exhibit99.htm

of 2010 and by $2.6 million, or 16%, from the second quarter a year ago. On a year-to-date basis, net interest income increased by $4.6 million, or 14%, from 2009. The net interest margin (annualized tax-equivalent net interest income as a percentage of average earning assets) for the second quarter of 2010 was 2.86%, up by 8 basis points from the first quarter of 2010 and by 41 basis points from the second quarter of 2009. For the six months ended June 30, 2010, the net interest margin was 2.82%, up by 40 basis points from the same period a year earlier. The quarter and year-to-date increases in net interest margin are due in large part to lower funding costs. On a year-to-date basis, the cost of interest-bearing liabilities declined by 65 basis points from 2009.

Wealth management revenues for the second quarter of 2010 increased by $457 thousand, or 7%, from the first quarter of 2010 and by $809 thousand, or 14%, from the second quarter last year. On a linked-quarter basis, the increase in wealth management revenues includes a $277 thousand increase in seasonal tax preparation fees. For the six months ended June 30, 2010, wealth management revenues were up by $1.7 million, or 15 percent, from the same period in 2009. Assets under administration totaled $3.7 billion at June 30, 2010, down by $241 million from March 31, 2010 reflecting declines in market value, net of income of $249 million and net client cash inflows of $8 million. Assets under administration were down by $111 million from December 31, 2009 and up by $343 million from June 30, 2009.

of 2010 and by $654 thousand, or 3%, from the second quarter of 2009. Included in second quarter 2009 noninterest expenses was a special FDIC assessment of $1.35 million ($869 thousand, after tax, or 5 cents per diluted share.) Excluding this special FDIC assessment, second quarter 2010 noninterest expenses increased by $2.0 million, or 11%, from the second quarter of 2009, due largely to increases in salaries and employee benefit costs as well as credit, collection and foreclosed property costs. Salaries and employee benefits costs, the largest component of noninterest expenses, increased by $1.4 million, or 13%, compared to the second quarter of 2009, reflecting the impact of higher staffing levels related to a new branch opened in the fourth quarter of 2009 and selected staffing additions in the commercial lending and wealth management areas. Credit, collection and foreclosed property costs for the second quarter of 2010 increased by $210 thousand, or 114%, from the same quarter in 2009.

Nonperforming assets (nonaccrual loans, nonaccrual investment securities and property acquired through foreclosure or repossession) amounted to $25.9 million, or 0.89% of total assets, at June 30, 2010, compared to $27.5 million, or 0.95% of total assets, at March 31, 2010. Nonperforming assets were $30.5 million, or 1.06% of total assets, at December 31, 2009. Nonaccrual loans totaled $22.7 million at June 30, 2010, down by $1.6 million in the second quarter of 2010, reflecting a net decrease of $2.1 million in nonaccrual commercial loans and a net increase of $455 thousand in nonaccrual residential mortgages. Property acquired through foreclosure or repossession amounted to $2.3 million at June 30, 2010, compared to $2.0 million at both March 31, 2010 and December 31, 2009.

The loan loss provision charged to earnings amounted to $1.5 million for the second quarter of 2010, unchanged from the first quarter of 2010 level and down by $1.5 million from the second quarter of 2009 level. For the six months ended June 30, 2010 and 2009, the loan loss provision totaled $3.0 million and $4.7 million, respectively. Net charge-offs amounted to $1.2 million in the second quarter of 2010, as compared to net charge-offs of $1.2 million in the first quarter of 2010 and $1.4 million in the second quarter of 2009. For the six months ended June 30, 2010, net charge-offs totaled $2.4 million, essentially unchanged from the comparable period in 2009.

management’s strategy to not reinvest the proceeds from maturities and pay-downs on mortgage-backed securities. The largest component of the investment securities portfolio is mortgage-backed securities, all of which are issued by U.S. Government agencies or U.S. Government-sponsored enterprises. At June 30, 2010, the net unrealized gain position on the investment securities portfolio was $22.6 million, including gross unrealized losses of $11.9 million. Approximately 97% of the gross unrealized losses on the investment securities portfolio were concentrated in variable rate trust preferred securities issued by financial services companies. During the second quarter of 2010, credit-related impairment losses of $354 thousand were charged to earnings on a pooled trust preferred debt security deemed to be other-than-temporarily impaired.

Washington Trust Chairman, President and Chief Executive Officer Joseph J. MarcAurele, and David V. Devault, Executive Vice President, Chief Financial Officer and Secretary, will host a conference call on Thursday, July 22, 2010 at 8:30 a.m. (Eastern Time) to discuss Washington Trust’s second quarter results. This call is being webcast by SNL IR Solutions and can be accessed through the Investor Relations section of the Washington Trust website, www.washtrust.com, or may be accessed by calling (877) 317-6789, or (412) 317-6789 for international callers. A replay of the call will be posted in this same location on the website shortly after the conclusion of the call. To listen to a replay of the conference call, dial (877) 344-7529 and enter Conference ID #: 442265. The replay will be available until 9:00 a.m. on August 6, 2010.

