8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 27, 2020

WASHINGTON TRUST BANCORP, INC.

(Exact Name of Registrant as Specified in Charter)

Rhode Island	001-32991	05-0404671
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
23 Broad Street
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Westerly,	Rhode Island	02891
(Address of principal executive offices)		(Zip Code)
(401)	348-1200
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(Registrant's telephone number, including area code)
N/A
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(Former name or address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | | --- | --- || ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | | --- | --- || ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | | --- | --- || ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | | --- | --- |

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

| Emerging growth company | ☐ | | --- | --- || If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition | | | --- | --- | | period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the | | | Exchange Act. | ☐ |

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Item 2.02 Results of Operations and Financial Condition.

On January 27, 2020, Washington Trust Bancorp, Inc. issued a press release in which it disclosed unaudited financial information related to fourth quarter 2019 consolidated earnings. A copy of the press release relating to such announcement, dated January 27, 2020, is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Pursuant to General Instructions B.2 of Form 8-K, this information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d)	Exhibits.
	Exhibit No.	Exhibit
	99.1	Press release dated January 27, 2020*
	*Filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		WASHINGTON TRUST BANCORP, INC.
Date:	January 27, 2020	By:	/s/ Ronald S. Ohsberg
			Ronald S. Ohsberg
			Senior Executive Vice President, Chief Financial Officer and Treasurer

		Exhibit

Exhibit 99.1

NASDAQ: WASH

Contact: Elizabeth B. Eckel

Senior Vice President, Marketing

Telephone: (401) 348-1309

E-mail: ebeckel@washtrust.com

Date: January 27, 2020

FOR IMMEDIATE RELEASE

Washington Trust Reports Fourth Quarter and Full-Year 2019 Earnings

WESTERLY, R.I., January 27, 2020 (PR NEWSWIRE)…Washington Trust Bancorp, Inc. (Nasdaq:WASH), parent company of The Washington Trust Company, today announced fourth quarter 2019 net income of $15.5 million, or $0.89 per diluted share, compared to net income of $18.8 million, or $1.08 per diluted share, reported for the third quarter of 2019. Net income for the year ended December 31, 2019 totaled $69.1 million, or $3.96 per diluted share, compared to $68.4 million, or $3.93 per diluted share, reported for the prior year.

“Washington Trust reported record full-year 2019 earnings,” stated Edward O. Handy III, Washington Trust Chairman and Chief Executive Officer.  “Our results reflect the strength and stability of our core business model, which enabled us to generate growth and revenues from key business lines.  As we enter our 220th year of service, Washington Trust remains committed to providing enhanced value to those who have contributed to our success over time:  our employees, our customers, our communities and our shareholders.”

Selected highlights for the fourth quarter and full-year 2019 include:

•	Returns on average equity and average assets for the fourth quarter 2019 were 12.24% and 1.18%, respectively. Full-year returns on average equity and average assets were 14.34% and 1.34%, respectively.
•	Total loans amounted to $3.9 billion at December 31, 2019, up by $115 million, or 3%, from the end of the preceding quarter. Total loans were up by $213 million, or 6%, from December 31, 2018.
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•	In-market deposits (total deposits less out-of-market wholesale brokered time deposits) amounted to $3.2 billion at December 31, 2019, up by $59 million, or 2%, from the end of the preceding quarter. Total in-market deposits were up by $167 million, or 5%, from December 31, 2018.
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•	In December, Washington Trust declared a quarterly dividend of 51 cents per share. Full-year 2019 dividends declared amounted to $2.00 per share, an increase of 24 cents per share, or 14%, over last year.
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Net Interest Income

Net interest income was $32.0 million for the fourth quarter of 2019, down by $984 thousand, or 3%, from the third quarter of 2019. The net interest margin was 2.61% for the fourth quarter, down by 11 basis points from 2.72% for the preceding quarter. The declines in net interest income and the net interest margin reflect the impact of the Federal Reserve rate cuts in the second half of 2019.

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Washington Trust

January 27, 2020

Significant linked quarter changes included:

•	Average interest-earning assets increased by $42 million, primarily due to a $72 million increase in the average balance of loans, partially offset by a $46 million decline in the average balance of the securities portfolio. The yield on interest-earning assets for the fourth quarter was 3.86%, down by 21 basis points from the preceding quarter, reflecting the impact of lower market interest rates.
•	Average interest-bearing liabilities increased by $33 million, with an increase of $90 million in average in-market deposits, partially offset by a decrease of $57 million in average wholesale funding balances (wholesale brokered time deposits and Federal Home Loan Bank advances). The cost of interest-bearing liabilities for the fourth quarter was 1.53%, down by 13 basis points from the preceding quarter, reflecting lower market interest rates.
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Noninterest Income

Noninterest income totaled $16.6 million for the fourth quarter of 2019, down by $1.7 million, or 9%, from the third quarter of 2019. Significant linked quarter changes included:

•	Wealth management revenues amounted to $8.9 million for the fourth quarter of 2019, down by $259 thousand, or 3%, on a linked quarter basis, due to a decline in asset-based revenues.

Wealth management assets under administration benefited from financial market appreciation in the fourth quarter of 2019 and totaled $6.2 billion at December 31, 2019, up by $109 million, or 2%, from September 30, 2019. The average balance of assets under administration for the fourth quarter decreased by approximately $209 million, or 3%, from the average balance for the preceding quarter.

