WESTERLY, R.I., April 27, 2016 (GLOBE NEWSWIRE) -- Washington Trust Bancorp, Inc. (Nasdaq:WASH), parent company of The Washington Trust Company, today announced net income of $10.9 million, or $0.64 per diluted share, for the first quarter of 2016, up from net income of $10.7 million, or $0.62 per diluted share, reported for the fourth quarter of 2015. 

"Washington Trust continued to post solid earnings in the latest quarter," stated Joseph J. MarcAurele, Washington Trust Chairman and CEO.  "We recently opened a new retail branch on the East Side of Providence, Rhode Island, and have selected a site, and are awaiting regulatory approval, for a new mortgage banking office in Wellesley, Massachusetts.   Our market expansion efforts, along with the continuing strength of our commercial, retail, mortgage banking and wealth management business lines, will help us to continue to achieve favorable results in future periods."

Selected highlights for the first quarter of 2016 include:

• Returns on average equity and average assets were solid at 11.50% and 1.16%, respectively.  Comparable amounts for the fourth quarter of 2015 were 11.52% and 1.16%, respectively.
• Total loans stood at $3.0 billion at March 31, 2016, up by 1.1% in the quarter.  Total loans were up by 5.8% from a year ago.
• Total deposits amounted to $2.9 billion at March 31, 2016, down by 1.9% in the quarter and up by 3.5% from a year ago.
• In March, Washington Trust declared a quarterly dividend of 36 cents per share, representing a $0.02 per share increase over the previous quarter and the sixth consecutive year of dividend increases.

Net Interest Income
Net interest income totaled $27.7 million for the first quarter of 2016, up by $1.5 million, or 6%, from the fourth quarter of 2015.  The net interest margin was 3.24% for the first quarter of 2016, up 16 basis points from the previous quarter.  Commercial loan prepayment fee income, which is included in net interest income, amounted to $1.0 million in the first quarter of 2016, compared to $73 thousand in the prior quarter.  A significant portion of the latest quarter prepayment fee amount was attributable to one relationship.  Excluding the loan prepayment fee income in each  period, the first quarter net interest margin was 3.13%, up by 6 basis points on a linked quarter basis.  This increase also reflects a modest benefit resulting from the increase in the short-term borrowing rate announced by the Federal Reserve in December 2015.  Other significant linked quarter changes included:

• Average interest-earning assets increased by $60 million, largely due to growth in average balances of commercial loans.  Loan prepayment fee income contributed 12 basis points to the yield on interest-earning assets in the first quarter of 2016, compared to 1 basis point in the prior quarter.  Excluding the impact of prepayment fee income in each period, the yield on interest-earning assets was 3.72% for the first quarter, compared to 3.67% in the prior quarter.
• Average interest-bearing liabilities rose by $70 million, reflecting increases in average wholesale funding balances.  The cost of interest-bearing funds was 0.74%, unchanged from the previous quarter.

Noninterest Income
Noninterest income totaled $14.6 million for the first quarter of 2016, down by $512 thousand, or 3%, from the fourth quarter of 2015.  Significant linked quarter changes included:

• Wealth management revenues totaled $9.2 million for the first quarter, in-line with the previous quarter.  Wealth management assets under administration amounted to $5.9 billion at March 31, 2016, up by $34 million, or 1%, on a linked quarter basis.  Managed assets represented approximately 92% of total wealth management assets at March 31, 2016.
• Mortgage banking revenues totaled $2.2 million for the first quarter, down by $384 thousand, or 15%, on a linked quarter basis, reflecting a lower volume of loan sales sold to the secondary market.  Residential mortgage loans sold to the secondary market amounted to $106.0 million in the first quarter, compared to $127.4 million in the previous quarter.
• Loan related derivative income amounted to $645 thousand in the first quarter, down by $107 thousand, or 14%, from the prior quarter.

Noninterest Expenses
Noninterest expenses totaled $25.5 million for the first quarter of 2016, up by $889 thousand, or 4%, from the prior quarter.  Included in noninterest expenses for first quarter of 2016 was $431 thousand of debt prepayment penalty expense associated with the prepayment of $10.0 million in FHLBB advances.  Excluding the debt prepayment penalty expense, noninterest expenses were up by $458 thousand, or 2%, from the fourth quarter.  Salaries and employee benefit costs, the largest component of noninterest expenses, increased by $327 thousand from the prior quarter, reflecting an increase in payroll taxes associated with the start of the new calendar year.

Income tax expense amounted to $5.5 million for the first quarter of 2016, up by $138 thousand from the amount recognized in the previous quarter.  The effective tax rate for the first quarter of 2016 was 33.4%, compared to 33.2% for the fourth quarter of 2015.

