Thank you, Elliot. Good morning and welcome to Washington Trust Bancorp, Inc's conference call for the first quarter of 2026. Joining us this morning are members of Washington Trust's Executive Team, Ned Handy, Chairman and Chief Executive Officer, Mary Nunes, President and Chief Operating Officer, Ron Osberg, Senior Executive Vice President, Chief Financial Officer and Treasurer, and Bill Ray, Senior Executive Vice President and Chief Risk Officer. Please note that today's presentation may contain forward-looking statements and our actual results could differ materially from what is discussed on today's call. Our complete safe harbor statement is contained in our earnings release, which was issued yesterday, as well as other documents that are filed with the SEC. All of these materials and other public filings are available on our Investor Relations website at ir.washtrust.com. Washington Trust trades on NASDAQ under the symbol WASH. I'm now pleased to introduce today's host, Washington Trust Chairman and Chief Executive Officer, Ned Handy.

Thank you, Sharon. Good morning, and thank you for joining our first quarter conference call. We appreciate your time and your continued interest in Washington Trust. I'll begin with a brief overview of our first quarter results, and then Ron will provide more detail on our financial performance for the quarter. Following our remarks, Mary and Bill will join us for the question and answer session. Building on the momentum generated throughout 2025, quarterly performance was driven by continued net interest margin expansion, reflecting the underlying strength of our core banking business and continued benefits from our December 2024 balance sheet repositioning transactions. The Q1 results do, however, include a higher provision related to reserve bills on two pre-credits moved to non-accrual in March, and we'll provide details on those in the Q&A session. Our capital ratios remain strong, providing the flexibility to support continued execution across the business. In the first quarter, we completed a digital banking conversion for personal accounts that provides enhanced security and technology and a better customer experience, reinforcing our focus on service and relationships. We will continue the conversion of our business accounts in the ensuing quarters. With recent industry shifts locally, these investments position us well to attract new customers by pairing modern capabilities with the personalized service that defines Washington Trust. We're also leveraging our strength as a community bank that prioritizes local decision-making to attract experienced bankers to our commercial team. We recently added new talent across C&I, Cree, and business banking, all of whom bring deep experience and strong client relationships in the region. The institutional banking team we added in January is showing strong momentum that positions us for loan and deposit growth as the year progresses. In addition, our planned branch opening later this year in Pawtucket, Rhode Island, will further expand our presence in the northern part of the state. Overall, we're encouraged by the progress we are making to position the company for long-term success. With that, I'll turn the call over to Ron to provide additional detail on our financial results. Ron?

Thank you, Ned, and good morning, everyone. Net income in the first quarter was $12.6 million, or $0.66 per share, compared to $16 million, or $0.83 per share last quarter. PPNR was down 6% from Q4 and up by 23% year-over-year on an adjusted basis. Net interest income was $40.5 million, down by 1% from Q4 and up by 11% year-over-year. The margin was $263, up by 7 basis points from Q4 and up by 34 basis points year-over-year. Q1 included $116,000 of loan prepayment fee income, which benefited NIM by one basis point, compared to $516,000, or three basis points last quarter. Non-interest income was down $1.2 million, or 6%, compared to Q4, and up by 11% year-over-year on an adjusted basis. Loan-related derivative income, which is transactional in nature, was down by $854,000 compared to Q4. Wealth management revenues were down by $205,000 or 2%. Average AUA for Q1 decreased by 1% and increased by 10% year-over-year. Mortgage banking revenues were $3 million, seasonally down 6%, and were up by 32% year-over-year. Our mortgage pipeline at March 31st was $114 million, up by $33 million, or 41%, from the end of December. Non-interest expense totaled $37.8 million in Q1, down by 1%. Other non-interest expenses were down by $1.2 million in Q1, largely due to a $1 million contribution made to our charitable foundation in Q4. In the first quarter, salary and employee benefits expense was up by $693,000, or 3%, reflecting merit increases and higher payroll taxes associated with the start of a new calendar year. Our Q1 effective tax rate was 21.6%, and we expect the full year 2026 effective tax rate to be approximately 21.5%. On sheet total loans were down 2% from December 31st. Total commercial loans decreased by $95 million, reflecting mainly payoffs in the CREEP portfolio. The commercial pipeline in total is approximately $156 million. Residential loans decreased by $21 million as we continue to amortize that portfolio. In-market deposits were down 2% from the end of Q4 and up by 3% year-over-year, and wholesale funding was down by $50 million, or 8%, from the end of December. Our loan-to-deposit ratio decreased slightly to 96.9% at the end of March. Turning to asset and credit quality, at March 31st, non-approving loans were 81 basis points on total loans and increased by $27.5 million from the prior quarter, largely due to two commercial real estate office loans. That's two loans with 33 basis points on total loans. In the first quarter, we recognized the $4 million provision for credit loss is largely reflecting an increase in specific reserves on the two CRE office loans. The allowance total of $41.1 million are 82 basis points. And at this time, I will turn the flow back to Ned.