Assets under administration have been negatively impacted by approximately $650 million in lost client accounts associated with the departure of two senior counselors at the end of the second quarter of 2019. The impact of these lost accounts was a reduction of revenues of approximately $290 thousand during the third quarter and $775 thousand in the fourth quarter.

•	Mortgage banking revenues totaled $3.7 million for the fourth quarter of 2019, down by $1.2 million, or 24%, from the third quarter of 2019. This reflected a linked quarter decline in the mortgage pipeline and corresponding fair value of mortgage loan commitments and loans held for sale as of December 31, 2019. Mortgage loans sold to the secondary market totaled $176 million in the fourth quarter, compared to $185 million in the preceding quarter.
•	Loan related derivative income was $1.1 million for the fourth quarter of 2019, down by $291 thousand, or 21%, reflecting lower volume of commercial borrower interest rate swap transactions.
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Noninterest Expenses

Noninterest expenses totaled $28.8 million for the fourth quarter of 2019, up by $1.9 million, or 7%, from the third quarter of 2019. The linked quarter comparison of noninterest expenses was impacted by the following:

•	In the fourth quarter of 2019, a write-down valuation adjustment of $1.0 million on other real estate owned ("OREO") was recognized and included in other noninterest expenses. There were no such adjustments in the third quarter of 2019.
•	FDIC assessment credits of $235 thousand were recognized in the fourth quarter of 2019, compared to credits of $895 thousand in the third quarter of 2019. No additional FDIC assessment credits remain available, as the credits were
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Washington Trust

January 27, 2020

fully utilized in the fourth quarter of 2019.

Excluding the impact of the aforementioned items, noninterest expenses for the fourth quarter of 2019 increased by $192 thousand, or 1%, on a linked quarter basis, reflecting modest increases across various noninterest expense categories.

Income tax expense totaled $4.3 million for the fourth quarter of 2019, down by $915 thousand from the preceding quarter. The effective tax rate for the fourth quarter of 2019 was 21.8%, unchanged from the preceding quarter.

Investment Securities

The securities portfolio totaled $899 million at December 31, 2019, up by $12 million, or 1%, from September 30, 2019, reflecting purchases of U.S. government agency and U.S. government-sponsored debt securities, including mortgage-backed securities, that were largely offset by routine pay-downs on mortgage-backed securities and calls of debt securities. Fourth quarter 2019 purchases were concentrated in December and totaled $123 million, with a weighted average yield of 2.79%.

Securities represented 17% of total assets at both December 31, 2019 and September 30, 2019.

Loans

Total loans amounted to $3.9 billion at December 31, 2019, up by $115 million, or 3%, from the end of the preceding quarter. Linked quarter changes included:

•	Residential real estate loans increased by $71 million, or 5%, from September 30, 2019 and included purchases of $53 million of residential mortgage loans with a weighted average rate of 3.36%. The purchased loans were individually evaluated to our underwriting standards and are predominantly secured by properties in Massachusetts.
•	Commercial loans grew by $49 million, or 2%, with net increases of $30 million in the commercial real estate portfolio and $19 million in the commercial and industrial portfolio. In the fourth quarter, commercial loan originations and construction advances totaled approximately $111 million and were partially offset by payoffs and paydowns.
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•	The consumer loan portfolio decreased by $5 million from the balance at September 30, 2019.
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From the end of 2018, total loans increased by $213 million, or 6%, with growth of $120 million, or 6%, in commercial loans, $89 million, or 7%, in residential real estate loans and $4 million, or 1%, in consumer loans.

Deposits and Borrowings

Total deposits amounted to $3.5 billion at December 31, 2019, down by $87 million, or 2%, from the end of the preceding quarter and $25 million, or 1%, from the end of 2018. Included in total deposits are out-of-market wholesale brokered time deposits, which decreased by $146 million from September 30, 2019 and by $192 million from the end of 2018.

Excluding wholesale brokered time deposits, in-market deposits at December 31, 2019 were up by $59 million, or 2%, from the end of the preceding quarter and by $167 million, or 5%, from the end of 2018, reflecting growth in money market and NOW account balances.

Federal Home Loan Bank advances amounted to $1.1 billion at December 31, 2019, up by $185 million from September 30, 2019 and $191 million from the end of 2018.

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Washington Trust

January 27, 2020

Asset Quality

Nonperforming assets amounted to $18.5 million at December 31, 2019, down by $527 thousand from the end of the preceding quarter. This decline included a $3.0 million decrease in OREO and a $2.5 million increase in nonaccrual loans. The decrease in OREO reflected the sale of a foreclosed commercial property, with a carrying value of $2.0 million at September 30, 2019, at no gain or loss and a $1.0 valuation write-down adjustment on the remaining foreclosed commercial property in OREO at the end of 2019.

Total nonaccrual loans amounted to $17.4 million, or 0.45% of total loans, at December 31, 2019, compared to $14.9 million, or 0.39% of total loans, at September 30, 2019, reflecting a net increase in nonaccrual residential real estate loans. Total past due loans amounted to $15.7 million, or 0.40% of total loans, at December 31, 2019, compared to $14.4 million, or 0.38% of total loans, at September 30, 2019.