This press release contains certain statements that may be considered “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, including statements regarding our strategy, effectiveness of investment programs, evaluations of future interest rate trends and liquidity, expectations as to growth in assets, deposits and results of operations, success of acquisitions, future operations, market position, financial position, and prospects, plans, goals and objectives of management are forward-looking statements. The actual results, performance or achievements of Washington Trust could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in general national, regional or international economic conditions or conditions affecting the banking or financial services industries or financial capital markets, volatility and disruption in national and international financial markets, 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 Washington Trust’s competition, changes in legislation or regulation and accounting principles, policies and guidelines, 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, 2009, as filed with the Securities and Exchange Commission, 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 press release, and Washington Trust assumes no obligation to update forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Reported amounts are presented in accordance with U.S. generally accepted accounting principles ("GAAP"). 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.

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS (unaudited)
	June 30,		December 31,
(Dollars in thousands, except par value)	2010		2009
Assets:
Cash and noninterest-bearing balances due from banks	$	32,787	$	38,167
Interest-bearing balances due from banks		26,676		13,686
Other short-term investments		4,426		5,407
Mortgage loans held for sale		8,798		9,909
Securities available for sale, at fair value;
amortized cost $653,355 in 2010 and $677,676 in 2009		675,938		691,484
Federal Home Loan Bank stock, at cost		42,008		42,008
Loans:
Commercial and other		1,019,357		984,550
Residential real estate		622,613		605,575
Consumer		330,528		329,543
Total loans		1,972,498		1,919,668
Less allowance for loan losses		27,985		27,400
Net loans		1,944,513		1,892,268
Premises and equipment, net		27,237		27,524
Accrued interest receivable		9,195		9,137
Investment in bank-owned life insurance		50,871		44,957
Goodwill		58,114		58,114
Identifiable intangible assets, net		8,362		8,943
Property acquired through foreclosure or repossession, net		2,338		1,974
Other assets		38,590		40,895
Total assets	$	2,929,853	$	2,884,473

Liabilities:
Deposits:
Demand deposits	$	225,494	$	194,046
NOW accounts		234,014		202,367
Money market accounts		378,004		403,333
Savings accounts		209,616		191,580
Time deposits		902,777		931,684
Total deposits		1,949,905		1,923,010
Dividends payable		3,423		3,369
Federal Home Loan Bank advances		615,146		607,328
Junior subordinated debentures		32,991		32,991
Other borrowings		20,914		21,501
Accrued expenses and other liabilities		42,063		41,328
Total liabilities		2,664,442		2,629,527

Shareholders’ Equity:
Common stock of $.0625 par value; authorized 30,000,000 shares;
issued 16,120,659 shares in 2010 and 16,061,748 shares in 2009		1,008		1,004
Paid-in capital		83,657		82,592
Retained earnings		172,186		168,514
Accumulated other comprehensive income		8,560		3,337
Treasury stock, at cost; 19,185 in 2009		–		(501	)
Total shareholders’ equity		265,411		254,946
Total liabilities and shareholders’ equity	$	2,929,853	$	2,884,473

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME (unaudited)

(Dollars and shares in thousands, except per share amounts)	Three Months					Six Months
Periods ended June 30,	2010			2009		2010			2009
Interest income:
Interest and fees on loans	$	24,180		$	24,147	$	48,148		$	48,286
Interest on securities:
Taxable		5,837			7,588		11,888			16,037
Nontaxable		770			778		1,539			1,558
Dividends on corporate stock and Federal Home Loan Bank stock		54			55		109			127
Other interest income		13			9		34			26
Total interest income		30,854			32,577		61,718			66,034
Interest expense:
Deposits		5,331			8,481		11,100			18,028
Federal Home Loan Bank advances		6,000			7,112		12,219			14,339
Junior subordinated debentures		447			479		1,077			958
Other interest expense		243			244		485			489
Total interest expense		12,021			16,316		24,881			33,814
Net interest income		18,833			16,261		36,837			32,220
Provision for loan losses		1,500			3,000		3,000			4,700
Net interest income after provision for loan losses		17,333			13,261		33,837			27,520
Noninterest income:
Wealth management services:
Trust and investment advisory fees		5,153			4,402		10,170			8,524
Mutual fund fees		1,105			993		2,215			1,908
Financial planning, commissions and other service fees		505			559		684			935
Wealth management services		6,763			5,954		13,069			11,367
Service charges on deposit accounts		1,400			1,201		2,553			2,314
Merchant processing fees		2,406			2,086		4,012			3,435
Income from bank-owned life insurance		474			447		913			891
Net gains on loan sales and commissions on loans originated for others		318			1,552		878			2,596
Net realized gains on securities		–			257		–			314
Net (losses) gains on interest rate swap contracts		(121	)		341		(53	)		401
Other income		273			465		586			884
Noninterest income, excluding other-than-temporary impairment losses		11,513			12,303		21,958			22,202
Total other-than-temporary impairment losses on securities		(2,840	)		–		(4,102	)		(4,244	)
Portion of loss recognized in other comprehensive income (before taxes)		2,486			–		3,685			2,253
Net impairment losses recognized in earnings		(354	)		–		(417	)		(1,991	)
Total noninterest income		11,159			12,303		21,541			20,211
Noninterest expense:
Salaries and employee benefits		11,726			10,359		23,227			20,834
Net occupancy		1,237			1,122		2,461			2,348
Equipment		1,014			1,036		2,011			2,011
Merchant processing costs		2,057			1,780		3,414			2,923
Outsourced services		855			568		1,610			1,354
FDIC deposit insurance costs		784			2,143		1,578			2,794
Legal, audit and professional fees		408			664		926			1,339
Advertising and promotion		419			491		783			792
Amortization of intangibles		290			308		581			616
Other expenses		2,193			1,858		3,984			3,708
Total noninterest expense		20,983			20,329		40,575			38,719
Income before income taxes		7,509			5,235		14,803			9,012
Income tax expense		2,211			1,470		4,333			2,577
Net income	$	5,298		$	3,765	$	10,470		$	6,435
Weighted average common shares outstanding – basic		16,104.6			15,983.6		16,081.3			15,963.2
Weighted average common shares outstanding – diluted		16,143.1			16,037.4		16,116.3			16,009.1
Per share information:
Basic earnings per common share	$	0.33		$	0.24	$	0.65		$	0.40
Diluted earnings per common share	$	0.33		$	0.23	$	0.65		$	0.40
Cash dividends declared per share	$	0.21		$	0.21	$	0.42		$	0.42

