggregate fair value of all derivative instruments with ~~credit risk~~cross-~~related~~default ~~contingent~~provisions ~~features~~ that were in liability positions was $5336.40 million. If all of our “mirror” swaps had terminated on March 31, ~~for~~2011, ~~which~~due to cross-default provisions, we ~~had~~could ~~posted~~have ~~collateral~~been required to settle our obligations under these agreements at their termination values of $5136.10 million. inAt ~~cash~~March ~~and~~31, ~~mortgage-related~~2011, ~~securities~~we inhad ~~the~~already ~~normal~~posted ~~course~~$36.4 ofmillion ~~business~~as collateral with our counterparties.

• The aggregate fair value of all derivative instruments with ~~cross-default~~collateral call provisions related to the credit rating contingent feature that were in liability positions was $5329.47 million. IfAs ~~all~~ of ~~our~~March ~~“mirror” swaps had terminated on September 30~~31, ~~2010~~2011, ~~due~~additional tocredit ~~cross-default~~rating ~~provisions,~~downgrades wewould ~~could~~not have ~~been~~resulted ~~required~~in toadditional ~~settle our obligations under these agreements at their termination values of $53.7 million. At September 30, 2010, we had already posted $51.1 million as~~ collateral ~~with our counterparties~~calls.

• The ~~aggregate fair value of all~~ derivative ~~instruments~~instrument with ~~collateral~~a ~~call~~contingent ~~provisions~~feature ~~related~~resulting toin ~~the~~a ~~credit~~swap ~~rating~~termination ~~contingent~~was ~~feature~~in ~~that~~a ~~were~~liability inposition. ~~liability~~Its ~~positions~~fair value was $441.5 million, and no collateral was posted. ~~Additional~~If this swap had terminated on March 31, 2011, the credit rating-contingent ~~downgrades~~feature could have ~~resulted~~required inus ato ~~maximum~~settle ~~collateral~~this ~~call~~arrangement at its termination value of $01.65 million.

•At ~~The derivative instrument with a contingent feature resulting in a swap termination was in a liability position. Its fair value was $2.0 million~~December 31, ~~and no collateral was posted. If this swap had terminated on September 30,~~ 2010~~, the credit rating-contingent feature could have required us to settle this arrangement at its termination value of $2.3 million.~~:

•

The aggregate fair value of all derivative instruments with credit risk-related contingent features that were in liability positions was $41.8 million, for which we had posted collateral of $50.0 million in cash and mortgage-related securities in the normal course of business.

•

The aggregate fair value of all derivative instruments with cross-default provisions that were in liability positions was $41.8 million. If all of our “mirror” swaps had terminated on December 31, 2010, due to cross-default provisions, we could have been required to settle our obligations under these agreements at their termination values of $41.9 million. At December 31, 2010, we had already posted $50.0 million as collateral with our counterparties.

•

The aggregate fair value of all derivative instruments with collateral call provisions related to the credit rating contingent feature that were in liability positions was $34.7 million. As of December 31, 2010, additional credit rating downgrades could have resulted in a maximum collateral call of $0.6 million.

•

The derivative instrument with a contingent feature resulting in a swap termination was in a liability position. Its fair value was $1.6 million, and no collateral was posted. If this swap had terminated on December 31, 2010, the credit rating-contingent feature could have required us to settle this arrangement at its termination value of $1.7 million.

•

During 2010, 4 swaps with a total notional value of $26.0 million were terminated when borrowers defaulted on their loans, resulting in $2.1 million of expense.

At December 31, 2009:

• The aggregate fair value of all derivative instruments with credit risk-related contingent features that were in liability positions was $45.6 million, for which we had posted collateral of $52.4 million in cash and mortgage-related securities in the normal course of business.

• The aggregate fair value of all derivative instruments with cross-default provisions that were in liability positions was $45.6 million. If all of our “mirror” swaps had terminated on December 31, 2009, due to cross-default provisions, we could have been required to settle our obligations under these agreements at their termination values of $46.0 million. At December 31, 2009, we had already posted $52.4 million as collateral with our counterparties.

• The aggregate fair value of all derivative instruments with collateral call provisions related to the credit rating contingent feature that were in liability positions was $39.4 million. Additional credit rating downgrades could have resulted in a maximum collateral call of $4.0 million.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

• The derivative instrument with a contingent feature resulting in a swap termination was in a liability position. Its fair value was $1.2 million and no collateral was posted. If this swap had terminated on December 31, 2009, the credit rating contingent feature could have required us to settle this arrangement at its termination value of $1.3 million.

We sold all of our interest rate floor contracts in January 2008. We realized a gain of $35.5 million on the sale of these contracts, which had a notional amount of $1.00 billion. We are reclassifying this gain from accumulated other comprehensive income to interest and fees on loans based on the remaining terms of the originally hedged portfolio of loans. These monthly reclassifications began in February 2008 and will continue until July 2014.

We reclassified $51.40 million of this gain into income during the first ~~nine~~three months of ~~2010~~2011. Between ~~October~~April 1, ~~2010,~~2011 and ~~September~~March 3031, ~~2011~~2012, we expect to reclassify approximately $32.73 million of of pretax net gains, or approximately $21.34 million after tax, on discontinued cash flow hedges reported in accumulated other comprehensive income. If we add other hedges, the amounts we actually recognize could differ from these estimates.

For more information about our derivative and hedging activities and how we account for them, read Note 23, “Summary of significant accounting policies,” and Note 1516, “Derivative and hedging activities,” in our ~~2009~~2010 Annual Report on Form 10-K. For more information about the fair values of derivatives, read Note 6, “Fair value measurement of assets and liabilities,” in this report, and Note 1415, “Fair value measurement of assets and liabilities,” in our ~~2009~~2010 Annual Report on Form 10-K.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

8. ~~Reserve~~Loans, loans held for ~~loan~~sale, ~~losses~~and OREO

~~Changes~~Loan ~~in the reserve for loan losses~~concentrations

	For the three months ended						For the nine months ended
	September 30,						September 30,
(in millions)	2010			2009			2010			2009
Reserve for loan losses at beginning of period	$	373.8		$	184.9		$	251.5		$	157.1
Loans charged off:
Commercial, financial, and agricultural loans		(56.3	)		(8.1	)		(89.9	)		(24.2	)
Commercial real estate — construction loans		(69.5	)		(6.3	)		(162.8	)		(27.1	)
Commercial mortgage loans		(13.5	)		(1.0	)		(30.9	)		(3.0	)
Residential mortgage		(0.1	)		(0.5	)		(0.2	)		(0.5	)
Consumer and other retail loans		(8.5	)		(7.9	)		(29.9	)		(31.8	)
Total loans charged off	$	(147.9	)	$	(23.8	)	$	(313.7	)	$	(86.6	)
Recoveries on loans previously charged off:
Commercial, financial, and agricultural loans	$	0.6		$	0.2		$	2.4		$	0.5
Commercial real estate — construction loans		0.5			—			0.5			—
Commercial mortgage loans		0.1			0.3			0.6			0.3
Consumer and other retail loans		1.8			1.5			5.0			6.6
Total recoveries	$	3.0		$	2.0		$	8.5		$	7.4
Net loans charged off:
Commercial, financial, and agricultural loans	$	(55.7	)	$	(7.9	)	$	(87.5	)	$	(23.7	)
Commercial real estate — construction loans		(69.0	)		(6.3	)		(162.3	)		(27.1	)
Commercial mortgage loans		(13.4	)		(0.7	)		(30.3	)		(2.7	)
Residential mortgage		(0.1	)		(0.5	)		(0.2	)		(0.5	)
Consumer and other retail loans		(6.7	)		(6.4	)		(24.9	)		(25.2	)
Total net loans charged off	$	(144.9	)	$	(21.8	)	$	(305.2	)	$	(79.2	)
Transfers from reserve for lending commitments		—			—			—			1.7
Provision charged to operations		281.5			38.7			564.1			122.2
Reserve for loan losses at end of period	$	510.4		$	201.8		$	510.4		$	201.8
Reserve for lending commitments in other liabilities	$	32.5		$	5.7		$	32.5		$	5.7

Loans as a percentage of total loans outstanding


	March 31,			December 31,
	2011			2010
Commercial, financial, and agricultural		29	%		29	%
Commercial real estate — construction		18	%		19	%
Commercial mortgage		27	%		26	%
Residential mortgage		6	%		6	%
Consumer		15	%		15	%
Secured with investments		5	%		5	%

In addition to loans outstanding, we had unfunded commitments to lend in the real estate sector of approximately $604.1 million and $686.7 million at March 31, 2011 and December 31, 2010, respectively. For more information on this, read Note 9, “Credit quality and the reserve for loan losses,” in these financial statements.

For more information about loan concentrations, read Note 8, “Loans, loans held for sale, and OREO,” in our 2010 Annual Report on Form 10-K.

Composition of commercial real estate — construction portfolio


	March 31,			December 31,
	2011			2010
Project type:
Residential real estate construction		44	%		46	%
Land development		24	%		23	%
Retail and office		16	%		15	%
Owner-occupied		2	%		1	%
Multi-family		7	%		8	%
Other		7	%		7	%

Geographic location:
Delaware		55	%		55	%
Pennsylvania		27	%		25	%
Maryland		5	%		6	%
New Jersey		12	%		12	%
Other		1	%		2	%

In addition to servicing our own residential mortgage loan portfolio, we service $770.8 million of residential mortgage loans for Fannie Mae and other private investors. For more information about mortgage servicing rights, read Note 10, “Goodwill and other intangible assets,” in these financial statements.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~Impaired~~At March 31, 2011, loans with an aggregate book value of $877.2 million were pledged as collateral to provide borrowing capacity at the Federal Reserve.

	As of		As of
	September 30,		December 31,
(in millions)	2010		2009
Investment recorded in impaired loans subject to a reserve for loan losses:	$	553.6	$	351.5
2010 reserve: $172.3
2009 reserve: $88.5
Investment in impaired loans requiring no reserve for loan losses, net of cumulative losses of:	$	397.9	$	148.3
2010 cumulative losses: $186.3
2009 cumulative losses: $18.8
Investment recorded in impaired loans	$	951.5	$	499.8
Investment recorded in impaired loans classified as nonaccruing 1	$	906.0	$	455.6
Investment recorded in impaired loans classified as troubled restructured debt (accruing)	$	44.5	$	28.5
1 Includes nonaccruing loans that are classified as troubled debt restructurings	$	62.4	$	116.7

Loans with interest reserves

	For the three months ended				For the nine months ended
	September 30,				September 30,
(in millions)	2010		2009		2010		2009
Average investment recorded in impaired loans	$	774.7	$	357.0	$	606.2	$	292.0
Interest income recognized on impaired loans	$	1.3	$	0.7	$	3.3	$	2.6
Interest income recognized using the cash basis method of income recognition	$	1.3	$	0.7	$	3.3	$	2.5

As part of our construction project financing, we employ interest reserves. Using interest reserves benefits both us and our borrowers, because interest reserves provide borrowers with temporary sources of cash flow which they can use to make interest payments during the development/construction phases of projects. We allow payments from interest reserves as they reach various stages of completion, and because we expect that cash flows will be positive once sales begin and/or stabilization occurs. We record these payments as interest income and we capitalize them by increasing the loan principal due from the borrower. We monitor loans with interest reserves throughout the project’s life and periodically evaluate the loan for an appropriate risk rating, interest accrual status, and classification as a troubled restructured loan. We may suspend interest accrual on loans that are not currently delinquent, but which have risk rating classifications of substandard or lower. We place loans and lines of credit with risk ratings of substandard or lower, and which depend on interest reserves for future interest payments, on nonaccruing status. At times, we may modify the terms of loans with interest reserves. These modifications may include maturity extensions, renewals, changes in the loan’s interest rate, additional collateral requirements, and/or additional capital infusions into the project by the borrower to reduce debt or to support future debt service. These modifications typically result from delays or other issues in the underlying construction projects, such as slower-than-anticipated sell-outs of the projects, insufficient leasing activity, and/or depreciation in the values of the collateral securing the loans. Under such circumstances, we believe that working with a borrower to restructure a loan provides us with a better likelihood of recovering our loan. At March 31, 2011, we had $206.8 million of loans that were supported by $15.9 million of interest reserve balances. Included in the $206.8 million of loans were $69.2 million of nonaccruing loans that were supported by interest reserves. At December 31, 2010, we had $274.5 million of loans that were supported by $22.2 million of interest reserve balances. Included in the $274.5 million of loans were $92.4 million of nonaccruing loans that were supported by interest reserves.

~~Determining the reserve for loan losses is an inherently subjective process. Estimates we make,~~OREO including estimates of the amounts and timing of payments we expect to receive on impaired loans, may be susceptible to significant change. Continued declines in the collateral values supporting our loans, worsening financial conditions of some of our borrowers, and continued lack of improvement in the Delaware economy could have an adverse effect on our results of operations and financial condition.

We had $67.0 million and $45.6 million in OREO held for sale as of March 31, 2011 and December 31, 2010, respectively. During the first three months of 2011, property valued at $28.7 million was transferred to OREO and we had sales and write-downs of $7.3 million, which resulted in a net loss of $0.1 million. This loss is in the “OREO write-down/losses and reserve for unfunded lending commitments” line of the statement of income.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

9.Loans ~~Goodwill~~held ~~and~~for ~~other intangible assets~~sale

	At September 30, 2010							At December 31, 2009
	Gross					Net		Gross					Net
	carrying		Accumulated			carrying		carrying		Accumulated			carrying
(in millions)	amount		amortization			amount		amount		amortization			amount
Goodwill (nonamortizing)	$	391.9	$	29.8		$	362.1	$	393.0	$	29.8		$	363.2
Other intangibles (amortizing):
Mortgage servicing rights	$	13.2	$	9.9		$	3.3	$	12.6	$	9.0		$	3.6
Client lists		62.6		35.6			27.0		73.7		37.6			36.1
Acquisition costs		1.7		1.7			—		1.7		1.7			—
Other intangibles		2.1		1.6			0.5		2.1		1.6			0.5
Total other intangibles	$	79.6	$	48.8	1	$	30.8	$	90.1	$	49.9	1	$	40.2

At March 31, 2011, we had $24.4 million of loans in the loans-held-for-sale category because we were actively engaged in a plan to sell these loans in the future. The types of loans that comprise the loans-held-for-sale balance are shown in the following table:

1 The change in accumulated amortization during the first nine months of 2010 included a decrease of $0.1 million due to foreign currency translation adjustments and a decrease of $7.1 million due to the reduced ownership of GTBA.


	At March 31,		At December 31,
(in millions)	2011		2010

Commercial, financial, and agricultural	$	6.0	$	6.7
Commercial real estate — construction		10.0		23.7
Commercial mortgage		6.7		20.4
Consumer		1.7		1.7

Total	$	24.4	$	52.5

WeLoans ~~identified~~held ~~certain~~for ~~triggering~~sale ~~events~~decreased ~~that~~$28.1 million ~~required~~from usthe tobalance ~~evaluate~~at December 31, 2010. In the first quarter, we sold $22.5 million of our ~~goodwill~~loans held for ~~impairment~~sale and realized a $2.4 million ~~Our~~loss ~~analysis~~on ~~showed~~the ~~that~~sale. ~~there~~The remaining decrease in loans held for sale of $5.6 million was nodue ~~material~~to ~~impairment~~a atcombination ~~September~~of additional 30write-downs, ~~2010~~payments on held-for-sale loans and transfers into/out of the held-for-sale category. The fair value of loans held for sale was determined either on an aggregate basis, aggregated by lending relationship, using third-party written offers or third-party broker estimates, or on an individual basis using appraisal data or other means.

~~Amortization~~Nonaccruing ~~expense~~and accruing status of ~~other~~loans ~~intangible~~held ~~assets~~for sale At March 31, 2011

	For the three months ended				For the nine months ended
(in millions)	Nonaccruing1,3		Accruing2,3
	September 30,				September 30,
Commercial, financial, and agricultural	$	6.0	$	—
(in millions)	2010		2009		2010		2009
Commercial real estate — construction		10.0		—
Amortization expense of other intangible assets	$	1.9	$	2.4	$	6.1	$	7.5
Commercial mortgage		6.7		—
Consumer		—		1.7
Total	$	22.7	$	1.7

Future amortization expense of other intangible assets


¹		All of the nonaccruing loans held for sale are greater than 90 days past due and have substandard ratings.

²		None of the accruing loans held for sale are delinquent.

³		There was no troubled restructured debt in accruing or nonaccruing loans held for sale.

	For the year ended December 31,
(in millions)	2011		2012		2013		2014		2015
Estimated annual amortization expense of other intangible assets	$	6.6	$	5.4	$	4.2	$	3.0	$	2.3

Carrying amount of goodwill by business segment

			Wealth			Corporate			Affiliate
	Regional		Advisory			Client			Money
(in millions)	Banking		Services			Services			Managers		Total
Balance as of January 1, 2010	$	3.8	$	131.8		$	84.7		$	142.9	$	363.2
Goodwill acquired		—		0.4			1.5			0.2		2.1
Decrease in carrying value due to reduction in GTBA ownership		—		(2.7	)		—			—		(2.7	)
Decrease in carrying value due to foreign currency translation adjustments		—		—			(0.5	)		—		(0.5	)
Balance as of September 30, 2010	$	3.8	$	129.5		$	85.7		$	143.1	$	362.1

The goodwill from acquisitions recorded during the first nine months of 2010 consists of $1.9 million in connection with the 2008 acquisition of AST Capital Trust Company and $0.2 million related to an increase in WT Investments, Inc.’s equity interest in CRM. Additionally, during the first nine months of 2010, we reduced our ownership position in GTBA, resulting in a $2.7 million reduction in goodwill and an $11.0 million reduction in other intangible assets.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~Changes~~9. inCredit ~~other~~quality ~~intangible~~and ~~assets~~the reserve for loan losses

	For the nine months ended September 30,
	2010						2009
						Weighted					Weighted
						average					average
	Amount			Residual		amortization	Amount		Residual		amortization
(dollars in millions)	assigned			value		period	Assigned		value		period
Mortgage servicing rights	$	0.6		$	—	8 years	$	2.6	$	—	8 years
(Decrease)/increase in carrying value of client lists due to foreign currency translation adjustments		(0.1	)		—			0.4		—
Decrease in carrying value due to reduction in GTBA ownership		(11.0	)		—			—		—
Other intangibles		—			—			0.1		—	9 years
Changes in other intangible assets	$	(10.5	)	$	—		$	3.1	$	—

Credit quality indicators

~~For~~Information ~~more~~about ~~information~~our ~~about~~primary ~~goodwill~~credit ~~and~~quality ~~other~~indicators ~~intangible~~is ~~assets,~~shown ~~read~~in ~~Note 2,~~the ~~“Summary~~tables ofbelow. For more ~~significant~~information ~~accounting~~about ~~policies~~this,” ~~and~~read Note 10 9, “~~Goodwill~~Credit quality and ~~other~~the ~~intangible~~reserve ~~assets~~for loan losses,” in our ~~2009~~2010 Annual Report on Form 10-K.