Loans
Total loans amounted to $3.0 billion at March 31, 2016, up by $34 million, or 1.1%, from the balance at the end of the fourth quarter.  Significant linked quarter changes included:

• Total commercial loans increased by $44 million, or 2.7%, including growth of $46 million in the commercial real estate portfolio.
• The residential real estate loan portfolio declined by $9 million, or 0.9%.
• Consumer loans decreased by $1 million, or 0.3%.

Investment Securities
The securities portfolio amounted to $430 million at March 31, 2016, up by $35 million, or 8.9%, from the balance at December 31, 2015, primarily due to the purchases of $51 million of additional U.S. government agency and agency mortgage-backed debt securities, partially offset by calls, maturities and routine principal pay-downs.  Investment securities were 11% of total assets as of March 31, 2016.

Deposits and Borrowings
Total deposits amounted to $2.9 billion at March 31, 2016, down by $55 million, or 1.9%, in the first quarter.  Excluding wholesale brokered time deposits, in-market deposits decreased by $62 million, or 2.3%, in the quarter.  The largest outflow during the quarter was $60 million of money market deposits, attributable to outflows in various institutional and commercial deposits.

FHLBB advances amounted to $487 million at March 31, 2016, up by $108 million, or 28.6%, from December 31, 2015.  FHLBB advances totaling $10.0 million were prepaid in late March 2016.  The weighted average rate of these advances was 2.72% with a weighted average remaining term of 32 months.  These were replaced with $10.0 million of brokered time certificates of deposits with an 18-month maturity and a fixed interest rate of 0.95%.  Net interest savings of $132 thousand for the remainder of 2016 are expected as a result of the extinguishment of the FHLBB advances.

Asset Quality
Total past due loans amounted to $18 million, or 0.60% of total loans, at March 31, 2016, compared to $18 million, or 0.58% of total loans, at December 31, 2015.  Total nonaccrual loans declined from $21 million, or 0.70% of total loans, at December 31, 2015, to $17 million, or 0.57%, at March 31, 2016.

A loan loss provision totaling $500 thousand was charged to earnings in the first quarter of 2016, compared to a loan loss provision of $750 thousand recognized in the fourth quarter of 2015.  Net charge-offs amounted to $1.4 million in the first quarter of 2016, including a $1.2 million charge-off associated with one commercial real estate relationship.  Net charge-offs for the prior quarter amounted to $842 thousand.  The allowance for loan losses was $26.1 million, or 0.86% of total loans, at March 31, 2016, compared to $27.1 million, or 0.90% of total loans, at December 31, 2015.  The reduction in ratio of the allowance to total loans includes the impact of loan charge-offs for which loss exposure had been allocated prior to the latest quarter.  The loan loss provision was based on management’s assessment of loss exposure, as well as loan loss allocations commensurate with loan portfolio growth in the quarter.

Capital and Dividends
Total shareholder's equity was $381 million at March 31, 2016, up by $6 million from December 31, 2015.  Capital levels at March 31, 2016 exceeded the regulatory minimum levels to be considered well capitalized, with a total risk-based capital ratio of 12.45% at March 31, 2016, compared to 12.58% at December 31, 2015.  At March 31, 2016, book value per share amounted to $22.40, up from $22.06 in the prior quarter.

The Board of Directors declared a quarterly dividend of 36 cents per share for the quarter ended March 31, 2016, a $0.02 increase from the prior quarter.  The dividend was paid on April 14, 2016 to shareholders of record on April 1, 2016.

Conference Call
Washington Trust will host a conference call to discuss its first quarter results, business highlights and outlook on Wednesday, April 27, 2016 at 1:30 p.m. (Eastern Time).  Individuals may dial in to the call at 1-877-407-0784.  An audio replay of the call will be available, shortly after the conclusion of the call, by dialing 1-877-870-5176 and entering the Replay PIN Number 13634508; the audio replay will be available through May 4, 2016.  Also, a webcast of the call will be posted in the Investor Relations section of Washington Trust's web site, www.washtrustbancorp.com, and will be available through June 30, 2016.

Background 
Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company, a state-chartered bank headquartered in Westerly, Rhode Island. Founded in 1800, Washington Trust is the oldest community bank in the nation and is the largest independent bank headquartered in Rhode Island. Washington Trust offers a full range of financial services, including commercial banking, small business 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 OMX® under the symbol WASH. Investor information is available on the Corporation’s web site: www.washtrustbancorp.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 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 the control of Washington Trust.  These risks, uncertainties and other factors may cause the actual results, performance or achievements of Washington Trust 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; additional government intervention in the U.S. financial system; 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 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 the our competition; changes in legislation or regulation and accounting principles, policies and guidelines; the ability to fully realize the expected financial results from the Halsey Associates, Inc. acquisition; 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, 2015, 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.