Based on management's assessment of loss exposure, as well as loan loss allocations commensurate with growth and changes in the loan portfolio and credit quality, management concluded that no loan loss provision was necessary in the fourth quarter of 2019. A loan loss provision of $400 thousand was recognized in the preceding quarter. In the fourth quarter of 2019, net recoveries of $17 thousand were recognized, compared to net charge-offs of $801 thousand in the preceding quarter.

The allowance for loan losses amounted to $27.0 million, or 0.69% of total loans, at December 31, 2019, compared to $27.0 million, or 0.71% of total loans, at September 30, 2019.

Capital and Dividends

Total shareholders' equity was $503.5 million at December 31, 2019, up by $5.7 million from September 30, 2019. This increase included net income of $15.5 million, which was partially offset by $8.9 million in dividend declarations and a charge of $2.8 million to the accumulated other comprehensive income component of shareholders' equity associated with the annual remeasurement of pension plan liabilities. This charge was largely due to a decline in the discount rate used to measure the present value of pension plan liabilities as a result of a reduction in market interest rates in 2019.

Capital levels at December 31, 2019 exceeded the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 12.94% at December 31, 2019, unchanged from September 30, 2019. Book value per share amounted to $29.00 at December 31, 2019, compared to $28.71 at September 30, 2019.

The Board of Directors declared a quarterly dividend of 51 cents per share for the quarter ended December 31, 2019. The dividend was paid on January 10, 2020 to shareholders of record on January 2, 2020.

Conference Call

Washington Trust will host a conference call to discuss its fourth quarter results, business highlights and outlook on Tuesday, January 28, 2020 at 8:30 a.m. (Eastern Time). Individuals may dial in to the call at 1-888-317-6016. An audio replay of the call will be available, shortly after the conclusion of the call, by dialing 1-877-344-7529 and entering the Replay PIN Number 10138161;

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Washington Trust

January 27, 2020

the audio replay will be available through February 11, 2020. Also, a webcast of the call will be posted in the Investor Relations section of Washington Trust's web site, http://ir.washtrust.com, and will be available through March 31, 2020.

Background

Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company. Founded in 1800, Washington Trust is the oldest community bank in the nation, the largest state-chartered bank headquartered in Rhode Island and one of the Northeast's premier financial services companies. Washington Trust offers a full range of financial services, including commercial banking, mortgage banking, personal banking and wealth management and trust services through its offices located in Rhode Island, Connecticut and Massachusetts. The Corporation’s common stock trades on NASDAQ under the symbol WASH. Investor information is available on the Corporation’s web site at http://ir.washtrust.com.

Forward-Looking Statements

This press release contains statements that are “forward-looking statements”. We may also make forward-looking statements in other documents we file with the SEC, in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters. You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control. These risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements.

Some of the factors that might cause these differences include the following: weakness in national, regional or international economic conditions or conditions affecting the banking or financial services industries or financial capital markets; volatility in national and international financial markets; reductions in net interest income resulting from interest rate volatility as well as changes in the balance and mix of loans and deposits; reductions in the market value or outflows of wealth management assets under administration; changes in the value of securities and other assets; reductions in loan demand; changes in loan collectibility, default and charge-off rates; changes in the size and nature of our competition; changes in legislation or regulation and accounting principles, policies and guidelines; operational risks including, but not limited to, cybersecurity breaches, fraud and natural disasters; and changes in the assumptions used in making such forward-looking statements. In addition, the factors described under “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, as updated by our Quarterly Reports on Form 10-Q and other filings submitted to the SEC, may result in these differences. You should carefully review all of these factors and you should be aware that there may be other factors that could cause these differences. These forward-looking statements were based on information, plans and estimates at the date of this report, and we assume no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Supplemental Information - Explanation of Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures. Washington Trust's management believes that the supplemental non-GAAP information, which consists of measurements and ratios based on tangible equity and tangible assets, is utilized by regulators and market analysts to evaluate a company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