Internal risk-rating analysis
At March 31, 2011


							Doubtful		Total loan
(in millions)	Pass		Watchlist		Substandard		& loss		balance

Commercial, financial, and agricultural — auto dealer floorplan	$	110.3	$	14.8	$	30.3	$	—	$	155.4
Commercial, financial, and agricultural — other		1,154.1		166.1		535.1		16.5		1,871.8

Total commercial, financial, and agricultural		1,264.4		180.9		565.4		16.5		2,027.2

Real estate — construction — land development		45.3		75.0		166.5		30.3		317.1
Real estate — construction — residential construction		101.2		41.1		376.4		50.7		569.4
Real estate — construction — other		253.1		59.5		99.2		2.2		414.0

Total real estate — construction		399.6		175.6		642.1		83.2		1,300.5

Commercial mortgage — owner occupied		668.0		117.8		235.2		2.8		1,023.8
Commercial mortgage — non-owner occupied		600.3		118.3		174.9		0.8		894.3

Total commercial mortgage		1,268.3		236.1		410.1		3.6		1,918.1

Residential mortgage ²		400.3		—		25.3		—		425.6

Consumer — loans to commercial clients ¹		43.1		5.7		25.6		0.2		74.6
Consumer — other ²		975.8		—		11.3		—		987.1

Total consumer		1,018.9		5.7		36.9		0.2		1,061.7

Loans secured with investments		347.2		7.4		18.8		4.0		377.4

Total	$	4,698.7	$	605.7	$	1,698.6	$	107.5	$	7,110.5


¹		Consumer loans to commercial clients are consumer loans that are more complex than other typical consumer loans, are usually related to commercial loan relationships, and are managed by commercial loan staff in a manner similar to commercial loans.

²		We included consumer loans and residential mortgage loans that do not receive risk ratings in this analysis. We included these loans in the substandard category if they are nonaccruing and in the pass category if they are accruing. We consider the primary credit quality indicator of these types of loans to be the delinquency status. Please refer to the loan aging analysis table in this note for details regarding retail loan aging.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~10.~~At ~~Components~~December 31, ~~of net periodic benefit cost~~2010

We offer a pension plan, a supplemental executive retirement plan (SERP), and a postretirement benefit plan for which we record net periodic benefit costs. For more information about these plans, read Note 18, “Pension and other postretirement benefits,” in our 2009 Annual Report on Form 10-K.


							Doubtful		Total loan
(in millions)	Pass		Watchlist		Substandard		& loss		balance

Commercial, financial, and agricultural — auto dealer floorplan	$	153.3	$	15.2	$	52.3	$	—	$	220.8
Commercial, financial, and agricultural — other		1,181.6		195.9		557.0		23.3		1,957.8

Total commercial, financial, and agricultural		1,334.9		211.1		609.3		23.3		2,178.6

Real estate — construction — land development		80.5		39.9		176.8		31.7		328.9
Real estate — construction — residential construction		117.3		77.3		408.9		56.2		659.7
Real estate — construction — other		283.0		46.2		107.5		3.8		440.5

Total real estate — construction		480.8		163.4		693.2		91.7		1,429.1

Commercial mortgage — owner occupied		686.9		153.7		201.1		0.1		1,041.8
Commercial mortgage — non-owner occupied		630.3		138.4		148.7		0.3		917.7

Total commercial mortgage		1,317.2		292.1		349.8		0.4		1,959.5

Residential mortgage ²		405.5		—		29.1		—		434.6

Consumer — loans to commercial clients ¹		44.2		6.2		26.9		0.2		77.5
Consumer — other ²		1,039.7		—		17.1		—		1,056.8

Total consumer		1,083.9		6.2		44.0		0.2		1,134.3

Loans secured with investments		362.7		0.6		22.6		3.9		389.8

Total	$	4,985.0	$	673.4	$	1,748.0	$	119.5	$	7,525.9

Components of net periodic benefit cost


¹		Consumer loans to commercial clients are consumer loans that are more complex than other typical consumer loans, are usually related to commercial loan relationships, and are managed by commercial loan staff in a manner similar to commercial loans.

²		We included consumer loans and residential mortgage loans that do not receive risk ratings in this analysis. We included these loans in the substandard category if they are nonaccruing and in the pass category if they are accruing. We consider the primary credit quality indicator of these types of loans to be the delinquency status. Please refer to the loan aging analysis table in this note for details regarding retail loan aging.

	For the three months ended September 30,
											Postretirement
	Pension benefits						SERP benefits				benefits
(in millions)	2010			2009			2010		2009		2010			2009
Service cost	$	3.1		$	3.0		$	0.4	$	0.3	$	0.2		$	0.1
Interest cost		3.6			3.3			0.6		0.5		0.4			0.5
Expected return on plan assets		(5.6	)		(4.7	)		—		—		—			—
Amortization of prior service cost		—			—			0.1		0.1		(0.5	)		(0.5	)
Recognized actuarial losses		0.4			0.5			0.3		0.2		0.2			0.2
Net periodic benefit cost	$	1.5		$	2.1		$	1.4	$	1.1	$	0.3		$	0.3
Employer contributions	$	—		$	10.0		$	0.1	$	0.1	$	0.7		$	0.7

Components of net periodic benefit cost

	For the nine months ended September 30,
											Postretirement
	Pension benefits						SERP benefits				benefits
(in millions)	2010			2009			2010		2009		2010			2009
Service cost	$	9.4		$	8.9		$	1.0	$	0.8	$	0.4		$	0.4
Interest cost		10.6			10.0			1.9		1.6		1.2			1.3
Expected return on plan assets		(16.7	)		(14.0	)		—		—		—			—
Amortization of prior service cost		—			—			0.3		0.2		(1.4	)		(1.4	)
Recognized actuarial losses		1.1			1.4			1.0		0.6		0.6			0.5
Net periodic benefit cost	$	4.4		$	6.3		$	4.2	$	3.2	$	0.8		$	0.8
Employer contributions	$	—		$	10.0		$	0.4	$	0.4	$	2.1		$	2.2
Expected annual contribution	$	—					$	0.8			$	2.8

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~11.~~Loan ~~Investment~~aging ~~securities~~analysis At March 31, 2011

We maintain an investment securities portfolio to generate cash flow, to help manage interest rate risk, and to provide collateral for deposits and other liabilities. We do not invest in securities for trading purposes. There are no client funds in this portfolio.


	30-59		60-89		90 days
	days past		days past		or more		Total past
(in millions)	due		due		past due		due		Current		Total loans

Commercial, financial, and agricultural — auto dealer floorplan	$	—	$	—	$	0.2	$	0.2	$	155.2	$	155.4
Commercial, financial, and agricultural — other		34.9		4.4		280.0		319.3		1,552.5		1,871.8

Total commercial, financial, and agricultural		34.9		4.4		280.2		319.5		1,707.7		2,027.2

Real estate — construction — land development		4.1		9.9		127.5		141.5		175.6		317.1
Real estate — construction — residential construction		16.6		1.3		317.2		335.1		234.3		569.4
Real estate — construction — other		23.7		0.7		70.5		94.9		319.1		414.0

Total real estate — construction		44.4		11.9		515.2		571.5		729.0		1,300.5

Commercial mortgage — owner occupied		15.0		0.8		87.4		103.2		920.6		1,023.8
Commercial mortgage — non-owner occupied		16.0		16.6		84.6		117.2		777.1		894.3

Total commercial mortgage		31.0		17.4		172.0		220.4		1,697.7		1,918.1

Residential mortgage		17.5		—		22.3		39.8		385.8		425.6

Consumer — home equity		2.4		1.0		7.0		10.4		512.7		523.1
Consumer — indirect secured		5.0		0.8		3.5		9.3		353.1		362.4
Consumer — direct secured		0.1		0.1		0.1		0.3		17.5		17.8
Consumer — unsecured		0.7		0.5		0.7		1.9		80.8		82.7
Consumer — overdrafts		—		—		—		—		1.1		1.1
Consumer — loans to commercial clients		1.4		—		21.2		22.6		52.0		74.6

Total consumer		9.6		2.4		32.5		44.5		1,017.2		1,061.7

Loans secured with investments		12.5		0.1		8.8		21.4		356.0		377.4

Total	$	149.9	$	36.2	$	1,031.0	$	1,217.1	$	5,893.4	$	7,110.5

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

At December 31, 2010


	30-59		60-89		90 days
	days past		days past		or more		Total past
(in millions)	due		due		past due		due		Current		Total loans

Commercial, financial, and agricultural — auto dealer floorplan	$	—	$	—	$	0.3	$	0.3	$	220.5	$	220.8
Commercial, financial, and agricultural — other		9.6		3.7		294.3		307.6		1,650.2		1,957.8

Total commercial, financial, and agricultural		9.6		3.7		294.6		307.9		1,870.7		2,178.6

Real estate — construction — land development		8.1		2.6		127.7		138.4		190.5		328.9
Real estate — construction — residential construction		23.1		2.4		373.6		399.1		260.6		659.7
Real estate — construction — other		3.0		0.3		57.2		60.5		380.0		440.5

Total real estate — construction		34.2		5.3		558.5		598.0		831.1		1,429.1

Commercial mortgage — owner occupied		11.9		5.4		59.7		77.0		964.8		1,041.8
Commercial mortgage — non-owner occupied		15.3		0.9		78.8		95.0		822.7		917.7

Total commercial mortgage		27.2		6.3		138.5		172.0		1,787.5		1,959.5

Residential mortgage		22.3		—		25.3		47.6		387.0		434.6

Consumer — home equity		1.5		0.6		11.8		13.9		525.1		539.0
Consumer — indirect secured		7.7		1.3		3.1		12.1		399.7		411.8
Consumer — direct secured		0.2		—		0.3		0.5		12.0		13.7
Consumer — unsecured		0.9		0.6		0.8		2.3		86.6		88.9
Consumer — overdrafts		—		—		—		—		3.4		3.4
Consumer — loans to commercial clients		0.6		—		20.9		21.5		57.2		77.5

Total consumer		10.9		2.5		36.9		50.3		1,084.0		1,134.3

Loans secured with investments		5.9		0.1		12.6		18.6		371.2		389.8

Total	$	110.1	$	17.9	$	1,066.4	$	1,194.4	$	6,331.5	$	7,525.9

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Nonaccruing loans and accruing loans past due 90 days or more

At March 31, 2011


			Accruing loans
	Nonaccruing		past due 90 days
(in millions)	loans		or more

Commercial, financial, and agricultural — auto dealer floorplan	$	0.2	$	—
Commercial, financial, and agricultural — other		278.1		1.9

Total commercial, financial, and agricultural		278.3		1.9

Real estate — construction — land development		119.4		8.1
Real estate — construction — residential construction		311.9		5.3
Real estate — construction — other		67.2		3.3

Total real estate — construction		498.5		16.7

Commercial mortgage — owner occupied		80.0		7.4
Commercial mortgage — non-owner occupied		79.7		4.9

Total commercial mortgage		159.7		12.3

Residential mortgage		22.3		—

Consumer — home equity		7.0		—
Consumer — indirect secured		3.5		—
Consumer — direct secured		0.1		—
Consumer — unsecured		—		0.7
Consumer — overdrafts		—		—
Consumer — loans to commercial clients		21.2		—

Total consumer		31.8		0.7

Loans secured with investments		8.0		0.8

Total	$	998.6	$	32.4

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

At December 31, 2010


			Accruing loans
	Nonaccruing		past due 90 days
(in millions)	loans		or more

Commercial, financial, and agricultural — auto dealer floorplan	$	0.3	$	—
Commercial, financial, and agricultural — other		285.8		8.5

Total commercial, financial, and agricultural		286.1		8.5

Real estate — construction — land development		114.8		12.9
Real estate — construction — residential construction		356.8		16.8
Real estate — construction — other		55.0		2.2

Total real estate — construction		526.6		31.9

Commercial mortgage — owner occupied		51.6		8.1
Commercial mortgage — non-owner occupied		72.4		6.4

Total commercial mortgage		124.0		14.5

Residential mortgage		25.3		—

Consumer — home equity		11.8		—
Consumer — indirect secured		3.1		—
Consumer — direct secured		0.3		—
Consumer — unsecured		0.1		0.7
Consumer — overdrafts		—		—
Consumer — loans to commercial clients		20.9		—

Total consumer		36.2		0.7

Loans secured with investments		11.4		1.2

Total	$	1,009.6	$	56.8

Effect of nonaccruing loans on interest income


	At		At
(in millions)	March 31, 2011		December 31, 2010

Nonaccruing loans	$	998.6	$	1,009.6


	Q1 2011		Q1 2010
Interest income that would have been recognized on nonaccruing loans under original terms	$	18.3	$	6.7
Payments received recorded as interest income on nonaccruing loans	$	0.7	$	0.7

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The reserve for loan losses

We establish a reserve for loan losses in accordance with GAAP by charging a provision for loan losses against income. Determining the reserve for loan losses is an inherently subjective process. Estimates we make, including estimates of collateral values and the amounts and timing of payments we expect to receive on impaired loans, may be susceptible to significant change. If actual circumstances differ substantially from the assumptions we use to determine the reserve, including continued declines in the collateral values supporting our loans, worsening financial conditions of some of our borrowers, and continued lack of improvement in the Delaware economy, future adjustments to the reserve may be necessary. This could have a material adverse effect on our results of operations and financial condition. For more information about the reserve for loan losses, read Note 9, “Credit quality and the reserve for loan losses,” in our 2010 Annual Report on Form 10-K.

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Changes in the reserve for loan losses


	For the three months ended
	March 31,
(in millions)	2011			2010
Reserve for loan losses at beginning of period:
Commercial, financial, and agricultural loans	$	140.7		$	65.9
Commercial real estate — construction loans		188.5			100.8
Commercial mortgage loans		61.6			40.6
Residential mortgage		5.9			3.3
Consumer and other retail loans		39.4			36.4
Loans secured with investments		4.7			4.5

Total reserve for loan losses at beginning of period	$	440.8		$	251.5
Loans charged off:
Commercial, financial, and agricultural loans	$	(33.2	)	$	(8.2	)
Commercial real estate — construction loans		(43.2	)		(12.1	)
Commercial mortgage loans		(2.5	)		(2.4	)
Residential mortgage		(0.1	)		—
Consumer and other retail loans		(5.5	)		(8.1	)

Total loans charged off	$	(84.5	)	$	(30.8	)
Recoveries on loans previously charged off:
Commercial, financial, and agricultural loans	$	1.7		$	0.3
Commercial real estate — construction loans		1.0			—
Commercial mortgage loans		0.1			—
Consumer and other retail loans		1.2			1.4

Total recoveries	$	4.0		$	1.7
Net loans charged off:
Commercial, financial, and agricultural loans	$	(31.5	)	$	(7.9	)
Commercial real estate — construction loans		(42.2	)		(12.1	)
Commercial mortgage loans		(2.4	)		(2.4	)
Residential mortgage		(0.1	)		—
Consumer and other retail loans		(4.3	)		(6.7	)

Total net loans charged off	$	(80.5	)	$	(29.1	)
Provision charged to operations:
Commercial, financial, and agricultural loans	$	11.2		$	16.7
Commercial real estate — construction loans		22.6			38.5
Commercial mortgage loans		7.1			12.9
Residential mortgage		0.5			0.9
Consumer and other retail loans		0.4			9.4
Loans secured with investments		(0.5	)		(1.0	)

Total provision charged to operations	$	41.3		$	77.4
Transfers from reserve for lending commitments
Commercial, financial, and agricultural loans	$	7.9		$	—

Total transfers from reserve for lending commitments	$	7.9		$	—
Reserve for loan losses at end of period:
Commercial, financial, and agricultural loans	$	128.3		$	74.7
Commercial real estate — construction loans		168.9			127.3
Commercial mortgage loans		66.3			51.2
Residential mortgage		6.3			4.1
Consumer and other retail loans		35.5			39.0
Loans secured with investments		4.2			3.5

Total reserve for loan losses at end of period	$	409.5		$	299.8

Reserve for lending commitments in other liabilities	$	45.4		$	8.9

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Reserve analysis
At March 31, 2011


	Loan balances						Reserve balances
	Individually		Collectively				Individually		Collectively
	evaluated for		evaluated for				evaluated for		evaluated for
(in millions)	impairment		impairment		Total		impairment		impairment		Total

Commercial, financial, and agricultural	$	281.8	$	1,745.4	$	2,027.2	$	47.6	$	80.7	$	128.3
Commercial real estate — construction		498.8		801.7		1,300.5		72.6		96.3		168.9
Commercial mortgage		172.4		1,745.7		1,918.1		12.5		53.8		66.3
Residential mortgage		27.6		398.0		425.6		1.8		4.5		6.3
Consumer		33.4		1,028.3		1,061.7		4.2		31.3		35.5
Loans secured with investments		16.2		361.2		377.4		—		4.2		4.2

Total	$	1,030.2	$	6,080.3	$	7,110.5	$	138.7	$	270.8	$	409.5

At December 31, 2010


	Loan balances						Reserve balances
	Individually		Collectively				Individually		Collectively
	evaluated for		evaluated for				evaluated for		evaluated for
(in millions)	impairment		impairment		Total		impairment		impairment		Total

Commercial, financial, and agricultural	$	303.7	$	1,874.9	$	2,178.6	$	60.7	$	80.0	$	140.7
Commercial real estate — construction		526.6		902.5		1,429.1		83.6		104.9		188.5
Commercial mortgage		137.3		1,822.2		1,959.5		13.1		48.5		61.6
Residential mortgage		29.4		405.2		434.6		1.5		4.4		5.9
Consumer		38.2		1,096.1		1,134.3		5.2		34.2		39.4
Loans secured with investments		19.6		370.2		389.8		—		4.7		4.7

Total	$	1,054.8	$	6,471.1	$	7,525.9	$	164.1	$	276.7	$	440.8

Impaired loans


	At		At
	March 31,		December 31,
(in millions)	2011		2010

Impaired loans subject to a reserve for loan losses:
2011 reserve: $138.7	$	405.8
2010 reserve: $164.1			$	451.9
Impaired loans requiring no reserve for loan losses, net of cumulative charge-offs of:
2011 cumulative charge-offs: $300.0	$	624.4
2010 cumulative charge-offs: $291.4			$	602.9

Total impaired loans	$	1,030.2	$	1,054.8

Impaired loans classified as nonaccruing¹	$	998.6	$	1,009.6
Impaired loans classified as troubled restructured debt (accruing)	$	30.6	$	43.9

¹ Includes nonaccruing loans that are classified as troubled debt restructurings	$	42.9	$	38.1

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


	For the three months ended
	March 31, 2011
	Average				Interest income
	investment		Interest income		recognized on
	recorded in		recognized on		impaired loans
(in millions)	impaired loans		impaired loans		(cash basis)¹

Commercial, financial, and agricultural — auto dealer floorplan	$	0.3	$	—	$	—
Commercial, financial, and agricultural — other		306.4		—		0.3

Total commercial, financial, and agricultural		306.7		—		0.3

Real estate — construction — land development		370.7		—		0.1
Real estate — construction — residential construction		79.8		—		—
Real estate — construction — other		68.0		—		—

Total real estate — construction		518.5		—		0.1

Commercial mortgage — owner occupied		82.2		0.2		0.2
Commercial mortgage — non-owner occupied		77.2		—		0.1

Total commercial mortgage		159.4		0.2		0.3

Residential mortgage		29.0		—		—

Consumer — home equity		7.5		—		0.1
Consumer — indirect secured		3.3		0.1		0.1
Consumer — direct secured		0.2		—		—
Consumer — unsecured		0.9		—		—
Consumer — overdrafts		—		—		—
Consumer — loans to commercial clients		20.8		—		—

Total consumer		32.7		0.1		0.2

Loans secured with investments		18.3		0.1		0.1

Total	$	1,064.6	$	0.4	$	1.0


¹		Interest income recognized on impaired loans using the cash basis method of income recognition.