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

	At or for the Quarters Ended
	June 30,			Mar 31,			Dec. 31,			Sept. 30,			June 30,
(Dollars in thousands, except per share amounts)	2010			2010			2009			2009			2009
Financial Data
Total assets	$	2,929,853		$	2,896,425		$	2,884,473		$	2,888,065		$	2,919,808
Total loans		1,972,498			1,937,524			1,919,668			1,906,565			1,891,254
Total securities		675,938			716,964			691,484			732,646			776,435
Total deposits		1,949,905			1,961,188			1,923,010			1,894,170			1,883,720
Total shareholders’ equity		265,411			259,529			254,946			252,146			242,293
Net interest income		18,833			18,004			16,946			16,726			16,261
Provision for loan losses		1,500			1,500			2,000			1,800			3,000
Noninterest income, excluding other-than-temporary
impairment losses		11,513			10,445			11,649			11,504			12,303
Net impairment losses recognized in earnings		(354	)		(63	)		(679	)		(467	)		-
Noninterest expenses		20,983			19,592			19,257			19,192			20,329
Income tax expense		2,211			2,122			1,911			1,858			1,470
Net income		5,298			5,172			4,748			4,913			3,765

Share Data
Basic earnings per common share	$	0.33		$	0.32		$	0.30		$	0.31		$	0.24
Diluted earnings per common share	$	0.33		$	0.32		$	0.30		$	0.31		$	0.23
Dividends declared per share	$	0.21		$	0.21		$	0.21		$	0.21		$	0.21
Book value per share	$	16.46		$	16.14		$	15.89		$	15.73		$	15.14
Tangible book value per share – Non-GAAP*	$	12.34		$	11.99		$	11.71		$	11.53		$	10.91
Market value per share	$	17.04		$	18.64		$	15.58		$	17.52		$	17.83

Shares outstanding at end of period		16,120.7			16,079.1			16,042.6			16,026.6			16,001.9
Weighted average common shares outstanding – basic		16,104.6			16,057.7			16,035.4			16,016.8			15,983.6
Weighted average common shares outstanding – diluted		16,143.1			16,101.5			16,082.0			16,074.5			16,037.4

Key Ratios
Return on average assets		0.73	%		0.71	%		0.66	%		0.68	%		0.52	%
Return on average tangible assets – Non-GAAP*		0.74	%		0.73	%		0.67	%		0.69	%		0.53	%
Return on average equity		8.05	%		8.00	%		7.47	%		7.94	%		6.22	%
Return on average tangible equity – Non-GAAP*		10.78	%		10.80	%		10.16	%		10.91	%		8.63	%

Capital Ratios
Tier 1 risk-based capital		11.22	% (i)		11.24	%		11.14	%		11.06	%		10.98	%
Total risk-based capital		12.47	% (i)		12.50	%		12.40	%		12.31	%		12.23	%
Tier 1 leverage ratio		7.94	% (i)		7.89	%		7.82	%		7.68	%		7.53	%
Equity to assets		9.06	%		8.96	%		8.84	%		8.73	%		8.30	%
Tangible equity to tangible assets – Non-GAAP*		6.95	%		6.81	%		6.67	%		6.55	%		6.12	%
(i) – estimated

Wealth Management Assets Under Administration
Balance at beginning of period	$	3,900,783		$	3,770,193		$	3,603,424		$	3,316,308		$	2,957,918
Net investment (depreciation) appreciation & income		(249,214	)		95,855			88,690			295,257			313,999
Net customer cash flows		7,814			34,735			78,079			(8,141	)		44,391
Balance at end of period	$	3,659,383		$	3,900,783		$	3,770,193		$	3,603,424		$	3,316,308

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

	Six Months Ended
	June 30,			June 30,
(Dollars in thousands, except per share amounts)	2010			2009
Financial Data
Net interest income	$	36,837		$	32,220
Provision for loan losses		3,000			4,700
Noninterest income, excluding other-than-temporary impairment losses		21,958			22,202
Net impairment losses recognized in earnings		(417	)		(1,991	)
Noninterest expenses		40,575			38,719
Income tax expense		4,333			2,577
Net income		10,470			6,435

Share Data
Basic earnings per common share	$	0.65		$	0.40
Diluted earnings per common share	$	0.65		$	0.40
Dividends declared per share	$	0.42		$	0.42

