form8-k20110725.htm

Exhibit 99.1

[Graphic Omitted]

NASDAQ: WASH

Contact: Elizabeth B. Eckel

Senior Vice President, Marketing

Telephone: (401) 348-1309

E-mail: ebeckel@washtrust.com

Date: July 25, 2011

FOR IMMEDIATE RELEASE

Washington Trust Announces Record Net Income for Second Quarter 2011

Diluted Earnings Per Share up 39% over Second Quarter 2010

Westerly, Rhode Island…Washington Trust Bancorp, Inc. (NASDAQ Global SelectÒ; symbol: WASH), parent company of The Washington Trust Company, today announced second quarter 2011 net income of $7.6 million, or 46 cents per diluted share, compared to second quarter 2010 net income of $5.3 million, or 33 cents per diluted share. The returns on average equity and average assets for the second quarter of 2011 were 10.83% and 1.04%, respectively, compared to 8.05% and 0.73%, respectively, for the same period in 2010.

For the six months ended June 30, 2011, net income amounted to $14.4 million, or 88 cents per diluted share, compared to $10.5 million, or 65 cents per diluted share, for the same period in 2010. The returns on average equity and average assets for the first six months of 2011 were 10.44% and 0.99%, respectively, compared to 8.03% and 0.72%, respectively, for the same period in 2010.

“Washington Trust posted record quarterly net income, as our state-wide presence and client base continues to grow in a challenging economy,” stated Joseph J. MarcAurele, Washington Trust Chairman, President and Chief Executive Officer. “We’re excited about the opportunities offered by our new East Providence branch, which is scheduled to open in September 2011.”

Financial Highlights:

·	A gain of $203 thousand ($141 thousand after tax; 1 cent per share) was recognized on the sale of a bank property in the second quarter of 2011.

·	Net interest margin amounted to 3.21% for the second quarter of 2011 compared to 3.16% for the first quarter of 2011 and up by 35 basis points from the 2.86% reported for the second quarter of 2010.

·	Wealth management revenues increased by $430 thousand, or 6%, from the first quarter of 2011 and by $747 thousand, or 11%, from the second quarter of 2010. Assets under administration increased by 1% in the second quarter and by 5% in the first six months of 2011.

·	The loan loss provision charged to earnings in the second quarter of 2011 was $1.2 million, a decrease of $300 thousand on both a linked quarter basis and compared to the second quarter of 2010.

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·	Federal Deposit Insurance Corp. (“FDIC”) deposit insurance premiums were down by $320 thousand from the second quarter of 2010 and by $259 thousand from the first quarter of 2011, reflecting lower assessment rates.

·	Total loan growth amounted to $28 million, or 1%, in the second quarter of 2011, with commercial loan growth of $17 million and residential mortgage loan growth of $9 million.

A balance sheet management transaction was conducted in May 2011 that included the sale of $5.7 million in mortgage-backed securities and prepayment of $5.0 million Federal Home Loan Bank of Boston (“FHLBB”) advances. The transaction resulted in net realized gains on securities of $226 thousand and a $221 thousand debt prepayment penalty.

Nonperforming assets amounted to $24.1 million, or 0.82% of total assets, at June 30, 2011, up from $22.3 million, or 0.77% of total assets, at March 31, 2011. Total loans 30 days or more past due amounted to $24.6 million, or 1.19% of total loans, at June 30, 2011, down by $2.7 million in the second quarter.

Net Interest Income

Net interest income for the second quarter of 2011 increased by $737 thousand, or 4%, from the first quarter of 2011 and by $2.2 million, or 12%, from the second quarter a year ago.

The net interest margin for the second quarter of 2011 was 3.21%, up by 5 basis points from the first quarter of 2011 and by 35 basis points from the second quarter of 2010. For the six months ended June 30, 2011, the net interest margin was 3.19%, up by 37 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.

Noninterest Income

Noninterest income totaled $13.3 million for the second quarter of 2011, up by $1.6 million, or 14%, on a linked quarter basis and up by $2.1 million, or 19%, over the second quarter of 2010. Second quarter 2011 noninterest income included $226 thousand of net realized gains on securities related to the previously described balance sheet management transaction and also included $203 thousand of gain recognized on the sale of a bank property, which was classified in other income. Excluding these two second quarter items, noninterest income increased by $1.2 million, or 10%, from the first quarter of 2011 and by $1.7 million, or 15%, from the same period a year earlier. The increase in noninterest income reflected increases in wealth management revenues and merchant processing fees.

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Wealth management revenues for the second quarter of 2011 increased by $430 thousand, or 6%, on a linked quarter basis and by $747 thousand, or 11%, over the second quarter a year ago. On a linked quarter basis, the increase in wealth management revenues includes a $254 thousand increase in tax preparation fees, which are typically concentrated in the second quarter.

Wealth management assets under administration totaled $4.1 billion at June 30, 2011, up by $29 million, from March 31, 2011 reflecting increases in market value net of income of $2 million and net client cash inflows of $28 million. Assets under administration were up by $181 million from December 31, 2010 and up by $522 million from June 30, 2010.

There were no other-than-temporary impairment losses on investment securities recognized in the second quarter of 2011, compared to $33 thousand in the first quarter of 2011 and $354 thousand in the second quarter a year earlier.

Noninterest Expenses

Noninterest expenses totaled $22.3 million for the second quarter of 2011. Second quarter of 2011 noninterest expenses included $221 thousand of debt prepayment charges. Excluding second quarter debt prepayment charges, noninterest expenses increased by $1.3 million, or 6%, from the first quarter of 2011 and by $1.1 million, or 5%, from the same period a year earlier. The increase in noninterest expenses reflected increases in salaries and employee benefit costs, merchant processing costs and foreclosed property costs, offset in part by lower FDIC deposit insurance costs.