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Washington Trust Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; Dollars in thousands)
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018
Assets:
Cash and due from banks		132,193		141,768		115,904		88,242		89,923
Short-term investments	6,262		4,336		3,910		3,317		3,552
Mortgage loans held for sale, at fair value	27,833		44,657		39,996		14,608		20,996
Securities:
Available for sale debt securities, at fair value	899,490		887,020		969,168		994,881		927,810
Held to maturity debt securities, at amortized cost	—		—		—		—		10,415
Total securities	899,490		887,020		969,168		994,881		938,225
Federal Home Loan Bank stock, at cost	50,853		45,030		49,759		48,025		46,068
Loans:
Total loans	3,892,999		3,778,106		3,730,339		3,738,469		3,680,360
Less allowance for loan losses	27,014		26,997		27,398		27,644		27,072
Net loans	3,865,985		3,751,109		3,702,941		3,710,825		3,653,288
Premises and equipment, net	28,700		29,293		29,302		29,822		29,005
Operating lease right-of-use assets	26,792		27,500		28,174		28,249		—
Investment in bank-owned life insurance	82,490		81,920		81,351		80,786		80,463
Goodwill	63,909		63,909		63,909		63,909		63,909
Identifiable intangible assets, net	7,218		7,448		7,684		7,923		8,162
Other assets	100,934		114,888		97,574		84,142		77,175
Total assets		5,292,659		5,198,878		5,189,672		5,154,729		5,010,766
Liabilities:
Deposits:
Noninterest-bearing deposits		609,924		619,839		587,326		577,319		603,216
Interest-bearing deposits	2,888,958		2,966,314		2,917,296		2,926,941		2,920,832
Total deposits	3,498,882		3,586,153		3,504,622		3,504,260		3,524,048
Federal Home Loan Bank advances	1,141,464		956,786		1,060,960		1,056,129		950,722
Junior subordinated debentures	22,681		22,681		22,681		22,681		22,681
Operating lease liabilities	28,861		29,541		30,210		30,187		—
Other liabilities	97,279		105,892		86,994		71,629		65,131
Total liabilities	4,789,167		4,701,053		4,705,467		4,684,886		4,562,582
Shareholders’ Equity:
Common stock	1,085		1,084		1,083		1,082		1,081
Paid-in capital	123,281		121,900		121,115		120,743		119,888
Retained earnings	390,363		383,765		373,873		365,521		355,524
Accumulated other comprehensive loss	(11,237		(8,924		(11,866		(17,503		(28,309
Total shareholders’ equity	503,492		497,825		484,205		469,843		448,184
Total liabilities and shareholders’ equity		5,292,659		5,198,878		5,189,672		5,154,729		5,010,766

All values are in US Dollars.

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Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited; Dollars and shares in thousands, except per share amounts)
	For the Three Months Ended								For the Twelve Months Ended
	Dec 31, <br>2019			Jun 30, <br>2019		Mar 31, <br>2019			Dec 31, <br>2019		Dec 31, <br>2018
Interest income:
Interest and fees on loans		40,079	41,558		42,138		41,744	40,299		165,519		149,932
Interest on mortgage loans held for sale	359			288		180			1,237		1,212
Taxable interest on debt securities	5,817			7,006		7,226			26,367		21,816
Nontaxable interest on debt securities	—			8		9			18		61
Dividends on Federal Home Loan Bank stock	693			720		695			2,855		2,369
Other interest income	435			399		340			1,667		1,017
Total interest and dividend income	47,383			50,559		50,194			197,663		176,407
Interest expense:
Deposits	9,144			9,469		8,696			37,101		24,175
Federal Home Loan Bank advances	6,015			6,980		6,661			26,168		19,073
Junior subordinated debentures	230			252		253			980		869
Total interest expense	15,389			16,701		15,610			64,249		44,117
Net interest income	31,994			33,858		34,584			133,414		132,290
Provision for loan losses	—			525		650			1,575		1,550
Net interest income after provision for loan losses	31,994			33,333		33,934			131,839		130,740
Noninterest income:
Wealth management revenues	8,894			9,549		9,252			36,848		38,341
Mortgage banking revenues	3,669			3,640		2,646			14,795		10,381
Card interchange fees	1,100			1,018		997			4,214		3,768
Service charges on deposit accounts	941			929		875			3,684		3,628
Loan related derivative income	1,116			746		724			3,993		2,461
Income from bank-owned life insurance	570			566		649			2,354		2,196
Net realized losses on securities	27			(80		—			(53		—
Other income	301			385		224			1,245		1,339
Total noninterest income	16,618			16,753		15,367			67,080		62,114
Noninterest expense:
Salaries and employee benefits	18,374			18,436		17,619			72,761		69,277
Outsourced services	2,752			2,518		2,606			10,598		8,684
Net occupancy	1,986			1,904		1,998			7,821		7,891
Equipment	996			1,028		1,011			4,081		4,312
Legal, audit and professional fees	692			664		534			2,535		2,427
FDIC deposit insurance costs	109			540		429			618		1,612
Advertising and promotion	402			525		239			1,534		1,406
Amortization of intangibles	229			239		239			943		979
Change in fair value of contingent consideration	—			—		—			—		(187
Other expenses	3,215			2,297		2,289			9,849		9,761
Total noninterest expense	28,755			28,151		26,964			110,740		106,162
Income before income taxes	19,857			21,935		22,337			88,179		86,692
Income tax expense	4,321			4,662		4,842			19,061		18,260
Net income		15,536	18,814		17,273		17,495	17,036		69,118		68,432
Net income available to common shareholders		15,502	18,778		17,238		17,461	17,004		68,979		68,288
Weighted average common shares outstanding:
Basic	17,351			17,330		17,304			17,331		17,272
Diluted	17,436			17,405		17,401			17,414		17,391
Earnings per common share:
Basic		0.89	1.08		0.99		1.01	0.98		3.98		3.95
Diluted		0.89	1.08		0.99		1.00	0.98		3.96		3.93
Cash dividends declared per share		0.51	0.51		0.51		0.47	0.47		2.00		1.76

All values are in US Dollars.