Weighted average common shares outstanding – basic		16,081.3			15,963.2
Weighted average common shares outstanding – diluted		16,116.3			16,009.1

Key Ratios
Return on average assets		0.72	%		0.44	%
Return on average tangible assets – Non-GAAP*		0.74	%		0.45	%
Return on average equity		8.03	%		5.36	%
Return on average tangible equity – Non-GAAP*		10.79	%		7.48	%

Asset Quality Data
Allowance for Loan Losses
Balance at beginning of period	$	27,400		$	23,725
Provision charged to earnings		3,000			4,700
Charge-offs		(2,538	)		(2,509	)
Recoveries		123			135
Balance at end of period	$	27,985		$	26,051

Net Loan Charge-Offs
Commercial:
Mortgages	$	1,022		$	1,255
Construction and development		-			-
Other		1,066			864
Residential:
Mortgages		211			159
Homeowner construction		-			-
Consumer		116			96
Total	$	2,415		$	2,374

Net charge-offs to average loans (annualized)		0.25	%		0.25	%

Wealth Management Assets Under Administration
Balance at beginning of period	$	3,770,193		$	3,147,649
Net investment (depreciation) appreciation & income		(153,359	)		163,144
Net customer cash flows		42,549			5,515
Balance at end of period	$	3,659,383		$	3,316,308

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

	For the Quarters Ended
	June 30,	Mar. 31,	Dec. 31,	Sept. 30,	June 30,
	2010	2010	2009	2009	2009
Average Yields (taxable equivalent basis)
Assets:
Commercial and other loans	5.23%	5.31%	5.19%	5.26%	5.37%
Residential real estate loans, including
mortgage loans held for sale	5.05%	5.19%	5.17%	5.22%	5.38%
Consumer loans	4.00%	3.99%	4.06%	4.15%	4.19%
Total loans	4.97%	5.05%	4.99%	5.06%	5.17%
Cash, federal funds sold
and other short-term investments	0.17%	0.23%	0.19%	0.28%	0.27%
FHLBB stock	–%	–%	–%	–%	–%
Taxable debt securities	3.94%	4.10%	4.10%	4.19%	4.21%
Nontaxable debt securities	5.83%	5.89%	5.74%	5.73%	5.80%
Corporate stocks	6.23%	6.05%	5.68%	7.02%	5.40%
Total securities	4.17%	4.33%	4.30%	4.38%	4.37%
Total interest-earning assets	4.64%	4.72%	4.70%	4.76%	4.83%
Liabilities:
NOW accounts	0.12%	0.13%	0.18%	0.19%	0.17%
Money market accounts	0.56%	0.61%	0.82%	0.91%	0.98%
Savings accounts	0.17%	0.18%	0.22%	0.25%	0.26%
Time deposits	1.94%	2.13%	2.52%	2.74%	3.06%
FHLBB advances	4.08%	4.26%	4.35%	4.18%	4.11%
Junior subordinated debentures	5.44%	7.75%	5.33%	6.56%	5.82%
Other	4.63%	4.66%	4.68%	4.71%	4.70%
Total interest-bearing liabilities	2.00%	2.17%	2.40%	2.54%	2.66%

Interest rate spread (taxable equivalent basis)	2.64%	2.55%	2.30%	2.22%	2.17%
Net interest margin (taxable equivalent basis)	2.86%	2.78%	2.56%	2.51%	2.45%

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

		Period End Balances At
(Dollars in thousands)		6/30/2010		3/31/2010		12/31/2009		9/30/2009		6/30/2009
Loans
Commercial:	Mortgages	$	510,315	$	493,102	$	496,996	$	484,478	$	439,182
	Construction and development		67,215		77,787		72,293		68,069		64,504
	Other		441,827		427,870		415,261		423,775		443,552
	Total commercial		1,019,357		998,759		984,550		976,322		947,238
Residential:	Mortgages		610,245		597,481		593,981		595,270		606,324
	Homeowner construction		12,368		11,577		11,594		9,303		12,535
	Total residential real estate		622,613		609,058		605,575		604,573		618,859
Consumer:	Home equity lines		218,440		213,841		209,801		200,512		195,612
	Home equity loans		57,682		59,390		62,430		66,439		70,806
	Other		54,406		56,476		57,312		58,719		58,739
	Total consumer		330,528		329,707		329,543		325,670		325,157
	Total loans	$	1,972,498	$	1,937,524	$	1,919,668	$	1,906,565	$	1,891,254


	Period End Balances At
(Dollars in thousands)	6/30/2010		3/31/2010		12/31/2009		9/30/2009		6/30/2009
Deposits
Demand deposits	$	225,494	$	204,317	$	194,046	$	198,712	$	187,830
NOW accounts		234,014		196,905		202,367		185,772		187,014
Money market accounts		378,004		397,896		403,333		376,100		356,726
Savings accounts		209,616		202,236		191,580		190,707		192,484
Time deposits		902,777		959,834		931,684		942,879		959,666
Total deposits	$	1,949,905	$	1,961,188	$	1,923,010	$	1,894,170	$	1,883,720

Out-of-market brokered certificates of deposits
included in time deposits	$	94,641	$	88,748	$	93,684	$	102,383	$	151,175