Salaries and employee benefits costs, the largest component of noninterest expenses, increased by $570 thousand, or 5%, on a linked-quarter basis, due in large part to seasonal hires and higher commissions and incentives. Salaries and employee benefits costs increased by $672 thousand, or 6%, compared to the second quarter of 2010. This increase reflected higher staffing levels at the Burlington, Massachusetts mortgage production office, which opened in the first quarter of 2011, other selected staffing additions and higher commissions and incentives, which were being recognized at lower levels in 2010.

Income tax expense amounted to $3.3 million for the second quarter of 2011, compared to $3.0 million for the first quarter of 2011 and $2.2 million for the second quarter of 2010. The effective tax rate for both the second quarter of 2011 and first quarter of 2011 was 30.5%, as compared to 29.4% for the second quarter of 2010.

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Asset Quality

Nonperforming assets (nonaccrual loans, nonaccrual investment securities and property acquired through foreclosure or repossession) amounted to $24.1 million, or 0.82% of total assets, at June 30, 2011, compared to $22.3 million, or 0.77% of total assets, at March 31, 2011. Nonaccrual loans totaled $21.0 million at June 30, 2011, up by $1.6 million in the second quarter of 2011, reflecting a net increase of $1.3 million in nonaccrual residential loans. Property acquired through foreclosure or repossession amounted to $2.2 million at June 30, 2011. Four properties were acquired and five properties were sold during the quarter.

At June 30, 2011, total past due loans amounted to $24.6 million, or 1.19% of total loans, down by $2.7 million in the second quarter of 2011. Total past due commercial loans amounted to $11.3 million, or 1.05% of total commercial loans, at June 30, 2011, down by $4.1 million in the second quarter of 2011. Total past due residential mortgage loans were up by $1.4 million in the second quarter of 2011 including one mortgage with a carrying value of $942 thousand.

At June 30, 2011, loans classified as troubled debt restructurings totaled $18.6 million, down by $2.5 million from the $21.1 million balance at March 31, 2011, reflecting payoffs and declassification from troubled debt restructuring status.

The loan loss provision charged to earnings amounted to $1.2 million for the second quarter of 2011, down by $300 thousand from both the first quarter 2011 and second quarter 2010 levels. Net charge-offs amounted to $956 thousand in the second quarter of 2011, as compared to net charge-offs of $974 thousand in the first quarter of 2011 and $1.2 million in the second quarter of 2010.

Loans

Total loans grew by $28 million, or 1%, in the second quarter of 2011. We continued to experience good commercial origination activity in the second quarter, with a $17 million, or 1.4%, increase in the commercial loan portfolio, despite some larger paydowns. The residential mortgage portfolio grew by $9 million in the second quarter of 2011 while consumer loan balances increased by $1 million. During the first six months of 2011, total loans grew by $62 million, or 3%, with the largest increase in the commercial loan portfolio.

Investment Securities

The investment securities portfolio amounted to $592 million at June 30, 2011, up by $15 million from the

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balance at March 31, 2011, primarily due to purchases of mortgage-backed securities. The investment securities portfolio decreased by $3 million from the balance at December 31, 2010.

Deposits and Borrowings

Deposits totaled $2 billion at June 30, 2011, down by $53 million, or 3%, from the balance at March 31, 2011 reflecting a seasonal decrease in governmental and other deposits, which are expected to build again during the third quarter of 2011. On a year-to-date basis, total deposits declined by $40 million, or 2%, reflecting declines in money market account balances and time deposits, which were partially offset by increases in demand deposits, NOW accounts and savings account balances.

FHLBB advances totaled $558 million at June 30, 2011, up by $89 million from March 31, 2011 and up by $60 million from December 31, 2010.

Capital Management

Capital levels remain firmly above the regulatory minimums to be considered well capitalized, with total risk-based capital ratio of 12.98% at June 30, 2011, compared to 12.79% at December 31, 2010. Total shareholder’s equity was $281.4 million at June 30, 2011, up by $12.6 million from the balance at December 31, 2010.

Dividends Declared

The Board of Directors declared a quarterly dividend of 22 cents per share for the quarter ended June 30, 2011. The dividend was paid on July 14, 2011 to shareholders of record on June 30, 2011.

Conference Call

Washington Trust will host a conference call on Tuesday, July 26, 2011 at 8:30 a.m. Eastern Time to discuss second quarter results. This call is being webcast and can be accessed through the Investor Relations section of the Washington Trust web site, www.washtrust.com. Individuals may dial in to the call at 1-877-317-6789. The international dial-in number is 1-412-317-6789. A replay of the call will be posted in this same location on the web site shortly after the conclusion of the call. To listen to a replay of the conference call, dial 1-877-344-7529. For international access, dial 1-412-317-0088. The Conference Number for replay is 10001534. The replay will be available until 9:00 a.m. on August 9, 2011.

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Background

Washington Trust Bancorp, Inc. is the parent of The Washington Trust Company, a Rhode Island state-chartered bank founded in 1800. Washington Trust offers personal banking, business banking and wealth management services through its offices in Rhode Island, eastern Massachusetts and southeastern Connecticut. Washington Trust Bancorp, Inc.’s common stock trades on the NASDAQ Global SelectÒ Market under the symbol “WASH.” Investor information is available on the Corporation’s web site: www.washtrust.com.