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Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited; Dollars and shares in thousands, except per share amounts)
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018
Share and Equity Related Data:
Book value per share		29.00		28.71		27.93		27.15		25.90
Tangible book value per share - Non-GAAP (1)		24.90		24.60		23.80		23.00		21.74
Market value per share		53.79		48.31		52.18		48.15		47.53
Shares issued and outstanding at end of period	17,363		17,338		17,336		17,305		17,302
Capital Ratios (2):
Tier 1 risk-based capital	12.23		12.21		12.06		11.84		11.81
Total risk-based capital	12.94		12.94		12.80		12.59		12.56
Tier 1 leverage ratio	9.04		8.97		8.76		8.69		8.89
Common equity tier 1	11.65		11.62		11.46		11.25		11.20
Balance Sheet Ratios:
Equity to assets	9.51		9.58		9.33		9.11		8.94
Tangible equity to tangible assets - Non-GAAP (1)	8.28		8.32		8.06		7.83		7.62
Loans to deposits (3)	111.3		105.8		106.8		106.3		104.3

All values are in US Dollars.

											For the Twelve Months Ended
	For the Three Months Ended
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018		Dec 31, <br>2019		Dec 31, <br>2018
Performance Ratios (4):
Net interest margin (5)	2.61	%	2.72	%	2.81	%	2.93	%	2.95	%	2.77	%	3.01	%
Return on average assets (net income divided by average assets)	1.18	%	1.44	%	1.34	%	1.39	%	1.40	%	1.34	%	1.46	%
Return on average tangible assets - Non-GAAP (1)	1.20	%	1.46	%	1.36	%	1.41	%	1.42	%	1.36	%	1.48	%
Return on average equity (net income available for common shareholders divided by average equity)	12.24	%	15.20	%	14.58	%	15.52	%	15.61	%	14.34	%	16.20	%
Return on average tangible equity - Non-GAAP (1)	14.26	%	17.79	%	17.17	%	18.43	%	18.75	%	16.85	%	19.57	%
Efficiency ratio (6)	59.2	%	52.4	%	55.6	%	54.0	%	54.4	%	55.2	%	54.6	%
(1)	See the section labeled “SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures” at the end of this document.
---	---
(2)	Estimated for December 31, 2019 and actuals for prior periods.
---	---
(3)	Period-end balances of net loans and mortgage loans held for sale as a percentage of total deposits.
---	---
(4)	Annualized based on the actual number of days in the period.
---	---
(5)	Fully taxable equivalent (FTE) net interest income as a percentage of average-earnings assets.
---	---
(6)	Total noninterest expense as percentage of total revenues (net interest income and noninterest income).
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-8-

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Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS
(Unaudited; Dollars in thousands)
	For the Three Months Ended										For the Twelve Months Ended
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018		Dec 31, <br>2019		Dec 31, <br>2018
Wealth Management Results
Wealth Management Revenues:
Asset-based revenues		8,731		9,013		9,141		8,921		8,930		35,806		37,343
Transaction-based revenues	163		140		408		331		82		1,042		998
Total wealth management revenues		8,894		9,153		9,549		9,252		9,012		36,848		38,341
Assets Under Administration (AUA):
Balance at beginning of period		6,126,327		6,478,890		6,350,128		5,910,814		6,462,340		5,910,814		6,714,637
Net investment appreciation (depreciation) & income	310,766		66,514		222,489		520,057		(534,847		1,119,826		(201,176
Net client asset flows	(243,175		(419,077		(93,727		(80,743		(16,679		(836,722		(602,647
Other (1)	41,883		—		—		—		—		41,883		—
Balance at end of period		6,235,801		6,126,327		6,478,890		6,350,128		5,910,814		6,235,801		5,910,814
Percentage of AUA that are managed assets	90%		90%		91%		91%		90%		90%		90%
Mortgage Banking Results
Mortgage Banking Revenues:
Gains & commissions on loan sales, net (2)		3,583		4,752		3,523		2,474		1,798		14,332		9,748
Loan servicing fee income, net (3)	86		88		117		172		180		463		633
Total mortgage banking revenues		3,669		4,840		3,640		2,646		1,978		14,795		10,381
Residential Mortgage Loan Originations:
Originations for retention in portfolio		120,882		105,075		69,736		51,697		58,515		347,390		335,585
Originations for sale to secondary market (4)	160,175		189,979		162,123		85,826		96,792		598,103		427,037
Total mortgage loan originations		281,057		295,054		231,859		137,523		155,307		945,493		762,622
Residential Mortgage Loans Sold:
Sold with servicing rights retained		42,612		25,766		18,292		9,490		16,577		96,160		98,941
Sold with servicing rights released (4)	134,091		159,210		119,122		82,589		81,985		495,012		333,998
Total mortgage loans sold		176,703		184,976		137,414		92,079		98,562		591,172		432,939

All values are in US Dollars.

(1)	Represents the classification of certain non-fee generating assets as AUA due to a reporting change in the fourth quarter of 2019.
(2)	Includes gains on loan sales, commission income on loans originated for others, servicing right gains, fair value adjustments on mortgage loans held for sale, and fair value adjustments and gains on forward loan commitments.
---	---
(3)	Represents loan servicing fee income, net of servicing right amortization and valuation adjustments.
---	---
(4)	Includes brokered loans (loans originated for others).
---	---

-9-

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Washington Trust Bancorp, Inc. and Subsidiaries
END OF PERIOD LOAN AND DEPOSIT COMPOSITION
(Unaudited; Dollars in thousands)
	Dec 31, <br>2019
Loans:
Commercial real estate (1)		1,547,572	1,517,320	1,482,836	1,463,682	$1,392,408
Commercial & industrial	585,289
Total commercial	2,132,861
Residential real estate (2)	1,449,090
Home equity	290,874
Other	20,174
Total consumer	311,048
Total loans		3,892,999	3,778,106	3,730,339	3,738,469	$3,680,360

All values are in US Dollars.