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS (unaudited)
(Dollars and shares in thousands)	Mar 31,  2016					Dec 31,  2015					Sep 30,  2015					Jun 30,  2015					Mar 31,  2015
Assets:
Cash and due from banks	$	89,966				$	93,222				$	106,445				$	79,795				$	84,842
Short-term investments		4,931					4,409					3,629					4,298					4,191
Mortgage loans held for sale		22,895					38,554					31,805					37,389					47,117
Securities:
Available for sale, at fair value		411,352					375,044					323,795					351,378					340,942
Held to maturity, at amortized cost		19,040					20,023					21,140					22,523					24,025
Total securities		430,392					395,067					344,935					373,901					364,967
Federal Home Loan Bank stock, at cost		26,515					24,316					37,730					37,730					37,730
Loans:
Commercial		1,698,811					1,654,547					1,579,854					1,583,537					1,559,523
Residential real estate		1,004,349					1,013,555					1,024,214					1,001,263					987,564
Consumer		343,833					345,025					345,850					343,784					333,505
Total loans		3,046,993					3,013,127					2,949,918					2,928,584					2,880,592
Less allowance for loan losses		26,137					27,069					27,161					27,587					27,810
Net loans		3,020,856					2,986,058					2,922,757					2,900,997					2,852,782
Premises and equipment, net		29,882					29,593					28,180					28,124					27,839
Investment in bank-owned life insurance		66,000					65,501					65,000					64,502					64,009
Goodwill		64,059					64,059					64,196					58,114					58,114
Identifiable intangible assets, net		11,137					11,460					11,793					4,539					4,694
Other assets		71,577					59,365					58,366					55,088					56,229
Total assets	$	3,838,210				$	3,771,604				$	3,674,836				$	3,644,477				$	3,602,514
Liabilities:
Deposits:
Demand deposits	$	539,119				$	537,298				$	513,856				$	457,755				$	477,046
NOW accounts		394,873					412,602					358,973					357,922					333,321
Money market accounts		763,565					823,490					855,858					789,334					821,353
Savings accounts		331,800					326,967					305,775					300,108					298,802
Time deposits		850,294					833,898					801,818					834,000					852,621
Total deposits		2,879,651					2,934,255					2,836,280					2,739,119					2,783,143
Federal Home Loan Bank advances		487,189					378,973					381,649					471,321					385,992
Junior subordinated debentures		22,681					22,681					22,681					22,681					22,681
Other liabilities		67,409					60,307					63,699					52,189					56,819
Total liabilities		3,456,930					3,396,216					3,304,309					3,285,310					3,248,635
Shareholders’ Equity:
Common stock		1,064					1,064					1,062					1,052					1,048
Paid-in capital		111,641					110,949					109,724					103,408					102,587
Retained earnings		277,810					273,074					268,166					263,790					258,069
Accumulated other comprehensive loss		(9,235	)				(9,699	)				(8,425	)				(9,083	)				(7,825	)
Total shareholders’ equity		381,280					375,388					370,527					359,167					353,879
Total liabilities and shareholders’ equity	$	3,838,210				$	3,771,604				$	3,674,836				$	3,644,477				$	3,602,514