	For the three
	months ended
(in millions)	March 31, 2010

Average investment recorded in impaired loans	$	515.9

Interest income recognized on impaired loans	$	1.2

Interest income recognized using the cash basis method of income recognition	$	1.2

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Impaired loans with no related reserve recorded


	At March 31, 2011				At December 31, 2010
			Unpaid				Unpaid
	Loan		principal		Loan		principal
(in millions)	balance ¹		balance		balance ¹		balance

Commercial, financial, and agricultural — auto dealer floorplan	$	0.1	$	0.1	$	0.2	$	0.2
Commercial, financial, and agricultural — other		174.9		222.3		161.7		215.6

Total commercial, financial, and agricultural		175.0		222.4		161.9		215.8

Real estate — construction — land development		209.8		404.1		222.2		397.6
Real estate — construction — residential construction		51.8		71.9		57.7		78.6
Real estate — construction — other		29.1		49.6		37.9		55.4

Total real estate — construction		290.7		525.6		317.8		531.6

Commercial mortgage — owner occupied		59.3		66.1		35.9		43.7
Commercial mortgage — non-owner occupied		51.6		61.4		37.4		49.2

Total commercial mortgage		110.9		127.5		73.3		92.9

Residential mortgage		12.6		12.6		10.6		10.6

Consumer — home equity		1.3		1.3		3.4		3.4
Consumer — indirect secured		—		—		—		—
Consumer — direct secured		—		—		—		—
Consumer — unsecured		—		—		—		—
Consumer — overdrafts		—		—		—		—
Consumer — loans to commercial clients		17.7		18.8		16.3		19.8

Total consumer		19.0		20.1		19.7		23.2

Loans secured with investments		16.2		16.2		19.6		20.2

Total	$	624.4	$	924.4	$	602.9	$	894.3


¹		Loan balance is net of cumulative charge-offs, if any.

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Impaired loans with a reserve recorded


	At March 31, 2011						At December 31, 2010
			Unpaid						Unpaid
	Loan		principal		Related		Loan		principal		Related
(in millions)	balance ¹		balance		Reserve		balance ¹		balance		reserve

Commercial, financial, and agricultural — auto dealer floorplan	$	0.1	$	0.1	$	—	$	12.9	$	14.5	$	0.4
Commercial, financial, and agricultural — other		106.7		112.3		47.6		128.9		139.0		60.3

Total commercial, financial, and agricultural		106.8		112.4		47.6		141.8		153.5		60.7

Real estate — construction — land development		139.1		149.9		49.8		156.1		168.9		61.1
Real estate — construction — residential construction		23.0		24.2		14.8		26.5		27.0		13.2
Real estate — construction — other		46.0		46.4		8.0		26.2		26.9		9.3

Total real estate — construction		208.1		220.5		72.6		208.8		222.8		83.6

Commercial mortgage — owner occupied		33.4		34.0		4.6		28.3		29.0		4.8
Commercial mortgage — non-owner occupied		28.1		28.7		7.9		35.7		35.8		8.3

Total commercial mortgage		61.5		62.7		12.5		64.0		64.8		13.1

Residential mortgage		15.0		15.0		1.8		18.8		18.8		1.5

Consumer — home equity		6.8		6.8		1.3		9.4		9.4		2.3
Consumer — indirect secured		3.4		3.4		0.5		3.1		3.1		0.3
Consumer — direct secured		0.1		0.1		—		0.5		0.5		0.2
Consumer — unsecured		0.7		0.7		0.8		0.9		0.9		0.5
Consumer — overdrafts		—		—		—		—		—		—
Consumer — loans to commercial clients		3.4		4.0		1.6		4.6		5.2		1.9

Total consumer		14.4		15.0		4.2		18.5		19.1		5.2

Loans secured with investments		—		—		—		—		—		—

Total	$	405.8	$	425.6	$	138.7	$	451.9	$	479.0	$	164.1


¹		Loan balance is net of cumulative charge-offs, if any.

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The reserve for unfunded commitments

In accordance with current accounting policies, we record a separate reserve amount on our balance sheet under other liabilities for unfunded loan commitments, mainly letters of credit. This reserve is based on assumptions about the probability of draws on these commitments, their risk ratings, and the estimated losses that we may incur if the commitments are drawn upon. Increases and decreases to this reserve are recorded in the “OREO write-downs/losses and reserve for unfunded commitments” line of the statement of income.

Reserve for unfunded lending commitments roll-forward
For the three months ended March 31, 2011


(in millions)
Reserve for unfunded commitments at January 1, 2011	$	58.2
Additions due to new commitments during the period		5.4
Reductions due to expired or funded commitments during the period		(19.8	)
Additions due to changes in reserve assumptions during the period ¹		1.5

Net change in reserve for unfunded commitments		(12.9	)
Reserve for unfunded commitments at March 31, 2011	$	45.3


¹		The major assumptions used in determining the reserve amount are funding probability, credit quality of the underlying borrower, and historical loss experience.

Unfunded lending commitments


	At		At
(in millions)	March 31, 2011		December 31, 2010

Unfunded commitments to extend credit	$	2,168.3	$	2,282.3
Standby and commercial letters of credit		221.9		248.3

Total exposure to unfunded commitments	$	2,390.2	$	2,530.6

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

10. Goodwill and other intangible assets


	At March 31, 2011							At December 31, 2010
	Gross					Net		Gross				Net
	carrying		Accumulated			carrying		carrying		Accumulated		carrying
(in millions)	amount		amortization			amount		amount		amortization		amount
Goodwill (nonamortizing)	$	366.6	$	29.8		$	336.8	$	366.1	$	29.8	$	336.3
Other intangibles (amortizing):
Mortgage servicing rights	$	13.6	$	10.5		$	3.1	$	13.5	$	10.2	$	3.3
Client lists		62.7		38.7			24.0		62.6		37.1		25.5
Acquisition costs		1.7		1.7			—		1.7		1.7		—
Other intangibles		2.1		1.7			0.4		2.1		1.7		0.4

Total other intangibles	$	80.1	$	52.6	¹	$	27.5	$	79.9	$	50.7	$	29.2


¹		The change in accumulated amortization during the first three months of 2011 included an increase of $0.1 million due to foreign currency translation adjustments.

Amortization expense of other intangible assets


	For the three months ended
	March 31,
(in millions)	2011		2010
Amortization expense of other intangible assets	$	1.8	$	2.3

Future amortization expense of other intangible assets


	For the year ended December 31,
(in millions)	2012		2013		2014		2015		2016

Estimated annual amortization expense of other intangible assets	$	5.5	$	4.3	$	3.1	$	2.3	$	1.9

Carrying amount of goodwill by business segment


			Wealth		Corporate		Affiliate
	Regional		Advisory		Client		Money
(in millions)	Banking		Services		Services		Managers		Total
Balance as of January 1, 2011	$	—	$	129.5	$	85.5	$	121.3	$	336.3
Increase in carrying value due to foreign currency translation adjustments		—		—		0.5		—		0.5

Balance as of March 31, 2011	$	—	$	129.5	$	86.0	$	121.3	$	336.8

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Changes in other intangible assets


	For the three months ended March 31,
	2011					2010
					Weighted						Weighted
					average						average
	Amount		Residual		amortization	Amount			Residual		amortization
(dollars in millions)	assigned		value		period	assigned			value		period
Mortgage servicing rights	$	0.1	$	—	8 years	$	0.2		$	—	8 years
Increase/(decrease) in carrying value of client lists due to foreign currency translation adjustments		0.1		—			(0.3	)		—
Decrease in carrying value due to reduction in GTBA ownership		—		—			(11.0	)		—

Changes in other intangible assets	$	0.2	$	—		$	(11.1	)	$	—

For more information about goodwill and other intangible assets, read Note 3, “Summary of significant accounting policies,” and Note 11, “Goodwill and other intangible assets,” in our 2010 Annual Report on Form 10-K.

11. Components of net periodic benefit cost

We offer a pension plan, a supplemental executive retirement plan (SERP), and a postretirement benefit plan for which we record net periodic benefit costs. For more information about these plans, read Note 19, “Pension and other postretirement benefits,” in our 2010 Annual Report on Form 10-K.

Components of net periodic benefit cost


	For the three months ended March 31,
											Postretirement
	Pension benefits						SERP benefits				benefits
(in millions)	2011			2010			2011		2010		2011			2010

Service cost	$	3.4		$	3.1		$	0.4	$	0.4	$	0.2		$	0.2
Interest cost		3.8			3.6			0.6		0.6		0.4			0.4
Expected return on plan assets		(5.3	)		(5.6	)		—		—		—			—
Amortization of prior service cost		—			—			0.1		0.1		(0.5	)		(0.5	)
Recognized actuarial losses		0.7			0.4			0.2		0.3		0.2			0.2

Net periodic benefit cost	$	2.6		$	1.5		$	1.3	$	1.4	$	0.3		$	0.3

Employer contributions	$	—		$	—		$	0.6	$	0.1	$	0.7		$	0.7
Expected annual contributions	$	—					$	1.6			$	2.9

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

12. Investment securities

We maintain an investment securities portfolio to generate cash flow, help manage interest rate risk, and provide collateral for deposits and other liabilities. We do not invest in securities for trading purposes. There are no client funds in this portfolio.

Our investment securities portfolio consists of:

•

Securities issued by the U.S. Treasury.

•

Discount notes and other securities issued by other U.S. government agencies, including the Government National Mortgage Association (Ginnie Mae), the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac), and the Federal Home Loan Bank System.

•

Obligations of state and political subdivisions, which primarily are bonds issued by the state of Delaware and municipalities in Delaware.

•

Mortgage-backed securities and collateralized mortgage obligations issued by Fannie Mae, Freddie Mac, and Ginnie Mae, in which the underlying collateral consists of fixed and adjustable rate residential mortgages. All of the loans underlying these securities were originated subject to the underwriting guidelines and standards of the respective government agency.

• Corporate debt securities, including single-issue and pooled trust preferred securities (TruPS) issued by financial institutions.

• Perpetual preferred stock, which consists of securities issued by Fannie Mae, Freddie Mac, and two other financial institutions. (The carrying value of our Fannie Mae and Freddie Mac perpetual stock is zero, due to impairment charges we recorded in 2008).

•

Non-U.S. government agency securities and small amounts of other types of marketable debt and equity securities.

Numerous factors affect the valuations at which we record these securities on our balance sheet, including market interest rates, credit spreads, and investor perceptions. We review the securities in our investment portfolio at least quarterly in order to determine their fair values, which can be equal to, more than, or less than their amortized costs. To determine a security’s fair value, we use a variety of techniques and consult with third-party valuation experts. For more information about the key determinants of a security’s fair value, read Note 6, “Fair value measurement of assets and liabilities,” in this report.

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

We classify investment securities in one of two categories:

Available-for-sale (AFS). This means we have the ability to hold the security, but we may elect to sell it, depending on our needs.

Held-to-maturity (HTM). This means we have not only the ability, but also the intent, to retain the security on our books until it matures.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

AFS securities are carried at their estimated fair value. When the fair value of an AFS security exceeds its book value, we record an unrealized gain as a change in stockholders’ equity through accumulated other comprehensive income. This increases stockholders’ equity. It does not affect earnings.

HTM securities are carried at their amortized cost. When the fair value of an HTM security exceeds its amortized cost, we disclose the change as an unrealized gain in the investment securities footnotes that accompany our financial statements. There is no corresponding change to stockholders’ equity or earnings.

When a security’s fair value falls below its book value, it is considered impaired, and we are required to assess whether it is either temporarily impaired or OTTI. To determine whether a security is temporarily impaired or OTTI, we consider factors that include:

•

Whether the present value of cash flows we expect to collect is less than the amortized cost basis of the security.

•

The causes of the decline in fair value, such as credit problems, interest rate fluctuations, industry conditions, and/or market volatility.

•

The severity and duration of the decline in the security’s fair value (from its amortized cost basis).

•

The security issuer’s ability to make scheduled interest or principal payments.

•

Changes made by credit rating agencies to the credit rating of the security or its issuer.

•

Whether we intend to sell the security or hold it until it recovers in value, matures, or is called.

•

Whether it is more likely than not that we will be required to sell the security before it recovers its amortized cost basis.

When we believe the security’s valuation decline (impairment) is primarily a function of short-term financial market forces, we classify it as temporarily impaired. When we believe that conditions in addition to financial market forces have contributed to the security’s valuation decline, we classify it as OTTI.

Wilmington Trust Corporation and subsidiaries
Form 10-Q for the three months ended March 31, 2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Under ASC 320, “Investments — Debt and Equity Securities,” if we do not intend to sell a debt security, and if it is not more likely than not that we will be required to sell the security, we must separate other-than-temporary impairments into two amounts, each of which is accounted for differently:

A portion related to credit loss. This portion is recognized in earnings as an impairment loss.

A portion related to all other factors. This portion is recognized in comprehensive income, net of taxes.

33The credit-related portion of an other-than-temporary impairment is the difference between the security’s amortized cost (the security’s carrying value plus any previous other-than-temporary impairment recorded in accumulated other comprehensive income) and the present value of the security’s expected future cash flows. We base our calculations of a security’s expected cash flows on its contractual terms, discounted at a rate equal to the effective interest rate implicit when we acquired the security. We adjust the expected cash flows of each security for current and anticipated defaults each quarter.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The credit-related portion of an other-than-temporary impairment is the difference between the security’s amortized cost (the security’s carrying value plus any previous other-than-temporary impairment recorded in accumulated other comprehensive income) and the present value of the security’s expected future cash flows. We base our calculations of a security’s expected cash flows on its contractual terms, discounted at a rate equal to the effective interest rate implicit when we acquired the security. We adjust the expected cash flows of each security for current and expected defaults each quarter.

For the pooled TruPS in our portfolio, we use a third party to help us calculate estimated future cash flows using default/deferral assumptions based on an analysis of the creditworthiness of every underlying issuer in each pool. In assessing creditworthiness, we consider each issuer’s capital strength, liquidity position, asset quality, loan composition, earnings, and credit rating, as well as other financial measures. We believe that our methodology gives us the best estimate of the expected future cash flows for each of these securities.

In the ~~2010~~2011 ~~third~~first quarter, 14 of the 38 pooled TruPS in our investment securities portfolio were determined to be OTTI, which resulted in an impairment loss of $72.09 million. Of this amount, $42.49 million was credit-related and was recorded as an other-than-temporary impairment loss in the statement of income. The $42.49 million credit-related loss was caused by continued deterioration in the credit quality of the institutions whose preferred stock underlie the pooled TruPS that we own. ~~The~~Less ~~remaining~~than $20.61 million of non-credit-related ~~portion of the~~ write-down reduced stockholders’ equity ~~by $1.7 million on an after-tax basis~~ and was recorded in other comprehensive income.

~~For~~In the 2011 first ~~nine months of 2010~~quarter, ~~impairment~~we ~~losses~~also onrecorded ~~pooled~~a ~~TruPS totaled~~ $482.1 million. ~~Of this amount, $30.1 million was credit-related and was recorded in the statement of income. The remaining $18.0 million non-credit-related portion of the~~ write-down ~~reduced stockholders’ equity by $11.5 million~~ on an ~~after-tax~~other ~~basis.~~marketable ~~In addition to the $30.1 million pooled TruPS loss, we recorded a $0.1 million loss on an AFS~~ equity security that was determined to be OTTI ~~in the 2010 first quarter~~.