(1)	Commercial real estate loans consist of commercial mortgages and construction and development loans. Commercial mortgages are loans secured by income producing property.
(2)	Residential real estate loans consist of mortgage and homeowner construction loans secured by one- to four-family residential properties.
---	---
	December 31, 2019				December 31, 2018
---	---	---	---	---	---	---	---	---
	Balance		% of Total		Balance		% of Total
Commercial Real Estate Loans by Property Location:
Rhode Island		$394,929	25	%		$377,249	27	%
Connecticut	616,484		40		570,116		41
Massachusetts	458,029		30		356,615		26
Subtotal	1,469,442		95		1,303,980		94
All other states	78,130		5		88,428		6
Total commercial real estate loans		$1,547,572	100	%		$1,392,408	100	%
Residential Real Estate Loans by Property Location:
Rhode Island		$356,392	25	%		$352,141	26	%
Connecticut	140,574		10		141,775		10
Massachusetts	932,726		64		849,435		63
Subtotal	1,429,692		99		1,343,351		99
All other states	19,398		1		17,036		1
Total residential real estate loans		$1,449,090	100	%		$1,360,387	100	%
	Dec 31, <br>2019
---	---	---	---	---	---	---
Deposits:
Noninterest-bearing demand deposits		609,924	619,839	587,326	577,319	$603,216
Interest-bearing demand deposits	159,938
NOW accounts	520,295
Money market accounts	765,899
Savings accounts	373,503
Time deposits (in-market)	784,481
In-market deposits	3,214,040
Wholesale brokered time deposits	284,842
Total deposits		3,498,882	3,586,153	3,504,622	3,504,260	$3,524,048

All values are in US Dollars.

-10-

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Washington Trust Bancorp, Inc. and Subsidiaries
CREDIT & ASSET QUALITY DATA
(Unaudited; Dollars in thousands)
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018
Asset Quality Ratios:
Nonperforming assets to total assets	0.35		0.37		0.29		0.28		0.28
Nonaccrual loans to total loans	0.45		0.39		0.34		0.33		0.32
Total past due loans to total loans	0.40		0.38		0.48		0.39		0.37
Allowance for loan losses to nonaccrual loans	155.18		181.16		212.93		223.57		231.25
Allowance for loan losses to total loans	0.69		0.71		0.73		0.74		0.74
Nonperforming Assets:
Commercial real estate		603		684		926		926		925
Commercial & industrial	657		—		—		—		—
Total commercial	1,260		684		926		926		925
Residential real estate	14,297		12,531		10,610		10,032		9,346
Home equity	1,763		1,599		1,243		1,407		1,436
Other consumer	88		88		88		—		—
Total consumer	1,851		1,687		1,331		1,407		1,436
Total nonaccrual loans	17,408		14,902		12,867		12,365		11,707
Other real estate owned	1,109		4,142		2,142		2,142		2,142
Total nonperforming assets		18,517		19,044		15,009		14,507		13,849
Past Due Loans (30 days or more past due):
Commercial real estate		1,433		684		3,670		926		1,080
Commercial & industrial	1		1		1		1		—
Total commercial	1,434		685		3,671		927		1,080
Residential real estate	11,429		11,599		11,237		10,849		10,520
Home equity	2,696		1,973		2,904		2,911		1,989
Other consumer	130		99		102		13		33
Total consumer	2,826		2,072		3,006		2,924		2,022
Total past due loans		15,689		14,356		17,914		14,700		13,622
Accruing loans 90 days or more past due		—		—		—		—		—
Nonaccrual loans included in past due loans		11,477		9,797		8,581		8,563		8,613

All values are in US Dollars.

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Washington Trust Bancorp, Inc. and Subsidiaries
CREDIT & ASSET QUALITY DATA
(Unaudited; Dollars in thousands)
	For the Three Months Ended										For the Twelve Months Ended
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018		Dec 31, <br>2019		Dec 31, <br>2018
Nonaccrual Loan Activity:
Balance at beginning of period		14,902		12,867		12,365		11,707		10,809		11,707		15,211
Additions to nonaccrual status	2,766		5,672		1,620		1,924		2,918		11,982		8,764
Loans returned to accruing status	—		(597		(118		(855		(1,500		(1,570		(2,680
Loans charged-off	(132		(966		(819		(103		(298		(2,020		(1,187
Loans transferred to other real estate owned	—		(2,000		—		—		—		(2,000		(3,074
Payments, payoffs and other changes	(128		(74		(181		(308		(222		(691		(5,327
Balance at end of period		17,408		14,902		12,867		12,365		11,707		17,408		11,707
Allowance for Loan Losses:
Balance at beginning of period		26,997		27,398		27,644		27,072		26,509		27,072		26,488
Provision charged to earnings	—		400		525		650		800		1,575		1,550
Charge-offs	(132		(966		(819		(103		(298		(2,020		(1,187
Recoveries	149		165		48		25		61		387		221
Balance at end of period		27,014		26,997		27,398		27,644		27,072		27,014		27,072
Net Loan Charge-Offs (Recoveries):
Commercial real estate		(44		947		—		—		—		903		602
Commercial & industrial	(15		(122		(16		6		(13		(147		(109
Total commercial	(59		825		(16		6		(13		756		493
Residential real estate	—		—		486		—		156		486		229
Home equity	17		(36		289		48		65		318		164
Other consumer	25		12		12		24		29		73		80
Total consumer	42		(24		301		72		94		391		244
Total		(17		801		771		78		237		1,633		966
Net charge-offs to average loans (annualized)	—		0.08		0.08		0.01		0.03		0.04		0.03

All values are in US Dollars.