Washington Trust Bancorp, Inc. and Subsidiaries
FIVE QUARTER CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(Dollars and shares in thousands, except per share amounts)
Three Months Ended		Mar 31,  2016					Dec 31,  2015					Sep 30,  2015					Jun 30,  2015					Mar 31,  2015
Interest income:
Interest and fees on loans		$	29,998				$	28,511				$	28,626				$	28,739				$	28,353
Interest on securities:	Taxable		2,370					2,262					2,178					2,176					2,259
	Nontaxable		327					352					366					402					435
Dividends on Federal Home Loan Bank stock			210					315					309					164					165
Other interest income			64					37					47					29					25
Total interest and dividend income			32,969					31,477					31,526					31,510					31,237
Interest expense:
Deposits			2,968					3,097					3,308					3,348					3,389
Federal Home Loan Bank advances			2,152					1,966					1,987					1,891					1,902
Junior subordinated debentures			112					157					232					241					241
Other interest expense			2					2					2					2					3
Total interest expense			5,234					5,222					5,529					5,482					5,535
Net interest income			27,735					26,255					25,997					26,028					25,702
Provision for loan losses			500					750					200					100					—
Net interest income after provision for loan losses			27,235					25,505					25,797					25,928					25,702
Noninterest income:
Wealth management revenues			9,174					9,167					8,902					8,912					8,435
Mortgage banking revenues			2,198					2,582					1,990					2,741					2,588
Service charges on deposit accounts			907					971					986					973					935
Card interchange fees			797					810					849					826					714
Income from bank-owned life insurance			499					502					498					492					490
Loan related derivative income			645					752					327					717					645
Equity in earnings (losses) of unconsolidated subsidiaries			(88	)				(69	)				(69	)				(69	)				(86	)
Other income			502					431					430					669					299
Total noninterest income			14,634					15,146					13,913					15,261					14,020
Noninterest expense:
Salaries and employee benefits			16,380					16,053					15,971					15,506					15,494
Net occupancy			1,807					1,724					1,721					1,669					1,886
Equipment			1,501					1,393					1,424					1,376					1,340
Outsourced services			1,363					1,337					1,250					1,277					1,247
Legal, audit and professional fees			629					825					630					610					676
FDIC deposit insurance costs			493					470					467					436					473
Advertising and promotion			265					325					356					578					267
Amortization of intangibles			323					333					260					156					155
Debt prepayment penalties			431					—					—					—					—
Acquisition related expenses			—					52					504					433					—
Other expenses			2,258					2,049					1,955					2,258					1,993
Total noninterest expense			25,450					24,561					24,538					24,299					23,531
Income before income taxes			16,419					16,090					15,172					16,890					16,191
Income tax expense			5,484					5,346					4,964					5,387					5,181
Net income		$	10,935				$	10,744				$	10,208				$	11,503				$	11,010
Net income available to common shareholders - basic		$	10,910				$	10,718				$	10,181				$	11,469				$	10,971
Net income available to common shareholders - diluted		$	10,910				$	10,718				$	10,180				$	11,470				$	10,971
Weighted average common shares outstanding - basic			17,023					17,004					16,939					16,811					16,759
Weighted average common shares outstanding - diluted			17,157					17,167					17,102					16,989					16,939
Per share information:	Basic earnings per common share	$	0.64				$	0.63				$	0.60				$	0.68				$	0.65
	Diluted earnings per common share	$	0.64				$	0.62				$	0.60				$	0.68				$	0.65
	Cash dividends declared per share	$	0.36				$	0.34				$	0.34				$	0.34				$	0.34

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
	At or for the Three Months Ended
(Dollars and shares in thousands, except per share amounts)	Mar 31,  2016				Dec 31,  2015				Sep 30,  2015				Jun 30,  2015				Mar 31,  2015
Share and Equity Related Data:
Book value per share	$	22.40			$	22.06			$	21.82			$	21.34			$	21.10
Tangible book value per share - Non-GAAP (1)	$	17.98			$	17.62			$	17.36			$	17.61			$	17.35
Market value per share	$	37.32			$	39.52			$	38.45			$	39.48			$	38.19
Shares issued and outstanding at end of period		17,024				17,020				16,985				16,834				16,773
Performance Ratios:
Net interest margin (FTE)		3.24	%			3.08	%			3.07	%			3.15	%			3.18	%
Return on average assets		1.16	%			1.16	%			1.11	%			1.27	%			1.23	%
Return on average tangible assets - Non-GAAP (1)		1.18	%			1.19	%			1.13	%			1.29	%			1.25	%
Return on average equity		11.50	%			11.52	%			11.13	%			12.88	%			12.54	%
Return on average tangible equity - Non-GAAP (1)		14.34	%			14.45	%			13.82	%			15.62	%			15.27	%
Capital Ratios:
Tier 1 risk-based capital	11.56% (i)					11.64	%			11.83	%			11.79	%			11.78	%
Total risk-based capital	12.45% (i)					12.58	%			12.80	%			12.78	%			12.80	%
Tier 1 leverage ratio	9.31% (i)					9.37	%			9.26	%			9.31	%			9.21	%
Common equity tier 1	10.82% (i)					10.89	%			11.05	%			11.00	%			10.98	%
Equity to assets		9.93	%			9.95	%			10.08	%			9.86	%			9.82	%
Tangible equity to tangible assets - Non-GAAP (1)		8.13	%			8.11	%			8.18	%			8.28	%			8.22	%
(i) - estimated
Wealth Management Revenues:
Trust and investment management fees	$	8,065			$	8,001			$	7,768			$	7,238			$	7,142
Mutual fund fees		843				952				989				1,032				1,036
Asset-based revenues		8,908				8,953				8,757				8,270				8,178
Transaction-based revenues		266				214				145				642				257
Total wealth management revenues	$	9,174			$	9,167			$	8,902			$	8,912			$	8,435
Wealth Management Assets Under Administration:
Balance at beginning of period	$	5,844,636			$	5,714,201			$	5,211,548			$	5,159,663			$	5,069,966
Acquisition of Halsey Associates, Inc. (Aug. 1, 2015)		—				—				839,994				—				—
Net investment appreciation (depreciation) & income		22,389				153,953				(316,121	)			(13,932	)			80,872
Net client cash flows		11,942				(23,518	)			(21,220	)			65,817				8,825
Balance at end of period	$	5,878,967			$	5,844,636			$	5,714,201			$	5,211,548			$	5,159,663
Mortgage Banking Revenues:
Gains and commissions on residential loan sales, net	$	2,134			$	2,528			$	1,964			$	2,748			$	2,585
Residential mortgage servicing fee income, net		64				54				26				(7	)			3
Total mortgage banking revenues	$	2,198			$	2,582			$	1,990			$	2,741			$	2,588
Residential Mortgage Loan Originations:
Originations for retention in portfolio	$	47,545			$	38,080			$	76,963			$	65,134			$	54,675
Originations for sale to the secondary market (2)		90,458				134,125				126,353				134,360				128,996
Total mortgage loan originations	$	138,003			$	172,205			$	203,316			$	199,494			$	183,671
Residential Mortgage Loans Sold:
Loans sold with servicing rights retained	$	26,454			$	44,493			$	37,782			$	32,693			$	47,256
Loans sold with servicing rights released (2)		79,507				82,906				94,645				110,484				80,641
Total mortgage loans sold	$	105,961			$	127,399			$	132,427			$	143,177			$	127,897