Thanks, Ron. And now we'll take questions.

Thank you. If you would like to ask a question, please press star followed by 1 on your telephone keypad. If you would like to withdraw your question, please press star followed by 2. When preparing to ask a question, please ensure your device is unmuted locally. First question comes from Justin Crowley with Piper Sandler. Your line is open. Please go ahead.

Hey, good morning, everyone. I wanted to start off just giving a little more detail on the two office loans, Just anything on geography, and then maybe some more specifics on, you know, what occurred to drive the downgrades in specific reserves, so just things like occupancy levels, or perhaps just how close they even were to maturity. I'm not sure if that maybe necessitated new appraisals.

Yeah, Bill, do you want to take that?

Sure.

Sure. They're both loans that have been current up until this point. In both cases, in March, there were sort of triggering events. that led to us deciding to make the decision for quarter-end to put them on nonaccrual. Both of them have strong, sophisticated sponsors, and we're engaged with both of them right now on – one was a maturity, the other doesn't mature until next year. We're engaged with both of them on the right next steps. So I don't want to get into too much detail on what that means, But we, like with most of our assets that have been in, you know, criticized, either special mention or classified, most of them emerge unscathed. And in this case, though, we took the step to put reserves in place that we thought were appropriate to reflect any potential loss down the road. So, again, we think they're both solid properties with solid sponsors. and we expect that we'll continue to drive resolution, and we're hoping that, you know, within the next few quarters, these will either exit or they will emerge back into performing status.

Okay, got it. And then were there any general reserves allocated to office, or was it all specific with regard to these two loans? I guess trying to get a sense of how you think about the risk of the rest of the office book at this point and the cycle for that, for this asset class, and, you know, if the thinking there has changed at all?

Well, I think our office exposure peaked at $300 million a couple of years ago. It's now down to $230 million. And we think we've done that with a fairly small amount of charge-offs along the way, relatively. So we expect to continue to reduce our office exposure over time. Within, you know, the CECL methodology, we make sure that we use qualitative factors, especially to address issues in office, and so we have taken some of those steps. And we believe going forward that there's always going to be a handful of properties that are sort of on the bubble that need some attention and focus. But as you can see, all of our other office properties are performing. There aren't delinquencies there that we're concerned about. So we just expect that assets will move into lower ratings and then will emerge from those. And we certainly spend a lot of time thinking about maturity wall analysis and refinance risk, and so we're constantly juggling those handful of properties that look like they might raise some issues down the road and try to stay ahead of them. So I guess the best way of saying we're cautious on office, and we'll continue to be cautious on office, but we also think the scale of the problems within it are well within our capabilities to handle from an earnings standpoint and a reserving standpoint.

And then, you know, I guess somewhat larger-sized loans here, it sounds like they were self-originated. Was that the case, or were either participations? Just wanted to confirm that.

