10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended MARCH 31, 2015 or

o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ______ to ______.

Commission file number:  001-32991

WASHINGTONTRUSTBANCORP,INC.

(Exact name of registrant as specified in its charter)

RHODE ISLAND	05-0404671
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

23 BROAD STREET
WESTERLY, RHODE ISLAND	02891
(Address of principal executive offices)	(Zip Code)

(401) 348-1200

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes o No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes o No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Mark one)

Large accelerated filer o	Accelerated filer x
Non-accelerated filer o	Smaller reporting company o
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

o Yes x No

The number of shares of common stock of the registrant outstanding as of April 30, 2015 was 16,811,770.

FORM 10-Q
WASHINGTON TRUST BANCORP, INC. AND SUBSIDIARIES
For the Quarter Ended March 31, 2015
TABLE OF CONTENTS
	Page Number
PART I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014	3
Consolidated Statements of Income for the three months ended March 31, 2015 and 2014	4
Consolidated Statements of Comprehensive Income for the three months ended March 31, 2015 and 2014	5
Consolidated Statements of Changes in Shareholders' Equity for the three months ended March 31, 2015 and 2014	6
Consolidated Statements of Cash Flows for the three months ended March 31, 2015 and 2014	7
Condensed Notes to Unaudited Consolidated Financial Statements	8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	39
Item 3. Quantitative and Qualitative Disclosures About Market Risk	61
Item 4. Controls and Procedures	61
PART II. Other Information
Item 1. Legal Proceedings	62
Item 1A. Risk Factors	62
Item 6. Exhibits	62
Signatures	63

- 2-

PART I.  Financial Information

Item 1.  Financial Statements

Consolidated Balance Sheets (unaudited) (Dollars in thousands, except par value)

	March 31, 2015			December 31, 2014
Assets:
Cash and due from banks		$84,842			$76,386
Short-term investments	4,191			3,964
Mortgage loans held for sale (including $36,672 at March 31, 2015 and $30,321 at December 31, 2014 measured at fair value)	47,117			45,693
Securities:
Available for sale, at fair value	340,942			357,662
Held to maturity, at amortized cost (fair value $24,834 at March 31, 2015 and $26,008 at December 31, 2014)	24,025			25,222
Total securities	364,967			382,884
Federal Home Loan Bank stock, at cost	37,730			37,730
Loans:
Commercial	1,559,523			1,535,488
Residential real estate	987,564			985,415
Consumer	333,505			338,373
Total loans	2,880,592			2,859,276
Less allowance for loan losses	27,810			28,023
Net loans	2,852,782			2,831,253
Premises and equipment, net	27,839			27,495
Investment in bank-owned life insurance	64,009			63,519
Goodwill	58,114			58,114
Identifiable intangible assets, net	4,694			4,849
Other assets	56,229			54,987
Total assets		$3,602,514			$3,586,874
Liabilities:
Deposits:
Demand deposits		$477,046			$459,852
NOW accounts	333,321			326,375
Money market accounts	821,353			802,764
Savings accounts	298,802			291,725
Time deposits	852,621			874,102
Total deposits	2,783,143			2,754,818
Federal Home Loan Bank advances	385,992			406,297
Junior subordinated debentures	22,681			22,681
Other liabilities	56,819			56,799
Total liabilities	3,248,635			3,240,595
Commitments and contingencies
Shareholders’ Equity:
Common stock of $.0625 par value; authorized 30,000,000 shares; issued and outstanding 16,772,956 shares at March 31, 2015 and 16,746,363 shares at December 31, 2014	1,048			1,047
Paid-in capital	102,587			101,204
Retained earnings	258,069			252,837
Accumulated other comprehensive loss	(7,825		)	(8,809		)
Total shareholders’ equity	353,879			346,279
Total liabilities and shareholders’ equity		$3,602,514			$3,586,874

The accompanying notes are an integral part of these unaudited consolidated financial statements.

3

Consolidated Statements of Income (unaudited) (Dollars and shares in thousands, except per share amounts)

Three months ended March 31,		2015			2014
Interest income:
Interest and fees on loans			$28,353			$25,589
Interest on securities:	Taxable	2,259			2,942
	Nontaxable	435			582
Dividends on Federal Home Loan Bank stock		165			142
Other interest income		25			35
Total interest and dividend income		31,237			29,290
Interest expense:
Deposits		3,389			2,969
Federal Home Loan Bank advances		1,902			2,241
Junior subordinated debentures		241			241
Other interest expense		3			3
Total interest expense		5,535			5,454
Net interest income		25,702			23,836
Provision for loan losses		—			300
Net interest income after provision for loan losses		25,702			23,536
Noninterest income:
Wealth management revenues		8,435			8,065
Merchant processing fees		—			1,291
Net gains on loan sales and commissions on loans originated for others		2,585			1,239
Service charges on deposit accounts		935			754
Card interchange fees		714			681
Income from bank-owned life insurance		490			445
Net gains on interest rate swap contracts		645			260
Equity in earnings (losses) of unconsolidated subsidiaries		(86		)	(43		)
Net gain on sale of business line		—			6,265
Other income		302			413
Total noninterest income		14,020			19,370
Noninterest expense:
Salaries and employee benefits		15,494			14,558
Net occupancy		1,886			1,640
Equipment		1,340			1,236
Merchant processing costs		—			1,050
Outsourced services		1,247			1,044
Legal, audit and professional fees		676			618
FDIC deposit insurance costs		473			440
Advertising and promotion		267			232
Amortization of intangibles		155			164
Debt prepayment penalties		—			6,294
Other expenses		1,993			2,016
Total noninterest expense		23,531			29,292
Income before income taxes		16,191			13,614
Income tax expense		5,181			4,316
Net income			$11,010			$9,298
Weighted average common shares outstanding - basic		16,759			16,626
Weighted average common shares outstanding - diluted		16,939			16,800
Per share information:	Basic earnings per common share		$0.65			$0.56
	Diluted earnings per common share		$0.65			$0.55
	Cash dividends declared per share		$0.34			$0.29

The accompanying notes are an integral part of these unaudited consolidated financial statements.

4

Consolidated Statements of Comprehensive Income (unaudited) (Dollars in thousands)

Three months ended March 31,	2015			2014
Net income		$11,010			$9,298
Other comprehensive income, net of tax:
Net change in fair value of securities available for sale	664			612
Cash flow hedges:
Change in fair value of cash flow hedges	(8		)	(16		)
Net cash flow hedge losses reclassified into earnings	93			92
Net change in fair value of cash flow hedges	85			76
Defined benefit plan obligation adjustment	235			88
Total other comprehensive income, net of tax	984			776
Total comprehensive income		$11,994			$10,074

The accompanying notes are an integral part of these unaudited consolidated financial statements.

5

Consolidated Statements of Changes in Shareholders' Equity (unaudited) (Dollars and shares in thousands)

	Common Shares Outstanding	Common Stock		Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at January 1, 2015	16,746		$1,047		$101,204		$252,837			($8,809	)		$346,279
Net income						11,010						11,010
Total other comprehensive income, net of tax									984			984
Cash dividends declared						(5,778		)				(5,778		)
Share-based compensation				580								580
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit	27	1		803								804
Balance at March 31, 2015	16,773		$1,048		$102,587		$258,069			($7,825	)		$353,879

	Common Shares Outstanding	Common Stock		Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at January 1, 2014	16,614		$1,038		$97,566		$232,595			($1,553	)		$329,646
Net income						9,298						9,298
Total other comprehensive income, net of tax									776			776
Cash dividends declared						(4,894		)				(4,894		)
Share-based compensation				491								491
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit	21	2		539								541
Balance at March 31, 2014	16,635		$1,040		$98,596		$236,999			($777	)		$335,858

The accompanying notes are an integral part of these unaudited consolidated financial statements.

6

Consolidated Statement of Cash Flows (unaudited) (Dollars in thousands)

Three months ended March 31,		2015			2014
Cash flows from operating activities:
Net income			$11,010			$9,298
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		—			300
Depreciation of premises and equipment		882			783
Net amortization of premium and discount		358			219
Amortization of intangibles		155			164
Share-based compensation		580			491
Income from bank-owned life insurance		(490		)	(445		)
Net gain on sale of business line		—			(6,265		)
Net gains on loan sales and commissions on loans originated for others		(2,585		)	(1,239		)
Net gains on interest rate swap contracts		(645		)	(260		)
Equity in losses of unconsolidated subsidiaries		86			43
Proceeds from sales of loans		117,571			48,296
Loans originated for sale		(116,502		)	(46,159		)
Decrease (increase) in other assets		814			(81		)
Decrease in other liabilities		(1,936		)	(3,723		)
Net cash provided by operating activities		9,298			1,422
Cash flows from investing activities:
Proceeds from sale of:	Other investment securities available for sale	—			547
Maturities and principal payments of:	Mortgage-backed securities available for sale	12,533			11,313
	Other investment securities available for sale	4,986			20,844
	Mortgage-backed securities held to maturity	1,137			960
Net proceeds from the sale of business line		—			7,205
Net increase in loans		(20,620		)	(13,584		)
Purchases of loans, including purchased interest		(856		)	(2,934		)
Proceeds from the sale of property acquired through foreclosure or repossession		—			659
Purchases of premises and equipment		(1,226		)	(1,291		)
Net cash (used in) provided by investing activities		(4,046		)	23,719
Cash flows from financing activities:
Net increase in deposits		28,325			86,333
Net decrease in other borrowings		(12		)	(11		)
Proceeds from Federal Home Loan Bank advances		120,000			54,000
Repayment of Federal Home Loan Bank advances		(140,305		)	(138,653		)
Proceeds from stock options exercises and issuance of other equity instruments		698			496
Tax benefit from stock option exercises and other equity instruments		106			45
Cash dividends paid		(5,381		)	(4,511		)
Net cash provided by (used in) financing activities		3,431			(2,301		)
Net increase in cash and cash equivalents		8,683			22,840
Cash and cash equivalents at beginning of period		80,350			85,317
Cash and cash equivalents at end of period			$89,033			$108,157

Noncash Investing and Financing Activities:
Loans charged off		$321		$1,223
Loans transferred to property acquired through foreclosure or repossession	230		421
Supplemental Disclosures:
Interest payments		$5,459		$5,175
Income tax payments	310		265

The accompanying notes are an integral part of these unaudited consolidated financial statements.

7

Condensed Notes to Unaudited Consolidated Financial Statements

(1) General Information

Washington Trust Bancorp, Inc. (the “Bancorp”) is a publicly-owned registered bank holding company and financial holding company.  The Bancorp owns all of the outstanding common stock of The Washington Trust Company, of Westerly (the “Bank”), a Rhode Island chartered commercial bank founded in 1800.  Through its subsidiaries, the Bancorp offers a complete product line of financial services including commercial, residential and consumer lending, retail and commercial deposit products, and wealth management services through its offices in Rhode Island, eastern Massachusetts and Connecticut.