In-market deposits, excluding out of market
brokered certificates of deposit	$	1,855,264	$	1,872,440	$	1,829,326	$	1,791,787	$	1,732,545

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

(Dollars in thousands)	At June 30, 2010
	Amortized		Unrealized		Unrealized			Fair
Securities Available for Sale	Cost (1)		Gains		Losses			Value
Obligations of U.S. government-sponsored enterprises	$	56,585	$	4,312	$	−		$	60,897
Mortgage-backed securities issued by U.S. government
agencies and U.S. government-sponsored enterprises		464,938		25,338		(110	)		490,166
States and political subdivisions		79,464		3,123		(118	)		82,469
Trust preferred securities:
Individual name issuers		30,582		−		(7,970	)		22,612
Collateralized debt obligations		4,504		−		(3,632	)		872
Corporate bonds		13,269		1,554		−			14,823
Common stocks		659		102		−			761
Perpetual preferred stocks		3,354		85		(101	)		3,338
Total securities available for sale	$	653,355	$	34,514	$	(11,931	)	$	675,938


(Dollars in thousands)	At December 31, 2009
	Amortized		Unrealized		Unrealized			Fair
Securities Available for Sale	Cost (1)		Gains		Losses			Value
Obligations of U.S. government-sponsored enterprises	$	41,565	$	3,675	$	−		$	45,240
Mortgage-backed securities issued by U.S. government
agencies and U.S. government-sponsored enterprises		503,115		20,808		(477	)		523,446
States and political subdivisions		80,183		2,093		(214	)		82,062
Trust preferred securities:
Individual name issuers		30,563		−		(9,977	)		20,586
Collateralized debt obligations		4,966		−		(3,901	)		1,065
Corporate bonds		13,272		1,434		−			14,706
Common stocks		658		111		−			769
Perpetual preferred stocks		3,354		396		(140	)		3,610
Total securities available for sale	$	677,676	$	28,517	$	(14,709	)	$	691,484

	At June 30, 2010
	Credit Rating		Amortized	Unrealized		Fair
(Dollars in thousands)	Moody’s	S&P (b)	Cost (a)	Gains	Losses	Value
Trust preferred securities:
Individual name issuers (c):
JPMorgan Chase & Co.	A2	BBB+	$9,719	$ –	$(2,366)	$7,353
Bank of America Corporation	Baa3	BB	5,730	–	(1,773)	3,957
Wells Fargo & Company	Baa1/Baa2	A-	5,104	–	(1,043)	4,061
SunTrust Banks, Inc.	Baa3	BB	4,165	–	(1,226)	2,939
Northern Trust Corporation	A3	A-	1,980	–	(357)	1,623
State Street Corporation	A3	BBB+	1,968	–	(426)	1,542
Huntington Bancshares Incorporated	Ba1	B	1,916	–	(779)	1,137
Total individual name issuers			30,582	–	(7,970)	22,612

Collateralized debt obligations (CDO):
Tropic CDO 1, tranche A4L (d)	Ca		3,221	–	(2,486)	735
Preferred Term Securities [PreTSL] XXV, tranche C1 (e)	C		1,283	–	(1,146)	137
Total collateralized debt obligations			4,504	–	(3,632)	872
Total trust preferred securities			$35,086	$ –	$(11,602)	$23,484

(d)

This investment security is not rated by S&P. As of June 30, 2010, 17 of the 38 pooled institutions have invoked their original contractual right to defer interest payments. This investment security was placed on nonaccrual status as of March 31, 2009. During the quarter ended March 31, 2009, an adverse change occurred in the expected cash flows for this instrument indicating that, based on cash flow forecasts with regard to timing of deferrals and potential future recovery of deferred payments, default rates, and other matters, the Washington Trust would not receive all contractual amounts due under the instrument and would not recover the entire cost basis of the security. Washington Trust had concluded that these conditions warranted a conclusion of other-than-temporary impairment for this holding as of March 31, 2009 and recognized credit-related impairment losses of $1.4 million in earnings in the first quarter of 2009. In April 2010, this investment security began deferring a portion of interest payments. The analysis of the expected cash flows for this security as of June 30, 2010 resulted in an additional credit-related impairment loss of $354 thousand being recognized in earnings in the second quarter of 2010.

(e)

This investment security is not rated by S&P. As of June 30, 2010, 20 of the 73 pooled institutions have invoked their original contractual right to defer interest payments. In the fourth quarter of 2008, this investment security began deferring interest payments until future periods. This investment security was placed on nonaccrual status as of December 31, 2008. During the quarter ended September 30, 2009, an adverse change occurred in the expected cash flows for this instrument indicating that, based on cash flow forecasts with regard to timing of deferrals and potential future recovery of deferred payments, default rates, and other matters, Washington Trust would not receive all contractual amounts due under the instrument and would not recover the entire cost basis of the security. Washington Trust had concluded that these conditions warrant a conclusion of other-than-temporary impairment for this holding as of September 30, 2009 and recognized credit-related impairment losses of $467 thousand in earnings in the third quarter of 2009. During the quarter ended December 31, 2009, Washington Trust recognized additional credit-related impairment losses on this security of $679 thousand. The analysis of the expected cash flows for this security as of March 31, 2010 resulted in an additional credit-related impairment loss of $63 thousand being recognized in earnings in the first quarter of 2010. The analysis of the expected cash flows for this security as of June 30, 2010 did not result in further credit-related impairment loss.