I'm not sure which loans you're referring to, but there's only, there's five loans.

The two office loans have migrated. The two office loans have migrated.

Sure, actually, they're both participations. We're the lead on the Class A, the Class A office space one. We're two-thirds participant in the lead, and then we are the minority participant on the lab space deal.

Okay, gotcha. And then I guess pivoting a little, just on loan growth, with the contraction you saw this quarter, can you refresh us just on how to think about growth from here? You know, I believe we talked about mid-single-digit, call it, you know, maybe 5% growth previously. I know a lot's changed since then with some of the geopolitical noise, so just curious for an update there.

Yeah, I'll take that one. Thanks for the question. Yeah, so the quarter saw, you know, pretty significant paydowns, payoffs, mostly in the Cree space, and not the kind of commensurate new origination that we're used to. But the path ahead looks very good. We're sticking with our mid-single-digit growth for the year projection, and it's important that we talk about where that's going to come from. At this point, we're feeling like Cree is probably going to be low single-digit growth for the year. They've got some making up to do based on the first quarter payoffs, and then we're thinking kind of flat to 1%. It's somewhat intentional. Most of the growth is going to come from our core C&I business and our institutional banking business. We're expecting sort of high single-digit growth out of our core C&I business, which you'll recall has a current outstanding in the kind of $560 million level. So you can do the math there. And then most of the C&I growth is going to come out of our relatively new institutional banking group. Alongside that is in deposits that will come from that. They're expecting to kind of self-fund at a 30% to 40% level, which is much higher than certainly Cree and much higher than our core C&I business. So that's an added benefit. They joined the group in late January, so it's expected to take a little while for them to get up and running, but the pipeline is growing as we expected, and we're very encouraged by that. I'm sticking with the mid-single-digit growth, if not a little higher, and, you know, again, very encouraged by the types of credit, the quality of credit that we're seeing in the pipeline build. So, more to come on that at the end of the next quarter. Okay, great.

And then just one last one on the margin. I think I might have missed this in the pair of remarks. I know there were some elevated pretainment fees last quarter. Was there any of that in the 263 for the first quarter?

Yes, like one basis point.

And then I guess just thoughts on the margins from here. I think you'll get that left from the swap termination, but could you just remind us the benefit there and then just also how you're thinking about organic expansion uh through the year yeah so the the swap termination will add nine basis points in the second quarter and another four basis points in the third quarter okay and then i guess just oh go ahead go ahead just i'm just going to ask outside of that you know just beyond the benefit from the swap um just how you're thinking about um you know just margin lift from here as we get through the year yeah Yeah, there's modest expansion by quarter.

The first quarter was probably, you know, a little higher. It helped by the prepayment, actually helped a little bit by the shorter day count in the quarter, actually added about two basis points to the NIM. But when we look ahead to the fourth quarter, we're thinking, you know, 275 to 280 in the quarter.

Okay, great. I appreciate it. Thanks so much. Thanks, Justin.

We now turn to Damon Del Monte with KBW. Your line is open. Please go ahead.

Hey, good morning, guys. Thanks for taking my questions. Ron, could you just repeat the last comment you made on the margin, the 275, the 280? Was that for the second quarter, or was that for where you expected to be at year end? I missed that. Sorry, Damon. Yeah, just to be clear, fourth quarter. Fourth quarter.

So, you know, we're looking at 265 to 270.

That jives us what you were describing from the benefit. And then I guess maybe a little bit on expenses and kind of how you're thinking about the outlook from there. You know, you've made some hires. I'm assuming that's all kind of baked into the numbers. You know, I think the expenses were around, what, $37.8 million. So, just kind of modest growth off of this. So, do you think you could actually keep it kind of flat?

Yeah, we're actually seeing about a million-dollar increase in Q2, and some of that is – really, there's three areas we're looking at, advertising, mortgage commissions, and then we've got some project implementation expenses that will be coming through.

Got it.