The consolidated financial statements include the accounts of the Bancorp and its subsidiaries (collectively, the “Corporation” or “Washington Trust”).  All significant intercompany transactions have been eliminated.

The accounting and reporting policies of the Corporation conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices of the banking industry.  In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period.  Actual results could differ from those estimates.  Material estimates that are particularly susceptible to change are the determination of the allowance for loan losses, the review of goodwill for impairment and the assessment of investment securities for impairment.

The unaudited consolidated financial statements of the Corporation presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by GAAP. In the opinion of management, all adjustments (consisting of normal recurring adjustments) and disclosures considered necessary for the fair presentation of the accompanying consolidated financial statements have been included. Interim results are not necessarily reflective of the results of the entire year. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

(2) Recently Issued Accounting Pronouncements

Receivables - Troubled Debt Restructurings by Creditors - Topic 310

Accounting Standards Update No. 2014-04, “Reclassifications of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure” (“ASU 2014-04”), was issued in January 2014 and clarifies when banks and similar institutions (creditors) should reclassify mortgage loans collateralized by residential real estate properties from the loan portfolio to other real estate owned (“OREO”). ASU 2014-04 is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. The Corporation elected the prospective transition method and the adoption of ASU 2014-04 did not have a material impact on the Corporation’s consolidated financial statements.

Revenue from Contracts with Customers - Topic 606

Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), was issued in May 2014 and provides a revenue recognition framework for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of non-financial assets unless those contracts are within the scope of other accounting standards. ASU 2014-09 is effective for annual periods beginning after December 15, 2016, including interim periods within that reporting period with early adoption not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Corporation is currently evaluating the impact that ASU 2014-09 will have on the its consolidated financial statements and related disclosures. The Corporation has not yet selected a transition method nor has it determined the effect of ASU 2014-09 on its ongoing financial reporting.

(3) Cash and Due from Banks

The Bank maintains certain average reserve balances to meet the requirements of the Board of Governors of the Federal Reserve System (“FRB”).  Some or all of these reserve requirements may be satisfied with vault cash. Reserve balances amounted to $10.1 million at March 31, 2015 and $8.0 million at December 31, 2014 and were included in cash and due from banks in the Consolidated Balance Sheets.

As of March 31, 2015 and December 31, 2014, cash and due from banks included interest-bearing deposits in other banks of $47.0 million and $42.7 million, respectively.

- 8-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(4) Securities

The following tables present the amortized cost, gross unrealized holding gains, gross unrealized holding losses and fair value of securities by major security type and class of security:

(Dollars in thousands)
March 31, 2015	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,203		$98		$—			$31,301
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	222,547		10,498		—			233,045
Obligations of states and political subdivisions	42,664		1,515		—			44,179
Individual name issuer trust preferred debt securities	30,762		—		(4,475		)	26,287
Corporate bonds	6,119		36		(25		)	6,130
Total securities available for sale		$333,295		$12,147		($4,500	)		$340,942
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$24,025		$809		$—			$24,834
Total securities held to maturity		$24,025		$809		$—			$24,834
Total securities		$357,320		$12,956		($4,500	)		$365,776

(Dollars in thousands)
December 31, 2014	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,205		$21		($54	)		$31,172
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	235,343		10,023		—			245,366
Obligations of states and political subdivisions	47,647		1,529		—			49,176
Individual name issuer trust preferred debt securities	30,753		—		(4,979		)	25,774
Corporate bonds	6,120		57		(3		)	6,174
Total securities available for sale		$351,068		$11,630		($5,036	)		$357,662
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$25,222		$786		$—			$26,008
Total securities held to maturity		$25,222		$786		$—			$26,008
Total securities		$376,290		$12,416		($5,036	)		$383,670

At March 31, 2015 and December 31, 2014, securities available for sale and held to maturity with a fair value of $347.6 million and $350.5 million, respectively, were pledged as collateral for Federal Home Loan Bank of Boston (“FHLBB”) borrowings and letters of credit, potential borrowings with the FRB, certain public deposits and for other purposes. See Note 8 for additional discussion of FHLBB borrowings.

- 9-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The schedule of maturities of debt securities available for sale and held to maturity is presented below. Mortgage-backed securities are included based on weighted average maturities, adjusted for anticipated prepayments.  All other debt securities are included based on contractual maturities.  Actual maturities may differ from amounts presented because certain issuers have the right to call or prepay obligations with or without call or prepayment penalties.  Yields on tax exempt obligations are not computed on a tax equivalent basis.

(Dollars in thousands)
March 31, 2015	Within 1 Year			1-5 Years			5-10 Years			After 10 Years			Totals
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises:
Amortized cost		$—			$31,003			$200			$—			$31,203
Weighted average yield	—		%	1.72		%	2.32		%	—		%	1.73		%
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost	37,723			100,409			57,461			26,954			222,547
Weighted average yield	3.71			3.30			2.81			1.76			3.06
Obligations of state and political subdivisions:
Amortized cost	3,601			24,267			14,796			—			42,664
Weighted average yield	3.78			3.94			3.99			—			3.95
Individual name issuer trust preferred debt securities:
Amortized cost	—			—			—			30,762			30,762
Weighted average yield	—			—			—			1.11			1.11
Corporate bonds:
Amortized cost	5,713			203			203			—			6,119
Weighted average yield	2.84			1.62			3.21			—			2.81
Total debt securities available for sale:
Amortized cost		$47,037			$155,882			$72,660			$57,716			$333,295
Weighted average yield	3.61		%	3.09		%	3.05		%	1.42		%	2.86		%
Fair value		$48,955			$161,578			$75,897			$54,512			$340,942
Securities Held to Maturity:
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost		$3,007			$9,323			$7,364			$4,331			$24,025
Weighted average yield	3.11		%	3.03		%	2.78		%	0.89		%	2.58		%
Fair value		$3,108			$9,637			$7,612			$4,477			$24,834

Included in the above table are debt securities with an amortized cost balance of $98.1 million and a fair value of $95.0 million at March 31, 2015 that are callable at the discretion of the issuers.  Final maturities of the callable securities range from 6 months to 22 years, with call features ranging from 1 month to 2 years.

Other-Than-Temporary Impairment Assessment

The Corporation assesses whether the decline in fair value of investment securities is other-than-temporary on a regular basis. Unrealized losses on debt securities may occur from current market conditions, increases in interest rates since the time of purchase, a structural change in an investment, volatility of earnings of a specific issuer, or deterioration in credit quality of the issuer.  Management evaluates impairments in value both qualitatively and quantitatively to assess whether they are other‑than‑temporary.

- 10-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following tables summarize temporarily impaired securities, segregated by length of time the securities have been in a continuous unrealized loss position:

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
March 31, 2015	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Individual name issuer trust preferred debt securities	—		$—		$—		11		$26,287		($4,475	)	11		$26,287		($4,475	)
Corporate bonds	1	1,975		(25		)	—	—		—			1	1,975		(25		)
Total temporarily impaired securities	1		$1,975		($25	)	11		$26,287		($4,475	)	12		$28,262		($4,500	)

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
December 31, 2014	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Obligations of U.S. government-sponsored enterprises	3		$20,952		($54	)	—		$—		$—		3		$20,952		($54	)
Individual name issuer trust preferred debt securities	—	—		—			11	25,774		(4,979		)	11	25,774		(4,979		)
Corporate bonds	—	—		—			1	199		(3		)	1	199		(3		)
Total temporarily impaired securities	3		$20,952		($54	)	12		$25,973		($4,982	)	15		$46,925		($5,036	)

Further deterioration in credit quality of the underlying issuers of the securities, further deterioration in the condition of the financial services industry, a continuation or worsening of the current economic environment, or additional declines in real estate values, among other things, may further affect the fair value of these securities and increase the potential that certain unrealized losses be designated as other-than-temporary in future periods, and the Corporation may incur additional write-downs.

Trust Preferred Debt Securities of Individual Name Issuers

Included in debt securities in an unrealized loss position at March 31, 2015 were 11 trust preferred security holdings issued by 7 individual companies in the banking sector.  Management believes the unrealized loss position in these holdings is attributable to the general widening of spreads for this category of debt securities issued by financial services companies since the time these securities were purchased.  Based on the information available through the filing date of this report, all individual name issuer trust preferred debt securities held in our portfolio continue to accrue and make payments as expected with no payment deferrals or defaults on the part of the issuers.  As of March 31, 2015, individual name issuer trust preferred debt securities with an amortized cost of $11.9 million and unrealized losses of $2.0 million were rated below investment grade by Standard & Poors, Inc. (“S&P”).  Management reviewed the collectibility of these securities taking into consideration such factors as the financial condition of the issuers, reported regulatory capital ratios of the issuers, credit ratings, including ratings in effect as of the reporting period date as well as credit rating changes between the reporting period date and the filing date of this report, and other information.  We noted no additional downgrades to below investment grade between the reporting period date and the filing date of this report.  Based on these analyses, management concluded that it expects to recover the entire amortized cost basis of these securities.  Furthermore, Washington Trust does not intend to sell these securities and it is not more‑likely‑than‑not that Washington Trust will be required to sell these securities before recovery of their cost basis, which may be maturity.  Therefore, management does not consider these investments to be other-than-temporarily impaired at March 31, 2015.

- 11-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(5) Loans

The following is a summary of loans:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		%		Amount		%
Commercial:
Mortgages (1)		$865,042	30	%		$843,978	30	%
Construction & development (2)	89,851		3		79,592		3
Commercial & industrial (3)	604,630		21		611,918		21
Total commercial	1,559,523		54		1,535,488		54
Residential real estate:
Mortgages	954,905		33		948,731		33
Homeowner construction	32,659		1		36,684		1
Total residential real estate	987,564		34		985,415		34
Consumer:
Home equity lines	239,537		8		242,480		8
Home equity loans	46,727		2		46,967		2
Other (4)	47,241		2		48,926		2
Total consumer	333,505		12		338,373		12
Total loans (5)		$2,880,592	100	%		$2,859,276	100	%

(1) Loans primarily secured by income producing property.

(2) Loans for construction of commercial properties, loans to developers for construction of residential properties and loans for land development.

(3) Loans to businesses and individuals, a substantial portion of which are fully or partially collateralized by real estate.

(4) Consumer installment loans and loans secured by general aviation aircraft and automobiles.

(5) Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

At March 31, 2015 and December 31, 2014, there were $1.24 billion and $1.21 billion, respectively, of loans pledged as collateral to the FHLBB under a blanket pledge agreement and to the FRB for the discount window. See Note 8 for additional disclosure regarding borrowings.