(1) See the section labeled “Supplemental Information - Non-GAAP Financial Measures” at the end of this document.
(2) Also includes loans originated in a broker capacity.

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
		At March 31, 2016
		Amortized					Unrealized					Unrealized				Fair
(Dollars in thousands)		Cost					Gains					Losses				Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$	97,151				$	160				$	(26	)		$	97,285
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises			249,141					8,322					—				257,463
Obligations of states and political subdivisions			31,025					511					—				31,536
Individual name issuer trust preferred debt securities			29,824					—					(6,743	)			23,081
Corporate bonds			1,965					32					(10	)			1,987
Total securities available for sale			409,106					9,025					(6,779	)			411,352
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises			19,040					624					—				19,664
Total securities held to maturity			19,040					624					—				19,664
Total securities		$	428,146				$	9,649				$	(6,779	)		$	431,016

	Period End Balances At
(Dollars in thousands)	Mar 31,  2016					Dec 31,  2015					Sep 30,  2015					Jun 30,  2015					Mar 31,  2015
Commercial:
Mortgages	$	976,931				$	931,953				$	873,767				$	876,589				$	865,042
Construction & development		123,032					122,297					121,857					110,989					89,851
Commercial & industrial		598,848					600,297					584,230					595,959					604,630
Total commercial		1,698,811					1,654,547					1,579,854					1,583,537					1,559,523
Residential real estate:
Mortgages		980,274					984,437					994,808					971,705					954,905
Homeowner construction		24,075					29,118					29,406					29,558					32,659
Mortgages		1,004,349					1,013,555					1,024,214					1,001,263					987,564
Consumer:
Home equity lines		258,513					255,565					252,862					249,845					239,537
Home equity loans		45,499					46,649					47,610					47,437					46,727
Other		39,821					42,811					45,378					46,502					47,241
Total consumer		343,833					345,025					345,850					343,784					333,505
Total loans	$	3,046,993				$	3,013,127				$	2,949,918				$	2,928,584				$	2,880,592

	At March 31, 2016								At December 31, 2015
(Dollars in thousands)	Balance					% of Total			Balance					% of Total
Commercial Real Estate Loans by Property Location:
Rhode Island, Connecticut, Massachusetts	$	1,009,962				91.8	%		$	959,883				91.0	%
New York, New Jersey, Pennsylvania		76,721				7.0	%			80,989				7.7	%
New Hampshire		13,280				1.2	%			13,377				1.3	%
Total commercial real estate loans (1)	$	1,099,963				100.0	%		$	1,054,249				100.0	%
Residential Mortgages by Property Location:
Rhode Island, Connecticut, Massachusetts	$	987,695				98.4	%		$	995,743				98.2	%
New Hampshire		9,517				0.9	%			10,186				1.0	%
New York, Virginia, New Jersey, Maryland, Pennsylvania		3,753				0.4	%			4,163				0.4	%
Ohio		1,488				0.1	%			1,557				0.2	%
Other		1,896				0.2	%			1,906				0.2	%
Total residential mortgages	$	1,004,349				100.0	%		$	1,013,555				100.0	%

(1) Commercial real estate loans consist of commercial mortgages and construction and development loans.  Commercial mortgages are loans secured by income producing property.