In comparison, ~~there~~for ~~was~~the a2010 ~~$55.0 million~~first ~~other-than-temporary~~quarter, ~~impairment~~23 ~~charge~~of onthe 38 pooled TruPS in ~~the~~ ~~2009~~our ~~third~~investment securities ~~quarter.~~portfolio ~~Total~~were ~~other-than-temporary~~determined ~~impairment~~to ~~charges~~be ~~for~~OTTI, ~~the~~which ~~first~~resulted ~~nine~~in ~~months~~an ~~of 2009~~impairment ~~were~~loss ~~$129.7 million, which consisted~~ of $~~122~~29.7 8 million. ofOf ~~other-than-temporary~~this ~~impairment on pooled TruPS~~amount, $317.9 million ofwas ~~other-than-temporary~~related ~~impairment~~to oncredit aquality ~~mutual~~and ~~fund~~was ~~investment,~~recorded ~~and~~as ~~$2.5~~an ~~million of~~ other-than-temporary impairment onloss ain ~~marketable~~the ~~equity~~statement ~~security~~of income. WeThe ~~reclassified~~remaining $011.6 9 million noncredit ofportion ~~the~~was ~~pooled~~recorded ~~TruPS~~in other~~-than-temporary~~ ~~impairment~~comprehensive ~~charge~~income, towhich ~~accumulated~~reduced ~~other~~stockholders’ equity. ~~comprehensive~~In ~~income~~addition into the ~~second~~$17.9 million ~~quarter~~OTTI ofpooled ~~2009~~TruPS ~~with~~loss, ~~the~~a ~~adoption~~$0.1 million ofloss ~~FSP~~was ~~FAS~~recorded ~~No. 115-2~~on ~~and FAS~~an ~~No.124~~available-2,for-sale ~~which~~equity security that was ~~incorporated~~determined ~~into~~to ~~ASC~~be ~~320~~OTTI in the 2010 first quarter.

3447

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Credit loss roll forward

(in millions)
Balance of credit-related other-than-temporary impairment at January 1, 2010	$	97.6
Balance of credit-related other-than-temporary impairment at January 1, 2011	$	135.5
Additions:
Credit losses for which other-than-temporary impairments were not recognized previously		~~0.9~~—
Additional credit losses for which other-than-temporary impairments were recognized previously		292.39
Balance of credit-related other-than-temporary impairment at September 30, 2010	$	127.8
Balance of credit-related other-than-temporary impairment at March 31, 2011	$	138.4

Amortized cost and fair value of available-for-sale securities at ~~September~~March 3031, ~~2010~~2011

			OTTI
	Amortized		recognized		Unrealized		Unrealized			Fair
(in millions)	cost		in OCI		gains		losses			value
Investment securities available for sale:
U.S. Treasury securities	$	~~173~~31.18	$	—	$	~~0.1~~—	$	—		$	~~173~~31.28
Government agency securities		~~239~~191.90		—		0.31		(0.17	)		~~240~~190.14
Obligations of state and political subdivisions		4.9.0		—		~~0.1~~—		—			59.0
Collateralized mortgage obligations:
Secured by residential mortgages		3321.23		—		0.96		—			3421.19
Mortgage-backed debt securities:
Residential mortgage-backed securities		~~152~~126.60		—		87.30		—			~~160~~133.90
Preferred stock:
Large financial institutions		1.51		—		0.4		—			1.95
Small financial institutions		3.0		—		—		—			3.0
Total preferred stock		4.51		—		0.4		—			4.95
Other marketable equity securities:
Mutual funds		3.0		—		—		—			3.0
Other		31.43		—		—		—			31.43
Total other marketable equity securities		6.4.3		—		—		—			6.4.3
Total investment securities available for sale	$	~~614~~387.65	$	—	$	108.1	$	(0.17	)	$	~~624~~394.69

35Amortized cost and fair value of available-for-sale securities at December 31, 2010


			OTTI
	Amortized		recognized		Unrealized		Unrealized			Fair
(in millions)	cost		in OCI		gains		losses			value

Investment securities available for sale:
U.S. Treasury securities	$	48.8	$	—	$	0.1	$	—		$	48.9
Government agency securities		245.7		—		0.1		(0.4	)		245.4
Obligations of state and political subdivisions		9.2		—		—		—			9.2
Collateralized mortgage obligations:
Secured by residential mortgages		26.4		—		0.8		—			27.2
Mortgage-backed debt securities:
Residential mortgage-backed securities		138.0		—		7.4		—			145.4
Preferred stock:
Large financial institutions		1.1		—		0.4		—			1.5
Small financial institutions		3.0		—		—		—			3.0

Total preferred stock		4.1		—		0.4		—			4.5
Other marketable equity securities:
Mutual funds		3.0		—		—		—			3.0
Other		3.3		—		—		—			3.3

Total other marketable equity securities		6.3		—		—		—			6.3

Total investment securities available for sale	$	478.5	$	—	$	8.8	$	(0.4	)	$	486.9

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Amortized cost, carrying value, and fair value of ~~available~~held-~~for~~to-~~sale~~maturity securities at ~~December~~March 31, ~~2009~~2011

			OTTI
	Amortized		recognized		~~Unrealized~~Carrying		Unrealized			~~Fair~~Unrealized			Fair
(in millions)	cost		in OCI		~~gains~~value		~~losses~~gains			~~value~~losses			value
Investment securities available for sale:
Investment securities held to maturity:
U.S. Treasury securities	$	233.0	$	—	$	—	$	(0.2	)	$	232.8
Obligations of state and political subdivisions	$	0.4	$	—	$	0.4	$	—		$	—		$	0.4
Government agency securities		224.9		—		0.5		(0.8	)		224.6
Corporate debt securities:
Obligations of state and political subdivisions		5.1		—		0.1		—			5.2
Single-issue trust-preferreds		58.6		—		58.6		0.9			(2.8	)		56.7
Collateralized mortgage obligations:
Pooled trust-preferreds		112.1		69.4		42.7		9.6			(1.2	)		51.1
Secured by residential mortgages		49.9		—		1.3		—			51.2
Total corporate debt securities		170.7		69.4		101.3		10.5			(4.0	)		107.8
Mortgage-backed debt securities:
Non-U.S. government agency debt securities		0.5		—		0.5		—			—			0.5
Residential mortgage-backed securities		195.8		—		7.6		—			203.4
Other debt securities		0.5		—		0.5		—			—			0.5
Preferred stock:
Total investment securities held to maturity	$	172.1	$	69.4	$	102.7	$	10.5		$	(4.0	)	$	109.2
Large financial institutions		17.5		—		3.4		—			20.9
Small financial institutions		3.0		—		—		—			3.0
Total preferred stock		20.5		—		3.4		—			23.9
Other marketable equity securities:
Mutual funds		3.0		—		—		—			3.0
Other		3.5		—		—		—			3.5
Total other marketable equity securities		6.5		—		—		—			6.5
Total investment securities available for sale	$	735.7	$	—	$	12.9	$	(1.0	)	$	747.6

Amortized cost, carrying value, and fair value of held-to-maturity securities at ~~September~~December 3031, 2010

			OTTI
	Amortized		recognized		Carrying		Unrealized		Unrealized			Fair
(in millions)	cost		in OCI		value		gains		losses			value
Investment securities held to maturity:
Obligations of state and political subdivisions	$	0.43	$	—	$	0.43	$	—	$	—		$	0.43
Corporate debt securities:
Single-issue trust-preferreds		58.25		—		58.25		—0.1		(4.76	)		5354.50
Pooled trust-preferreds		~~121~~113.07		7771.9		4341.18		45.6		(21.56	)		45.28
Total corporate debt securities		~~179~~172.2		7771.9		~~101~~100.3		45.67		(76.2	)		9899.78
Non-U.S. government agency debt securities		0.5		—		0.5		—		—			0.5
Other debt securities		0.7		—		0.7		—		—			0.7
Total investment securities held to maturity	$	~~180~~173.87	$	7771.9	$	~~102~~101.98	$	45.67	$	(76.2	)	$	~~100~~101.3

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Amortized cost, carrying value, and fair value of held-to-maturity securities at December 31, 2009

			OTTI
	Amortized		recognized		Carrying		Unrealized		Unrealized			Fair
(in millions)	cost		in OCI		value		gains		losses			value
Investment securities held to maturity:
Obligations of state and political subdivisions	$	0.5	$	—	$	0.5	$	—	$	—		$	0.5
Corporate debt securities:
Single-issue trust-preferreds		57.7		—		57.7		—		(9.2	)		48.5
Pooled trust-preferreds		141.3		88.0		53.3		3.0		(4.9	)		51.4
Total corporate debt securities		199.0		88.0		111.0		3.0		(14.1	)		99.9
Non-U.S. government agency debt securities		0.5		—		0.5		—		—			0.5
Other debt securities		0.9		—		0.9		—		—			0.9
Total investment securities held to maturity	$	200.9	$	88.0	$	112.9	$	3.0	$	(14.1	)	$	101.8

Temporarily impaired securities

When a security is determined to be temporarily impaired, and there is an associated unrealized loss, the security’s accounting treatment depends on whether it is classified as AFS or HTM.

For temporarily impaired AFS securities, we are required to:

•

Report the amount of the impairment as an unrealized loss.

• Record the unrealized loss as a reduction in stockholders’ equity through accumulated other comprehensive income. This reduces stockholders’ equity. It does not affect earnings.

~~This~~For ~~reduces~~temporarily ~~stockholders’~~impaired ~~equity.~~HTM Itsecurities, ~~does~~we ~~not~~are ~~affect~~required ~~earnings.~~to:

~~For~~• ~~temporarily~~Disclose ~~impaired HTM securities, we are required to disclose~~ the amount of the decline in fair value in a footnote disclosure, not as a change in stockholders’ equity. This has no effect on our financial statements or earnings.

~~A continued downturn in the financial markets could cause us to reassess whether any or all of~~49 ~~these securities remain temporarily impaired, or if any or all of them should be deemed OTTI.~~

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~Temporarily~~A ~~impaired~~continued ~~securities~~downturn asin the financial markets could cause us to reassess whether any or all of these ~~September 30~~securities remain temporarily impaired, ~~2010~~or if any or all of them should be assessed as OTTI.

	Fewer than 12 months					12 months or more					Total
			Estimated					Estimated					Estimated
	Fair		unrealized			Fair		unrealized			Fair		unrealized
(in millions)	value		losses			value		losses			value		losses
Government agency securities	$	67.7	$	(0.1	)	$	—	$	—		$	67.7	$	(0.1	)
Corporate debt securities:
Single-issue trust-preferreds		—		—			40.7		(4.7	)		40.7		(4.7	)
Pooled trust-preferreds		—		—			45.2		(80.4	)		45.2		(80.4	)
Total corporate debt securities		—		—			85.9		(85.1	)		85.9		(85.1	)
Total temporarily impaired securities	$	67.7	$	(0.1	)	$	85.9	$	(85.1	)	$	153.6	$	(85.2	)

Temporarily impaired securities as of March 31, 2011

Temporarily impaired securities as of December 31, 2009


	Fewer than 12
	months					12 months or more					Total
			Estimated					Estimated					Estimated
	Fair		unrealized			Fair		unrealized			Fair		unrealized
(in millions)	value		losses			value		losses			value		losses

U.S. Treasury securities	$	5.0	$	—		$	—	$	—		$	5.0	$	—
Government agency securities		130.3		(0.7	)		—		—			130.3		(0.7	)
Obligations of state and political subdivisions		4.2		—			—		—			4.2		—
Corporate debt securities:
Single-issue trust-preferreds		—		—			31.1		(2.8	)		31.1		(2.8	)
Pooled trust-preferreds		—		—			51.1		(70.6	)		51.1		(70.6	)

Total corporate debt securities		—		—			82.2		(73.4	)		82.2		(73.4	)

Total temporarily impaired securities	$	139.5	$	(0.7	)	$	82.2	$	(73.4	)	$	221.7	$	(74.1	)

	Fewer than 12 months					12 months or more					Total
			Estimated					Estimated					Estimated
	Fair		unrealized			Fair		unrealized			Fair		unrealized
(in millions)	value		losses			value		losses			value		losses
U.S. Treasury securities	$	206.1	$	(0.2	)	$	—	$	—		$	206.1	$	(0.2	)
Government agency securities		89.7		(0.8	)		—		—			89.7		(0.8	)
Corporate debt securities:
Single-issue trust-preferreds		—		—			48.5		(9.2	)		48.5		(9.2	)
Pooled trust-preferreds		—		—			51.4		(92.9	)		51.4		(92.9	)
Total corporate debt securities		—		—			99.9		(102.1	)		99.9		(102.1	)
Total temporarily impaired securities	$	295.8	$	(1.0	)	$	99.9	$	(102.1	)	$	395.7	$	(103.1	)

Temporarily impaired securities as of December 31, 2010


	Fewer than 12
	months					12 months or more					Total
			Estimated					Estimated					Estimated
	Fair		unrealized			Fair		unrealized			Fair		unrealized
(in millions)	value		losses			value		losses			value		losses

Government agency securities	$	159.2	$	(0.4	)	$	—	$	—		$	159.2	$	(0.4	)
Corporate debt securities:
Single-issue trust-preferreds		—		—			50.0		(4.6	)		50.0		(4.6	)
Pooled trust-preferreds		—		—			45.8		(73.5	)		45.8		(73.5	)

Total corporate debt securities		—		—			95.8		(78.1	)		95.8		(78.1	)

Total temporarily impaired securities	$	159.2	$	(0.4	)	$	95.8	$	(78.1	)	$	255.0	$	(78.5	)

Trust-preferred securities

Our TruPS portfolio consists of 38 pooled issues and 9 single-issue securities. The single-issue TruPS are from money center and large regional banks. The pooled instruments include securities issued by banks, insurance companies, and other financial institutions. Our positions in pooled TruPS generally are secured by over-collateralization or default protections provided by subordinated tranches.

All of our TruPS are recorded on our balance sheet as HTM investment securities and ~~in our footnote disclosures~~ as corporate debt securities in our footnote disclosures.

3850

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

AsWe ~~previously discussed in this note, we~~ determined that some of our pooled TruPS were OTTI in 2008, 2009, 2010, and ~~in the first nine months of 2010~~2011. In total, as of ~~September~~March 3031, ~~2010~~2011:

•

We have recorded other-than-temporary impairment write-downs on 33 of the 38 pooled TruPS in our portfolio.

•

We have not recorded other-than-temporary impairment write-downs on any of the 9 single-issue TruPS in our portfolio.

Illiquidity persists in the market for TruPS. Consequently, determining their estimated fair values requires substantial judgment and the use of factors that are difficult to estimate. Changes in the creditworthiness of the underlying financial institutions, market conditions, and other factors could cause us to determine that more of our TruPS are OTTI. Such determinations would require us to record additional write-downs in TruPS values, and additional impairment losses for the portions of any write-downs that are related to credit losses.

For more information on our TruPS portfolio valuations, see the disclosures of amortized cost, carrying value, and fair value of HTM securities that appear earlier in this note.

Other matters

At ~~September~~March 3031, ~~2010~~2011, securities with an aggregate book value of $~~321~~301.83 million were pledged to ~~secure~~ secure public deposits, short-term borrowings, demand notes issued to the U.S. Treasury, FHLB borrowings, repurchase agreements, interest rate swap agreements, and ~~for~~ other purposes required by law.

We had investments in the securities of regulatory authorities that totaled $3241.45 million at March ~~September 30~~31, ~~2010~~2011, and $2635.86 million at December 31, ~~2009~~2010. These securities are carried at cost.

39Contractual maturities of debt securities available for sale at March 31, 2011


				After 1 year			After 5 years
	1 year			through			through			After
(dollars in millions)	or less			5 years			10 years			10 years			Total

U.S. Treasury securities	$	26.4		$	5.4		$	—		$	—		$	31.8
Government agency securities		25.0			166.0			—			—			191.0
Obligations of state and political subdivisions		0.3			—			—			8.7			9.0
Collateralized mortgage obligations:
Secured by residential mortgages		—			—			1.6			19.7			21.3
Mortgage-backed securities:
Residential mortgage-backed securities		—			9.4			100.7			15.9			126.0

Total amortized cost of debt securities available for sale	$	51.7		$	180.8		$	102.3		$	44.3		$	379.1
Fair value of debt securities available for sale	$	51.8		$	180.5		$	108.0		$	45.8		$	386.1
Weighted average yield of debt securities available for sale ¹		0.65	%		1.17	%		4.25	%		4.56	%		2.32	%


¹		Weighted average yields are not on a tax-equivalent basis.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Contractual maturities of debt securities ~~available~~held ~~for~~to ~~sale~~maturity at ~~September~~March 3031, ~~2010~~2011

				After 1			After 5
				year			years
	1 year			through 5			through 10			After 10
(dollars in millions)	or less			5 years			10 years			years			Total
U.S. Treasury securities	$	167.2		$	5.9		$	—		$	—		$	173.1
Obligations of state and political subdivisions	$	0.4		$	—		$	—		$	—		$	0.4
Government agency securities		52.1			177.7			10.1			—			239.9
Corporate debt securities:
Obligations of state and political subdivisions		0.3			—			—			4.6			4.9
Single-issue trust-preferreds		—			—			—			58.6			58.6
Collateralized mortgage obligations:
Pooled trust-preferreds		—			—			—			42.7			42.7
Secured by residential mortgages		—			—			3.4			29.8			33.2
Total corporate debt securities		—			—			—			101.3			101.3
Mortgage-backed securities:
Non-U.S. government agency debt securities		—			0.5			—			—			0.5
Residential mortgage-backed securities		—			12.3			120.8			19.5			152.6
Other debt securities		0.3			0.2			—			—			0.5
Total amortized cost of debt securities available for sale	$	219.6		$	195.9		$	134.3		$	53.9		$	603.7
Total carrying value of debt securities held to maturity	$	0.7		$	0.7		$	—		$	101.3		$	102.7
Fair value of debt securities available for sale	$	219.7		$	196.7		$	141.1		$	55.8		$	613.3
Fair value of debt securities held to maturity	$	0.7		$	0.7		$	—		$	107.8		$	109.2
Weighted average yield of debt securities available for sale 1		0.28	%		1.77	%		4.19	%		4.52	%		2.01	%
Weighted average yield of debt securities held to maturity 1		3.39	%		1.40	%		—	%		6.12	%		6.11	%