Nonaccrual Loans

Loans, with the exception of certain well-secured loans that are in the process of collection, are placed on nonaccrual status and interest recognition is suspended when such loans are 90 days or more overdue with respect to principal and/or interest, or sooner if considered appropriate by management. Well-secured loans are permitted to remain on accrual status provided that full collection of principal and interest is assured and the loan is in the process of collection. Loans are also placed on nonaccrual status when, in the opinion of management, full collection of principal and interest is doubtful. Interest previously accrued but not collected on such loans is reversed against current period income. Subsequent interest payments received on nonaccrual loans are applied to the outstanding principal balance of the loan or recognized as interest income depending on management’s assessment of the ultimate collectibility of the loan. Loans are removed from nonaccrual status when they have been current as to principal and interest for a period of time, the borrower has demonstrated an ability to comply with repayment terms, and when, in management’s opinion, the loans are considered to be fully collectible.

- 12-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following is a summary of nonaccrual loans, segregated by class of loans:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Commercial:
Mortgages		$5,115		$5,315
Construction & development	—		—
Commercial & industrial	2,193		1,969
Residential real estate:
Mortgages	6,956		7,124
Homeowner construction	—		—
Consumer:
Home equity lines	1,051		1,217
Home equity loans	511		317
Other	39		3
Total nonaccrual loans		$15,865		$15,945
Accruing loans 90 days or more past due		$—		$—

As of March 31, 2015 and December 31, 2014, nonaccrual loans of $3.6 million and $3.2 million, respectively, were current as to the payment of principal and interest.

At March 31, 2015, there were no significant commitments to lend additional funds to borrowers whose loans were on nonaccrual status.

Past Due Loans

Past due status is based on the contractual payment terms of the loan. The following tables present an age analysis of past due loans, segregated by class of loans:

(Dollars in thousands)	Days Past Due
March 31, 2015	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$497		$61		$5,115		$5,673		$859,369		$865,042
Construction & development	—		—		—		—		89,851		89,851
Commercial & industrial	229		229		721		1,179		603,451		604,630
Residential real estate:
Mortgages	4,470		1,352		3,607		9,429		945,476		954,905
Homeowner construction	—		—		—		—		32,659		32,659
Consumer:
Home equity lines	1,244		429		463		2,136		237,401		239,537
Home equity loans	213		111		255		579		46,148		46,727
Other	55		25		5		85		47,156		47,241
Total loans		$6,708		$2,207		$10,166		$19,081		$2,861,511		$2,880,592

- 13-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(Dollars in thousands)	Days Past Due
December 31, 2014	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$—		$—		$5,315		$5,315		$838,663		$843,978
Construction & development	—		—		—		—		79,592		79,592
Commercial & industrial	2,136		1,202		181		3,519		608,399		611,918
Residential real estate:
Mortgages	2,943		821		3,284		7,048		941,683		948,731
Homeowner construction	—		—		—		—		36,684		36,684
Consumer:
Home equity lines	570		100		841		1,511		240,969		242,480
Home equity loans	349		240		56		645		46,322		46,967
Other	35		5		—		40		48,886		48,926
Total loans		$6,033		$2,368		$9,677		$18,078		$2,841,198		$2,859,276

Included in past due loans as of March 31, 2015 and December 31, 2014, were nonaccrual loans of $12.3 million and $12.7 million, respectively. All loans 90 days or more past due at March 31, 2015 and December 31, 2014 were classified as nonaccrual.

Impaired Loans

Impaired loans consist of nonaccrual commercial loans, troubled debt restructured loans and other loans classified as impaired that are individually evaluated for impairment. Impaired loans are loans for which it is probable that the Corporation will not be able to collect all amounts due according to the contractual terms of the loan agreements and loans restructured in a troubled debt restructuring. Impaired loans do not include large groups of smaller-balance homogeneous loans that are collectively evaluated for impairment, which consist of most residential mortgage loans and consumer loans.

- 14-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following is a summary of impaired loans:

(Dollars in thousands)	Recorded Investment (1)				Unpaid Principal				Related Allowance
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
No Related Allowance Recorded:
Commercial:
Mortgages		$205		$432		$205		$432		$—		$—
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,322		1,047		1,323		1,076		—		—
Residential real estate:
Mortgages	1,618		1,477		1,912		1,768		—		—
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	—		—		—		—		—		—
Home equity loans	—		—		—		—		—		—
Other	—		—		—		—		—		—
Subtotal	3,145		2,956		3,440		3,276		—		—
With Related Allowance Recorded:
Commercial:
Mortgages		$14,384		$14,585		$14,564		$14,564		$1,173		$927
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,754		1,878		2,305		2,437		185		177
Residential real estate:
Mortgages	1,296		2,226		1,423		2,338		222		326
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	244		250		250		250		76		141
Home equity loans	72		45		116		62		1		12
Other	151		112		151		114		—		—
Subtotal	17,901		19,096		18,809		19,765		1,657		1,583
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583
Total:
Commercial		$17,665		$17,942		$18,397		$18,509		$1,358		$1,104
Residential real estate	2,914		3,703		3,335		4,106		222		326
Consumer	467		407		517		426		77		153
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583

(1) The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

- 15-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents the average recorded investment balance of impaired loans and interest income recognized on impaired loans segregated by loan class:

(Dollars in thousands)	Average Recorded Investment				Interest Income Recognized
Three months ended March 31,	2015		2014		2015		2014
Commercial:
Mortgages		$14,942		$28,340		$79		$165
Construction & development	—		—		—		—
Commercial & industrial	3,036		2,366		19		23
Residential real estate:
Mortgages	3,457		3,744		16		14
Homeowner construction	—		—		—		—
Consumer:
Home equity lines	247		134		—		1
Home equity loans	74		95		—		1
Other	146		125		3		2
Totals		$21,902		$34,804		$117		$206

Troubled Debt Restructurings

Loans are considered restructured in a troubled debt restructuring when the Corporation has granted concessions to a borrower due to the borrower’s financial condition that it otherwise would not have considered. These concessions may include modifications of the terms of the debt such as deferral of payments, extension of maturity, reduction of principal balance, reduction of the stated interest rate other than normal market rate adjustments, or a combination of these concessions. Debt may be bifurcated with separate terms for each tranche of the restructured debt. Restructuring a loan in lieu of aggressively enforcing the collection of the loan may benefit the Corporation by increasing the ultimate probability of collection.

Restructured loans are classified as accruing or non-accruing based on management’s assessment of the collectibility of the loan. Loans which are already on nonaccrual status at the time of the restructuring generally remain on nonaccrual status for approximately six months before management considers such loans for return to accruing status. Accruing restructured loans are placed into nonaccrual status if and when the borrower fails to comply with the restructured terms and management deems it unlikely that the borrower will return to a status of compliance in the near term.

Troubled debt restructurings are reported as such for at least one year from the date of the restructuring. In years after the restructuring, troubled debt restructured loans are removed from this classification if the restructuring did not involve a below-market rate concession and the loan is not deemed to be impaired based on the terms specified in the restructuring agreement.

Troubled debt restructurings are classified as impaired loans. The Corporation identifies loss allocations for impaired loans on an individual loan basis. The recorded investment in troubled debt restructurings was $17.7 million and $18.4 million, respectively, at March 31, 2015 and December 31, 2014. These amounts included accrued interest of $30 thousand and $33 thousand, respectively. The allowance for loan losses included specific reserves for these troubled debt restructurings of $1.5 million and $1.2 million, respectively, at March 31, 2015 and December 31, 2014. As of March 31, 2015, there were no significant commitments to lend additional funds to borrowers whose loans had been restructured.

- 16-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents loans modified as a troubled debt restructuring:

(Dollars in thousands)			Outstanding Recorded Investment (1)
	# of Loans		Pre-Modifications				Post-Modifications
Three months ended March 31,	2015	2014	2015		2014		2015		2014
Commercial:
Mortgages	—	—		$—		$—		$—		$—
Construction & development	—	—	—		—		—		—
Commercial & industrial	1	—	300		—		300		—
Residential real estate:
Mortgages	1	2	93		479		93		479
Homeowner construction	—	—	—		—		—		—
Consumer:
Home equity lines	—	—	—		—		—		—
Home equity loans	—	—	—		—		—		—
Other	1	—	35		—		35		—
Totals	3	2		$428		$479		$428		$479

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs, at the time of the restructuring. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

The following table provides information on how loans were modified as a troubled debt restructuring:

(Dollars in thousands)
Three months ended March 31,	2015		2014
Below-market interest rate concession		$335		$—
Payment deferral	93		479
Maturity / amortization concession	—		—
Interest only payments	—		—
Combination(1)	—		—
Total		$428		$479

(1) Loans included in this classification were modified with a combination of any two of the concessions listed in this table.

- 17-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents loans modified in a troubled debt restructuring within the previous twelve months for which there was a payment default:

(Dollars in thousands)	# of Loans		Recorded Investment (1)
Three months ended March 31,	2015	2014	2015		2014
Commercial:
Mortgages	—	—		$—		$—
Construction & development	—	—	—		—
Commercial & industrial	2	6	11		1,191
Residential real estate:
Mortgages	2	—	338		—
Homeowner construction	—	—	—		—
Consumer:
Home equity lines	—	—	—		—
Home equity loans	—	—	—		—
Other	—	—	—		—
Totals	4	6		$349		$1,191

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

Credit Quality Indicators

Commercial

The Corporation utilizes an internal rating system to assign a risk to each of its commercial loans. Loans are rated on a scale of 1 to 10. This scale can be assigned to three broad categories including “pass” for ratings 1 through 6, “special mention” for 7-rated loans, and “classified” for loans rated 8, 9 or 10. The loan rating system takes into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral, the adequacy of guarantees and other credit quality characteristics. As of March 31, 2015 and December 31, 2014, the weighted average risk rating of the Corporation’s commercial loan portfolio was 4.68 and 4.67, respectively. For non-impaired loans, the Corporation assigns a loss allocation factor to each loan, based on its risk rating for purposes of establishing an appropriate allowance for loan losses. See Note 6 for additional information.

A description of the commercial loan categories are as follows:

Pass - Loans with acceptable credit quality, defined as ranging from superior or very strong to a status of lesser stature. Superior or very strong credit quality is characterized by a high degree of cash collateralization or strong balance sheet liquidity. Lesser stature loans have an acceptable level of credit quality but exhibit some weakness in various credit metrics such as collateral adequacy, cash flow, secondary sources of repayment, or performance inconsistency or may be in an industry or of a loan type known to have a higher degree of risk.

Special Mention - Loans with potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Bank’s position as creditor at some future date. Special Mention assets are not adversely classified and do not expose the Bank to sufficient risk to warrant adverse classification. Examples of these conditions include but are not limited to outdated or poor quality financial data, strains on liquidity and leverage, losses or negative trends in operating results, marginal cash flow, weaknesses in occupancy rates or trends in the case of commercial real estate and frequent delinquencies.