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The following table presents average balance and interest rate information. Tax-exempt income is converted to a fully taxable equivalent basis using the statutory federal income tax rate adjusted for applicable state income taxes net of the related federal tax benefit. Unrealized gains (losses) on available for sale securities and fair value adjustments on mortgage loans held for sale are excluded from the average balance and yield calculations. Nonaccrual loans, as well as interest recognized on these loans, are included in amounts presented for loans.

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis)
(Unaudited; Dollars in thousands)
For the Three Months Ended	December 31, 2019				September 30, 2019				Quarter Change
	Average Balance				Average Balance				Average Balance		Interest			Yield/<br>Rate
Assets:
Cash, federal funds sold and short-term investments		115,458	435	%		96,231	493	%		19,227		($58	)	(0.54	)%
Mortgage loans held for sale	38,494				39,771				(1,277		(51		)	(0.39	)
Taxable debt securities	874,770				920,910				(46,140		(501		)	(0.08	)
Nontaxable debt securities	—				75				(75		(3		)	(15.87	)
Total securities	874,770				920,985				(46,215		(504		)	(0.08	)
FHLB stock	46,501				47,982				(1,481		(54		)	(0.27	)
Commercial real estate	1,538,627				1,490,878				47,749		(823		)	(0.36	)
Commercial & industrial	576,590				584,601				(8,011		(374		)	(0.19	)
Total commercial	2,115,217				2,075,479				39,738		(1,197		)	(0.31	)
Residential real estate	1,399,144				1,367,017				32,127		105			(0.06	)
Home equity	293,029				291,058				1,971		(361		)	(0.52	)
Other	20,589				22,270				(1,681		(28		)	(0.13	)
Total consumer	313,618				313,328				290		(389		)	(0.50	)
Total loans	3,827,979				3,755,824				72,155		(1,481		)	(0.23	)
Total interest-earning assets	4,903,202				4,860,793				42,409		(2,148		)	(0.21	)
Noninterest-earning assets	323,833				320,223				3,610
Total assets		5,227,035				5,181,016				46,019
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits		146,408	578	%		137,980	649	%		8,428		($71	)	(0.30	)%
NOW accounts	489,374				471,302				18,072		13			0.01
Money market accounts	769,860				699,138				70,722		85			(0.07	)
Savings accounts	365,977				362,142				3,835		(4		)	(0.01	)
Time deposits (in-market)	789,864				800,571				(10,707		(24		)	0.02
Total interest-bearing in-market deposits	2,561,483				2,471,133				90,350		(1		)	(0.04	)
Wholesale brokered time deposits	392,001				475,026				(83,025		(647		)	(0.17	)
Total interest-bearing deposits	2,953,484				2,946,159				7,325		(648		)	(0.09	)
FHLB advances	1,006,246				980,091				26,155		(497		)	(0.27	)
Junior subordinated debentures	22,681				22,681				—		(15		)	(0.27	)
Total interest-bearing liabilities	3,982,411				3,948,931				33,480		(1,160		)	(0.13	)
Noninterest-bearing demand deposits	618,406				626,408				(8,002
Other liabilities	123,604				115,480				8,124
Shareholders' equity	502,614				490,197				12,417
Total liabilities and shareholders' equity		5,227,035				5,181,016				46,019
Net interest income (FTE)			32,315				33,303					($988	)
Interest rate spread				%				%						(0.08	)%
Net interest margin				%				%						(0.11	)%

All values are in US Dollars.

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:

For the Three Months Ended	Dec 31, 2019
Commercial loans		321	323	($2	)
Nontaxable debt securities	—				)
Total		321	325	($4	)

All values are in US Dollars.