1 Weighted average yields are not on a tax-equivalent basis.

Contractual maturities of debt securities held to maturity at September 30, 2010

				After 1			After 5
				year			years
	1 year			through 5			through			After 10
(dollars in millions)	or less			years			10 years			years			Total
Obligations of state and political subdivisions	$	0.4		$	—		$	—		$	—		$	0.4
Corporate debt securities:
Single-issue trust-preferreds		—			—			—			58.2			58.2
Pooled trust-preferreds		—			—			—			43.1			43.1
Total corporate debt securities		—			—			—			101.3			101.3
Non-U.S. government agency debt securities		—			0.5			—			—			0.5
Other debt securities		0.2			0.5			—			—			0.7
Total carrying value of debt securities held to maturity	$	0.6		$	1.0		$	—		$	101.3		$	102.9
Fair value of debt securities held to maturity	$	0.6		$	1.0		$	—		$	98.7		$	100.3
Weighted average yield of debt securities held to maturity 1		1.98	%		1.69	%		—	%		6.69	%		6.69	%

1 Weighted average yields are not on a tax-equivalent basis

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Sale and write-down of investment securities available for sale

	For the three months ended						~~For the nine months ended~~
	September 30,						September 30,
	March 31,
(in millions)	~~2010~~2011			~~2009~~2010			~~2010~~			~~2009~~
Proceeds:
U.S. Treasury securities	$	—		$	—		$	75.0		$	—
Other marketable equity securities:
Government agency securities		—			—			—			103.2
Other	$	—		$	0.2
Collateralized mortgage obligations:
Total proceeds	$	—		$	0.2
Secured by residential mortgages		—			—			—			103.8
Gross gains realized:
Mortgage-backed debt securities:
Other marketable equity securities:
Residential mortgage-backed securities		—			—			—			197.8
Other	$	—		$	0.2
Other marketable equity securities:
Total gains realized	$	—		$	0.2
Other		12.3			5.7			12.8			5.7
Other-than-temporary impairment charges:
Total proceeds	$	12.3		$	5.7		$	87.8		$	410.5
Other marketable equity securities:
Gross gains realized:
Other	$	(2.1	)	$	(0.1	)
Government agency securities	$	—		$	—		$	—		$	3.6
Total other marketable equity securities		(2.1	)		(0.1	)
Collateralized mortgage obligations:
Total other-than-temporary impairment charges	$	(2.1	)	$	(0.1	)
Secured by residential mortgages		—			—			—			2.7
Mortgage-backed debt securities:
Residential mortgage-backed securities		—			—			—			6.0
Other marketable equity securities:
Other		2.1			1.5			2.5			1.5
Total gains realized	$	2.1		$	1.5		$	2.5		$	13.8
Other-than-temporary impairment charges:
Other marketable equity securities:
Mutual funds	$	—		$	—		$	—		$	(3.9	)
Other		—			(2.5	)		(0.1	)		(2.5	)
Total other marketable equity securities		—			(2.5	)		(0.1	)		(6.4	)
Total other-than-temporary impairment charges	$	—		$	(2.5	)	$	(0.1	)	$	(6.4	)

~~Called~~There were no gains or losses on called investment securities in the first quarter of 2011 or 2010.

	For the three months ended				For the nine months ended
	September 30,				September 30,
(in millions)	2010		2009		2010		2009
Gross gains	$	1.5	$	—	$	1.5	$	—
Gross losses	$	0.2	$	—	$	0.2	$	—

For more information about our investment securities portfolio, read Note 7, “Investment securities,” in our 2010 Annual Report on Form 10-K. For more information about how we account for investment securities, read Note 6, “Fair value measurement of assets and liabilities,” in this report, as well as Note 3, “Summary of significant accounting policies,” Note 15, “Fair value measurement of assets and liabilities,” and Note 22, “Accumulated other comprehensive income,” in our 2010 Annual Report on Form 10-K.

~~For more information about our investment securities portfolio, read Note 6, “Investment~~52 securities,” in our 2009 Annual Report on Form 10-K. For more information about how we account for investment securities, read Note 6, “Fair value measurement of assets and liabilities,” in this report, as well as Note 2, “Summary of significant accounting policies,” Note 14, “Fair value measurement of assets and liabilities,” and Note 21, “Accumulated other comprehensive income,” in our 2009 Annual Report on Form 10-K.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1213. Borrowings

Our short-term borrowings consist of federal funds purchased, securities sold under agreements to repurchase, and an advance from the FHLB.

Our long-term debt at ~~September~~March 3031, ~~2010~~2011, was $~~494~~595.5 million. This amount included:

• A $50150.0 million FHLB ~~advance~~advances, summarized as follows:

Amount issued and

Fixed

outstanding

Quarterly

payment

Issue date

(in millions)

Term

payment dates

rate

Maturity

July 9, 2010

50.0

2 years

January 9, April 9,

1.11

July 9, 2012

July 9, and October 9

July 9, October 9

October 20, 2010

50.0

18 months

January 20, April 20,

0.70

April 20, 2012

July 20, October 20

October 20, 2010

50.0

2 years

January 20, April 20,

0.79

October 22, 2012

July 20, October 20

•

Two issuances of subordinated debt, totaling $450 million, summarized as follows:

Amount issued and

Fixed

outstanding

Semiannual

payment

Issue date

(in millions)

Term

payment dates

rates

Maturity

April 4, 2003

250.0

10 years

April 15 and October 15

4.875

April 15, 2013

April 1, 2008

200.0

10 years

April 1 and October 1

8.50

April 2, 2018

• $(43.78) million of unamortized losses related to terminated interest rate swaps on long-term debt.

•

$(0.1) million of unamortized discounts on the $250.0 million of subordinated long-term debt that matures on April 15, 2013.

• $(0.76) million of unamortized discounts on the $200.0 million of subordinated long-term debt that matures on April 2, 2018.

None of our long-term debt is redeemable prior to maturity or subject to any sinking fund.

For more information on our borrowings, read Note 1213, “Borrowings,” in our ~~2009~~2010 Annual Report on Form 10-K.

4253

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1314. Capital

InAll of our regulatory capital ratios at March ~~2010~~31, we2011 ~~completed~~exceeded anthe ~~underwritten~~minimums ~~public~~required ~~offering~~by ofregulators for ~~21,706,250~~banks ~~shares~~and ofbank ~~common~~holding ~~stock~~companies to be considered well-capitalized. However, banking ~~The~~regulators ~~offering~~also ~~priced~~make atqualitative ~~$13.25~~judgments ~~per~~about ~~share~~the components of our capital, risk weightings, and ~~raised~~other ~~$274~~factors.~~0 million~~ Therefore, ~~net~~the well-capitalized minimum thresholds presented below are subject to change by our regulators, based on their view of ~~$13~~our financial condition and circumstances.~~7 million~~ During the first quarter of 2011, Wilmington Trust FSB entered into a supervisory agreement with ~~underwriting~~the ~~discounts~~Office of Thrift Supervision (OTS) under which, among other things, Wilmington Trust FSB is deemed adequately capitalized and ~~commissions~~which sets targets for Wilmington Trust FSB’s future capital ratios. The ~~proceeds~~agreement ~~qualify~~requires asWilmington ~~both~~Trust ~~tangible~~FSB ~~common~~to ~~equity~~maintain a Tier 1 capital ratio of at least 9% and a risk-based capital ratio of at least 14% by June 30, 2011. At March 31, 2011, Wilmington ~~regulatory~~Trust FSB’s Tier 1 capital and risk-based capital ratios were 12.92% and 14.21%, respectively. Further declines in our capital ratios could result in additional formal regulatory actions, which could compromise our businesses.

At September 30, 2010, all of our capital ratios were lower than at December 31, 2009 because our net loss for the first nine months of 2010 caused our capital to decrease. All of our regulatory capital ratios at September 30, 2010, continued to exceed the minimums required by the Federal Reserve for banks to be considered well-capitalized. However, the “well-capitalized” minimum thresholds presented below are subject to change by our regulators, based on their view of our financial condition and circumstances. Further declines in these ratios could result in formal regulatory actions which could compromise our businesses.

U.S. regulatory capital ratios

											Well-capitalized minimum
	As of September 30,					As of December 31,					As of September 30,
	As of March 31,					As of December 31,					As of March 31,
	2010					2009					2010
	2011					2010					2011
(dollars in millions)	Ratio			Amount		Ratio			Amount		Ratio			Amount
Total capital (to risk-weighted assets)
Wilmington Trust Corporation		1312.6955	%	$	1,~~269~~021.16		1412.3129	%	$	1,~~568~~060.82		10.00	%	$	~~927~~814.42
Wilmington Trust Company		1210.5163	%	$	~~1,024~~760.10		1110.3959	%	$	~~1,127~~807.42		10.00	%	$	~~818~~715.71
Wilmington Trust FSB		1314.4521	%	$	~~157~~163.62		1213.1134	%	$	~~174~~150.57		10.00	%	$	~~117~~114.28
Tier 1 capital (to risk-weighted assets)
Wilmington Trust Corporation		97.1557	%	$	~~848~~616.70		97.8651	%	$	~~1,080~~648.1		6.00	%	$	~~556~~488.45
Wilmington Trust Company		119.2032	%	$	~~916~~666.97		109.1128	%	$	~~1,001~~707.15		6.00	%	$	~~491~~429.21
Wilmington Trust FSB		12.1592	%	$	~~142~~148.53		1012.8504	%	$	~~156~~136.41		6.00	%	$	7068.39
Tier 1 leverage capital (to average assets)
Wilmington Trust Corporation		85.1999	%	$	~~848~~616.70		106.1002	%	$	~~1,080~~648.1		5.00	%	$	~~517~~514.94
Wilmington Trust Company		107.3160	%	$	~~916~~666.97		107.6461	%	$	~~1,001~~707.15		5.00	%	$	~~444~~438.7
Wilmington Trust FSB		86.4979	%	$	~~142~~148.53		7.0632	%	$	~~156~~136.41		5.00	%	$	83109.92

4354

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1415. Income taxes

Income taxes and tax rate

	For the three months						~~For the nine months~~
	ended September 30,						ended September 30,
	ended March 31,
(dollars in millions)	~~2010~~2011			~~2009~~2010			~~2010~~			~~2009~~
Pre-tax loss (less non-controlling interest)	$	(~~264~~32.69	)	$	(1645.76	)	$	~~(493.9~~	)	$	~~(3.0~~	)
Income tax expense/(benefit)	$	~~100~~0.76		$	(1016.84	)	$	~~17.0~~		$	~~(9.8~~	)
Effective tax rate		(~~38.~~1.8	)%		6436.70	%		~~(3.4~~	)%		~~326.7~~	%

We ~~established~~continued ato ~~$189.5 million~~record a valuation allowance against our deferred tax asset atduring ~~September 30,~~the first ~~2010,~~quarter ~~which~~of 2011. This affected our income tax expense and our effective tax rate. ~~Our~~because ~~income~~the tax benefit ~~expense~~recorded for the ~~third~~ ~~quarter~~period ~~and~~was ~~first~~offset ~~nine~~by ~~months of 2010 included income~~ tax expense offrom ~~$189.5 related to~~ the establishment of ~~this~~additional valuation allowance. ~~Excluding~~At March 31, 2011, the ~~effect~~balance of ~~the~~this valuation allowance, ~~our~~was ~~effective tax rate for the 2010 third quarter would have been 33~~$303.6~~% and the effective tax rate for the first nine~~ ~~months~~million, ofcompared ~~2010 would have been 35.0%. The majority of our valuation allowance is related~~ to $~~180~~292.3 2 million ofat ~~tax~~December 31, ~~benefit~~2010. ~~that~~Tax weexpense ~~recorded~~ for the first ~~nine~~quarter ~~months~~ of 2011 ~~2010.~~also Inincluded ~~comparison, our deferred~~ tax ~~asset~~expense ~~valuation~~related ~~allowance~~to atprofitable ~~December 31,~~state ~~2009~~and ~~was~~foreign $0tax entities.~~7 million.~~

InThe ~~comparison, 2009~~ income tax ~~expense~~benefit ~~and~~reported ~~effective~~in ~~tax rates were also affected by certain items. The release, during~~ the ~~2009~~first ~~third~~ quarter, of ~~$2.7 million~~2010 ofwas ~~certain~~subsequently ~~tax~~reversed ~~reserves~~in ~~and $1.4 million of tax benefit from state tax rate changes increased~~ the ~~tax benefit that we recorded for the~~ third quarter ~~and the first nine months~~ of ~~2009.~~2010 Inwhen ~~addition,~~management ~~the~~determined ~~restoration,~~that in the ~~2009 second quarter, of a $3.9 million~~ deferred tax asset ~~that~~was ~~had~~no ~~been~~longer ~~written~~more ~~off in 2008, increased~~likely ~~the~~than ~~tax~~not ~~benefit~~to ~~recorded~~be ~~for the first nine months of 2009~~realized.

We evaluate our deferred tax asset for realizability quarterly. ASC 740, “Income Taxes,” requires that we assess realizability using all available evidence and that we use a “more likely than not” standard when forming a conclusion about the establishment of a valuation allowance. The realizability of our deferred tax asset depends on multiple variables, including available loss carry-backs, the timing of future earnings, the reversal of current timing differences, and available tax-planning strategies. At September 30, 2010, we concluded that it is more likely than not that we will not realize a portion of our deferred tax asset because negative evidence associated with our cumulative GAAP net operating loss and continued uncertainty in the credit quality of our loan portfolio outweighs other positive evidence. In reaching this conclusion, we gave significant weight to recent losses, most notably that we reached a three-year cumulative GAAP net operating loss position in 2010. Accordingly, we no longer consider future taxable income in our deferred tax asset valuation analysis. At September 30, 2010, we established a $189.5 million valuation allowance against our deferred tax asset. The valuation allowance is carried in the other assets line of our statement of condition and is included as income tax expense in the income tax expense/(benefit) line of our statement of income.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of September 30, 2010, we had a $17.0 million net deferred tax asset that we do not have a valuation allowance against because we believe that it is more likely than not that it will be realized in the future. Although realization is not assured, we anticipate that realization of this asset will occur through a combination of taxable temporary difference reversals and tax-planning strategies.

In addition, we had $135.0 million of tax receivables that are included in the other assets line of our statement of condition. These receivables consist primarily of :

• $65.3 million of loss carry-backs, for which we filed carry-back claims during the 2010 third quarter, and which reduced our net deferred tax asset and increased our tax receivable.

• $66.6 million of 2010 losses, which we expect to recover through the use of available loss carry-backs related to our 2008 tax year.

Under ASC 740, “Income Taxes,” we recognize interest and penalties related to uncertain tax benefits as income tax expense. We have reviewed and, where necessary, accrued for uncertain tax benefits for periods open to examination. We have applied this methodology consistently with prior periods.

We file income tax returns in multiple tax jurisdictions. In some of these jurisdictions, we file returns for multiple legal entities. Generally, we are subject to examination by tax auditors in these jurisdictions for three to six years (open tax years). As of ~~September~~March 3031, ~~2010~~2011, there were no no material changes regarding uncertain tax benefits related to prior periods, and statutes of limitations had not been extended materially in any of our significant locations.

Our IRS examination for the tax year 2006 was completed during 2009. The tax years 2007, 2008, and 2009 remain open to examination by the IRS. We periodically are under examination by various state and local authorities.

For more information about our income taxes and our deferred tax asset valuation allowance, read Note 2021, “Income taxes,” in our ~~2009~~2010 Annual Report on Form 10-K.

4555

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1516. Segment reporting

We report business segment results for four segments: one for each of our three core businesses — Regional Banking, Wealth Advisory Services (WAS), and Corporate Client Services (CCS) — and one that combines the results of affiliate money managers Cramer Rosenthal McGlynn (CRM) and Roxbury Capital Management (RCM).

Our business segment accounting policies are the same as those described in Note 23, “Summary of significant accounting policies,” in our ~~2009~~2010 Annual Report on Form 10-K. Our business segment disclosures mirror the internal profitability reports we produce and review each quarter. We report segment assets on an average-balance basis, because we believe average balances offer a more relevant measure of business trends than period-end balances; we maintain and review all internal segment data on an average-balance basis; and we base some expense allocations on an average-balance basis. We have adjusted segment data for prior periods due to changes in reporting methodology and/or organizational structure.

For more information about our business segments, read Item 2 in Part I of this report, as well as Note 12, “Nature of business,” Note 45, “Affiliates and acquisitions,” and Note 2324, “Segment reporting,” in our ~~2009~~2010 Annual Report on Form 10-K.