Classified - Loans identified as “substandard”, “doubtful” or “loss” based on criteria consistent with guidelines provided by banking regulators. A “substandard” loan has defined weaknesses which make payment default or principal exposure likely, but not yet certain. Such loans are apt to be dependent upon collateral liquidation, a secondary source of repayment or an event outside of the normal course of business. The loans are closely watched and are either already on nonaccrual status or may be placed on nonaccrual status when management determines there is uncertainty of collectibility. A “doubtful” loan is placed on non-accrual status and has a high probability of loss, but the extent of the loss is difficult to quantify due to dependency upon

- 18-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

collateral having a value that is difficult to determine or upon some near-term event which lacks certainty. A loan in the “loss” category is considered generally uncollectible or the timing or amount of payments cannot be determined. “Loss” is not intended to imply that the loan has no recovery value but rather it is not practical or desirable to continue to carry the asset.

The Corporation’s procedures call for loan ratings and classifications to be revised whenever information becomes available that indicates a change is warranted. The criticized loan portfolio, which consists of commercial loans that are risk rated special mention or worse, are reviewed by management on a quarterly basis, focusing on the current status and strategies to improve the credit. An annual loan review program is conducted by a third party to provide an independent evaluation of the creditworthiness of the commercial loan portfolio, the quality of the underwriting and credit risk management practices and the appropriateness of the risk rating classifications. This review is supplemented with selected targeted internal reviews of the commercial loan portfolio.

The following table presents the commercial loan portfolio, segregated by category of credit quality indicator:

(Dollars in thousands)	Pass				Special Mention				Classified
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Mortgages		$842,516		$819,857		$17,207		$18,372		$5,319		$5,749
Construction & development	89,851		79,592		—		—		—		—
Commercial & industrial	586,370		592,206		15,536		16,311		2,724		3,401
Total commercial loans		$1,518,737		$1,491,655		$32,743		$34,683		$8,043		$9,150

Residential and Consumer

The residential and consumer portfolios are monitored on an ongoing basis by the Corporation using delinquency information and loan type as credit quality indicators. These credit quality indicators are assessed on an aggregate basis in these relatively homogeneous portfolios. For non-impaired loans, the Corporation assigns loss allocation factors to each respective loan type and delinquency status. See Note 6 for additional information.

Various other techniques are utilized to monitor indicators of credit deterioration in the portfolios of residential real estate mortgages and home equity lines and loans. Among these techniques is the periodic tracking of loans with an updated FICO score and an estimated loan to value (“LTV”) ratio. LTV is determined via statistical modeling analyses. The indicated LTV levels are estimated based on such factors as the location, the original LTV, and the date of origination of the loan and do not reflect actual appraisal amounts. The results of these analyses and other loan review procedures are taken into consideration in the determination of loss allocation factors for residential mortgage and home equity consumer credits. See Note 6 for additional information.

The following table presents the residential and consumer loan portfolios, segregated by category of credit quality indicator:

(Dollars in thousands)	Current and Under 90 Days Past Due				Over 90 Days Past Due
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Residential real estate:
Accruing mortgages		$947,949		$941,607		$—		$—
Nonaccrual mortgages	3,349		3,840		3,607		3,284
Homeowner construction	32,659		36,684		—		—
Total residential loans		$983,957		$982,131		$3,607		$3,284
Consumer:
Home equity lines		$239,074		$241,639		$463		$841
Home equity loans	46,472		46,911		255		56
Other	47,236		48,926		5		—
Total consumer loans		$332,782		$337,476		$723		$897

- 19-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(6) Allowance for Loan Losses

The allowance for loan losses is management’s best estimate of the inherent risk of loss in the loan portfolio as of the balance sheet date. The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans. The Corporation uses a methodology to systematically measure the amount of estimated loan loss exposure inherent in the loan portfolio for purposes of establishing a sufficient allowance for loan losses. The methodology includes three elements: (1) identification of loss allocations for individual loans deemed to be impaired, (2) application of loss allocation factors for non-impaired loans based on credit grade, historical loss experience, estimated loss emergence period and delinquency status, with adjustments for various exposures not adequately presented in historical loss experience, and (3) an unallocated allowance maintained for measurement imprecision associated with impaired and nonaccrual loans.

Loss allocations for loans deemed to be impaired are measured on a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or, if the loan is collateral dependent, at the fair value of the collateral. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of circumstances associated with the property.

Individual commercial loans not deemed to be impaired are evaluated using an internal rating system and the application of loss allocation factors. The loan rating system is described under the caption “Credit Quality Indicators” in Note 5. The loan rating system and the related loss allocation factors take into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral and the adequacy of guarantees. We periodically reassess and revise the loss allocation factors used in the assignment of loss exposure to appropriately reflect our analysis of migrational loss experience. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in the commercial loan portfolio and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience, including our assessments of credit risk associated with certain industries, an ongoing trend toward larger credit relationships, recent changes in portfolio composition, conditions that may affect the ability of borrowers to meet debt service requirements, trends in rental rates on commercial real estate and conditions that may affect the collateral position, such as environmental matters.

Portfolios of more homogeneous populations of loans, including the various categories of residential mortgages and consumer loans, are analyzed as groups, with loss allocation factors assigned to each group based on account delinquency status. We periodically reassess and revise the loss allocation factors. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in residential mortgage and consumer loan portfolios and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience including trends in real estate values, consideration of general economic conditions, increases in delinquency levels and regulatory changes affecting the foreclosure process. These matters are also evaluated taking into account the geographic location of the underlying loans.

Because the methodology is based upon historical experience and trends, current economic data as well as management’s judgment, factors may arise that result in different estimations. Significant factors that could give rise to changes in these estimates may include, but are not limited to, changes in economic conditions in our market area, concentration of risk and declines in local property values. Adversely different conditions or assumptions could lead to increases in the allowance. In addition, various regulatory agencies periodically review the allowance for loan losses. Such agencies may require additions to the allowance based on their judgments about information available to them at the time of their examination.

- 20-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2015:

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,202			$1,300			$7,987			$17,489			$5,430			$2,713			$2,391			$28,023
Charge-offs	(200		)	—			(7		)	(207		)	(48		)	(66		)	—			(321		)
Recoveries	80			—			14			94			2			12			—			108
Provision	249			(71		)	(191		)	(13		)	(29		)	72			(30		)	—
Ending Balance		$8,331			$1,229			$7,803			$17,363			$5,355			$2,731			$2,361			$27,810

(1) Commercial & industrial loans.

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2014. Prior to December 31, 2014, the unallocated allowance included amounts for management’s qualitative and quantitative assessment of certain other loan portfolio risks not captured in other components of the allowance. The 2014 presentation of the allowance for loan losses by portfolio segment, set forth below, has been revised to conform to the December 31, 2014 presentation format. The reclassification resulted in a reduction of $5.3 million in the unallocated allowance previously reported as of March 31, 2014, with a corresponding increase to the allowance by portfolio segment. The reclassification resulted in no change in the total allowance.

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,022			$383			$7,835			$16,240			$6,450			$2,511			$2,685			$27,886
Charge-offs	(945		)	—			(196		)	(1,141		)	(42		)	(40		)	—			(1,223		)
Recoveries	6			—			26			32			35			13			—			80
Provision	(536		)	(114		)	805			155			705			93			(653		)	300
Ending Balance		$6,547			$269			$8,470			$15,286			$7,148			$2,577			$2,032			$27,043

(1) Commercial & industrial loans.

- 21-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents the Corporation’s loan portfolio and associated allowance for loan loss by portfolio segment and by impairment methodology:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Loans		Related Allowance		Loans		Related Allowance
Loans Individually Evaluated for Impairment:
Commercial:
Mortgages		$14,563		$1,173		$14,991		$927
Construction & development	—		—		—		—
Commercial & industrial	3,074		185		2,921		177
Residential real estate	2,912		222		3,698		326
Consumer	467		77		409		153
Subtotal		$21,016		$1,657		$22,019		$1,583
Loans Collectively Evaluated for Impairment:
Commercial:
Mortgages		$850,479		$7,158		$828,987		$7,275
Construction & development	89,851		1,229		79,592		1,300
Commercial & industrial	601,556		7,618		608,997		7,810
Residential real estate	984,652		5,133		981,717		5,104
Consumer	333,038		2,654		337,964		2,560
Subtotal		$2,859,576		$23,792		$2,837,257		$24,049
Unallocated	—		2,361		—		2,391
Total		$2,880,592		$27,810		$2,859,276		$28,023

(7) Time Certificates of Deposit

The following table presents scheduled maturities of time certificates of deposit:

(Dollars in thousands)	Scheduled Maturity		Weighted Average Rate
April 1, 2015 to December 31, 2015		$296,731	0.67	%
2016	177,667		1.02
2017	152,730		1.11
2018	77,579		1.35
2019	122,693		1.76
2020 and thereafter	25,221		1.52
Balance at March 31, 2015		$852,621	1.07	%

- 22-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(8) Borrowings

Federal Home Loan Bank Advances

Advances payable to the FHLBB amounted to $386.0 million and $406.3 million, respectively, at March 31, 2015 and December 31, 2014.

The following table presents maturities and weighted average interest rates on FHLBB advances outstanding as of March 31, 2015:

(Dollars in thousands)	Total Outstanding		Weighted Average Rate
April 1, 2015 to December 31, 2015		$160,520	0.49	%
2016	31,792		0.60	%
2017	30,075		5.44	%
2018	58,634		1.56	%
2019	42,661		4.40	%
2020 and thereafter	62,310		3.17	%
Balance at March 31, 2015		$385,992	1.91	%

As of March 31, 2015 and December 31, 2014, the Bank also has access to an unused line of credit with the FHLBB amounting to $40.0 million. In addition, the FHLBB has issued standby letters of credit to depositor customers of the Bank to collateralize public deposits. The Bank’s FHLBB borrowings, line of credit and letters of credit are collateralized by a blanket pledge agreement on the Bank’s FHLBB stock, certain qualified investment securities and loans, as well as amounts maintained on deposit at the FHLBB. The Bank’s unused remaining available borrowing capacity at the FHLBB was approximately $613.7 million and $569.4 million, respectively, at March 31, 2015 and December 31, 2014.