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

(Dollars in thousands)	For the Quarters Ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
Asset Quality Data	2010			2010			2009			2009			2009
Allowance for Loan Losses
Balance at beginning of period	$	27,711		$	27,400		$	26,431		$	26,051		$	24,498
Provision charged to earnings		1,500			1,500			2,000			1,800			3,000
Charge-offs		(1,263	)		(1,275	)		(1,215	)		(1,438	)		(1,483	)
Recoveries		37			86			184			18			36
Balance at end of period	$	27,985		$	27,711		$	27,400		$	26,431		$	26,051

Net Loan Charge-Offs
Commercial:
Mortgages	$	531		$	491		$	333		$	(10	)	$	794
Construction and development		–			–			–			–			–
Other		558			508			627			1,165			515
Residential:
Mortgages		90			121			29			201			127
Homeowner construction		–			–			–			–			–
Consumer		47			69			42			64			11
Total	$	1,226		$	1,189		$	1,031		$	1,420		$	1,447

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

(Dollars in thousands)
	June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,
Asset Quality Data	2010		2010		2009		2009		2009
Past Due Loans
Loans 30–59 Days Past Due
Commercial real estate	$	3,898	$	2,302	$	1,909	$	4,699	$	2,635
Other commercial loans		3,284		2,362		1,831		1,496		2,255
Residential mortgages		2,680		1,549		2,409		2,164		1,820
Consumer loans		3,364		2,019		1,258		593		1,042
Loans 30–59 days past due	$	13,226	$	8,232	$	7,407	$	8,952	$	7,752

Loans 60–89 Days Past Due
Commercial real estate	$	19	$	2,390	$	1,648	$	400	$	3,537
Other commercial loans		1,195		519		292		609		514
Residential mortgages		861		1,035		1,383		569		1,324
Consumer loans		195		202		591		39		44
Loans 60-89 days past due	$	2,270	$	4,146	$	3,914	$	1,617	$	5,419

Loans 90 Days or more Past Due
Commercial real estate	$	3,695	$	8,374	$	11,227	$	7,972	$	2,760
Other commercial loans		2,919		3,142		4,829		6,982		5,861
Residential mortgages		5,942		5,559		4,028		4,186		3,826
Consumer loans		634		635		164		300		2
Loans 90 days or more past due	$	13,190	$	17,710	$	20,248	$	19,440	$	12,449

Total Past Due Loans
Commercial real estate	$	7,612	$	13,066	$	14,784	$	13,071	$	8,932
Other commercial loans		7,398		6,023		6,952		9,087		8,630
Residential mortgages		9,483		8,143		7,820		6,919		6,970
Consumer loans		4,193		2,856		2,013		932		1,088
Total past due loans	$	28,686	$	30,088	$	31,569	$	30,009	$	25,620

Washington Trust Bancorp, Inc. and Subsidiaries
SELECTED FINANCIAL HIGHLIGHTS (unaudited)

(Dollars in thousands)
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
Asset Quality Data	2010			2010			2009			2009			2009
Nonperforming Assets
Commercial mortgages	$	6,680		$	8,933		$	11,588		$	8,147		$	5,995
Commercial construction and development		–			–			–			–			–
Other commercial		8,418			8,225			9,075			10,903			10,948
Residential real estate mortgages		6,850			6,395			6,038			5,313			5,168
Consumer		789			827			769			850			556
Total nonaccrual loans	$	22,737		$	24,380		$	27,470		$	25,213		$	22,667
Nonaccrual investment securities		872			1,154			1,065			1,490			1,881
Property acquired through foreclosure or repossession		2,338			1,974			1,974			1,186			236
Total nonperforming assets	$	25,947		$	27,508		$	30,509		$	27,889		$	24,784

Total past due loans to total loans		1.45	%		1.55	%		1.64	%		1.57	%		1.35	%
Nonperforming assets to total assets		0.89	%		0.95	%		1.06	%		0.97	%		0.85	%
Nonaccrual loans to total loans		1.15	%		1.26	%		1.43	%		1.32	%		1.20	%
Allowance for loan losses to nonaccrual loans		123.08	%		113.66	%		99.75	%		104.83	%		114.93	%
Allowance for loan losses to total loans		1.42	%		1.43	%		1.43	%		1.39	%		1.38	%


Troubled Debt Restructured Loans
Accruing troubled debt restructured loans
Commercial mortgages	$	6,176		$	5,813		$	5,566		$	2,107		$	1,576
Other commercial		2,224			1,217			540			375			323
Residential real estate mortgages		2,234			2,622			2,736			3,520			2,190
Consumer		997			1,398			858			822			780
Accruing troubled debt restructured loans		11,631			11,050			9,700			6,824			4,869
Nonaccrual troubled debt restructured loans
Commercial mortgages		986			2,238			–			–			–
Other commercial		301			247			228			353			136
Residential real estate mortgages		381			887			336			336			367
Consumer		43			44			45			7			–
Nonaccrual troubled debt restructured loans		1,711			3,416			609			696			503
Total troubled debt restructured loans	$	13,342		$	14,466		$	10,309		$	7,520		$	5,372

The following tables present 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. For dividends on corporate stocks, the 70% federal dividends received deduction is also used in the calculation of tax equivalency. Unrealized gains (losses) on available for sale securities are excluded from the average balance and yield calculations. Nonaccrual and renegotiated loans, as well as interest earned on these loans (to the extent recognized in the Consolidated Statements of Income) are included in amounts presented for loans.