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
	Period End Balances At
(Dollars in thousands)	Mar 31,  2016					Dec 31,  2015					Sep 30,  2015					Jun 30,  2015				Mar 31,  2015
Deposits:
Non-interest bearing demand deposits	$	464,639				$	455,124				$	462,115				$	419,768			$	419,063
Interest-bearing demand deposits		74,480					82,174					51,741					37,987				57,983
NOW accounts		394,873					412,602					358,973					357,922				333,321
Money market accounts		763,565					823,490					855,858					789,334				821,353
Savings accounts		331,800					326,967					305,775					300,108				298,802
Time deposits (in-market)		540,815					531,419					534,266					549,410				561,758
Wholesale brokered time deposits		309,479					302,479					267,552					284,590				290,863
Total deposits	$	2,879,651				$	2,934,255				$	2,836,280				$	2,739,119			$	2,783,143
Asset Quality Ratios:
Nonperforming assets to total assets		0.49	%				0.58	%				0.48	%				0.45	%			0.48	%
Nonaccrual loans to total loans		0.57	%				0.70	%				0.57	%				0.52	%			0.55	%
Allowance for loan losses to nonaccrual loans		150.00	%				128.61	%				161.25	%				182.32	%			175.29	%
Allowance for loan losses to total loans		0.86	%				0.90	%				0.92	%				0.94	%			0.97	%
Nonperforming Assets:
Commercial mortgages	$	4,054				$	5,711				$	4,915				$	4,915			$	5,115
Commercial construction & development		—					—					—					—				—
Commercial & industrial		2,659					3,018					1,137					1,039				2,193
Residential real estate mortgages		9,367					10,666					9,472					7,411				6,956
Consumer		1,345					1,652					1,320					1,766				1,601
Total nonaccrual loans		17,425					21,047					16,844					15,131				15,865
Property acquired through foreclosure or repossession		1,326					716					955					1,388				1,398
Total nonperforming assets	$	18,751				$	21,763				$	17,799				$	16,519			$	17,263
	Three Months Ended
(Dollars in thousands)	Mar 31,  2016					Dec 31,  2015					Sep 30,  2015					Jun 30,  2015				Mar 31,  2015
Nonaccrual Loan Activity:
Balance at beginning of period	$	21,047				$	16,844				$	15,131				$	15,865			$	15,945
Additions to nonaccrual status		1,352					7,029					3,319					2,567				1,608
Loans returned to accruing status		(206	)				(303	)				(156	)				(1,756	)			(366	)
Loans charged-off		(1,475	)				(904	)				(725	)				(355	)			(321	)
Loans transferred to other real estate owned		(610	)				(716	)			—						(261	)			(230	)
Payments, payoffs and other changes		(2,683	)				(903	)				(725	)				(929	)			(771	)
Balance at end of period	$	17,425				$	21,047				$	16,844				$	15,131			$	15,865
Allowance for Loan Losses:
Balance at beginning of period	$	27,069				$	27,161				$	27,587				$	27,810			$	28,023
Provision charged to earnings		500					750					200					100				—
Charge-offs		(1,475	)				(904	)				(725	)				(355	)			(321	)
Recoveries		43					62					99					32				108
Balance at end of period	$	26,137				$	27,069				$	27,161				$	27,587			$	27,810
Net Loan Charge-Offs (Recoveries):
Commercial mortgages	$	1,249				$	405				$	(4	)			$	196			$	120
Commercial & industrial		(18	)				217					348					26				(7	)
Residential real estate mortgages		134					117					12					4				46
Consumer		67					103					270					97				54
Total	$	1,432				$	842				$	626				$	323			$	213
Net charge-offs to average loans (annualized)		0.19	%				0.11	%				0.08	%				0.04	%			0.03	%