- 23-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(9) Shareholders’ Equity

Regulatory Capital Requirements

The following table presents the Corporation’s and the Bank’s actual capital amounts and ratios, as well as the corresponding minimum required capital ratios and minimum capital ratios required for the Bank to be “well capitalized” for purposes of the Federal Deposit Insurance Corporation’s (“FDIC”) prompt corrective action provisions:

(Dollars in thousands)	Actual				For Capital Adequacy Purposes				To Be “Well Capitalized” Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
March 31, 2015
Total Capital (to Risk-Weighted Assets):
Corporation		$352,521	12.80	%		$220,262	8.00	%		N/A	N/A
Bank	347,674		12.63		220,187		8.00		275,234		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	324,375		11.78		165,196		6.00		N/A		N/A
Bank	319,528		11.61		165,140		6.00		220,187		8.00
Common Equity Tier 1 Capital (to Risk-Weighted Assets): (1)
Corporation	302,376		10.98		123,897		4.50		N/A		N/A
Bank	319,528		11.61		123,855		4.50		178,902		6.50
Tier 1 Capital (to Average Assets): (2)
Corporation	324,375		9.21		140,864		4.00		N/A		N/A
Bank	319,528		9.08		140,738		4.00		175,922		5.00
December 31, 2014
Total Capital (to Risk-Weighted Assets):
Corporation	343,934		12.56		219,149		8.00		273,936		N/A
Bank	339,268		12.39		219,075		8.00		273,844		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	315,575		11.52		109,574		4.00		164,361		N/A
Bank	310,909		11.35		109,537		4.00		164,306		6.00
Tier 1 Capital (to Average Assets): (2)
Corporation	315,575		9.14		138,090		4.00		172,612		N/A
Bank	310,909		9.01		137,964		4.00		172,454		5.00

(1) New capital ratio effective January 1, 2015 under the Basel III capital requirements. See additional discussion of Basel III and the new regulatory capital requirements in the “Supervision and Regulation” section in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

(2)    Leverage ratio.

(10) Derivative Financial Instruments

The Corporation’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Corporation’s known or expected cash receipts and its known or expected cash payments principally to manage the Corporation’s interest rate risk. Additionally, the Corporation enters into interest rate derivatives to accommodate the business requirements of its customers. All derivatives are recognized as either assets or liabilities on the balance sheet and are measured at fair value.  The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and resulting designation.

Interest Rate Risk Management Agreements

Interest rate swaps are used from time to time as part of the Corporation’s interest rate risk management strategy.  Swaps are agreements in which the Corporation and another party agree to exchange interest payments (e.g., fixed-rate for variable-rate payments) computed on a notional principal amount.  The credit risk associated with swap transactions is the risk of default by the counterparty.  To minimize this risk, the Corporation enters into interest rate agreements only with highly rated counterparties that management believes to be creditworthy.  The notional amounts of these agreements do not represent amounts exchanged by the parties and, thus, are not a measure of the potential loss exposure.

- 24-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

Cash Flow Hedging Instruments

As of March 31, 2015 and December 31, 2014, the Bancorp had two interest rate swap contracts designated as cash flow hedges to hedge the interest rate associated with $22.7 million of variable rate junior subordinated debentures. The effective portion of the changes in fair value of derivatives designated as cash flow hedges is recorded in other comprehensive income and subsequently reclassified to earnings when gains or losses are realized.  The ineffective portion of changes in fair value of the derivatives is recognized directly in earnings as interest expense.  As of March 31, 2015 and December 31, 2014, the Bancorp has pledged collateral to derivative counterparties in the form of cash totaling $800 thousand and $939 thousand, respectively.  The Bancorp may need to post additional collateral in the future in proportion to potential increases in unrealized loss positions.

Customer Related Derivative Contracts

The Corporation has entered into interest rate swap contracts to help commercial loan borrowers manage their interest rate risk.  The interest rate swap contracts with commercial loan borrowers allow them to convert floating-rate loan payments to fixed-rate loan payments.  When we enter into an interest rate swap contract with a commercial loan borrower, we simultaneously enter into a “mirror” swap contract with a third party.  The third party exchanges the client’s fixed‑rate loan payments for floating-rate loan payments.  We retain the risk that is associated with the potential failure of counterparties and the risk inherent in originating loans.  As of March 31, 2015 and December 31, 2014, Washington Trust had interest rate swap contracts with commercial loan borrowers with notional amounts of $209.4 million and $165.8 million, respectively, and equal amounts of “mirror” swap contracts with third-party financial institutions.  These derivatives are not designated as hedges and therefore, changes in fair value are recognized in earnings.

Risk Participation Agreements

In 2015, the Corporation entered into a risk participation agreement (“RPA”) with another bank participating in a commercial loan arrangement. The participating bank guarantees the performance on a borrower-related interest rate swap contract. The RPA represents a purchased guarantee that is recorded as an asset and under the RPA the Corporation participates out the risk associated with the interest rate swap position executed with the commercial borrower, for a net fee paid to the participating bank, classified in net gains on interest rate swap contracts. The RPA derivative asset is recorded at fair value and changes in the fair value of the derivative asset are recognized in earnings in the period of change. As of March 31, 2015, the notional amount of the RPA was $12.5 million.

Loan Commitments

Interest rate lock commitments are extended to borrowers and relate to the origination of residential real estate mortgage loans held for sale.  To mitigate the interest rate risk inherent in these rate locks, as well as closed residential real estate mortgage loans held for sale, forward commitments are established to sell individual residential real estate mortgage loans.  Both interest rate lock commitments and commitments to sell residential real estate mortgage loans are derivative financial instruments, but do not meet criteria for hedge accounting and, as such are treated as derivatives not designated as hedging instruments. These derivative financial instruments are recorded at fair value and changes in fair value of these commitments are reflected in earnings in the period of change. The Corporation has elected to carry certain closed residential real estate mortgage loans held for sale at fair value, as changes in fair value in these loans held for sale generally offset changes in interest rate lock and forward sale commitments.

- 25-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents the fair values of derivative instruments in the Corporation’s Consolidated Balance Sheets:

(Dollars in thousands)	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	Mar 31, 2015		Dec 31, 2014		Balance Sheet Location	Mar 31, 2015		Dec 31, 2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts	Other assets		$—		$—	Other liabilities		$367		$497
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Other assets	1,769		1,212		Other liabilities	5		20
Commitments to sell mortgage loans	Other assets	14		13		Other liabilities	2,970		2,028
Customer related derivative contracts:
Interest rate swaps with customers	Other assets	7,415		4,554		Other liabilities	—		23
Mirror swaps with counterparties	Other assets	—		28		Other liabilities	7,699		4,748
Risk participation agreement	Other assets	47		—		Other liabilities	—		—
Total			$9,245		$5,807			$11,041		$7,316

The following tables present the effect of derivative instruments in the Corporation’s Consolidated Statements of Income and Changes in Shareholders’ Equity:

(Dollars in thousands)	Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion)				Location of Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Gain (Loss) Recognized in Income (Ineffective Portion)
Three months ended March 31,	2015		2014			2015		2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts		$85		$76	Interest Expense		$—		$—
Total		$85		$76			$—		$—

(Dollars in thousands)		Amount of Gain (Loss) Recognized in Income on Derivative
Three months ended March 31,	Statement of Income Location	2015			2014
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Net gains on loan sales & commissions on loans originated for others		$572			$277
Commitments to sell mortgage loans	Net gains on loan sales & commissions on loans originated for others	(941		)	(313		)
Customer related derivative contracts:
Interest rate swaps with customers	Net gains on interest rate swap contracts	3,633			1,030
Mirror swaps with counterparties	Net gains on interest rate swap contracts	(2,836		)	(770		)
Risk participation agreement	Net gains on interest rate swap contracts	(152		)	—
Total			$276			$224

- 26-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(11) Fair Value Measurements

The Corporation uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.  As of March 31, 2015 and December 31, 2014, securities available for sale, certain residential real estate mortgage loans held for sale and derivatives are recorded at fair value on a recurring basis.  Additionally, from time to time, we may be required to record at fair value other assets on a nonrecurring basis, such as collateral dependent impaired loans, property acquired through foreclosure or repossession, certain residential real estate mortgage loans held for sale and mortgage servicing rights.  These nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write-downs of individual assets.

Fair value is a market-based measurement, not an entity-specific measurement.  Fair value measurements are determined based on the assumptions the market participants would use in pricing the asset or liability.  In addition, GAAP specifies a hierarchy of valuation techniques based on whether the types of valuation information (“inputs”) are observable or unobservable.  Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Corporation’s market assumptions.  These two types of inputs have created the following fair value hierarchy:

• Level 1 – Quoted prices for identical assets or liabilities in active markets.

• Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

• Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in the markets and which reflect the Corporation’s market assumptions.

Fair Value Option Election

GAAP allows for the irrevocable option to elect fair value accounting for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis. The Corporation elected the fair value option for certain residential real estate mortgage loans held for sale to better match changes in fair value of the loans with changes in the fair value of the derivative loan sale contracts used to economically hedge them.

The aggregate principal amount of the residential real estate mortgage loans held for sale recorded at fair value was $35.6 million and $29.5 million, respectively, at March 31, 2015 and December 31, 2014. The aggregate fair value of these loans as of the same dates was $36.7 million and $30.3 million, respectively. As of March 31, 2015 and December 31, 2014, the aggregate fair value of residential real estate mortgage loans held for sale exceeded the aggregate principal amount by $1.1 million and $779 thousand, respectively.

There were no residential real estate mortgage loans held for sale 90 days or more past due as of March 31, 2015 and December 31, 2014.

The following table presents the changes in fair value related to mortgage loans held for sale, interest rate lock commitments and commitments to sell residential real estate mortgage loans, for which the fair value option was elected. Changes in fair values are reported as a component of net gains on loan sales and commissions on loans originated for others in the Consolidated Statements of Income.

(Dollars in thousands)
Three months ended March 31,	2015			2014
Mortgage loans held for sale		$341			$76
Interest rate lock commitments	572			277
Commitments to sell mortgage loans	(941		)	(313		)
Total changes in fair value		($28	)		$40

Items Measured at Fair Value on a Recurring Basis

Securities

Securities available for sale are recorded at fair value on a recurring basis.  When available, the Corporation uses quoted market prices to determine the fair value of securities; such items are classified as Level 1. There were no Level 1 securities held at March 31, 2015 and December 31, 2014.

- 27-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

Level 2 securities include debt securities with quoted prices, which are traded less frequently than exchange-traded instruments, whose value is determined using matrix pricing with inputs that are observable in the market or can be derived principally from or corroborated by observable market data.  This category generally includes obligations of U.S. government-sponsored enterprises, mortgage‑backed securities issued by U.S. government agencies and U.S. government‑sponsored enterprises, obligations of states and political subdivisions, trust preferred debt securities and corporate bonds.

Securities not actively traded whose fair value is determined through the use of cash flows utilizing inputs that are unobservable are classified as Level 3. There were no Level 3 securities held at March 31, 2015 and December 31, 2014.