Forward-Looking Statements

This press release contains certain statements that are “forward-looking statements”. We may also make written or oral 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 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, 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 Washington Trust’s competition, changes in legislation or regulation and accounting principles, policies and guidelines such as the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, 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, 2010, as filed with the Securities and Exchange Commission and as updated by our Quarterly Reports on Form 10-Q, 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 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)

	June 30,		December 31,
(Dollars in thousands, except par value)	2011		2010
Assets:
Cash and due from banks	$	64,265	$	85,971
Other short-term investments		7,480		6,765
Mortgage loans held for sale		8,825		13,894
Securities available for sale, at fair value;
amortized cost $570,905 in 2011 and $578,897 in 2010		591,580		594,100
Federal Home Loan Bank stock, at cost		42,008		42,008
Loans:
Commercial and other		1,073,495		1,027,065
Residential real estate		658,347		645,020
Consumer		325,310		323,553
Total loans		2,057,152		1,995,638
Less allowance for loan losses		29,353		28,583
Net loans		2,027,799		1,967,055
Premises and equipment, net		25,265		26,069
Investment in bank-owned life insurance		52,802		51,844
Goodwill		58,114		58,114
Identifiable intangible assets, net		7,377		7,852
Other assets		50,791		55,853
Total assets	$	2,936,306	$	2,909,525
Liabilities:
Deposits:
Demand deposits	$	261,016	$	228,437
NOW accounts		236,162		241,974
Money market accounts		355,096		396,455
Savings accounts		227,014		220,888
Time deposits		916,755		948,576
Total deposits		1,996,043		2,036,330
Federal Home Loan Bank advances		558,441		498,722
Junior subordinated debentures		32,991		32,991
Other borrowings		22,005		23,359
Other liabilities		45,401		49,259
Total liabilities		2,654,881		2,640,661
Shareholders’ Equity:
Common stock of $.0625 par value; authorized 30,000,000 shares;
issued 16,266,483 shares in 2011 and 16,171,618 shares in 2010		1,017		1,011
Paid-in capital		86,838		84,889
Retained earnings		186,078		178,939
Accumulated other comprehensive income		7,492		4,025
Total shareholders’ equity		281,425		268,864
Total liabilities and shareholders’ equity	$	2,936,306	$	2,909,525

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,		2011			2010			2011			2010
Interest income:
Interest and fees on loans		$	24,707		$	24,180		$	48,966		$	48,148
Interest on securities:
Taxable			4,869			5,837			9,642			11,888
Nontaxable			758			770			1,527			1,539
Dividends on corporate stock and Federal Home Loan Bank stock			66			54			133			109
Other interest income			13			13			37			34
Total interest income			30,413			30,854			60,305			61,718
Interest expense:
Deposits			4,030			5,331			8,232			11,100
Federal Home Loan Bank advances			4,685			6,000			9,417			12,219
Junior subordinated debentures			392			447			782			1,077
Other interest expense			242			243			483			485
Total interest expense			9,349			12,021			18,914			24,881
Net interest income			21,064			18,833			41,391			36,837
Provision for loan losses			1,200			1,500			2,700			3,000
Net interest income after provision for loan losses			19,864			17,333			38,691			33,837
Noninterest income:
Wealth management services:
Trust and investment advisory fees			5,822			5,153			11,498			10,170
Mutual fund fees			1,135			1,105			2,258			2,215
Financial planning, commissions and other service fees			553			505			834			684
Wealth management services			7,510			6,763			14,590			13,069
Service charges on deposit accounts			909			913			1,841			1,762
Merchant processing fees			2,682			2,406			4,626			4,012
Card interchange fees			581			487			1,068			876
Income from bank-owned life insurance			482			474			958			913
Net gains on loan sales and commissions on loans originated for others			537			318			1,062			878
Net realized gains on securities			226			–			197			–
Net gains (losses) on interest rate swap contracts			(35	)		(121	)		41			(53	)
Equity in losses of unconsolidated subsidiaries			(145	)		(50	)		(289	)		(102	)
Other income			538			323			921			688
Noninterest income, excluding other-than-temporary impairment losses			13,285			11,513			25,015			22,043
Total other-than-temporary impairment losses on securities			–			(243	)		(54	)		(245	)
Portion of loss recognized in other comprehensive income (before taxes)			–			(111	)		21			(172	)
Net impairment losses recognized in earnings			–			(354	)		(33	)		(417	)
Total noninterest income			13,285			11,159			24,982			21,626
Noninterest expense:
Salaries and employee benefits			12,398			11,726			24,226			23,227
Net occupancy			1,236			1,237			2,557			2,461
Equipment			1,070			1,014			2,119			2,011
Merchant processing costs			2,345			2,057			4,014			3,414
Outsourced services			875			855			1,747			1,695
FDIC deposit insurance costs			464			784			1,187			1,578
Legal, audit and professional fees			467			408			959			926
Advertising and promotion			427			419			780			783
Amortization of intangibles			237			290			475			581
Foreclosed property costs			338			87			504			123
Debt prepayment penalties			221			–			221			–
Other expenses			2,186			2,106			4,215			3,861
Total noninterest expense			22,264			20,983			43,004			40,660
Income before income taxes			10,885			7,509			20,669			14,803
Income tax expense			3,320			2,211			6,304			4,333
Net income		$	7,565		$	5,298		$	14,365		$	10,470
Weighted average common shares outstanding – basic			16,251.6			16,104.6			16,224.5			16,081.3
Weighted average common shares outstanding – diluted			16,284.3			16,111.3			16,257.0			16,116.3
Per share information:	Basic earnings per common share	$	0.46		$	0.33		$	0.88		$	0.65
	Diluted earnings per common share	$	0.46		$	0.33		$	0.88		$	0.65
	Cash dividends declared per share	$	0.22		$	0.21		$	0.44		$	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 and shares in thousands, except per share amounts)	2011			2011			2010			2010			2010
Financial Data:
Total assets	$	2,936,306		$	2,892,272		$	2,909,525		$	2,909,003		$	2,929,853
Total loans		2,057,152			2,029,637			1,995,638			2,011,148			1,972,498
Total securities		591,580			576,158			594,100			577,161			675,938
Total deposits		1,996,043			2,048,846			2,036,330			2,056,754			1,949,905
Total shareholders’ equity		281,425			273,885			268,864			267,109			265,411
Net interest income		21,064			20,327			20,253			20,101			18,833
Provision for loan losses		1,200			1,500			1,500			1,500			1,500
Noninterest income, excluding other-than-temporary
impairment losses		13,285			11,730			13,408			13,439			11,513
Net impairment losses recognized in earnings		-			(33	)		-			-			(354	)
Noninterest expenses		22,264			20,740			21,796			22,855			20,983
Income tax expense		3,320			2,984			3,154			2,815			2,211
Net income		7,565			6,800			7,211			6,370			5,298