Okay, great. And then further to that, we're adding a branch towards the end of the third, beginning of the fourth quarter. Those expenses will start to hit in Q3, and so we're probably looking at about 526, the branch of it.

Got it. Okay, great. And then on wealth management, you know, AUM were down a little bit this quarter. Is that just fluctuation of the market, or was there some outflow of clients?

Yeah, it was mostly market, and by mostly, that means it's not all. So, yes, we did have some net outflows.

Okay.

You can see markets have rebounded so far in April. But at least, you know, a lot of the clients that we saw in the quarter have reversed so far in the second quarter.

And then just lastly, you know, given the outlook for the loan growth going forward, how do we think about provision and kind of the reserve level? I mean, obviously, you built the reserve this quarter for those loans that went to non-accruel status. But, you know, if we assume that there's no other credit deterioration, do you kind of, you know, have the provision such that it keeps the reserve flat given the loan growth?

Yeah, we're kind of thinking somewhere in the range of $1 million to $2 million per quarter. And that covers loan growth, and, you know, maybe that gives us a little bit, you know, depending on what we book and when we book, it could give us a little bit of a reserve bill going forward. Got it.

Okay, great. Well, that's all that I had. Thanks so much. Thanks, Tim.

As another reminder, if you'd like to ask a question, please press R1 on your telephone keypad now. We now turn to Lori Hunsicker with Seaport Research. Your line is open. Please go ahead.

Yeah, hi. Good morning, Ned, Ron, Mary, and Bill. Thanks for taking my question. Just to stay with where the name was, loan loss provision. So the $4 million loan loss provision, I know you said, obviously, that was heavy with the office. What exactly was the dollar amount there associated with office of the $4 million bill?

Laurie, it was essentially all office. All of it. Got it.

Okay, perfect. And then I just wanted to dive a little bit deeper here in office. So just I have a series of questions here. So thanks for staying with me on this. So you've got 59% maturing in the next two years, $136 million. Is any of that currently in special mention, classified, nonaccrual? And if so, when is that actually maturing?

Well, of the five deals that are in the office space in special mention or classified, one of them matured, and that was one of the deals that we moved to nonaccrual. There's another one, the Class B special mention, that's actually maturing in the third quarter of this year. And one reason we moved it to special mention was just kind of as a marker as we work with the sponsor, who's a well-known and committed sponsor on a refinance approach. And then the other deal that went to nonaccrual doesn't mature until the third quarter of next year. So, as we disclosed, we look at all of our maturing office loans very carefully, and when we know enough to, with an emphasis on caution, we'll take steps to make it special mention. The deals that we talked about here, both were put on special mention, one in the fourth quarter of 2024, the other in the third quarter of last year. And you'll also see that we've had some positive migration out of special mention and classified. The large lab loan, for example, is special mention now, and as pre-rent burns off, we believe if contractual rates pay, I agree that that will be coming out of special mention before too long. So we think our migration track record is pretty solid, and we feel the same about the deals that are in there now. Again, there's five that make up that disclosure.

Yeah, great. Okay, so just for my clarification purposes, you had to move into nonaccrual. Was it the $22 million that matured that triggered that, or was it the – okay, so that one matured.

No, the $22 was not the one that matured. The one that matured was the $6.5 million in last days.

The $6.6 million, okay. So that matures. Okay, got it. Okay, so the other one, so the $22 million, that matures in the third quarter of 2017, you said?

Yes.

Okay, and then what is the occupancy running on that one, that glass there?

It's solid. I mean, it's north of 50%, and there's actually been a fair amount of leasing momentum. The move made here was more triggered by a notification of a potential lease termination for next year, but that tenant is renegotiating. So this generates a pretty material NOI, and we feel it's a solid property with a solid sponsor and a solid market. But like most sponsors, they're looking ahead and thinking about what their capital requirements are going to be, and so we're having discussions at this point on that topic.