Mortgage Loans Held for Sale

The fair values of mortgage loans held for sale are generally estimated based on secondary market rates offered for loans with similar characteristics. When secondary market information exists, these loans are classified as Level 2. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. Any changes in the valuation of mortgage loans held for sale is based upon the change in market interest rates between the loan closing date and the measurement date and an immaterial portion attributable to changes in instrument-specific credit risk. There were no Level 3 mortgage loans held for sale at March 31, 2015 and December 31, 2014.

Derivatives

Interest rate swap contracts are traded in over-the-counter markets where quoted market prices are not readily available.  Fair value measurements are determined using independent pricing models that utilize primarily market observable inputs, such as swap rates of different maturities and LIBOR rates and, accordingly, are classified as Level 2. For purposes of potential valuation adjustments to its interest rate swap contracts and risk participation agreements, the Corporation evaluates the credit risk of its counterparties as well as that of the Corporation.  Accordingly, Washington Trust considers factors such as the likelihood of default by the Corporation and its counterparties, its net exposures and remaining contractual life, among other factors, in determining if any fair value adjustments related to credit risk are required.  Counterparty exposure is evaluated by netting positions that are subject to master netting agreements, as well as considering the amount of collateral securing the position.

Level 2 fair value measurements of forward loan commitments (interest rate lock commitments and commitments to sell residential real estate mortgages) are estimated using the anticipated market price based on pricing indications provided by other financial institutions. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. There were no Level 3 forward loan commitments held at March 31, 2015 and December 31, 2014.

Items Measured at Fair Value on a Nonrecurring Basis

Collateral Dependent Impaired Loans

Collateral dependent loans that are deemed to be impaired are valued based upon the fair value of the underlying collateral. Such collateral primarily consists of real estate and, to a lesser extent, other business assets. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values resulting from its knowledge of the property. Internal valuations are utilized to determine the fair value of other business assets. Collateral dependent impaired loans are categorized as Level 3.

Property Acquired Through Foreclosure or Repossession

Property acquired through foreclosure or repossession included in other assets in the Consolidated Balance Sheets is adjusted to fair value less costs to sell upon transfer out of loans through a charge to allowance for loan losses. Subsequently, it is carried at the lower of carrying value or fair value less costs to sell. Such subsequent valuation charges are charged through earnings. Fair value is generally based upon appraised values of the collateral. Management may adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of the property, and such property is categorized as Level 3.

- 28-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

Items Recorded at Fair Value on a Recurring Basis

The following tables present the balances of assets and liabilities reported at fair value on a recurring basis:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
March 31, 2015
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,301		$—		$31,301		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	233,045		—		233,045		—
Obligations of states and political subdivisions	44,179		—		44,179		—
Individual name issuer trust preferred debt securities	26,287		—		26,287		—
Corporate bonds	6,130		—		6,130		—
Mortgage loans held for sale	36,672		—		36,672		—
Derivative assets (1)	9,245		—		9,245		—
Total assets at fair value on a recurring basis		$386,859		$—		$386,859		$—
Liabilities:
Derivative liabilities (2)		$11,041		$—		$11,041		$—
Total liabilities at fair value on a recurring basis		$11,041		$—		$11,041		$—

(1) Derivative assets include interest rate swaps contracts with customers, a risk participation agreement and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheets.

- 29-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2014
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,172		$—		$31,172		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	245,366		—		245,366		—
Obligations of states and political subdivisions	49,176		—		49,176		—
Individual name issuer trust preferred debt securities	25,774		—		25,774		—
Corporate bonds	6,174		—		6,174		—
Mortgage loans held for sale	30,321		—		30,321		—
Derivative assets (1)	5,807		—		5,807		—
Total assets at fair value on a recurring basis		$393,790		$—		$393,790		$—
Liabilities:
Derivative liabilities (2)		$7,316		$—		$7,316		$—
Total liabilities at fair value on a recurring basis		$7,316		$—		$7,316		$—

(1) Derivative assets include interest rate swaps contracts with customers and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheets.

It is the Corporation’s policy to review and reflect transfers between Levels as of the financial statement reporting date.  During the three months endedMarch 31, 2015 and 2014, there were no transfers in and/or out of Level 1, 2 or 3.

Items Recorded at Fair Value on a Nonrecurring Basis

Certain assets are measured at fair value on a nonrecurring basis in accordance with GAAP.  These adjustments to fair value usually result from the application of lower of cost or market accounting or write-downs of individual assets.  The valuation methodologies used to measure these fair value adjustments are described above.

The following table summarizes the carrying value of such assets held at March 31, 2015, which were written down to fair value during the three months endedMarch 31, 2015:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$3,962		$—		$—		$3,962
Property acquired through foreclosure or repossession	318		—		—		318
Total assets at fair value on a nonrecurring basis		$4,280		$—		$—		$4,280

The allowance for loan losses on collateral dependent impaired loans amounted to $1.2 million at March 31, 2015.

- 30-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table summarizes the carrying value of such assets held at December 31, 2014, which were written down to fair value during the year ended December 31, 2014:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$5,728		$—		$—		$5,728
Property acquired through foreclosure or repossession	348		—		—		348
Total assets at fair value on a nonrecurring basis		$6,076		$—		$—		$6,076

The allowance for loan losses on collateral dependent impaired loans amounted to $1.3 million at December 31, 2014.

The following tables present valuation techniques and unobservable inputs for assets measured at fair value on a nonrecurring basis for which the Corporation has utilized Level 3 inputs to determine fair value:

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
March 31, 2015
Collateral dependent impaired loans		$3,962	Appraisals of collateral	Discount for costs to sell	0% - 25% (10%)
				Appraisal adjustments (1)	0% - 15% (1%)
Property acquired through foreclosure or repossession		$318	Appraisals of collateral	Discount for costs to sell	0% - 10% (6%)
				Appraisal adjustments (1)	7% - 13% (10%)

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
December 31, 2014
Collateral dependent impaired loans		$5,728	Appraisals of collateral	Discount for costs to sell	0% - 10% (2%)
				Appraisal adjustments (1)	0% - 40% (3%)
Property acquired through foreclosure or repossession		$348	Appraisals of collateral	Discount for costs to sell	6% - 10% (8%)
				Appraisal adjustments (1)	5% - 23% (14%)

(1) Management may adjust appraisal values to reflect market value declines or other discounts resulting from its knowledge of the property.

Valuation of Other Financial Instruments

The methodologies for estimating the fair value of financial instruments that are measured at fair value on a recurring or nonrecurring basis are discussed above. The methodologies for other financial instruments are discussed below.

Loans

Fair values are estimated for categories of loans with similar financial characteristics. Loans are segregated by type and are then further segmented into fixed-rate and adjustable-rate interest terms to determine their fair value. The fair value of fixed-rate commercial and consumer loans is calculated by discounting scheduled cash flows through the estimated maturity of the loan using interest rates offered at the measurement date that reflect the credit and interest rate risk inherent in the loan. The estimate of maturity is based on the Corporation’s historical repayment experience. For residential mortgages, fair value is estimated by using market prices for sales of similar loans on the secondary market. The fair value of floating rate commercial and consumer loans approximates carrying value. Fair value for impaired loans is estimated using a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or if the loan is collateral dependent, at the fair value of the collateral. Loans are classified within Level 3 of the fair value hierarchy.

- 31-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

Time Deposits

The discounted values of cash flows using the rates currently offered for deposits of similar remaining maturities were used to estimate the fair value of time deposits. Time deposits are classified within Level 2 of the fair value hierarchy.

Federal Home Loan Bank Advances

Rates currently available to the Corporation for advances with similar terms and remaining maturities are used to estimate fair value of existing advances. FHLBB advances are categorized as Level 2.

Junior Subordinated Debentures

The fair value of the junior subordinated debentures is estimated using rates currently available to the Corporation for debentures with similar terms and maturities. Junior subordinated debentures are categorized as Level 2.

The following tables present the carrying amount, estimated fair value and placement in the fair value hierarchy of the Corporation’s financial instruments. The tables exclude financial instruments for which the carrying value approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB stock, accrued interest receivable and bank-owned life insurance. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits and accrued interest payable.

(Dollars in thousands)
March 31, 2015	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$24,025		$24,834		$—		$24,834		$—
Loans, net of allowance for loan losses	2,852,782		2,898,369		—		—		2,898,369
Financial Liabilities:
Time deposits		$852,621		$854,780		$—		$854,780		$—
FHLBB advances	385,992		400,770		—		400,770		—
Junior subordinated debentures	22,681		16,974		—		16,974		—

(Dollars in thousands)
December 31, 2014	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$25,222		$26,008		$—		$26,008		$—
Loans, net of allowance for loan losses	2,831,253		2,866,907		—		—		2,866,907
Financial Liabilities:
Time deposits		$874,102		$872,570		$—		$872,570		$—
FHLBB advances	406,297		418,005		—		418,005		—
Junior subordinated debentures	22,681		17,201		—		17,201		—

- 32-

Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(12) Defined Benefit Pension Plans

The Corporation maintains a tax-qualified defined benefit pension plan for the benefit of certain eligible employees who were hired prior to October 1, 2007. The Corporation also has non-qualified retirement plans to provide supplemental retirement benefits to certain employees, as defined in the plans. Defined benefit pension plans were previously amended to freeze benefit accruals after a 10-year transition period ending in December 2023.

The composition of net periodic benefit cost was as follows:

(Dollars in thousands)	Qualified Pension Plan						Non-Qualified Retirement Plans
Three months ended March 31,	2015			2014			2015		2014
Net Periodic Benefit Cost:
Service cost		$615			$538			$20		$12
Interest cost	732			723			122		120
Expected return on plan assets	(1,129		)	(1,016		)	—		—
Amortization of prior service (credit) cost	(6		)	(6		)	—		—
Recognized net actuarial loss	312			115			61		16
Net periodic benefit cost		$524			$354			$203		$148

The pension plan is funded on a current basis, in compliance with the requirements of ERISA.

(13) Share-Based Compensation Arrangements

During the three months endedMarch 31, 2015, performance share awards were granted to certain executive officers providing the opportunity to earn shares of common stock of the Corporation. The performance shares awarded were valued at the fair market value as of the award date, or $38.02, and will be earned over a 3-year performance period. The number of shares earned will range from zero to 200% of the target number of shares dependent upon the Corporation’s core return on equity and core earnings per share growth ranking compared to an industry peer group. The current assumption based on the most recent peer group information available results in shares earned at 150% of the target, or 46,950 shares.

(14) Business Segments

Washington Trust segregates financial information in assessing its results among its Commercial Banking and Wealth Management Services operating segments.  The amounts in the Corporate unit include activity not related to the segments. The methodologies and organizational hierarchies that define the business segments are periodically reviewed and revised.  Results may be restated, when necessary, to reflect changes in organizational structure or allocation methodology. Any changes in estimates and allocations that may affect the reported results of any business segment will not affect the consolidated financial position or results of operations of Washington Trust as a whole.