Share Data:
Basic earnings per common share	$	0.46		$	0.42		$	0.44		$	0.39		$	0.33
Diluted earnings per common share	$	0.46		$	0.42		$	0.44		$	0.39		$	0.33
Dividends declared per share	$	0.22		$	0.22		$	0.21		$	0.21		$	0.21
Book value per share	$	17.30		$	16.87		$	16.63		$	16.55		$	16.46
Tangible book value per share – Non-GAAP (1)	$	13.27		$	12.82		$	12.55		$	12.45		$	12.34
Market value per share	$	22.97		$	23.74		$	21.88		$	19.12		$	17.04

Shares outstanding at end of period		16,266.5			16,233.6			16,171.6			16,135.4			16,120.7
Weighted average common shares outstanding–basic		16,251.6			16,197.2			16,160.6			16,131.4			16,104.6
Weighted average common shares outstanding–diluted		16,284.3			16,229.8			16,182.7			16,136.3			16,111.3

Key Ratios:
Return on average assets		1.04	%		0.94	%		0.99	%		0.87	%		0.73	%
Return on average tangible assets – Non-GAAP (1)		1.07	%		0.96	%		1.01	%		0.89	%		0.74	%
Return on average equity		10.83	%		10.04	%		10.70	%		9.53	%		8.05	%
Return on average tangible equity – Non-GAAP (1)		14.16	%		13.26	%		14.17	%		12.67	%		10.78	%

Capital Ratios:
Tier 1 risk-based capital		11.72	% (i)		11.65	%		11.53	%		11.24	%		11.22	%
Total risk-based capital		12.98	% (i)		12.92	%		12.79	%		12.50	%		12.47	%
Tier 1 leverage ratio		8.61	% (i)		8.49	%		8.25	%		8.04	%		7.94	%
Equity to assets		9.58	%		9.47	%		9.24	%		9.18	%		9.06	%
Tangible equity to tangible assets – Non-GAAP (1)		7.52	%		7.36	%		7.14	%		7.07	%		6.95	%
(i) – estimated

Wealth Management Assets under
Administration (2):
Balance at beginning of period	$	4,119,207		$	3,967,207		$	3,744,632		$	3,626,871		$	3,869,502
Net investment appreciation (depreciation) & income		1,625			145,563			227,168			243,141			(250,445	)
Net customer cash flows		27,601			6,437			(4,593	)		(19,611	)		7,814
Other (3)		–			–			–			(105,769	)		–
Balance at end of period	$	4,148,433		$	4,119,207		$	3,967,207		$	3,744,632		$	3,626,871

(1)	See the section labeled “Supplemental Information – Non-GAAP Financial Measures” at the end of this document.

(2)	Prior period amounts have been reclassified to conform to current period presentation.

(3)

Amounts prior to 2011 have been revised to reflect current reporting practices. The most significant change was related to a change in the nature of a client relationship, which reduced the scope and frequency of services provided by Washington Trust. This change occurred at the beginning of the third quarter of 2010. In 2011, management concluded that a declassification of these client assets from assets under administration was appropriate, based on its current reporting practices. Accordingly, the 2010 assets under administration have been reduced by $106 million, beginning in the third quarter of that year. This revision to previously reported assets under administration did not result in any change to the reported amounts of wealth management revenues.

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

	Six Months Ended
	June 30,			June 30,
(Dollars and shares in thousands, except per share amounts)	2011			2010
Financial Data
Net interest income	$	41,391		$	36,837
Provision for loan losses		2,700			3,000
Noninterest income, excluding other-than-temporary impairment losses		25,015			22,043
Net impairment losses recognized in earnings		(33	)		(417	)
Noninterest expenses		43,004			40,660
Income tax expense		6,304			4,333
Net income		14,365			10,470

Share Data
Basic earnings per common share	$	0.88		$	0.65
Diluted earnings per common share	$	0.88		$	0.65
Dividends declared per share	$	0.44		$	0.42

Weighted average common shares outstanding - basic		16,224.5			16,081.3
Weighted average common shares outstanding - diluted		16,257.0			16,116.3

Key Ratios
Return on average assets		0.99	%		0.72	%
Return on average tangible assets – Non-GAAP (1)		1.02	%		0.74	%
Return on average equity		10.44	%		8.03	%
Return on average tangible equity – Non-GAAP (1)		13.72	%		10.79	%