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)
	Period End Balances At
(Dollars in thousands)	Mar 31,  2016				Dec 31,  2015				Sep 30,  2015				Jun 30,  2015				Mar 31,  2015
Past Due Loans:
Loans 30-59 Days Past Due:
Commercial mortgages	$	510			$	51			$	147			$	14			$	497
Commercial & industrial		268				405				162				2,581				229
Residential real estate mortgages		2,695				3,028				3,610				5,120				4,470
Consumer loans		904				1,653				899				1,634				1,512
Loans 30-59 days past due	$	4,377			$	5,137			$	4,818			$	9,349			$	6,708
Loans 60-89 Days Past Due:
Commercial mortgages	$	—			$	—			$	—			$	—			$	61
Commercial & industrial		1,568				9				3,455				2,299				229
Residential real estate mortgages		2,026				2,964				2,458				913				1,352
Consumer loans		549				863				338				397				565
Loans 60-89 days past due	$	4,143			$	3,836			$	6,251			$	3,609			$	2,207
Loans 90 Days or More Past Due:
Commercial mortgages	$	4,054			$	4,504			$	4,915			$	4,915			$	5,115
Commercial & industrial		1,070				48				720				638				721
Residential real estate mortgages		3,982				3,294				4,499				4,871				3,607
Consumer loans		669				740				608				647				723
Loans 90 days or more past due	$	9,775			$	8,586			$	10,742			$	11,071			$	10,166
Total Past Due Loans:
Commercial mortgages	$	4,564			$	4,555			$	5,062			$	4,929			$	5,673
Commercial & industrial		2,906				462				4,337				5,518				1,179
Residential real estate mortgages		8,703				9,286				10,567				10,904				9,429
Consumer loans		2,122				3,256				1,845				2,678				2,800
Total past due loans	$	18,295			$	17,559			$	21,811			$	24,029			$	19,081
Total past due loans to total loans		0.60	%			0.58	%			0.74	%			0.82	%			0.66	%
Accruing loans 90 days or more past due	$	—			$	—			$	—			$	—			$	—
Nonaccrual loans included in past due loans	$	14,030			$	13,635			$	13,964			$	12,397			$	12,314
Troubled Debt Restructured Loans:
Accruing troubled debt restructured loans:
Commercial mortgages	$	9,427			$	9,430			$	10,637			$	9,448			$	9,448
Commercial & industrial		837				853				2,069				2,209				881
Residential real estate mortgages		646				669				674				679				684
Consumer		226				228				232				201				134
Accruing troubled debt restructured loans		11,136				11,180				13,612				12,537				11,147
Nonaccrual troubled debt restructured loans:
Commercial mortgages		4,054				5,296				4,498				4,498				4,698
Commercial & industrial		857				1,371				380				381				1,442
Residential real estate mortgages		586				596				613				92				338
Consumer		—				—				—				33				34
Nonaccrual troubled debt restructured loans		5,497				7,263				5,491				5,004				6,512
Total troubled debt restructured loans	$	16,633			$	18,443			$	19,103			$	17,541			$	17,659

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 and renegotiated 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 (unaudited)
		Three Months Ended
		March 31, 2016											December 31, 2015											March 31, 2015
		Average Balance				Interest				Yield/ Rate			Average Balance				Interest				Yield/ Rate			Average Balance				Interest				Yield/  Rate
(Dollars in thousands)
Assets:
Commercial mortgages		$	933,939			$	8,215			3.54	%		$	885,967			$	7,887			3.53	%		$	851,946			$	7,717			3.67	%
Construction & development			129,217				1,108			3.45	%			134,243				1,004			2.97	%			84,302				666			3.20	%
Commercial & industrial			604,519				7,681			5.11	%			581,584				6,520			4.45	%			608,472				6,930			4.62	%
Total commercial loans		$	1,667,675			$	17,004			4.10	%		$	1,601,794			$	15,411			3.82	%		$	1,544,720			$	15,313			4.02	%
Residential real estate loans, including loans held for sale			1,031,260				10,155			3.96	%			1,049,007				10,338			3.91	%			1,030,016				10,314			4.06	%
Consumer loans			343,519				3,393			3.97	%			344,690				3,251			3.74	%			336,333				3,168			3.82	%
Total loans			3,042,454				30,552			4.04	%			2,995,491				29,000			3.84	%			2,911,069				28,795			4.01	%
Cash, federal funds sold and short-term investments			68,488				64			0.38	%			72,031				37			0.20	%			51,058				25			0.20	%
FHLBB stock			25,597				210			3.30	%			24,316				315			5.14	%			37,730				165			1.77	%
Taxable debt securities			359,060				2,370			2.65	%			341,130				2,262			2.63	%			322,570				2,259			2.84	%
Nontaxable debt securities			33,313				507			6.12	%			35,799				550			6.10	%			44,659				664			6.03	%
Total securities			392,373				2,877			2.95	%			376,929				2,812			2.96	%			367,229				2,923			3.23	%
Total interest-earning assets			3,528,912				33,703			3.84	%			3,468,767				32,164			3.68	%			3,367,086				31,908			3.84	%
Noninterest-earning assets			240,113											231,674											221,795
Total assets		$	3,769,025										$	3,700,441										$	3,588,881
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits		$	50,704			$	13			0.10	%		$	42,324			$	11			0.10	%		$	37,851			$	8			0.09	%
NOW accounts			386,488				56			0.06	%			376,185				56			0.06	%			329,588				48			0.06	%
Money market accounts			786,633				515			0.26	%			856,405				707			0.33	%			800,036				883			0.45	%
Savings accounts			328,174				49			0.06	%			310,608				47			0.06	%			293,926				46			0.06	%
Time deposits (in-market)			538,035				1,315			0.98	%			533,224				1,333			0.99	%			567,063				1,469			1.05	%
Wholesale brokered time deposits			296,801				1,020			1.38	%			277,681				943			1.35	%			294,664				935			1.29	%
FHLBB advances			453,019				2,152			1.91	%			373,652				1,966			2.09	%			404,773				1,902			1.91	%
Junior subordinated debentures			22,681				112			1.99	%			22,681				157			2.75	%			22,681				241			4.31	%
Other			79				2			10.18	%			92				2			8.62	%			128				3			9.51	%
Total interest-bearing liabilities			2,862,614				5,234			0.74	%			2,792,852				5,222			0.74	%			2,750,710				5,535			0.82	%
Demand deposits			471,782											475,215											438,904
Other liabilities			54,287											59,177											48,052
Shareholders' equity			380,342											373,197											351,215
Total liabilities and shareholders' equity		$	3,769,025										$	3,700,441										$	3,588,881
Net interest income (FTE)						$	28,469										$	26,942										$	26,373
Interest rate spread										3.10	%										2.94	%										3.02	%
Net interest margin										3.24	%										3.08	%										3.18	%