4656

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

				Wealth			Corporate			Affiliate
For the three months ended September 30, 2010	Regional			Advisory			Client			Money
(in millions)	Banking			Services			Services			Managers			Totals
Net interest income/(loss)	$	62.5		$	6.0		$	0.7		$	(1.5	)	$	67.7
Provision for loan losses		(249.8	)		(31.7	)		—			—			(281.5	)
Net interest (loss)/income after provision		(187.3	)		(25.7	)		0.7			(1.5	)		(213.8	)
Advisory fees:
Wealth Advisory Services		—			39.3			0.1			—			39.4
Corporate Client Services		0.1			—			48.2			—			48.3
Affiliate Money Managers		—			—			—			4.8			4.8
Total advisory fees		0.1			39.3			48.3			4.8			92.5
Amortization of other intangibles		—			(0.6	)		(0.7	)		(0.2	)		(1.5	)
Total advisory fees after amortization of other intangibles		0.1			38.7			47.6			4.6			91.0
Other noninterest income		11.6			0.6			0.4			—			12.6
Securities gains (net of losses)		2.6			0.4			0.4			—			3.4
Net interest and noninterest (loss)/income		(173.0	)		14.0			49.1			3.1			(106.8	)
Noninterest expense		68.8			45.0			39.6			—			153.4
Segment (loss)/profit before income taxes		(241.8	)		(31.0	)		9.5			3.1			(260.2	)
Income tax expense		79.4			7.6			3.3			1.2			91.5
Segment operating (loss)/income	$	(321.2	)	$	(38.6	)	$	6.2		$	1.9		$	(351.7	)
Investment securities impairment charge														(4.4	)
Income tax expense for impairment charge														9.2
Reported net loss													$	(365.3	)
Depreciation and amortization	$	2.5		$	2.1		$	2.1		$	0.2		$	6.9

For the three months ended March 31, 2011

				Wealth			Corporate			Affiliate
For the three months ended September 30, 2009	Regional			Advisory			Client			Money
	Regional			Advisory			Client			Money
(in millions)	Banking			Services			Services			Managers			Totals
Net interest income/(loss)	$	7448.40		$	54.64		$	1.31		$	(1.3	)	$	8052.02
Provision for loan losses		(3536.56	)		(34.27	)		—			—			(3841.73	)
Net interest income/(loss) after provision		3811.94			2(0.43	)		1.31			(1.3	)		4110.39
Advisory fees:
Wealth Advisory Services		~~0.1~~—			4541.84			~~(0.1~~—	)		—			4541.84
Corporate Client Services		0.21			—			4350.84			—			4450.05
Affiliate Money Managers		—			—			—			45.73			45.73
Total advisory fees		0.31			4541.84			4350.74			45.73			9497.52
Amortization of other intangibles		—			(1.0.6	)		(0.97	)		(0.2	)		(2.1.5	)
Total advisory fees after amortization of other intangibles		0.31			4440.8			4249.87			4.5.1			9295.47
Other noninterest income		1211.94			~~0.4~~—			—0.4			—			1311.38
Securities gains (net of losses)		1.2			0.1			0.2			—			1.5
Net interest and noninterest income		22.9			40.5			51.2			3.8			118.4
Net interest and noninterest income		53.3			47.7			44.3			3.2			148.5
Noninterest expense		49.3			49.6			43.6			—			142.5
Noninterest expense		45.1			45.0			36.9			—			127.0
Segment (loss)/profit before income taxes		(26.4	)		(9.1	)		7.6			3.8			(24.1	)
Segment profit before income taxes		8.2			2.7			7.4			3.2			21.5
Income tax expense		—			—			0.6			—			0.6
Income tax (benefit)/expense and noncontrolling interest		(0.5	)		1.2			1.1			0.5			2.3
Segment operating (loss)/income	$	(26.4	)	$	(9.1	)	$	7.0		$	3.8		$	(24.7	)
Segment operating income	$	8.7		$	1.5		$	6.3		$	2.7		$	19.2
Investment securities impairment charge														(5.0	)
Investment securities impairment charge														(38.1	)
Merger-related costs														(3.8	)
Income tax benefit for impairment charge														(13.0	)
Reported net loss													$	(33.5	)
Reported net loss													$	(5.9	)
Depreciation and amortization	$	2.6		$	2.1		$	2.1		$	0.2		$	7.0
Depreciation and amortization	$	3.3		$	2.6		$	2.2		$	0.3		$	8.4
Investment in equity method investees	$	—		$	—		$	—		$	140.6		$	140.6
Segment average assets	$	8,266.8		$	1,425.7		$	671.9		$	129.2		$	10,493.6

47For the three months ended March 31, 2010


				Wealth			Corporate			Affiliate
	Regional			Advisory			Client			Money
(in millions)	Banking			Services			Services			Managers			Totals

Net interest income/(loss)	$	67.1		$	6.4		$	2.5		$	(1.3	)	$	74.7
Provision for loan losses		(69.2	)		(8.2	)		—			—			(77.4	)

Net interest (loss)/income after provision		(2.1	)		(1.8	)		2.5			(1.3	)		(2.7	)
Advisory fees:
Wealth Advisory Services		—			44.1			—			—			44.1
Corporate Client Services		0.2			—			47.8			—			48.0
Affiliate Money Managers		—			—			—			4.8			4.8

Total advisory fees		0.2			44.1			47.8			4.8			96.9
Amortization of other intangibles		—			(0.8	)		(0.9	)		(0.2	)		(1.9	)

Total advisory fees after amortization of other intangibles		0.2			43.3			46.9			4.6			95.0
Other noninterest income		11.6			0.3			0.4			—			12.3
Securities gains		0.2			—			—			—			0.2

Net interest and noninterest income		9.9			41.8			49.8			3.3			104.8
Noninterest expense		47.9			44.7			38.9			—			131.5

Segment (loss)/profit before income taxes		(38.0	)		(2.9	)		10.9			3.3			(26.7	)
Income tax (benefit)/expense and noncontrolling interest		(14.7	)		(0.5	)		3.8			2.3			(9.1	)

Segment operating (loss)/income	$	(23.3	)	$	(2.4	)	$	7.1		$	1.0		$	(17.6	)
Investment securities impairment charge														(18.0	)
Income tax benefit not allocated to segments														6.4

Reported net loss													$	(29.2	)

Depreciation and amortization	$	2.6		$	2.4		$	2.2		$	0.2		$	7.4
Investment in equity method investees	$	—		$	—		$	—		$	159.9		$	159.9
Segment average assets	$	8,847.0		$	1,503.1		$	535.9		$	158.4		$	11,044.4

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

				Wealth			Corporate			Affiliate
For the nine months ended September 30, 2010	Regional			Advisory			Client			Money
(in millions)	Banking			Services			Services			Managers			Totals
Net interest income/(loss)	$	198.9		$	19.0		$	3.5		$	(4.2	)	$	217.2
Provision for loan losses		(504.3	)		(59.8	)		—			—			(564.1	)
Net interest (loss)/income after provision		(305.4	)		(40.8	)		3.5			(4.2	)		(346.9	)
Advisory fees:
Wealth Advisory Services		—			124.3			0.2			—			124.5
Corporate Client Services		0.4			—			147.2			—			147.6
Affiliate Money Managers		—			—			—			14.0			14.0
Total advisory fees		0.4			124.3			147.4			14.0			286.1
Amortization of other intangibles		—			(2.1	)		(2.4	)		(0.6	)		(5.1	)
Total advisory fees after amortization of other intangibles		0.4			122.2			145.0			13.4			281.0
Other noninterest income		35.9			1.3			1.2			—			38.4
Securities gains (net of losses)		2.9			0.5			0.4			—			3.8
Net interest and noninterest (loss)/income		(266.2	)		83.2			150.1			9.2			(23.7	)
Noninterest expense		182.2			135.1			121.8			—			439.1
Segment (loss)/profit before income taxes		(448.4	)		(51.9	)		28.3			9.2			(462.8	)
Income tax expense and noncontrolling interest		2.3			0.8			9.5			5.3			17.9
Segment operating (loss)/income	$	(450.7	)	$	(52.7	)	$	18.8		$	3.9		$	(480.7	)
Investment securities impairment charge														(30.2	)
Income tax benefit for impairment charge														—
Reported net loss													$	(510.9	)
Depreciation and amortization	$	7.5		$	6.6		$	6.3		$	0.6		$	21.0
Investment in equity method investees	$	—		$	0.9		$	—		$	157.1		$	158.0
Segment average assets	$	8,604.9		$	1,474.9		$	461.5		$	155.5		$	10,696.8

17. Accounting pronouncements

				Wealth			Corporate			Affiliate
For the nine months ended September 30, 2009	Regional			Advisory			Client			Money
(in millions)	Banking			Services			Services			Managers			Totals
Net interest income/(loss)	$	222.3		$	17.0		$	4.7		$	(3.8	)	$	240.2
Provision for loan losses		(110.4	)		(11.8	)		—			—			(122.2	)
Net interest income/(loss) after provision		111.9			5.2			4.7			(3.8	)		118.0
Advisory fees:
Wealth Advisory Services		1.0			139.2			2.1			—			142.3
Corporate Client Services		0.7			—			124.3			—			125.0
Affiliate Money Managers		—			—			—			11.3			11.3
Total advisory fees		1.7			139.2			126.4			11.3			278.6
Amortization of other intangibles		—			(3.0	)		(2.9	)		(0.6	)		(6.5	)
Total advisory fees after amortization of other intangibles		1.7			136.2			123.5			10.7			272.1
Other noninterest income		39.3			1.4			1.0			—			41.7
Securities gains (net of losses)		12.6			0.4			0.6			—			13.6
Net interest and noninterest income		165.5			143.2			129.8			6.9			445.4
Noninterest expense		135.9			134.0			111.0			1.1			382.0
Segment profit before income taxes		29.6			9.2			18.8			5.8			63.4
Income tax expense and noncontrolling interest		7.0			1.9			3.4			1.9			14.2
Segment operating income	$	22.6		$	7.3		$	15.4		$	3.9		$	49.2
Investment securities impairment charge														(66.0	)
Income tax benefit for impairment charge														(23.6	)
Reported net income													$	6.8
Depreciation and amortization	$	9.8		$	8.0		$	6.8		$	0.7		$	25.3
Investment in equity method investees	$	—		$	—		$	—		$	159.7		$	159.7
Segment average assets	$	9,387.7		$	1,487.8		$	457.3		$	160.3		$	11,493.1

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

16. Accounting pronouncements

The following recent accounting pronouncements may affect our financial condition and results of operations.

SFAS No. 167 and ASU 2010-10. In June 2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No. 46(revised),” which was incorporated into ASC 810, “Consolidation.” SFAS No. 167 amends the consolidation guidance for variable interest entities (VIEs) under FIN 46(revised), “Consolidation of Variable Interest Entities,” to, among other things, remove the consolidation exception for qualifying special purpose entities; revise certain guidance for determining whether an entity is a VIE; introduce a new consolidation approach that considers qualitative factors for determining who should consolidate a VIE; and change when it is necessary to reconsider both an entity’s status as a VIE and who should consolidate a VIE. SFAS No. 167 also introduces additional disclosure and presentation requirements related to an entity’s involvement in VIEs.

In February 2010, the FASB issued ASU 2010-10, “Amendments for Certain Investment Funds,” which indefinitely defers the effective date of SFAS No. 167 for an asset manager’s interests in entities that have attributes of investment companies (e.g., mutual funds, hedge funds, private equity funds, and venture capital funds), provided that the asset manager does not have an explicit or implicit obligation to fund actual losses that potentially could be significant to the investment company. The ASU also clarifies certain conditions under which fees paid to a decision maker or service provider are considered variable interests in a variable interest entity. Under the provisions of SFAS No. 167, we may have been required to consolidate certain entities to which we provide asset management services. In accordance with the provisions of ASU 2010-10, we deferred adoption of SFAS No. 167 for those entities. We have not yet completed our assessment of the effect, if any, that the lapsing of the deferral period will have on our financial statements.

SFAS No. 167 and ASU 2010-10 were effective for us on January 1, 2010. Their adoption did not have a material effect on our financial statements.

ASU 2010-20, ~~2009~~ASU 2011-1301, and ASU 2011-02. In ~~October~~July ~~2009~~2010, the FASB issued ASU ~~2009~~2010-1320, “~~Multiple-Deliverable Revenue~~Disclosures ~~Arrangements;~~about athe ~~consensus~~Credit Quality of ~~the~~Financing ~~FASB~~Receivables ~~Emerging~~and ~~Issues~~the ~~Task~~Allowance ~~Force,”~~for toCredit ~~establish~~Losses.” ~~the~~ASU 2010-20 ~~accounting~~introduces ~~for certain~~expanded ~~revenue~~disclosure ~~arrangements~~requirements inthat ~~which~~focus on the ~~vendor~~nature orof ~~service~~an ~~provider~~entity’s ~~will~~credit risk ~~perform~~associated ~~multiple revenue-generating~~with ~~activities~~its financing receivables (e.g., ~~contracts~~loans), and the entity’s assessment of that risk ~~require~~in anestimating ~~up-front~~its ~~fee~~allowance ~~along~~for ~~with~~credit ~~fees~~losses, ~~that recur~~as ~~over~~well ~~the~~as ~~life~~changes ofin the ~~arrangement).~~allowance ~~Specifically,~~and the reasons for those changes. The ASU ~~addresses~~requires ~~how~~entities to ~~separate deliverables~~disaggregate the new and existing disclosures based on how tothey ~~measure~~develop ~~and~~their ~~allocate~~allowance ~~arrangement~~for ~~consideration~~credit tolosses ~~one~~and orhow ~~more~~they ~~units~~manage oftheir ~~accounting~~credit exposures. ~~ASU~~New ~~2009-13~~disclosure ~~will~~requirements beintroduced ~~effective~~by ~~for~~the ~~revenue~~ASU ~~arrangements~~ that ~~are~~relate ~~entered~~to ~~into~~information oras ~~materially~~of ~~altered~~the ~~after~~end ~~January~~of a reporting period were effective for us on December 131, ~~2011~~2010. WeThe dodisclosure requirements ~~not~~that ~~expect~~relate ~~its~~to ~~adoption~~activity tothat ~~have~~occurs during a ~~material~~reporting ~~effect on~~period ~~our~~were ~~financial~~effective ~~statements~~for us on January 1, 2011.

4958

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~ASU 2010-06.~~ In January ~~2010~~2011, the FASB issued ASU ~~2010~~2011-0601, “~~Improving~~Deferral ~~Disclosures~~of ~~about Fair Value Measurements.” ASU 2010-06 amends~~ the ~~Fair~~Effective ~~Value~~Date ~~Measurements~~of ~~and~~ Disclosures ~~Topic to require new disclosures~~ about ~~transfers in and out of Levels 1 and 2 for fair value measurements,~~ ~~and~~Troubled ~~about~~Debt ~~activity~~Restructurings in ~~Level~~Update ~~3 fair value measurements, including separate presentations of information about purchases, sales, issuances, and settlements within the Level 3 reconciliation~~No. ~~Additionally,~~ 2010-20.” ~~the~~ ASU ~~clarifies~~2011-01 ~~existing~~temporarily ~~disclosure~~delays ~~requirements~~the ~~regarding inputs and valuation~~effective ~~techniques,~~date asof ~~well as~~ the ~~appropriate~~disclosures ~~level~~about oftroubled ~~disaggregation~~debt ofrestructurings ~~assets~~that ~~and~~were ~~liabilities.~~included ~~ASU 2010-06 was effective for us on January 1, 2010, except for the activity~~ in ~~Level 3 disclosure requirements, which will be effective for the fiscal year beginning January 1, 2011. The adoption of~~ ASU 2010-0620 ~~did not have a material effect on our financial statements. We have added the fair~~and ~~value~~was ~~disclosures~~effective ~~that~~upon ~~are required by this ASU to our financial statement footnotes~~issuance.

~~ASU 2010-11.~~ In ~~March~~April ~~2010~~2011, the FASB issued ASU ~~2010~~2011-1102, “~~Scope~~A ~~Exception~~Creditor’s ~~Related~~Determination ~~to Embedded~~of ~~Credit~~Whether ~~Derivatives,”~~a ~~which~~Restructuring Is ~~clarifies~~a ~~the~~Troubled ~~scope~~Debt ~~exceptions~~Restructuring.” ~~under~~ASU ~~existing~~2011-02 provides clarifying guidance ~~for~~on a creditor’s ~~bifurcation~~evaluation of ~~embedded~~whether ~~credit~~it ~~derivatives~~has granted a concession and whether the debtor is experiencing financial difficulties. ~~Specifically,~~The ~~ASU~~clarifying ~~2010-11~~guidance ~~addresses~~on ~~when~~determining ~~embedded~~whether a concession was granted discusses ~~credit~~the ~~derivatives~~debtor’s ~~resulting~~access ~~from~~to funds at a market rate for debt with similar characteristics as the restructured ~~transfer~~debt, ofthat ~~credit~~an ~~risk~~increase in the ~~form~~contractual ofinterest ~~subordination~~rate does not preclude the restructuring from ~~one~~being a concession, and that an insignificant delay in payment under the restructuring is not a concession. The clarifying guidance on determining whether the debtor is experiencing financial ~~instrument~~difficulties toindicates ~~another~~that ~~may~~a orcreditor can determine that the debtor is experiencing financial difficulties even if the debtor is not currently in payment default. Also, ASU 2011-02 clarifies that creditors may not beuse ~~considered~~the effective interest rate test when evaluating whether a restructuring is a troubled debt restructuring. The issuance of this ASU supersedes the temporary delay for ~~bifurcation~~the ~~and~~disclosure ~~separate~~requirements for troubled debt restructurings that was provided ~~accounting~~by ASU 2011-01. ASU 2011-02 and the disclosure requirements for troubled debt restructurings in ASU 2010-1120 ~~was~~will be effective for usinterim or annual periods beginning on ~~July~~or after June 115, ~~2010~~2011. We ~~Its~~have ~~adoption~~not ~~did~~completed ~~not~~our ~~have~~assessment aof ~~material~~ the effect, if any, that ASU 2011-02 will have on our financial statements.

~~ASU 2010-20~~18. InSubsequent ~~July 2010, the FASB issued ASU 2010-20, “Disclosures about the Credit~~events Quality of Financing Receivables and the Allowance for Credit Losses.” ASU 2010-20 introduces expanded disclosure requirements that focus on the nature of an entity’s credit risk associated with its financing receivables (e.g., loans), and the entity’s assessment of that risk in estimating its allowances for credit losses, as well as changes in the allowance and the reasons for those changes. The ASU requires entities to disaggregate the new and existing disclosures based on how they develop their allowances for credit losses and how they manage their credit exposures. New disclosure requirements introduced by the ASU that relate to information as of the end of a reporting period will be effective for us on December 31, 2010. The disclosure requirements that relate to activity that occurs during a reporting period will be effective for us on January 1, 2011. We do not expect the adoption of ASU 2010-20 to have a material effect on our financial statements. We will need to provide the applicable disclosures beginning with our December 31, 2010, financial statements.

~~17.~~ASC 855, “Subsequent ~~events~~Events,” requires us to evaluate whether any changes in our financial condition since March 31, 2011, warrant additional disclosure as a subsequent event.

~~ASC~~As ~~855~~of May 13, ~~“Subsequent~~2011, ~~Events~~the filing date of this report,” ~~requires~~we usdetermined tothat, ~~evaluate~~other ~~whether~~than ~~any~~the ~~changes~~matter discussed in ~~our~~Note ~~financial condition~~1 ~~since~~in ~~September 30~~this report, ~~2010~~“Proposed Merger with M&T Bank Corporation,” ~~warrant~~there ~~additional~~were ~~disclosure~~no recognized asor aunrecognized subsequent ~~event~~events to report under ASC 855.

~~On November 5, 2010, two purported stockholders of the Company filed purported class~~59 action lawsuits in the Delaware Court of Chancery captioned Medich v. Wilmington Trust Corporation, et al., C.A. No. 5958 (Del. Ch.) and Yi v. Wilmington Trust Corporation, et al., C.A. No. 5959 (Del. Ch.). Both lawsuits name as defendants the Company, each of the current members and a former member of the Company’s Board of Directors (the “Director Defendants”), M&T and Merger Sub. The complaints allege that the Director Defendants breached their fiduciary duties by failing to maximize stockholder value in connection with the Merger and also allege that M&T and Merger Sub aided and abetted those alleged breaches of fiduciary duty. The complaints seek declaratory and injunctive relief to prevent the consummation of the Merger and a constructive trust over any benefits improperly received by defendants. The Company believes the claims asserted are without merit and intends to vigorously defend against these suits.