Asset Quality Data
Allowance for Loan Losses
Balance at beginning of period	$	28,583		$	27,400
Provision charged to earnings		2,700			3,000
Charge-offs		(2,097	)		(2,538	)
Recoveries		167			123
Balance at end of period	$	29,353		$	27,985

Net Loan Charge-Offs
Commercial:
Mortgages	$	455		$	1,022
Construction and development		-			-
Other		1,049			1,066
Residential:
Mortgages		263			211
Homeowner construction		-			-
Consumer		163			116
Total	$	1,930		$	2,415

Net charge-offs to average loans (annualized)		0.19	%		0.25	%

Wealth Management Assets Under Administration
Balance at beginning of period	$	3,967,207		$	3,735,646
Net investment appreciation (depreciation) & income		147,188			(151,324	)
Net customer cash flows		34,038			42,549
Balance at end of period	$	4,148,433		$	3,626,871

(1)	See the section labeled “Supplemental Information – Non-GAAP Financial Measures” at the end of this document.

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

	For the Quarters Ended
	June. 30,	Mar. 31,	Dec. 31,	Sept. 30,	June 30,
	2011	2011	2010	2010	2010
Average Yield / Rate (taxable equivalent basis):
Assets:
Commercial and other loans	5.23%	5.28%	5.22%	5.29%	5.23%
Residential real estate loans, including
mortgage loans held for sale	4.72%	4.79%	4.76%	4.94%	5.05%
Consumer loans	3.91%	3.93%	3.96%	3.99%	4.00%
Total loans	4.86%	4.91%	4.87%	4.97%	4.97%
Cash, federal funds sold
and other short-term investments	0.15%	0.22%	0.21%	0.20%	0.17%
FHLBB stock	0.31%	0.31%	–%	–%	–%
Taxable debt securities	4.01%	3.93%	3.79%	3.93%	3.93%
Nontaxable debt securities	5.88%	5.95%	5.76%	5.76%	5.82%
Corporate stocks	7.50%	8.07%	7.42%	7.72%	7.60%
Total securities	4.28%	4.23%	4.08%	4.19%	4.17%
Total interest-earning assets	4.61%	4.61%	4.54%	4.63%	4.64%
Liabilities:
NOW accounts	0.10%	0.10%	0.12%	0.12%	0.12%
Money market accounts	0.25%	0.33%	0.34%	0.40%	0.56%
Savings accounts	0.12%	0.14%	0.14%	0.14%	0.17%
Time deposits	1.57%	1.61%	1.65%	1.74%	1.94%
FHLBB advances	3.80%	4.04%	4.13%	4.16%	4.08%
Junior subordinated debentures	4.77%	4.79%	5.15%	5.82%	5.43%
Other	4.48%	4.23%	4.43%	4.59%	4.63%
Total interest-bearing liabilities	1.61%	1.67%	1.70%	1.84%	2.00%

Interest rate spread (taxable equivalent basis)	3.00%	2.94%	2.84%	2.79%	2.64%
Net interest margin (taxable equivalent basis)	3.21%	3.16%	3.05%	3.01%	2.86%

	At June 30, 2011
	Amortized		Unrealized		Unrealized			Fair
(Dollars in thousands)	Cost (1)		Gains		Losses			Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises	$	29,415	$	3,834	$	−		$	33,249
Mortgage-backed securities issued by U.S. government
agencies and U.S. government-sponsored enterprises		411,629		20,098		(35	)		431,692
States and political subdivisions		78,445		3,595		(65	)		81,975
Trust preferred securities:
Individual name issuers		30,620		−		(5,009	)		25,611
Collateralized debt obligations		4,414		−		(3,480	)		934
Corporate bonds		13,870		1,098		−			14,968
Common stocks		658		224		−			882
Perpetual preferred stocks		1,854		415		−			2,269
Total securities available for sale	$	570,905	$	29,264	$	(8,589	)	$	591,580

(1)	Net of other-than-temporary impairment losses recognized in earnings.

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

		Period End Balances At
(Dollars in thousands)		6/30/2011		3/31/2011		12/31/2010		9/30/2010		6/30/2010
Loans:
Commercial:	Mortgages	$	562,976	$	551,069	$	518,623	$	522,355	$	510,315
	Construction & development		19,448		34,615		47,335		62,820		67,215
	Other		491,071		470,704		461,107		464,294		441,827
	Total commercial		1,073,495		1,056,388		1,027,065		1,049,469		1,019,357
Residential real estate:	Mortgages		644,210		636,916		634,739		622,975		610,245
	Homeowner construction		14,137		12,241		10,281		10,593		12,368
	Total residential real estate		658,347		649,157		645,020		633,568		622,613
Consumer:	Home equity lines		223,284		221,003		218,288		218,898		218,440
	Home equity loans		46,797		48,337		50,624		54,923		57,682
	Other		55,229		54,752		54,641		54,290		54,406
	Total consumer		325,310		324,092		323,553		328,111		330,528
	Total loans	$	2,057,152	$	2,029,637	$	1,995,638	$	2,011,148	$	1,972,498

	At June 30, 2011
(Dollars in thousands)	Balance		% of Total
Commercial Real Estate Loans by Property Location:
Rhode Island, Connecticut, Massachusetts	$	528,500		90.7	%
New York, New Jersey, Pennsylvania		40,462		6.9	%
New Hampshire		11,758		2.0	%
Other		1,704		0.4	%
Total commercial real estate loans (1)	$	582,424		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.