Okay, okay. And then just the Class B that you mentioned, just that $3.8 million that's on special mention, that was due to special mention. What is the occupancy on that, and how are you thinking about a resolution there?

It's in the high 60s. It's got some solid tenants. It's a well-known sponsor to us. all by the way all of these are in our core markets in the tri-state area and so our expectation is that we'll work something out with the sponsor and you know keep it on special mention as long as we need to to make sure it's it you know it's it's payment season and then potentially do an upgrade so again special mention here is it's sort of more just a prudential judgment to put a marker on something and watch it through its refinance process okay and then It's a fully performing loan at this point, and we expect it to continue that way. But we are being cautious as we, you know, face the maturity issue in the third quarter.

And then the last phase. So I had thought there were the $33, $34 million. I thought that was all related, and then it looks like just one piece moved over. Are those two completely separate loans?

Two completely separate loans. Gotcha.

So the 6.6, that was triggered by the maturity. And debt service coverage here is zero. So occupancy here is zero? Am I thinking about that the right way? Or what is occupancy?

Yeah, occupancy, that building is still in its initial lease-up phase, so it's zero. The other billing is effectively fully leased, and it's just a matter of, as you know, that's a very competitive market. As free rent burns off and it's payment season, we expect that to come back to, you know, fully performing and pass rated. We're just watching as tenants come out of free rent and make their payments. So there's very strong positive momentum on that one. On the other one, again, we're in a situation where it matured, and we're talking to the sponsors about what's going to happen next.

Gotcha. And for the one that's fully leased, the $27.5 million, in other words, positive momentum happens this year, happens next year. And I guess when specifically does that – oh, go ahead.

I'm sorry. You cut out a little bit. But if you're asking when that comes back out, again, we think it's, you know, probably within the next few quarters, we want to make sure the tenants are making their payments as agreed and that we're going to let it season a little bit and judge that. But we are feeling very solid about the leasing status and the performance status to date.

Okay. And then one last question on this lab loan. When does this $27.5 million mature?

That is 2029. Okay.

2029.

Great. And then, yeah, I think that answers all my questions on that. I really appreciate the details that you guys put on page 11. And actually, oh, I'm so sorry. One more question. So you had $2.2 million of Class T that was in special mention last quarter, and now it's gone, which is great. How was that resolved? Was that sold, or what happened there?

No, it ended up being fully leased, and, you know, it was performing all along. They were paying as agreed, but now that it's fully leased and we've gone through that process, we've moved it back into pass rated.

Perfect. Perfect. Great. Okay, so just two more questions. Now for you, Bill, I guess this goes back to you, Ron. Do you have the spot margin for Marsh?

Yeah, $259.

$259, great. And then, Ned, for you, this is my last question. Thanks again for taking all my questions. Buybacks, your capital levels are very, very strong, and your credit, obviously, ex-office is very, very strong. You know, you're one of the key banks in New England not repurchasing shares. Can you just help us think a little bit about your approach to buybacks and how you're thinking about it here?

Yeah, Laurie, I'll take it. I mean, we consider that all the time, and I think we've talked about it on previous calls, and I can make some arguments in favor of and also against doing the buybacks. Our dividend is still relatively high. The payout ratio is still relatively high. And so at this point, you know, we maintain a buyback program, but we really are not at this point intending to be buying back shares, yeah, at this point in time.

Great. Thanks for asking for my question.

Sure. Thanks, Laurie.

We have no further questions, so I'll hand back to Ned Handy for any final comments.

Well, thank you all for joining. As we move through 2026, we remain focused on what has defined us for 226 years, pairing personalized service and local decision-making with a comprehensive suite of financial products and services. We very much look forward to the quarters ahead and sharing the news about those quarters with you as we progress.

So thank you for your time today.

We certainly appreciate your interest and support, and we look forward to speaking with you again soon. Have a great day everybody.

Ladies and gentlemen, today's call is now concluded. We'd like to thank you for your participation. You may now disconnect your lines.