As of November 8, 2010, the filing date of this report, we determined that, other than the matter discussed above and the matter discussed in Note 1, “Recent events,” in this report, there were no recognized or unrecognized subsequent events to report under ASC 855.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

COMPANY OVERVIEW

Wilmington Trust Corporation, isa ~~(we~~financial ~~are)~~holding acompany headquartered in Delaware, ~~corporation~~is a relationship management company that helps individual and ainstitutional ~~financial~~clients ~~holding~~increase ~~company~~and ~~under~~preserve their wealth. Our company was founded by members of the ~~Bank~~du ~~Holding~~Pont ~~Company~~family ~~Act~~in 1903. WeSince then, ~~deliver~~we ~~our~~have ~~services~~been ~~through~~in ~~three~~the ~~businesses:~~business of building long-term relationships with clients.

~~Regional Banking. Our Regional Banking activities are concentrated in the mid-Atlantic region of the United States.~~ We ~~define~~offer ~~this~~diversified ~~area~~financial ~~as the state of Delaware and the parts of Maryland, New Jersey, and Pennsylvania that are within approximately 150 miles of our Wilmington headquarters. We target commercial banking~~ services tothrough ~~middle-market~~three ~~business owners throughout this region. We define this market as~~ businesses ~~that are family-owned or closely held, with~~: ~~annual sales of up to $250 million. We focus our consumer lending, residential mortgage lending, and core deposit-gathering activities in the state of Delaware.~~

~~Corporate~~• ~~Client~~Regional ~~Services~~Banking ~~(CCS)~~Services. ~~The~~This ~~CCS~~ business ~~provides~~serves acommercial ~~variety~~clients ofthroughout ~~trustee,~~the ~~agency, investment~~mid-Atlantic ~~management,~~region and ~~administrative~~consumer ~~services for institutional~~ clients. ~~CCS has offices~~ in ~~Arizona, Connecticut, Delaware, Michigan, Minnesota, Nevada, New Jersey, New York, South Carolina, Vermont, Grand Cayman,~~ the ~~Channel~~state ~~Islands (Jersey), Amsterdam (The Netherlands), Dublin (Ireland), London (England), Frankfurt (Germany), and Luxembourg. At the end~~ of ~~2009, CCS had clients in 89 countries~~Delaware.

• Wealth Advisory Services (WAS). ~~The~~This ~~WAS~~ business ~~helps~~serves ~~individuals~~high-net-worth and families with substantial wealth preserve and protect their wealth, minimize taxes, transfer wealth to future generations, support charitable endeavors, and manage their business affairs. We do this through a variety of asset management, family office, and fiduciary services. We target clients ~~who~~ have liquid assets of $10 million or more. WAS has offices in California, Connecticut, Delaware, Florida, Georgia, Maryland, Massachusetts, New Jersey, New York, and Pennsylvania. At the end of 2009, WAS had clients throughout the United States and in 3532 other countries.

~~More~~• ~~detail~~Corporate ~~about~~Client ~~each~~Services of(CCS). ~~our~~This ~~businesses~~business isserves ~~available~~institutional inclients ~~the summaries that follow and~~ in ~~our~~90 ~~2009 Annual Report on Form 10-K~~countries.

WeCollectively, ~~provide~~ our ~~services~~three ~~through~~businesses ~~various~~generate ~~legal~~a ~~entities~~diversified ~~and~~mix subsidiaries that we own wholly or in part. Our primary wholly-owned subsidiary, Wilmington Trust Company, was founded in 1903. For more information about these entities and subsidiaries, the services they provide, and the regulations to which they are subject, read Note 1, “Nature of ~~business,” in our 2009 Annual Report on Form 10-K~~revenue.

51More detail about each of our businesses is available in the summaries that follow and in our 2010 Annual Report on Form 10-K.

RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2011

This report discusses:

•

Changes in our financial condition (balance sheet) since December 31, 2010. All balances cited are period-end balances unless otherwise noted. In some cases, we present amounts as of March 31, 2010, for historical reference.

•

The results of our operations (income statement) for the three months ended March 31, 2011, compared with the corresponding period in 2010. In some cases, we provide amounts for other periods to provide historical context. Throughout this report, we use “net (loss)/income” to mean “net (loss)/income attributable to Wilmington Trust Corporation.” Our comments in this report reflect our best estimates of the trends we know about, anticipate, and believe are relevant to future operations. In the future, however, actual results may differ from our estimates.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

RESULTS FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2010

This report discusses:

• Changes in our financial condition (balance sheet) since December 31, 2009. All balances cited are period-end balances unless otherwise noted. In some cases, we present amounts as of September 30, 2009, for historical reference.

• The results of our operations (income statement) for the three and nine months ended September 30, 2010, compared with the corresponding periods in 2009. In some cases, we provide amounts for other periods to provide historical context.

EXECUTIVE SUMMARY

We reported a net loss of $~~365~~33.35 million for the ~~2010~~2011 ~~third~~first quarter. ~~After~~The ~~dividends~~main ~~and~~causes ~~accretion on~~of ~~preferred~~this ~~stock, the net~~ loss ~~available to common shareholders was $369.9 million, or $4.06 per~~ ~~share.~~were:

~~The~~• ~~primary~~A ~~causes~~$41.3 ofmillion ~~this~~provision ~~loss~~for ~~were:~~ loan losses.

• ALower ~~$281.5~~net ~~million~~interest ~~provision for loan losses. The effects of the protracted recessionary environment continued to pressure Delaware’s economy. Commercial loan repayment problems intensified~~income, ~~appraisals~~due ~~continued~~ to ~~reveal~~declining additional declines in collateral valuations and the financial condition of more borrowers weakened. As a result, the amount of nonaccruing loans increased, and the risk ratings of more loans were downgraded to substandard status. These conditions required us to charge off more loans, and increase the reserve for loan ~~losses.~~balances ~~If these conditions continue in the future, we could have additional nonaccruing loans, additional risk rating downgrades, additional charge-offs,~~ and ~~increases~~higher tononperforming ~~our~~asset ~~reserve for loan losses~~balances.

• ~~Income~~The ~~tax~~establishment ~~expense~~ of ~~$100.7~~additional ~~million, as we established a $189.5 million valuation allowance against our net~~ deferred tax asset, ~~because~~valuation weallowance nooffsetting ~~longer~~the ~~believe~~potential itcurrent ~~is more likely than not that~~ tax ~~benefits~~benefit ~~recorded~~of ~~previously~~pretax ~~will be realizable in the future~~losses.

~~Because~~After ofadjusting ~~our~~for ~~net~~dividends ~~loss~~and ~~during~~accretion ~~the~~on ~~first~~shares ~~nine months~~ of ~~2010,~~Wilmington ~~our~~Trust ~~capital~~Series A ~~and~~preferred ~~our regulatory~~stock ~~capital~~issued ~~ratios~~in ~~declined~~conjunction ~~from~~with ~~December 31, 2009, despite~~ our ~~common~~participation ~~stock~~in ~~issuance during~~ the ~~2010 first quarter~~U.S. AtDepartment ~~September 30,~~of ~~2010,~~the ~~our~~Treasury’s ~~regulatory~~Capital Purchase ~~capital~~Program ~~ratios~~(CPP), ~~although~~the ~~lower~~net ~~than~~loss ~~at year-end~~available ~~2009, continued~~ to ~~exceed~~common ~~the~~shareholders ~~minimums~~was ~~required~~$38.1 million, byor ~~the Federal Reserve for banks to be~~$0.42 ~~considered~~per ~~well-capitalized~~common share.

52Loan balances declined from year-end 2010 mainly because of charge-offs, paydowns, and weak demand for new loans. Loan balances at March 31, 2011, were $7.11 billion. Core deposit balances increased from year-end to $7.26 billion at March 31, 2011, mainly because of an increase in CCS deposits, while total deposits declined because of maturities of national brokered certificates.

Because of our net loss for the 2011 first quarter, our stockholders’ equity declined from year-end 2010. At the direction of our regulators, our Board of Directors did not declare a dividend on our common stock for the 2011 first quarter.

During 2010, because of our loan credit quality problems and the resulting net loss, erosion of capital, and adverse financial condition, management and the Board of Directors carefully studied the company’s strategic options. In the process, we reviewed a wide range of alternatives. Based on discussions we had with our regulators, we believed that, without a change-of-control transaction acceptable to them, we likely would face imminent significant regulatory actions, which likely would result in a dramatic worsening of our business prospects.

Ultimately, the Board determined that the best option for our stockholders, as well as our clients and staff members, was a merger with M&T Bank Corporation. On November 1, 2010, we announced that we signed a definitive merger agreement with M&T. The closing of the merger is subject to certain conditions, including approval by our stockholders and regulators. Our stockholders approved the merger on March 22, 2011 and we have obtained all necessary approvals to close the merger from our regulators. Subject to the terms and conditions of the merger agreement, we expect to close the merger on May 16, 2011, at which point we will become a wholly-owned subsidiary of MT&T.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

InM&T ~~addition,~~intends weto ~~have~~hold ~~improved~~ our ~~credit~~WAS ~~risk management practices,~~ and ~~our~~CCS ~~provisioning~~businesses ~~and reserve~~as ~~levels~~distinct ~~reflect~~divisions ~~the~~within ~~increased~~its ~~risk in our loan portfolio. However~~corporate structure, ~~there~~and isto nocontinue ~~significant economic~~to oroperate ~~real~~them ~~estate~~under ~~recovery on~~ the ~~horizon~~ inWilmington ~~our~~Trust ~~markets. Therefore~~brand, wewith ~~have~~expanded ~~little~~access to ~~assurance~~M&T’s ~~our~~clients ~~loan~~and ~~portfolio~~markets. ~~will~~M&T ~~strengthen significantly~~expects into ~~the~~combine ~~near term, or that~~ our ~~capital~~commercial ~~position~~bank ~~will~~with ~~not~~its ~~erode~~own ~~further. These risks~~banking ~~increase~~footprint ~~the~~under ~~possibility of downgrades by~~ the ~~credit~~M&T ~~rating agencies or adverse regulatory actions which could compromise our businesses~~name.

We ~~have~~discuss ~~two~~each ~~very~~of ~~strong~~these ~~fee-based~~factors ~~businesses~~in ~~that~~greater ~~continue~~detail ~~to perform well, are established leaders~~ in ~~their~~other ~~markets~~sections ~~and~~of ~~have~~this ~~prospects for the coming years~~report. WeFor ~~believe~~more information itabout isthe ~~important~~merger, toread doNote ~~all~~1, ~~we can~~“Proposed tomerger ~~protect~~with ~~and~~M&T ~~nourish~~Bank ~~those~~Corporation,” ~~businesses~~in ~~as well as address~~ the consolidated ~~issues~~financial statements in ~~our~~this ~~banking franchise~~report.

~~For~~Effective ~~all~~February 17, ~~these reasons~~2011, ~~management~~Wilmington ~~and~~Trust ~~the~~FSB ~~Board~~entered ofinto ~~Directors~~a ~~have~~supervisory ~~carefully~~agreement ~~studied~~with the ~~company’s~~ ~~strategic options~~OTS. InFor ~~the~~information ~~process,~~about werestrictions ~~reviewed a wide range of alternatives. Based on discussions we had with our regulators, we believed that, without a change of control transaction acceptable~~ to ~~our~~ ~~regulators, we would likely face imminent significant regulatory actions,~~ which ~~would result in our business prospects likely worsening dramatically. Ultimately, the Board determined that the best option for our shareholders, as well as our clients and the employees of~~ Wilmington Trust, ~~was~~FSB ais ~~merger~~subject ~~with~~under ~~M&T. On November 1, 2010, we announced~~ that ~~we have signed a definitive~~ ~~merger~~ agreement, ~~with~~read ~~M&T. If~~ the ~~merger~~Form is8-K ~~completed,~~ we ~~will~~filed ~~become~~with ~~a wholly-owned subsidiary of M&T. Completion of~~ the ~~merger~~SEC ison ~~subject to certain conditions~~February 23, ~~including, approval by our shareholders and regulators~~2011. ~~For more information about this event, read Note 1, “Recent~~ ~~events,” in this report.~~

~~With~~CHANGES aIN ~~history~~FINANCIAL ofCONDITION ~~superior~~FOR ~~earnings~~THE ~~and~~THREE ~~credit~~MONTHS ~~performance~~ENDED ~~across~~MARCH ~~economic cycles~~31, ~~M&T is one of~~2011 the strongest financial institutions in the country and a strong and stable partner for us. With highly complementary operations and geographic footprints as well as many value-enhancing opportunities across our businesses, Wilmington Trust and M&T are an excellent strategic fit.

~~M&T~~At ~~intends~~March 31, to hold our Wealth Advisory Services and Corporate Client Services businesses as distinct divisions within its corporate structure and intends to continue to operate these businesses under the Wilmington Trust brand2011, ~~with expanded access to M&T’s clients and markets. M&T expects to combine~~ our ~~commercial~~total ~~bank~~assets inwere ~~Delaware with its own banking footprint under the M&T name to create the premier depository franchise in the high-growth mid-Atlantic region~~$10.73 billion, ~~We share~~ a ~~similar~~ ~~community-focused~~$204.4 million ~~operating~~decrease ~~model~~from ~~with M&T, long~~year-~~tenured staff members, and a culture~~end ~~committed~~2010. toThis ~~serving~~decline ~~the~~was ~~areas~~caused ~~where~~primarily ~~we live and work.~~by:

~~Under~~• ~~the~~A ~~direction~~$415.4 ofmillion, ~~our~~or ~~regulators~~6%, ~~our~~decline ~~Board~~in ofloan ~~Directors~~balances. ~~did~~Decreases ~~not~~occurred ~~declare~~throughout athe ~~dividend~~portfolio, ondue ~~our common~~to ~~stock~~charge-offs, loan paydowns, and weak demand for ~~the~~new ~~2010~~loans. ~~third~~Loan ~~quarter~~balances at March 31, 2011 were $7. 11 billion, compared to $7.53 billion at December 31, 2010.

We• ~~discuss~~A ~~each~~$91.1 ofmillion ~~these~~decline ~~factors~~ in ~~greater~~investment ~~detail~~securities ~~in other sections of this report~~balances.

53The declines in loan and investment securities balances were partially offset by a $331.5 million increase in interest-bearing deposits in other banks. This increase reflected our continued efforts to enhance our liquidity in accordance with our contingency funding plan because of our loan credit quality problems and our net losses in 2010 and 2011. At March 31, 2011, the balance of interest-bearing deposits in other banks was $2.42 billion, compared to $2.09 billion at December 31, 2010.

Total deposit balances were $8.84 billion at March 31, 2011, a decrease of $135.5 million, or 2%, from year-end. Most of the decline was in national brokered certificates, which declined $250.6 million from year-end. This decline was partially offset by a $115.1 million increase in core deposits.

Stockholders’ equity declined from December 31, 2010, mainly because of the net loss that we experienced for the first three months of 2011.

For more information about loan and core deposit balances, read the Regional Banking discussion in this report. For more information about our capital and stockholders’ equity, read the capital resources discussion in this report.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

CHANGES IN FINANCIAL CONDITION FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2010

At September 30, 2010, our total assets were $10.40 billion, a $695.8 million decrease from year-end 2009. This decline was caused primarily by:

• An $840.5 million, or 9%, decline in loan balances. Decreases occurred throughout the portfolio, due to charge-offs, loan paydowns, and weak demand for new loans. Loan balances at September 30, 2010 were $8.13 billion.

• A $258.9 million increase in the reserve for loan losses, which brought the reserve to $510.4 million, or 6.28% of total loans outstanding.

• A $133.0 million decline in investment securities balances.

Partially offsetting these declines was a $647.4 million increase in interest-bearing deposits in other banks, which increased our liquidity. We enhanced our liquidity during the 2010 third quarter, in accordance with our contingency funding plan because of our loan credit quality problems and our net losses in 2010.

Total deposit balances were $8.29 billion at September 30, 2010, a decrease of $100.0 million, or 1%, from year-end. Most of the decline was in core deposits, which were $7.00 billion, a decrease of $116.8 million, or 2%, from year-end. A decrease in transactional noninterest-bearing demand deposits from CCS client deposits accounted for most of this decrease.

Because our loan and investment securities balances declined, our need for funding decreased, enabling us to decrease our short-term borrowings, which declined $413.3 million, to $190.5 million at September 30, 2010.

Long-term debt increased by $51.6 million from year-end 2009 because of a $50.0 million advance from the FHLB taken in the 2010 third quarter. The advance has a two year maturity and bears a 1.11% fixed rate.

Stockholders’ equity declined from December 31, 2009, mainly because of the net loss that we experienced for the first nine months of 2010. At September 30, 2010, all of our regulatory capital ratios continued to exceed the minimums required by the Federal Reserve for banks to be considered well-capitalized. Although our stockholders’ equity decreased from December 31, 2009, it benefited from the 21.7 million share common stock issuance completed on March 1, 2010. This issuance netted proceeds of $274 million, which qualified as both tangible common equity and regulatory Tier 1 capital. We used the proceeds for general corporate purposes. Since the offering, we have contributed $400 million of capital to our wholly-owned bank subsidiaries.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Assets

(dollars in millions)	At 9/30/10			At 12/31/09
Loan balances	$	8,126.7		$	8,967.2
Loans as a percentage of total assets		78	%		81	%
Investment securities	$	727.5		$	860.5
Investment securities as a percentage of total assets		7	%		8	%
Total assets	$	10,401.3		$	11,097.1

Earning assets 1

(dollars in millions)	At 9/30/10			At 12/31/09
Total earning assets	$	9,724.4		$	10,035.0
Percentage in loans		84	%		89	%
Percentage in investment securities		7	%		9	%
Percentage in other earning assets		9	%		2	%
Earning assets as a percentage of total assets		93	%		90	%

1 Includes loans, investment securities, FHLB and FRB stock, interest-bearing deposits in other banks, and federal funds sold and securities purchased under agreements to resell. Excludes the reserve for loan losses.