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Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (FTE Basis)
(Unaudited; Dollars in thousands)
For the Twelve Months Ended	December 31, 2019				December 31, 2018				Change
	Average Balance				Average Balance				Average Balance		Interest		Yield/<br> Rate
Assets:
Cash, federal funds sold and short-term investments		85,447	1,667	%		53,264	1,017	%		32,183		650	0.04	%
Mortgage loans for sale	30,928				28,360				2,568		25		(0.27	)
Taxable debt securities	947,875				832,374				115,501		4,551		0.16
Nontaxable debt securities	450				1,540				(1,090		(55		0.05
Total securities	948,325				833,914				114,411		4,496		0.15
FHLB stock	47,761				43,530				4,231		486		0.54
Commercial real estate	1,481,116				1,247,068				234,048		12,954		0.17
Commercial & industrial	596,451				627,485				(31,034		(1,300		0.03
Total commercial	2,077,567				1,874,553				203,014		11,654		0.12
Residential real estate	1,368,824				1,296,389				72,435		3,699		0.06
Home equity	286,767				283,868				2,899		550		0.15
Other	23,153				28,661				(5,508		(265		0.02
Total consumer	309,920				312,529				(2,609		285		0.13
Total loans	3,756,311				3,483,471				272,840		15,638		0.10
Total interest-earning assets	4,868,772				4,442,539				426,233		21,295		0.09
Noninterest-earning assets	300,549				239,327				61,222
Total assets		5,169,321				4,681,866				487,455
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits		144,836	2,537	%		112,792	1,231	%		32,044		1,306	0.66	%
NOW accounts	469,540				455,823				13,717		(112		(0.02	)
Money market accounts	693,921				665,690				28,231		3,320		0.45
Savings accounts	365,927				372,269				(6,342		39		0.01
Time deposits (in-market)	794,124				684,571				109,553		5,848		0.53
Total interest-bearing in-market deposits	2,468,348				2,291,145				177,203		10,401		0.37
Wholesale brokered time deposits	461,862				432,205				29,657		2,525		0.43
Total interest-bearing deposits	2,930,210				2,723,350				206,860		12,926		0.38
FHLB advances	1,015,914				854,398				161,516		7,095		0.35
Junior subordinated debentures	22,681				22,681				—		111		0.49
Total interest-bearing liabilities	3,968,805				3,600,429				368,376		20,132		0.39
Noninterest-bearing demand deposits	615,049				596,829				18,220
Other liabilities	104,463				63,102				41,361
Shareholders' equity	481,004				421,506				59,498
Total liabilities and shareholders' equity		5,169,321				4,681,866				487,455
Net interest income (FTE)			134,718				133,555					1,163
Interest rate spread				%				%					(0.30	)%
Net interest margin				%				%					(0.24	)%

All values are in US Dollars.

Interest income amounts presented in the preceding table include the following adjustments for taxable equivalency:

For the Twelve Months Ended	Dec 31, 2019
Commercial loans		1,299	1,248	51
Nontaxable debt securities	5
Total		1,304	1,265	39

All values are in US Dollars.

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Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION - Calculation of Non-GAAP Financial Measures
(Unaudited; Dollars in thousands, except per share amounts)
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018
Tangible Book Value per Share:
Total shareholders' equity, as reported		503,492		497,825		484,205		469,843		448,184
Less:
Goodwill	63,909		63,909		63,909		63,909		63,909
Identifiable intangible assets, net	7,218		7,448		7,684		7,923		8,162
Total tangible shareholders' equity		432,365		426,468		412,612		398,011		376,113
Shares outstanding, as reported	17,363		17,338		17,336		17,305		17,302
Book value per share - GAAP		29.00		28.71		27.93		27.15		25.90
Tangible book value per share - Non-GAAP		24.90		24.60		23.80		23.00		21.74
Tangible Equity to Tangible Assets:
Total tangible shareholders' equity		432,365		426,468		412,612		398,011		376,113
Total assets, as reported		5,292,659		5,198,878		5,189,672		5,154,729		5,010,766
Less:
Goodwill	63,909		63,909		63,909		63,909		63,909
Identifiable intangible assets, net	7,218		7,448		7,684		7,923		8,162
Total tangible assets		5,221,532		5,127,521		5,118,079		5,082,897		4,938,695
Equity to assets - GAAP	9.51		9.58		9.33		9.11		8.94
Tangible equity to tangible assets - Non-GAAP	8.28		8.32		8.06		7.83		7.62

All values are in US Dollars.

	For the Three Months Ended										For the Twelve Months Ended
	Dec 31, <br>2019		Sep 30, <br>2019		Jun 30, <br>2019		Mar 31, <br>2019		Dec 31, <br>2018		Dec 31, <br>2019		Dec 31, <br>2018
Return on Average Tangible Assets:
Net income, as reported		15,536		18,814		17,273		17,495		17,036		69,118		68,432
Total average assets, as reported		5,227,035		5,181,016		5,171,562		5,096,103		4,840,158		5,169,321		4,681,866
Less average balances of:
Goodwill	63,909		63,909		63,909		63,909		63,909		63,909		63,909
Identifiable intangible assets, net	7,330		7,562		7,800		8,040		8,278		7,681		8,642
Total average tangible assets		5,155,796		5,109,545		5,099,853		5,024,154		4,767,971		5,097,731		4,609,315
Return on average assets - GAAP	1.18		1.44		1.34		1.39		1.40		1.34		1.46
Return on average tangible assets - Non-GAAP	1.20		1.46		1.36		1.41		1.42		1.36		1.48
Return on Average Tangible Equity:
Net income available to common shareholders, as reported		15,502		18,778		17,238		17,461		17,004		68,979		68,288
Total average equity, as reported		502,614		490,197		474,353		456,241		432,043		481,004		421,506
Less average balances of:
Goodwill	63,909		63,909		63,909		63,909		63,909		63,909		63,909
Identifiable intangible assets, net	7,330		7,562		7,800		8,040		8,278		7,681		8,642
Total average tangible equity		431,375		418,726		402,644		384,292		359,856		409,414		348,955
Return on average equity - GAAP	12.24		15.20		14.58		15.52		15.61		14.34		16.20
Return on average tangible equity - Non-GAAP	14.26		17.79		17.17		18.43		18.75		16.85		19.57

All values are in US Dollars.

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