Management uses certain methodologies to allocate income and expenses to the business lines.  A funds transfer pricing methodology is used to assign interest income and interest expense to each interest-earning asset and interest-bearing liability on a matched maturity funding basis.  Certain indirect expenses are allocated to segments.  These include support unit expenses such as technology and processing operations and other support functions.

Commercial Banking

The Commercial Banking segment includes commercial, residential and consumer lending activities; equity in losses of unconsolidated investments in real estate limited partnerships; mortgage banking, secondary market and loan servicing activities; deposit generation; merchant credit card services; cash management activities; and direct banking activities, which include the operation of ATMs, telephone and Internet banking services and customer support and sales.

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Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

Wealth Management Services

Wealth Management Services includes investment management; financial planning; personal trust services, including services as trustee, administrator, custodian and guardian; and estate settlement. Institutional trust services are also provided, including fiduciary services.

Corporate

Corporate includes the Treasury Unit, which is responsible for managing the wholesale investment portfolio and wholesale funding needs.  It also includes income from bank-owned life insurance, net gain on sale of business line as well as administrative and executive expenses not allocated to the operating segments and the residual impact of methodology allocations such as funds transfer pricing offsets.

The following table presents the statement of operations and total assets for Washington Trust’s reportable segments:

(Dollars in thousands)	Commercial Banking				Wealth Management Services						Corporate				Consolidated Total
Three months ended March 31,	2015		2014		2015			2014			2015		2014		2015		2014
Net interest income (expense)		$20,625		$19,739		($14	)		($4	)		$5,091		$4,101		$25,702		$23,836
Provision for loan losses	—		300		—			—			—		—		—		300
Net interest income (expense) after provision for loan losses	20,625		19,439		(14		)	(4		)	5,091		4,101		25,702		23,536
Noninterest income	5,078		4,541		8,435			8,065			507		6,764		14,020		19,370
Noninterest expenses:
Depreciation and amortization expense	671		585		306			311			60		51		1,037		947
Other noninterest expenses	13,587		13,553		5,915			5,387			2,992		9,405		22,494		28,345
Total noninterest expenses	14,258		14,138		6,221			5,698			3,052		9,456		23,531		29,292
Income before income taxes	11,445		9,842		2,200			2,363			2,546		1,409		16,191		13,614
Income tax expense	3,730		3,261		844			876			607		179		5,181		4,316
Net income		$7,715		$6,581		$1,356			$1,487			$1,939		$1,230		$11,010		$9,298
Total assets at period end		$3,015,691		$2,577,350		$52,568			$52,475			$534,255		$564,321		$3,602,514		$3,194,146
Expenditures for long-lived assets	1,067		1,075		114			171			45		45		1,226		1,291

(15) Other Comprehensive Income

The following table presents the activity in other comprehensive income:

Three months ended March 31,	2015									2014
(Dollars in thousands)	Pre-tax Amounts			Income Taxes			Net of Tax			Pre-tax Amounts			Income Taxes			Net of Tax
Securities available for sale:
Net change in fair value of securities available for sale	1,053			389			664			964			352			612
Cash flow hedges:
Change in fair value of cash flow hedges	(32		)	(24		)	(8		)	(43		)	(27		)	(16		)
Net cash flow hedge losses reclassified into earnings (1)	145			52			93			145			53			92
Net change in fair value of cash flow hedges	113			28			85			102			26			76
Defined benefit plan obligation adjustment (2)	367			132			235			88			—			88
Total other comprehensive income		$1,533			$549			$984			$1,154			$378			$776

(1) Included in interest expense on junior subordinated debentures in the Consolidated Statements of Income.

(2) Included in salaries and employee benefits expense in the Consolidated Statements of Income.

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Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following tables present the changes in accumulated other comprehensive income (loss) by component, net of tax:

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2014		$4,110		$112		($287	)		($12,744	)		($8,809	)
Other comprehensive income (loss) before reclassifications	664		—		(8		)	—			656
Amounts reclassified from accumulated other comprehensive income	—		—		93			235			328
Net other comprehensive income	664		—		85			235			984
Balance at March 31, 2015		$4,774		$112		($202	)		($12,509	)		($7,825	)

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2013		$3,089		$112		($618	)		($4,136	)		($1,553	)
Other comprehensive income (loss) before reclassifications	612		—		(16		)	—			596
Amounts reclassified from accumulated other comprehensive income	—		—		92			88			180
Net other comprehensive income	612		—		76			88			776
Balance at March 31, 2014		$3,701		$112		($542	)		($4,048	)		($777	)

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Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(16) Earnings Per Common Share

Washington Trust utilizes the two-class method earnings allocation formula to determine earnings per share of each class of stock according to dividends and participation rights in undistributed earnings.  Share-based payments that entitle holders to receive non-forfeitable dividends before vesting are considered participating securities and included in earnings allocation for computing basic earnings per share under this method.  Undistributed income is allocated to common shareholders and participating securities under the two-class method based upon the proportion of each to the total weighted average shares available.

The following table presents the calculation of earnings per common share:

(Dollars and shares in thousands, except per share amounts)
Three months ended March 31,	2015			2014
Earnings per common share - basic:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Earnings per common share - basic		$0.65			$0.56
Earnings per common share - diluted:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Dilutive effect of common stock equivalents	180			174
Weighted average diluted common shares	16,939			16,800
Earnings per common share - diluted		$0.65			$0.55

Weighted average common stock equivalents, not included in common stock equivalents above because they were anti-dilutive, totaled 77,450 and 54,600, respectively, for the three months endedMarch 31, 2015 and 2014.

(17) Commitments and Contingencies

Financial Instruments with Off-Balance Sheet Risk

The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers and to manage the Corporation’s exposure to fluctuations in interest rates.  These financial instruments include commitments to extend credit, standby letters of credit, interest rate swap agreements and interest rate lock commitments and commitments to sell residential real estate mortgage loans.  These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the Corporation’s Consolidated Balance Sheets.  The contract or notional amounts of these instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.  The Corporation’s credit policies with respect to interest rate swap agreements with commercial borrowers, commitments to extend credit, and financial guarantees are similar to those used for loans.  The interest rate swaps with other counterparties are generally subject to bilateral collateralization terms.

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Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

The following table presents the contractual and notional amounts of financial instruments with off-balance sheet risk:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Financial instruments whose contract amounts represent credit risk:
Commitments to extend credit:
Commercial loans		$303,443		$325,402
Home equity lines	206,515		200,932
Other loans	47,998		48,551
Standby letters of credit	5,248		5,102
Financial instruments whose notional amounts exceed the amount of credit risk:
Forward loan commitments:
Interest rate lock commitments	60,546		40,015
Commitments to sell mortgage loans	106,457		84,808
Customer related derivative contracts:
Interest rate swaps with customers	209,416		165,795
Mirror swaps with counterparties	209,416		165,795
Interest rate risk management contracts:
Interest rate swaps	22,681		22,681

Commitments to Extend Credit

Commitments to extend credit are agreements to lend to a customer as long as there are no violations of any condition established in the contract.  Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee.  Since some of the commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements.  Each borrower’s creditworthiness is evaluated on a case-by-case basis.  The amount of collateral obtained is based on management’s credit evaluation of the borrower.

Standby Letters of Credit

Standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. These standby letters of credit are primarily issued to support the financing needs of the Bank’s commercial customers. The credit risk involved in issuing standby letters of credit is essentially the same as that involved in extending loan facilities to customers. The collateral supporting those commitments is essentially the same as for other commitments. Most standby letters of credit extend for one year. As of March 31, 2015 and December 31, 2014, the maximum potential amount of undiscounted future payments, not reduced by amounts that may be recovered, totaled $5.2 million and $5.1 million, respectively. At March 31, 2015 and December 31, 2014, there were no liabilities to beneficiaries resulting from standby letters of credit.  Fee income on standby letters of credit was insignificant for the three months endedMarch 31, 2015 and 2014.

Forward Loan Commitments

Interest rate lock commitments are extended to borrowers and relate to the origination of residential real estate mortgage loans held for sale. To mitigate the interest rate risk inherent in these rate locks, as well as closed residential real estate mortgage loans held for sale, forward commitments are established to sell individual residential real estate mortgage loans.  Both interest rate lock commitments and commitments to sell residential real estate mortgage loans are derivative financial instruments.

Leases

As of March 31, 2015 and December 31, 2014, the Corporation was obligated under various non-cancellable operating leases for properties used as banking offices and other office facilities.  Lease expiration dates range from 4 months to 26 years, with renewal options on certain leases of 1 month to 25 years. Rental expense under the operating leases amounted to $790 thousand for the three months endedMarch 31, 2015, compared to $737 thousand for the same period in 2014. Rental expense is recorded as a component of net occupancy expense in the accompanying Consolidated Statements of Income. There have been no significant changes in the future minimum lease payments payable from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

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Condensed Notes to Unaudited Consolidated Financial Statements – (continued)

(18) Sale of Business Line

On March 1, 2014, the Corporation sold its merchant processing service business line to a third party. The sale resulted in a net gain of $6.3 million; after-tax $4.0 million, or 24 cents per diluted share.  In connection with the sale, Washington Trust incurred divestiture related costs of $355 thousand; after-tax $227 thousand, or 1 cent per diluted share, in the first quarter of 2014. The net proceeds received from the sale totaled $7.2 million, including $900 thousand of deferred revenue that can be earned over a 5-year period by providing business referrals to the buyer. As of March 31, 2015, $720 thousand of deferred revenue remained to be earned under this arrangement.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the Corporation’s consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2014, and in conjunction with the condensed unaudited consolidated financial statements and notes thereto included in Item 1 of this report.  Operating results for the three months endedMarch 31, 2015 are not necessarily indicative of the results for the full-year ended December 31, 2015 or any future period.

Forward-Looking Statements

This report contains statements that are “forward-looking statements.”  We may also make forward-looking statements in other documents we file with the SEC, in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees.  You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters.  You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond our control.  These risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different than 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; 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, 2014, 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.

Critical Accounting Policies and Estimates

Accounting policies involving significant judgments, estimates and assumptions by management, which have, or could have, a material impact on the carrying value of certain assets and impact income are considered critical accounting policies.  The Corporation considers the following to be its critical accounting policies: allowance for loan losses, review of goodwill for impairment and the assessment of investment securities for impairment. There have been no significant changes in the Corporation’s critical accounting policies and estimates from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

Recently Issued Accounting Pronouncements

See Note 2 to the Unaudited Consolidated Financial Statements for details of recently issued accounting pronouncements and their expected impact on the Corporation’s financial statements.