Liabilities and stockholders’ equity

(dollars in millions)	At 9/30/10			At 12/31/09
Core deposits	$	7,003.5		$	7,120.3
Core deposits as a percentage of total liabilities		75	%		73	%
National brokered CDs and short-term borrowings	$	1,477.9		$	1,874.4
National brokered CDs and short-term borrowings as a percentage of total liabilities		16	%		19	%
Total liabilities	$	9,332.4		$	9,790.0
Wilmington Trust stockholders’ equity	$	1,068.9		$	1,306.7
Noncontrolling interest	$	—		$	0.4
Total liabilities and stockholders’ equity	$	10,401.3		$	11,097.1

Selected average balances

					Year-to-date		Year-to-date
(in millions)	2010 Q3		2009 Q3		2010		2009
Loan balances	$	8,308.0	$	9,079.6	$	8,575.8	$	9,329.9
Total assets	$	10,540.0	$	10,952.6	$	10,696.8	$	11,493.1
Core deposits	$	6,894.7	$	6,699.1	$	6,964.6	$	6,405.8
Total deposits	$	8,095.3	$	7,658.9	$	8,111.2	$	7,778.0
Total liabilities	$	9,121.5	$	9,630.0	$	9,222.2	$	10,161.3

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Investment securities portfolio

We maintain an investment securities portfolio to generate cash flow, help manage interest rate risk, and provide collateral for deposits and other liabilities. Our policy is to invest in securities that have, at the time of purchase, investment-grade ratings of A or better from Standard & Poor’s or Moody’s Investors Service. We do not hold investment securities for trading purposes. There are no client funds in this portfolio.

At ~~September~~March 3031, ~~2010~~2011, the investment securities portfolio was $~~727~~497.56 million, a decline of $~~133~~91.01 million from year-end ~~2009~~2010. This decrease was caused primarily by:

•

Maturities of U.S. Treasury securities.

•

Calls of government agency securities.

•

Amortization of mortgage-backed securities and collateralized mortgage obligations.

• Sales and calls of $19.7 million of preferred stock, which resulted in net securities gains of $3.6 million.

• $48.2 million of security write-downs that were deemed OTTI under GAAP. For additional information about other-than-temporary impairments, read Note 11, “Investment securities,” in this report.

These changes caused the mix of investment securities, on a percentage basis, to shift.

Investment securities portfolio composition

	At 9/30/10					At 12/31/09
	At 3/31/11					At 12/31/10
			Percent of					Percent of
(dollars in millions)	Amount		~~portfolio~~Portfolio			Amount		portfolio
U.S. Treasury securities	$	~~173~~31.28		246	%	$	~~232~~48.89		278	%
Government agency securities 1		~~240~~190.69		3338			~~225~~245.19		2642
Obligations of state and political subdivisions		59.4		12			59.75		1
Collateralized mortgage obligations		3421.19		4			5127.2		65
Mortgage-backed debt securities		~~160~~133.90		2227			~~203~~145.4		2325
Trust-preferred securities:
Single-issue trust-preferred securities		58.26		812			5758.75		710
Pooled trust-preferred securities		4342.17		69			5341.38		67
Total trust-preferred securities		101.3		1421			~~111~~100.03		1317
Preferred stock		4.95		1			234.95		31
Other marketable equity securities		74.18		1			7.40		1
Total investment securities	$	~~727~~497.56		100	%	$	~~860~~588.57		100	%
Amount invested in fixed rate instruments	$	~~611~~384.21		8477	%	$	~~723~~476.62		8481	%


¹		Includes $0.5 million of non-U.S. government agency securities.

56The negative duration of the portfolio in total at December 31, 2010, was caused by the lower TruPS valuations and historically low market interest rates.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Attrition and depressed TruPS valuations caused the portfolio’s average life and duration to change. The negative duration of the portfolio in total was caused by the lower TruPS valuations and historically low market interest rates.

Average life and duration in the investment securities portfolio (in years)

	At 9/30/10			At 12/31/09
	At 3/31/11			At 12/31/10
Average life		68.2846			67.2367
Duration		(30.7103	)		(03.4936	)

~~Excluding TruPS, duration at September 30, 2010, would have been 0.71 years.~~63

For additional information about our investment securities, their valuations, and related write-downs, read the Consolidated Statements of Cash Flows, Note 6, “Fair value measurement of assets and liabilities,” and Note 11, “Investment securities,” in this report.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

~~RESULTS~~Excluding TruPS, OFduration ~~OPERATIONS~~would ~~FOR~~have ~~THE~~been ~~THREE~~1.33 years ~~AND~~at ~~NINE~~March 31, 2011 ~~MONTHS~~and ~~ENDED~~1.28 ~~SEPTEMBER~~years ~~30,~~at December 31, 2010.

WeFor ~~reported~~additional ainformation ~~net~~about ~~loss~~our ofinvestment ~~$365.3 million~~securities, ~~for~~their ~~the~~valuations, ~~2010 third quarter~~ and ~~a net loss of $510.9~~related ~~million~~write-downs, ~~for~~read the ~~first~~Consolidated ~~nine~~Statements ~~months~~ of ~~2010.~~Cash ~~After adjusting for the dividends and accretion on the shares of Wilmington Trust Series A preferred stock issued in conjunction with our participation in the CPP~~Flows, ~~the~~Note ~~net loss available to common shareholders was $369.9 million~~6, or“Fair ~~$4.06~~value ~~per~~measurement ~~common~~of ~~share,~~assets ~~for~~and ~~the 2010 third quarter~~liabilities,” and ~~$524.5 million~~Note 12, or“Investment ~~$6.09 per common share~~securities,” ~~for~~in ~~the~~this ~~first nine months of 2010~~report.

InRESULTS ~~comparison,~~OF ~~the~~OPERATIONS ~~net~~FOR ~~loss~~THE ~~for~~THREE ~~the~~MONTHS ~~2009~~ENDED ~~third~~MARCH ~~quarter was $5.9 million~~31, ~~and the net loss available~~2011 to common shareholders was $0.15 per common share, after adjusting for the dividends and accretion on the shares of Wilmington Trust Series A preferred stock. Net income for the first nine months of 2009 was $6.8 million, and the net loss available to common shareholders was $0.10 per common share, after adjusting for the dividends and accretion on the shares of Wilmington Trust Series A preferred stock.

~~The~~We reported a net ~~losses~~loss of $33.5 million for the ~~third~~2011 first quarter. ~~and~~After adjusting for the dividends ~~first~~and ~~nine~~accretion ~~months~~on the shares of ~~2010~~Wilmington ~~were~~Trust ~~caused~~Series A ~~by:~~preferred stock issued in conjunction with our participation in the CPP, the net loss available to common shareholders was $38.1 million, or $0.42 per common share.

•In Acomparison, ~~significant~~the ~~increase~~net inloss for the ~~provision~~2010 ~~for~~first ~~loan~~quarter ~~losses~~was $29.2 million, asand ~~loan~~the ~~repayment~~net ~~problems~~loss available ~~escalated~~to ~~due~~common toshareholders ~~continued~~was ~~recessionary~~$0.44 ~~conditions~~per common share, ~~particularly~~after inadjusting ~~southern~~for ~~Delaware~~the dividends and accretion on the shares of Wilmington Trust Series A preferred stock.

• The ~~establishment~~net ofloss anfor ~~allowance~~the ~~against~~2011 ~~our~~first ~~deferred~~quarter ~~tax~~was ~~asset.~~caused by:

•

A $41.3 million provision for loan losses.

•

Lower net interest income, due to declining loan balances and higher nonperforming asset balances.

• ~~Mutual~~Continued mutual fund fee waivers, which reduced WAS revenue.

• An$5.0 ~~increase~~million inof ~~OREO~~OTTI ~~write-downs~~securities ~~and losses~~charges.

• AnHigher ~~increase~~noninterest ~~in our reserve for unfunded loan commitments~~expense.

• The ~~effects~~establishment of ~~the~~additional ~~difficult~~deferred ~~financial~~tax ~~environment~~asset ~~were~~valuation ~~offset~~allowance ~~partially~~offsetting bythe ~~some~~potential ~~positive developments:~~ current tax benefit of pretax losses.

•Weighted ~~Total~~average ~~CCS~~shares ~~fee~~outstanding ~~income increased~~ for ~~both~~ the ~~third~~2011 first quarter ~~and~~were 14.5 million higher than the 2010 first ~~nine~~quarter ~~months~~because of the 21.7 million share issuance on March 1, 2010.

• OTTI securities charges were lower than for the corresponding periods in 2009.

Weighted average shares outstanding rose by 22.0 million shares for 2010 third quarter and by 17.2 million shares for the first nine months of 2010, compared to the comparable 2009 periods, which decreased the net loss per common share. The issuance of 21.7 million shares on March 1, 2010 caused the increase in weighted average shares outstanding.

Weighted average common shares outstanding

Three months ended

~~Nine months ended~~

September 30,

March 31,

(in thousands)

~~2010~~2011

~~2009~~2010

~~2010~~

~~2009~~

Common shares outstanding (diluted)

9190,~~009~~976

6876,~~979~~465

~~86,140~~

~~68,963~~

5864

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

THE REGIONAL BANKING BUSINESS

The ~~severity of the recession and lack of sustained economic recovery during 2010 continued to affect our~~ Regional Banking business, ~~particularly~~continued into ~~southern~~experience ~~Delaware. A combination of~~ charge-offs and weak demand for new loans during the 2011 first quarter, which caused loan balances to decline ~~throughout the portfolio~~.

Regional Banking operating net ~~income~~loss for the ~~third~~2011 first quarter ~~and~~was greater than for the 2010 first quarter, ~~nine~~primarily ~~months~~because ofin 2010 ~~was~~the ~~lower~~income tax benefit reduced the 2010 operating loss. ~~than~~Operating net loss before income taxes for the ~~corresponding~~Regional ~~2009~~Banking segment ~~periods~~was less than for the 2011 first quarter, primarily because ~~the~~of a lower provision for loan losses, which was ~~higher~~offset partially by ~~and~~lower net interest income ~~and noninterest expense were lower~~.

Regional Banking operating ~~income~~net loss

(in millions)	~~2010~~2011 Q3Q1			~~2009~~2010 Q3Q1			~~2010 YTD~~			~~2009 YTD~~
Segment operating net (loss)/income	$	(321.2	)	$	8.7		$	(450.7	)	$	22.6
Segment operating net loss	$	(26.4	)	$	(23.3	)

For more information about Regional Banking operating ~~income~~loss, please read Note 1516, “Segment reporting,” in this report.

Although this report discusses changes in loan and deposit balances on a period-end basis, we consider average balances, rather than period-end balances, to be a better indicator of trends in the Regional Banking business. This is because average balances represent client activity over the longer term. This is especially true of core deposit balances, which often can be skewed by movements of transactional deposits made by CCS clients. Information about changes in our average balances appears in the quarterly ~~and year-to-date~~ analyses of net interest income, which appear between the net interest margin and the noninterest income discussions in this report.

LOANS

~~Loan charge-offs and weak demand for new loans, stemming from continued weakness in the regional economy, caused the decline in loan balances.~~ Total loan balances declined $~~840~~415.54 million, or 96%, during the first ~~nine~~three months of ~~2010.~~2011, ~~Approximately~~mainly because ~~79%~~ of ~~total~~loan ~~loans~~paydowns, ~~outstanding~~continued atloan ~~September 30~~charge-offs, ~~2010,~~ ~~were~~and ~~floating~~weak ~~rate~~demand for new loans.

Total loans outstanding

(dollars in millions)	At 93/3031/1011		At 12/31/0910		% change
Commercial	$	65,~~103~~245.68	$	65,~~685~~567.72		(96	)%
Retail 1		21,~~023~~864.17		21,~~281~~958.57		(115	)%
Total loans outstanding	$	87,~~126~~110.75	$	87,~~967~~525.29		(96	)%


¹		Includes consumer loans, residential mortgage loans, and loans secured with investments.

5965

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The mix of loans by geographic market remained relatively unchanged from year-end 2010, with the Delaware market ~~accounting~~ continuing to account for 5352% of total loans outstanding at ~~September~~March ~~30, 2010, compared to 54% at December~~ 31, ~~2009~~2011. ~~The composition of the loan portfolio by loan type also remained relatively unchanged.~~

~~Loan~~At March 31, 2011, the loan portfolio composition, on a percentage basis, was similar to year-end 2010.

	At 9/30/10			At 12/31/09
Commercial loans:
Commercial, financial, and agricultural		29	%		29	%
Commercial real estate — construction		21	%		22	%
Commercial mortgage — owner occupied		13	%		12	%
Commercial mortgage — non-owner occupied		12	%		12	%
Total commercial loans		75	%		75	%
Retail loans:
Residential mortgage		5	%		5	%
Consumer loans:
Home equity		7	%		6	%
Indirect		6	%		7	%
Credit card		1	%		1	%
Other consumer		1	%		1	%
Total consumer loans		15	%		15	%
Secured with investments		5	%		5	%
Total retail loans		25	%		25	%

Approximately 79% of total loans outstanding at March 31, 2011, were floating rate loans.

~~Loans~~Commercial ~~secured~~loans Commercial ~~with~~loans ~~investments~~were ~~are~~$5.25 billion ~~associated~~at ~~mainly~~March 31, ~~with~~2011, ~~WAS~~a decline ~~clients~~of $321.4 Wemillion, door ~~not~~6% ~~consider~~from ~~changes~~year-end. Decreases occurred in all categories of commercial loans, most notably in the ~~balances~~CF&A and commercial construction loan categories. The mix of ~~these~~commercial loans toby begeographic ~~indicative~~market was unchanged from year-end 2010, with approximately 51% of ~~trends~~commercial loans in the ~~Regional~~Delaware ~~Banking business~~market.

Commercial loans

Most of our commercial loans have floating rates, are secured by the borrower’s assets, and are supported by personal guarantees. At September 30, 2010:

• Commercial loans made up approximately 75% of our total loan portfolio, the same as at year-end 2009.

• Approximately 72% of commercial loan balances were for amounts of $10 million or less. On a percentage basis, the mix of loans by size was relatively unchanged from year-end.

• Approximately 90% of total commercial loans outstanding were floating rate loans. For more information about the pricing characteristics of commercial loans, read the interest rate risk discussion in this report.

Decreases in loan balances occurred in all three categories of commercial loans, most notably in commercial, financial, and agricultural (CF&A) loans and commercial construction loans. The geographic distribution of loans remained similar to year-end 2009.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three and nine months ended September 30, 2010

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Commercial loan balances

(dollars in millions)	At 9/30/10		At 12/31/09		% change
	At		At
Commercial, financial, and agricultural	$	2,373.4	$	2,627.0		(10	)%
	March 31,		December 31,
Commercial real estate — construction		1,681.6		1,956.4		(14	)%
(in millions)	2011		2010
Commercial mortgage — owner occupied		1,069.3		1,095.3		(2	)%
Commercial loans:
Commercial mortgage — non-owner occupied		979.3		1,007.0		(3	)%
Commercial, financial, and agricultural	$	2,027.2	$	2,178.6
Total commercial loans	$	6,103.6	$	6,685.7		(9	)%
Commercial real estate — construction		1,300.5		1,429.1
Commercial mortgage — owner occupied		1,023.8		1,041.8
Commercial mortgage — non-owner occupied		894.3		917.7
Total commercial loans	$	5,245.8	$	5,567.2

~~Commercial~~Consumer loans Consumer loan balances were $1.06 billion at March 31, 2011, a decline of $72.6 million from year-end 2010. Decreases occurred in the indirect, home equity and other consumer loan categories, with the largest decline in the indirect lending category, where paydowns on indirect automobile loan balances exceeded new volume. In addition, $5.5 million of charge-offs contributed to the decline in total consumer loans. While consumer loan balances decreased, the mix of consumer loans by geographic market was unchanged from year-end 2010, with approximately 57% of consumer loans in the Delaware market.

	At 9/30/10					At 12/31/09
			As a % of total					As a % of total
(dollars in millions)	Amount		commercial loans			Amount		commercial loans
Delaware	$	3,227.9		53	%	$	3,601.9		54	%
Pennsylvania	$	1,538.3		25	%	$	1,696.3		25	%
Maryland	$	659.1		11	%	$	684.2		10	%
New Jersey	$	498.7		8	%	$	509.7		8	%
Other	$	179.6		3	%	$	193.6		3	%

Consumer loan portfolio

Commercial, financial, and agricultural loans


(dollars in millions)	At 3/31/11		At 12/31/10		% change
Indirect	$	362.4	$	411.6		(12	)%
Home equity		523.1		539.0		(3	)%
Credit card		68.0		65.1		4	%
Other consumer		108.2		118.6		(9	)%

Total consumer loans	$	1,061.7	$	1,134.3		(6	)%

~~Weak demand for new loans, caused by continued recessionary conditions, plus loan paydowns and~~66 $89.9 million of charge-offs, contributed to the decline in CF&A loan balances during the first nine months of 2010. Balances at September 30, 2010, were $253.6 million, or 10%, lower than at year-end 2009.

Commercial construction loans

Commercial construction loan balances decreased $274.8 million, or 14%, from year-end 2009, mainly due to $162.8 million of charge-offs. Also, during the first nine months of 2010, approximately $68.3 million of performing loans were transferred from the commercial construction portfolio to the commercial mortgage portfolio. Generally, when a commercial construction project is completed, we transfer the loan to the commercial mortgage portfolio. Paydowns and weak demand for new construction loans also contributed to the decrease.

The breakdown of commercial construction loans by project type shifted slightly from year-end 2009. The percentage of commercial construction loans for residential projects and retail and office projects decreased, mainly due to charge-offs and projects that were completed in the first nine months of 2010. As of September 30, 2010, the geographic breakdown of the commercial construction portfolio remained similar to year-end 2009.

Wilmington Trust Corporation and subsidiaries Form 10-Q for the three ~~and nine~~ months ended ~~September~~March 3031, ~~2010~~2011

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

Commercial construction loans by project type

(dollars in millions)	At 9/30/10				At 12/31/09
Residential	$	804.8	48	%	$	983.3	51	%
Land development 1		384.1	23	%		434.9	22	%
Retail and office		272.1	16	%		344.0	18	%

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Filing Compare · WILMINGTON TRUST CORP