	At June 30, 2011
(Dollars in thousands)	Balance		% of Total
Residential Mortgages by Property Location:
Rhode Island, Connecticut, Massachusetts	$	629,477		95.6	%
New York, Virginia, New Jersey, Maryland, Pennsylvania, District of Columbia		12,488		1.9	%
Ohio		7,038		1.1	%
California, Washington, Oregon		3,453		0.5	%
Colorado, New Mexico, Utah		2,095		0.3	%
Georgia		1,669		0.3	%
New Hampshire		1,655		0.3	%
Wyoming		472		0.0	%
Total residential mortgages	$	658,347		100.0	%

	Period End Balances At
(Dollars in thousands)	6/30/2011		3/31/2011		12/31/2010		9/30/2010		6/30/2010
Deposits:
Demand deposits	$	261,016	$	274,798	$	228,437	$	242,455	$	225,494
NOW accounts		236,162		228,502		241,974		236,775		234,014
Money market accounts		355,096		387,923		396,455		408,828		378,004
Savings accounts		227,014		223,599		220,888		210,271		209,616
Time deposits		916,755		934,024		948,576		958,425		902,777
Total deposits	$	1,996,043	$	2,048,846	$	2,036,330	$	2,056,754	$	1,949,905

Out-of-market brokered certificates of deposits
included in time deposits	$	85,659	$	51,778	$	52,347	$	69,385	$	94,641
In-market deposits, excluding out of market
brokered certificates of deposit	$	1,910,384	$	1,997,068	$	1,983,983	$	1,987,369	$	1,855,264

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

	Period End Balances At
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(Dollars in thousands)	2011			2011			2010			2010			2010
Nonperforming Assets:
Commercial mortgages	$	7,476		$	6,068		$	6,624		$	6,426		$	6,680
Commercial construction and development		–			–			–			–			–
Other commercial		3,152			4,445			5,259			6,256			8,418
Residential real estate mortgages		9,570			8,265			6,414			6,080			6,850
Consumer		780			601			213			824			789
Total nonaccrual loans	$	20,978		$	19,379		$	18,510		$	19,586		$	22,737
Nonaccrual investment securities		934			752			806			841			872
Property acquired through foreclosure or repossession		2,189			2,163			3,644			2,612			2,338
Total nonperforming assets	$	24,101		$	22,294		$	22,960		$	23,039		$	25,947

Total past due loans to total loans		1.19	%		1.34	%		1.27	%		1.24	%		1.45	%
Nonperforming assets to total assets		0.82	%		0.77	%		0.79	%		0.79	%		0.89	%
Nonaccrual loans to total loans		1.02	%		0.95	%		0.93	%		0.97	%		1.15	%
Allowance for loan losses to nonaccrual loans		139.92	%		150.21	%		154.42	%		143.80	%		123.08	%
Allowance for loan losses to total loans		1.43	%		1.43	%		1.43	%		1.40	%		1.42	%

Troubled Debt Restructured Loans:
Accruing troubled debt restructured loans
Commercial mortgages	$	6,552		$	10,071		$	11,736		$	11,812		$	6,176
Other commercial		4,026			4,554			4,594			2,498			2,224
Residential real estate mortgages		2,279			2,724			2,863			2,870			2,234
Consumer		317			417			509			817			997
Accruing troubled debt restructured loans		13,174			17,766			19,702			17,997			11,631
Nonaccrual troubled debt restructured loans
Commercial mortgages		2,555			826			1,302			1,473			986
Other commercial		455			526			431			213			301
Residential real estate mortgages		2,303			1,785			948			823			381
Consumer		131			199			41			43			43
Nonaccrual troubled debt restructured loans		5,444			3,336			2,722			2,552			1,711
Total troubled debt restructured loans	$	18,618		$	21,102		$	22,424		$	20,549		$	13,342

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

	Period End Balances At
	June 30,		Mar. 31,		Dec. 31,		Sept. 30,		June 30,
(Dollars in thousands)	2011		2011		2010		2010		2010
Past Due Loans:
Loans 30–59 Days Past Due
Commercial mortgages	$	1,507	$	3,223	$	2,185	$	1,685	$	3,898
Other commercial loans		1,783		2,474		1,862		2,632		3,284
Residential real estate mortgages		3,355		2,986		3,073		2,828		2,680
Consumer loans		1,979		1,735		2,005		2,218		3,364
Loans 30–59 days past due	$	8,624	$	10,418	$	9,125	$	9,363	$	13,226

Loans 60–89 Days Past Due
Commercial mortgages	$	1,013	$	1,626	$	514	$	–	$	19
Other commercial loans		80		315		953		492		1,195
Residential real estate mortgages		992		1,345		1,477		430		861
Consumer loans		120		335		448		420		195
Loans 60-89 days past due	$	2,205	$	3,621	$	3,392	$	1,342	$	2,270

Loans 90 Days or more Past Due
Commercial mortgages	$	5,553	$	5,242	$	5,322	$	4,952	$	3,695
Other commercial loans		1,378		2,524		3,376		4,240		2,919
Residential real estate mortgages		6,549		5,165		4,041		4,696		5,942
Consumer loans		245		317		11		277		634
Loans 90 days or more past due	$	13,725	$	13,248	$	12,750	$	14,165	$	13,190

Total Past Due Loans
Commercial mortgages	$	8,073	$	10,091	$	8,021	$	6,637	$	7,612
Other commercial loans		3,241		5,313		6,191		7,364		7,398
Residential real estate mortgages		10,896		9,496		8,591		7,954		9,483
Consumer loans		2,344		2,387		2,464		2,915		4,193
Total past due loans	$	24,554	$	27,287	$	25,267	$	24,870	$	28,686