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

(Dollars in thousands)	Three Months Ended
	Mar 31, 2016					Dec 31, 2015					Mar 31, 2015
Commercial loans	$	554				$	489				$	442
Nontaxable debt securities		180					198					229
Total	$	734				$	687				$	671

Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION - Non-GAAP Financial Measures (unaudited)
	At or for the Three Months Ended
(Dollars in thousands, except per share amounts)	Mar 31,  2016				Dec 31,  2015				Sep 30,  2015				Jun 30,  2015				Mar 31,  2015
Calculation of Tangible Book Value per Share:
Total shareholders' equity at end of period	$	381,280			$	375,388			$	370,527			$	359,167			$	353,879
Less:
Goodwill		64,059				64,059				64,196				58,114				58,114
Identifiable intangible assets, net		11,137				11,460				11,793				4,539				4,694
Total tangible shareholders' equity at end of period	$	306,084			$	299,869			$	294,538			$	296,514			$	291,071
Shares outstanding at end of period		17,024				17,020				16,985				16,834				16,773
Book value per share - GAAP	$	22.40			$	22.06			$	21.82			$	21.34			$	21.10
Tangible book value per share - Non-GAAP	$	17.98			$	17.62			$	17.34			$	17.61			$	17.35
Calculation of Tangible Equity to Tangible Assets:
Total tangible shareholders' equity at end of period	$	306,084			$	299,869			$	294,538			$	296,514			$	291,071
Total assets at end of period	$	3,838,210			$	3,771,604			$	3,674,836			$	3,644,477			$	3,602,514
Less:
Goodwill		64,059				64,059				64,196				58,114				58,114
Identifiable intangible assets, net		11,137				11,460				11,793				4,539				4,694
Total tangible assets at end of period	$	3,763,014			$	3,696,085			$	3,598,847			$	3,581,824			$	3,539,706
Equity to assets - GAAP		9.93	%			9.95	%			10.08	%			9.86	%			9.82	%
Tangible equity to tangible assets - Non-GAAP		8.13	%			8.11	%			8.18	%			8.28	%			8.22	%
Calculation of Return on Average Tangible Assets:
Net income	$	10,935			$	10,744			$	10,208			$	11,503			$	11,010
Total average assets	$	3,769,025			$	3,700,441			$	3,678,487			$	3,622,715			$	3,588,881
Less:
Average goodwill		64,059				64,194				62,524				58,114				58,114
Average identifiable intangible assets, net		11,294				11,616				8,768				4,614				4,770
Total average tangible assets	$	3,693,672			$	3,624,631			$	3,607,195			$	3,559,987			$	3,525,997
Return on average assets - GAAP		1.16	%			1.16	%			1.11	%			1.27	%			1.23	%
Return on average tangible assets - Non-GAAP		1.18	%			1.19	%			1.13	%			1.29	%			1.25	%
Calculation of Return on Average Tangible Equity:
Net income	$	10,935			$	10,744			$	10,208			$	11,503			$	11,010
Total average shareholders' equity	$	380,342			$	373,197			$	366,724			$	357,365			$	351,215
Less:
Average goodwill		64,059				64,194				62,524				58,114				58,114
Average identifiable intangible assets, net		11,294				11,616				8,768				4,614				4,770
Total average tangible shareholders' equity	$	304,989			$	297,387			$	295,432			$	294,637			$	288,331
Return on average shareholders' equity - GAAP		11.50	%			11.52	%			11.13	%			12.88	%			12.54	%
Return on average tangible shareholders' equity - Non-GAAP		14.34	%			14.45	%			13.82	%			15.62	%			15.27	%

Contact:  Elizabeth B. Eckel
Senior Vice President, Marketing
Telephone:  (401) 348-1309
E-mail:  ebeckel@washtrust.com

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