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)

Three months ended June 30,	2010							2009
	Average				Yield/			Average				Yield/
(Dollars in thousands)	Balance		Interest		Rate			Balance		Interest		Rate
Assets
Commercial and other loans	$	1,008,153	$	13,149		5.23	%	$	916,329	$	12,270		5.37	%
Residential real estate loans, including
mortgage loans held for sale		618,907		7,790		5.05	%		637,633		8,550		5.38	%
Consumer loans		329,562		3,289		4.00	%		323,629		3,378		4.19	%
Total loans		1,956,622		24,228		4.97	%		1,877,591		24,198		5.17	%
Cash, federal funds sold
and other short-term investments		30,660		13		0.17	%		12,459		9		0.27	%
FHLBB stock		42,008		–		–	%		42,008		–		–	%
Taxable debt securities		594,673		5,837		3.94	%		723,199		7,588		4.21	%
Nontaxable debt securities		79,467		1,154		5.83	%		80,672		1,166		5.80	%
Corporate stocks		4,862		76		6.23	%		5,600		75		5.40	%
Total securities		679,002		7,067		4.17	%		809,471		8,829		4.37	%
Total interest-earning assets		2,708,292		31,308		4.64	%		2,741,529		33,036		4.83	%
Non interest-earning assets		212,546							182,473
Total assets	$	2,920,838						$	2,924,002
Liabilities and shareholders’ equity
NOW accounts	$	213,045	$	63		0.12	%	$	180,969	$	78		0.17	%
Money market accounts		392,691		547		0.56	%		376,559		917		0.98	%
Savings accounts		205,582		85		0.17	%		188,208		123		0.26	%
Time deposits		957,311		4,636		1.94	%		965,492		7,363		3.06	%
FHLBB advances		589,577		6,000		4.08	%		693,860		7,112		4.11	%
Junior subordinated debentures		32,991		447		5.44	%		32,991		479		5.82	%
Other		21,073		243		4.63	%		20,805		244		4.70	%
Total interest-bearing liabilities		2,412,270		12,021		2.00	%		2,458,884		16,316		2.66	%
Demand deposits		207,271							179,350
Other liabilities		38,159							43,498
Shareholders’ equity		263,138							242,270
Total liabilities and shareholders’ equity	$	2,920,838						$	2,924,002
Net interest income (FTE)			$	19,287						$	16,720
Interest rate spread						2.64	%						2.17	%
Net interest margin						2.86	%						2.45	%

Washington Trust Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited)

Six months ended June 30,	2010							2009
	Average				Yield/			Average				Yield/
(Dollars in thousands)	Balance		Interest		Rate			Balance		Interest		Rate
Assets
Commercial and other loans	$	997,042	$	26,053		5.27	%	$	906,946	$	24,381		5.42	%
Residential real estate loans, including
mortgage loans held for sale		617,216		15,664		5.12	%		641,773		17,262		5.42	%
Consumer loans		329,438		6,528		4.00	%		320,946		6,745		4.24	%
Total loans		1,943,696		48,245		5.01	%		1,869,665		48,388		5.22	%
Cash, federal funds sold
and other short-term investments		33,201		34		0.20	%		19,803		26		0.26	%
FHLBB stock		42,008		–		–	%		42,008		–		–	%
Taxable debt securities		596,352		11,888		4.02	%		747,087		16,037		4.33	%
Nontaxable debt securities		79,524		2,310		5.86	%		80,674		2,332		5.83	%
Corporate stocks		4,997		151		6.14	%		6,053		174		5.80	%
Total securities		680,873		14,349		4.25	%		833,814		18,543		4.48	%
Total interest-earning assets		2,699,778		62,628		4.68	%		2,765,290		66,957		4.88	%
Non interest-earning assets		208,787							178,593
Total assets	$	2,908,565						$	2,943,883
Liabilities and shareholders’ equity
NOW accounts	$	203,809	$	127		0.13	%	$	175,530	$	154		0.18	%
Money market accounts		400,907		1,164		0.59	%		370,846		2,314		1.26	%
Savings accounts		201,255		170		0.17	%		183,206		300		0.33	%
Time deposits		954,398		9,639		2.04	%		968,367		15,260		3.18	%
FHLBB advances		590,769		12,219		4.17	%		731,311		14,339		3.95	%
Junior subordinated debentures		32,991		1,077		6.59	%		32,991		958		5.86	%
Other		21,030		485		4.64	%		22,153		489		4.45	%
Total interest-bearing liabilities		2,405,159		24,881		2.09	%		2,484,404		33,814		2.74	%
Demand deposits		203,757							175,904
Other liabilities		38,828							43,666
Shareholders’ equity		260,821							239,909
Total liabilities and shareholders’ equity	$	2,908,565						$	2,943,883
Net interest income (FTE)			$	37,747						$	33,143
Interest rate spread						2.59	%						2.14	%
Net interest margin						2.82	%						2.42	%

Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION – Non-GAAP Financial Measures (unaudited)