Nonaccrual loans included in past due loans	$	16,705	$	16,456	$	14,894	$	15,870	$	17,881

	For the Quarters Ended
	June 30,			Mar. 31,			Dec. 31,			Sept. 30,			June 30,
(Dollars in thousands)	2011			2011			2010			2010			2010
Allowance for Loan Losses:
Balance at beginning of period	$	29,109		$	28,583		$	28,165		$	27,985		$	27,711
Provision charged to earnings		1,200			1,500			1,500			1,500			1,500
Charge-offs		(1,046	)		(1,051	)		(1,396	)		(1,468	)		(1,263	)
Recoveries		90			77			314			148			37
Balance at end of period	$	29,353		$	29,109		$	28,583		$	28,165		$	27,985

Net Loan Charge-Offs (Recoveries):
Commercial mortgages	$	122		$	333		$	226		$	(96	)	$	531
Other commercial		540			509			695			1,026			558
Residential real estate mortgages		145			118			(99	)		301			90
Consumer		149			14			260			89			47
Total	$	956		$	974		$	1,082		$	1,320		$	1,226

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,	2011							2010
	Average				Yield/			Average				Yield/
(Dollars in thousands)	Balance		Interest		Rate			Balance		Interest		Rate
Assets:
Commercial and other loans	$	1,065,619	$	13,900		5.23	%	$	1,008,153	$	13,149		5.23	%
Residential real estate loans, including
mortgage loans held for sale		656,570		7,732		4.72	%		618,907		7,790		5.05	%
Consumer loans		324,890		3,166		3.91	%		329,562		3,289		4.00	%
Total loans		2,047,079		24,798		4.86	%		1,956,622		24,228		4.97	%
Cash, federal funds sold
and other short-term investments		34,166		13		0.15	%		30,660		13		0.17	%
FHLBB stock		42,008		32		0.31	%		42,008		–		–	%

Taxable debt securities		486,905		4,869		4.01	%		595,523		5,837		3.93	%
Nontaxable debt securities		78,447		1,150		5.88	%		79,467		1,154		5.82	%
Corporate stocks		2,513		47		7.50	%		4,012		76		7.60	%
Total securities		567,865		6,066		4.28	%		679,002		7,067		4.17	%
Total interest-earning assets		2,691,118		30,909		4.61	%		2,708,292		31,308		4.64	%
Non interest-earning assets		212,968							212,546
Total assets	$	2,904,086						$	2,920,838
Liabilities and Shareholders’ Equity:
NOW accounts	$	229,746	$	60		0.10	%	$	213,045	$	63		0.12	%
Money market accounts		393,945		249		0.25	%		392,691		547		0.56	%
Savings accounts		224,588		69		0.12	%		205,582		85		0.17	%
Time deposits		935,813		3,652		1.57	%		957,311		4,636		1.94	%
FHLBB advances		494,989		4,685		3.80	%		589,577		6,000		4.08	%
Junior subordinated debentures		32,991		392		4.77	%		32,991		447		5.43	%
Other		21,663		242		4.48	%		21,073		243		4.63	%
Total interest-bearing liabilities		2,333,735		9,349		1.61	%		2,412,270		12,021		2.00	%
Demand deposits		251,585							207,271
Other liabilities		39,485							38,159
Shareholders’ equity		279,281							263,138
Total liabilities and shareholders’ equity	$	2,904,086						$	2,920,838
Net interest income (FTE)			$	21,560						$	19,287
Interest rate spread						3.00	%						2.64	%
Net interest margin						3.21	%						2.86	%

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

(Dollars in thousands)

Three months ended June 30,	2011		2010
Commercial and other loans	$	91	$	48
Nontaxable debt securities		392		384
Corporate stocks		13		22
Total	$	496	$	454

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

Six months ended June 30,	2011							2010
	Average				Yield/			Average				Yield/
(Dollars in thousands)	Balance		Interest		Rate			Balance		Interest		Rate
Assets:
Commercial and other loans	$	1,051,577	$	27,406		5.26	%	$	997,042	$	26,053		5.27	%
Residential real estate loans, including
mortgage loans held for sale		653,938		15,432		4.76	%		617,216		15,664		5.12	%
Consumer loans		324,471		6,310		3.92	%		329,438		6,528		4.00	%
Total loans		2,029,986		49,148		4.88	%		1,943,696		48,245		5.01	%
Cash, federal funds sold
and other short-term investments		39,029		37		0.19	%		33,201		34		0.21	%
FHLBB stock		42,008		64		0.31	%		42,008		–		–	%

Taxable debt securities		489,544		9,642		3.97	%		597,337		11,888		4.01	%
Nontaxable debt securities		78,947		2,316		5.92	%		79,524		2,310		5.86	%
Corporate stocks		2,512		96		7.71	%		4,012		151		7.59	%
Total securities		571,003		12,054		4.26	%		680,873		14,349		4.25	%
Total interest-earning assets		2,682,026		61,303		4.61	%		2,699,778		62,628		4.68	%
Non interest-earning assets		212,379							208,787
Total assets	$	2,894,405						$	2,908,565
Liabilities and Shareholders’ Equity:
NOW accounts	$	227,375	$	118		0.10	%	$	203,809	$	127		0.13	%
Money market accounts		396,614		572		0.29	%		400,907		1,164		0.59	%
Savings accounts		222,481		144		0.13	%		201,255		170		0.17	%
Time deposits		941,093		7,398		1.59	%		954,398		9,639		2.04	%
FHLBB advances		485,233		9,417		3.91	%		590,769		12,219		4.17	%
Junior subordinated debentures		32,991		782		4.78	%		32,991		1,077		6.58	%
Other		22,389		483		4.35	%		21,030		485		4.65	%
Total interest-bearing liabilities		2,328,176		18,914		1.64	%		2,405,159		24,881		2.09	%
Demand deposits		250,550							203,757
Other liabilities		40,520							38,828
Shareholders’ equity		275,159							260,821
Total liabilities and shareholders’ equity	$	2,894,405						$	2,908,565
Net interest income (FTE)			$	42,389						$	37,747
Interest rate spread						2.97	%						2.59	%
Net interest margin						3.19	%						2.82	%

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

(Dollars in thousands)

Six months ended June 30,	2011		2010
Commercial and other loans	$	182	$	97
Nontaxable debt securities		789		771
Corporate stocks		27		42
Total	$	998	$	910

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)	2011			2011			2010			2010			2010
Calculation of Tangible Book Value per Share:
Total shareholders’ equity at end of period	$	281,425		$	273,885		$	268,864		$	267,109		$	265,411
Less:
Goodwill		58,114			58,114			58,114			58,114			58,114
Identifiable intangible assets, net		7,377			7,614			7,852			8,089			8,362
Total tangible shareholders’ equity at end of period	$	215,934		$	208,157		$	202,898		$	200,906		$	198,935

Shares outstanding at end of period		16,266.5			16,233.6			16,171.6			16,135.4			16,120.7

Book value per share – GAAP	$	17.30		$	16.87		$	16.63		$	16.55		$	16.46
Tangible book value per share – Non-GAAP	$	13.27		$	12.82		$	12.55		$	12.45		$	12.34

Calculation of Tangible Equity to Tangible Assets:
Total tangible shareholders’ equity at end of period	$	215,934		$	208,157		$	202,898		$	200,906		$	198,935

Total assets at end of period	$	2,936,306		$	2,892,272		$	2,909,525		$	2,909,003		$	2,929,853
Less:
Goodwill		58,114			58,114			58,114			58,114			58,114
Identifiable intangible assets, net		7,377			7,614			7,852			8,089			8,362
Total tangible assets at end of period	$	2,870,815		$	2,826,544		$	2,843,559		$	2,842,800		$	2,863,377

Equity to assets - GAAP		9.58	%		9.47	%		9.24	%		9.18	%		9.06	%
Tangible equity to tangible assets – Non-GAAP		7.52	%		7.36	%		7.14	%		7.07	%		6.95	%

Calculation of Return on Average Tangible Assets:
Net income	$	7,564		$	6,800		$	7,211		$	6,370		$	5,298

Total average assets	$	2,904,086		$	2,884,618		$	2,912,770		$	2,931,816		$	2,920,838
Less:
Average goodwill		58,114			58,114			58,114			58,114			58,114
Average identifiable intangible assets, net		7,493			7,730			7,967			8,216			8,503
Total average tangible assets	$	2,838,479		$	2,818,774		$	2,846,689		$	2,865,486		$	2,854,221

Return on average assets - GAAP		1.04	%		0.94	%		0.99	%		0.87	%		0.73	%
Return on average tangible assets – Non-GAAP		1.07	%		0.96	%		1.01	%		0.89	%		0.74	%

Calculation of Return on Average Tangible Equity:
Net income	$	7,564		$	6,800		$	7,211		$	6,370		$	5,298

Total average shareholders’ equity	$	279,281		$	270,991		$	269,570		$	267,431		$	263,138
Less:
Average goodwill		58,114			58,114			58,114			58,114			58,114
Average identifiable intangible assets, net		7,493			7,730			7,967			8,216			8,503
Total average tangible shareholders’ equity	$	213,674		$	205,147		$	203,489		$	201,101		$	196,521

Return on average shareholders’ equity - GAAP		10.83	%		10.04	%		10.70	%		9.53	%		8.05	%
Return on average tangible shareholders’ equity – Non-GAAP		14.16	%		13.26	%		14.17	%		12.67	%		10.78	%

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

	Six Months Ended
	June 30,			June 30,
(Dollars in thousands)	2011			2010
Calculation of return on average tangible assets
Net income	$	14,364		$	10,470

Total average assets	$	2,894,405		$	2,908,565
Less:
Average goodwill		58,114			58,114
Average identifiable intangible assets, net		7,611			8,648
Total average tangible assets	$	2,828,680		$	2,841,803

Return on average assets - GAAP		0.99	%		0.72	%
Return on average tangible assets – Non-GAAP		1.02	%		0.74	%


Calculation of return on average tangible equity
Net income	$	14,364		$	10,470

Total average shareholders’ equity	$	275,159		$	260,821
Less:
Average goodwill		58,114			58,114
Average identifiable intangible assets, net		7,611			8,648
Total average tangible shareholders’ equity	$	209,434		$	194,059

Return on average shareholders’ equity - GAAP		10.44	%		8.03	%
Return on average tangible shareholders’ equity – Non-GAAP		13.72	%		10.79	%

Rhode Island	001-32991	05-0404671
--------------------	--------------------	---------------------
(State or Other Jurisdiction	(Commission	(IRS Employer
of Incorporation)	File Number)	Identification No.)

(c)	Exhibits.

	Exhibit No.	Exhibit

	99.1	Press Release dated July 25, 2011*


	*Filed herewith

	WASHINGTON TRUST BANCORP, INC.
Date: July 25, 2011	By:	/s/ David V. Devault
		David V. Devault
		Senior Executive Vice President, Secretary and Chief Financial Officer

Exhibit No.		Exhibit
99.1		Press Release dated July 25, 2011*

* Filed herewith