	At or for the Quarters Ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(Dollars in thousands, except per share amounts)	2010			2010			2009			2009			2009
Calculation of tangible book value per share
Total shareholders’ equity at end of period	$	265,411		$	259,529		$	254,946		$	252,146		$	242,293
Less:
Goodwill		58,114			58,114			58,114			58,114			58,114
Identifiable intangible assets, net		8,362			8,652			8,943			9,233			9,536
Total tangible shareholders’ equity at end of period	$	198,935		$	192,763		$	187,889		$	184,799		$	174,643

Shares outstanding at end of period		16,120.7			16,079.1			16,042.6			16,026.6			16,001.9

Book value per share – GAAP	$	16.46		$	16.14		$	15.89		$	15.73		$	15.14
Tangible book value per share – Non-GAAP	$	12.34		$	11.99		$	11.71		$	11.53		$	10.91


Calculation of tangible equity to tangible assets
Total tangible shareholders’ equity at end of period	$	198,935		$	192,763		$	187,889		$	184,799		$	174,643

Total assets at end of period	$	2,929,853		$	2,896,425		$	2,884,473		$	2,888,065		$	2,919,808
Less:
Goodwill		58,114			58,114			58,114			58,114			58,114
Identifiable intangible assets, net		8,362			8,652			8,943			9,233			9,536
Total tangible assets at end of period	$	2,863,377		$	2,829,659		$	2,817,416		$	2,820,718		$	2,852,158

Equity to assets - GAAP		9.06	%		8.96	%		8.84	%		8.73	%		8.30	%
Tangible equity to tangible assets – Non-GAAP		6.95	%		6.81	%		6.67	%		6.55	%		6.12	%


Calculation of return on average tangible assets
Net income	$	5,298		$	5,172		$	4,748		$	4,913		$	3,765

Total average assets	$	2,920,838		$	2,896,156		$	2,887,041		$	2,911,110		$	2,924,002
Less:
Average goodwill		58,114			58,114			58,114			58,114			58,114
Average identifiable intangible assets, net		8,503			8,794			9,084			9,379			9,686
Total average tangible assets	$	2,854,221		$	2,829,248		$	2,819,843		$	2,843,617		$	2,856,202

Return on average assets - GAAP		0.73	%		0.71	%		0.66	%		0.68	%		0.52	%
Return on average tangible assets – Non-GAAP		0.74	%		0.73	%		0.67	%		0.69	%		0.53	%


Calculation of return on average tangible equity
Net income	$	5,298		$	5,172		$	4,748		$	4,913		$	3,765

Total average shareholders’ equity	$	263,138		$	258,478		$	254,211		$	247,585		$	242,270
Less:
Average goodwill		58,114			58,114			58,114			58,114			58,114
Average identifiable intangible assets, net		8,503			8,794			9,084			9,379			9,686
Total average tangible shareholders’ equity	$	196,521		$	191,570		$	187,013		$	180,092		$	174,470

Return on average shareholders’ equity - GAAP		8.05	%		8.00	%		7.47	%		7.94	%		6.22	%
Return on average tangible shareholders’ equity – Non-GAAP		10.78	%		10.80	%		10.16	%		10.91	%		8.63	%

Washington Trust Bancorp, Inc. and Subsidiaries
SUPPLEMENTAL INFORMATION – Non-GAAP Financial Measures (unaudited)

	Six Months Ended
	June 30,			June 30,
(Dollars in thousands)	2010			2009
Calculation of return on average tangible assets
Net income	$	10,470		$	6,435

Total average assets	$	2,908,565		$	2,943,883
Less:
Average goodwill		58,114			58,114
Average identifiable intangible assets, net		8,648			9,840
Total average tangible assets	$	2,841,803		$	2,875,929

Return on average assets - GAAP		0.72	%		0.44	%
Return on average tangible assets – Non-GAAP		0.74	%		0.45	%


Calculation of return on average tangible equity
Net income	$	10,470		$	6,435

Total average shareholders’ equity	$	260,821		$	239,909
Less:
Average goodwill		58,114			58,114
Average identifiable intangible assets, net		8,648			9,840
Total average tangible shareholders’ equity	$	194,059		$	171,955

Return on average shareholders’ equity - GAAP		8.03	%		5.36	%
Return on average tangible shareholders’ equity – Non-GAAP		10.79	%		7.48	%

(Dollars in thousands)
	At June 30, 2010
Commercial Real Estate Loans by Property Location	Balance		% of Total
Rhode Island, Connecticut, Massachusetts	$	522,627		90.5	%
New York, New Jersey, Pennsylvania		41,263		7.1	%
New Hampshire		11,930		2.1	%
Other		1,710		0.3	%
Total commercial real estate loans (1)	$	577,530		100.0	%

(Dollars in thousands)
	At June 30, 2010
Residential Mortgages by Property Location	Balance		% of Total
Rhode Island, Connecticut, Massachusetts	$	579,338		93.0	%
New York, Virginia, New Jersey, Maryland, Pennsylvania, District of Columbia		15,250		2.4	%
Ohio		11,598		1.9	%
California, Washington, Oregon		8,110		1.3	%
Colorado, Texas, New Mexico, Utah		4,031		0.6	%
Georgia		2,508		0.4	%
New Hampshire		1,299		0.2	%
Other		479		0.2	%
Total residential mortgages	$	622,613		100.0	%