Overview

Washington Trust offers a comprehensive product line of banking and financial services to individuals and businesses, including commercial, residential and consumer lending, retail and commercial deposit products, and wealth management services through its offices in Rhode Island, eastern Massachusetts and Connecticut; its ATM networks; and its Internet website at www.washtrust.com.

Our largest source of operating income is net interest income, the difference between interest earned on loans and securities and interest paid on deposits and borrowings.  In addition, we generate noninterest income from a number of sources, including wealth management services, loan sales and commissions on loans originated for others, deposit services and bank-owned life insurance (“BOLI”).  Our principal noninterest expenses include salaries and employee benefits, occupancy and facility-related costs, technology and other administrative expenses.

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Our financial results are affected by interest rate fluctuations, changes in economic and market conditions, competitive conditions within our market area and changes in legislation, regulation and/or accounting principles.  While the regional economic climate has been improving in recent quarters, adverse changes in future economic growth, consumer confidence, credit availability and corporate earnings could impact our financial results. Management believes that overall credit quality has been stable to improving, generally in line with the pace of recovery in regional economic conditions.

We continued to leverage our strong, statewide brand to build market share in Rhode Island whenever possible and bring select business lines to new markets with high-growth potential while remaining steadfast in our commitment to provide superior service. In the first quarter of 2015, we opened a new full-service branch in Rumford, Rhode Island, and we plan to open another new full-service branch in Providence, Rhode Island, later in 2015 or early 2016.

Composition of Earnings

Net income for the first quarter of 2015 amounted to $11.0 million, or $0.65 per diluted share, up from $9.3 million, or $0.55 per diluted share, for the first quarter of 2014. The returns on average equity and average assets for the first quarter of 2015 were 12.54% and 1.23%, respectively, compared to 11.10% and 1.17%, respectively, for the same quarter in 2014.

First quarter 2014 results included the following transactions, which reduced net income for the three months ended March 31, 2014 by $245 thousand, or 1 cent per diluted share:

• On March 1, 2014, the Corporation sold its merchant processing service business line to a third party. The sale resulted in a gain of $6.3 million, after-tax $4.0 million, or 24 cents per diluted share.

• In connection with this sale, the Corporation incurred divestiture related costs of $355 thousand, after-tax $227 thousand, or 1 cent per diluted share. The majority of the divestiture costs were classified as salaries and employee benefit costs.

• Washington Trust also prepaid FHLBB advances totaling $99.3 million, resulting in debt prepayment penalty expense of $6.3 million, after-tax $4.0 million, or 24 cents per diluted share.

Excluding the above mentioned transactions, as well as the merchant processing fee revenue and expenses recognized prior to the consummation of the business line sale, increased profitability in 2015 as compared to 2014 reflected growth in net interest income, a decrease in the provision for loan losses, higher wealth management revenues and increased mortgage banking revenues, which were partially offset by higher salaries and employee benefit costs.

Net interest income for the three months endedMarch 31, 2015 amounted to $25.7 million, up by 8% from the comparable period in 2014, reflecting growth in average loan balances. The net interest margin (fully taxable equivalent net interest income as a percentage of average interest-earnings assets) was 3.18% for the three months endedMarch 31, 2015, compared to 3.34% for the comparable period in 2014.

Based on the assessment of the stable asset quality metrics, the relatively modest loan growth in the first quarter of 2015 and other favorable changes in loss exposure, management concluded that no provision for loan losses was necessary for the three months endedMarch 31, 2015. A $300 thousand loan loss provision was recognized in earnings for the comparable period in 2014.

Wealth management revenues for the three months endedMarch 31, 2015 totaled $8.4 million, up by 5% from the same period in 2014, due to an increase in asset-based wealth management revenues.

Net gains on loan sales and commissions on loans originated for others (“mortgage banking revenues”) for the three months endedMarch 31, 2015 amounted to $2.6 million, up by 109% from the same period in 2014, due to an increase in residential mortgage loan sales activity.

Salaries and employee benefit costs, the largest component of noninterest expenses, totaled $15.5 million, up by 6% from the same period in 2014, largely due to increases in our mortgage banking area and wealth management business line.

Results of Operations

Segment Reporting

Washington Trust manages its operations through two business segments, Commercial Banking and Wealth Management Services.  Activity not related to the segments, such as investment securities portfolio, wholesale funding activities, net gain on sale of business line, income from BOLI and administrative expenses are not allocated to the operating segments and are

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considered Corporate.  The Corporate unit also includes the residual impact of methodology allocations such as funds transfer pricing offsets.  Methodologies used to allocate income and expenses to business lines are periodically reviewed and revised. See Note 14 to the Unaudited Consolidated Financial Statements for additional disclosure related to business segments.

The Commercial Banking segment reported net income of $7.7 million for the three months endedMarch 31, 2015, compared to $6.6 million for the same period in 2014. Net interest income for this operating segment for the three months endedMarch 31, 2015, increased by $886 thousand, or 4%, from the same period in 2014, primarily due to growth in interest-earning assets. However, the increase was impacted by lower yields on loans as well as narrower spreads in the funds transfer pricing allocation with the Corporate unit. Due to stable and favorable trends in asset quality and credit quality indicators and relatively modest loan growth in the first quarter of 2015, no loan loss provision was recognized for the three months endedMarch 31, 2015, compared to a $300 thousand loan loss provision charged to earnings in the same quarter in 2014. Noninterest income derived from the Commercial Banking segment totaled $5.1 million for the three months endedMarch 31, 2015, up by $537 thousand, or 12%, from the comparable 2014 period. The increase in noninterest income was largely due to higher mortgage banking revenues and customer-related interest rate swap fee income, partially offset by a decrease in merchant processing fee revenue, due to the sale of this business line on March 1, 2014. The decrease in merchant processing fee revenue corresponded to a decline in merchant processing costs included in this operating segment’s noninterest expenses. Commercial Banking noninterest expenses for the three months endedMarch 31, 2015 were up modestly from the same period in 2014, reflecting increases in salaries and employee benefit costs and net occupancy costs, which were partially offset by a decline in merchant processing costs.

The Wealth Management Services segment reported net income of $1.4 million for the three months endedMarch 31, 2015, compared to $1.5 million for the same period in 2014. Noninterest income derived from the Wealth Management Services segment was $8.4 million for the three months endedMarch 31, 2015, up by 5% compared to the same period in 2014, due to an increase in asset-based wealth management revenues.  Wealth Management assets under administration totaled $5.2 billion at March 31, 2015, up by 2% from December 31, 2014 and up by 7% from March 31, 2014. Noninterest expenses for the Wealth Management Services segment totaled $6.2 million for the three months endedMarch 31, 2015, up by $523 thousand, or 9%, from the same period in 2014, primarily due to an increase in salaries and benefit costs.

Net income attributed to the Corporate unit amounted to $1.9 million for the three months endedMarch 31, 2015, compared to $1.2 million for the same period in 2014. The Corporate unit’s net interest income for the three months endedMarch 31, 2015 increased by $1.0 million from the comparable 2014 period, largely due to a favorable change in net funds transfer pricing offsets with the Commercial Banking segment, partially offset by a decrease in interest and dividend income. Noninterest income forthe Corporate unit for the three months endedMarch 31, 2015 decreased by $6.3 million, compared to the same period a year ago, due to the gain on the sale of the merchant processing services business line recognized in the first quarter of 2014. The Corporate unit’s noninterest expenses for the three months endedMarch 31, 2015 decreased by $6.4 million from the same period in 2014, largely due to debt prepayment penalty expense recognized in the first quarter of 2014. See additional discussion regarding these noninterest income and expense items in the “Overview” section under the caption “Composition of Earnings.”

Net Interest Income

Net interest income continues to be the primary source of our operating income.  Net interest income is affected by the level of interest rates, changes in interest rates and changes in the amount and composition of interest-earning assets and interest-bearing liabilities.  Included in interest income are loan prepayment fees and certain other fees, such as late charges. The following discussion presents net interest income on a fully taxable equivalent (“FTE”) basis by adjusting income and yields on tax-exempt loans and securities to be comparable to taxable loans and securities.  For more information, see the section entitled “Average Balances / Net Interest Margin - Fully Taxable Equivalent (FTE) Basis” below.

FTE net interest income for the three months endedMarch 31, 2015 amounted to $26.4 million up by $1.9 million, or 8%, from the $24.5 million reported for the same period in 2014. The net interest margin was 3.18% for the three months endedMarch 31, 2015, compared to 3.34% for the same period in 2014.

Average interest-earning assets amounted to $3.4 billion for the three months endedMarch 31, 2015 and were up by $396.1 million, or 13%, from the average balances for the same period in 2014, primarily due to loan growth. The yield on average interest-earning assets for the three months endedMarch 31, 2015 declined by 24 basis points from the comparable period in 2014, reflecting the impact of a sustained low interest rate environment.

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Total average loans for the three months endedMarch 31, 2015 increased by $444.1 million, or 18%, from the average balances for the comparable 2014 period, with growth in average residential real estate mortgage and commercial loan balances.  The yield on total loans for the three months endedMarch 31, 2015 was 4.01%, down by 25 basis points from the same period in 2014. The contribution of loan prepayment fees and other fees to the yield on total loans was 4 basis points and 5 basis points, respectively, for the three months endedMarch 31, 2015 and 2014. Due to the combined effect of new loan growth and the runoff of higher yielding loan balances, interest rates on total interest-earning assets may continue to decline.

Total average securities for the three months endedMarch 31, 2015 decreased by $36.7 million, or 9%, from the average balances for the same period a year earlier, reflecting maturities, calls and pay-downs.  The FTE rate of return on securities for the three months endedMarch 31, 2015 decreased by 61 basis points from the comparable period in 2014, due to runoff of higher yielding securities.

Average interest-bearing liabilities for the three months endedMarch 31, 2015 increased by $367.5 million, or 15%, from the average balances for the same period in 2014, largely due to increases in wholesale brokered time deposits and FHLBB advances. The cost of funds for the three months endedMarch 31, 2015 declined by 11 basis points from the comparable 2014 period, largely due to a decline in the rate paid on FHLBB advances. See additional discussion under the caption “Sources of Funds” for additional information regarding funding transactions.

The average balance of FHLBB advances for the three months endedMarch 31, 2015 was up by $134.8 million compared to the average balances for the same period in 2014. The average rate paid on such advances for the three months endedMarch 31, 2015 was 1.91% compared to 3.37% for the comparable period in 2014.

Total average interest-bearing deposits for the three months endedMarch 31, 2015 increased by $232.8 million, or 11%, from the average balances for the same period in 2014. This included an increase of $173.0 million in average out-of-market wholesale brokered time certificates of deposit. The average rate paid on wholesale brokered time deposits for the first three months of 2015 increased by 17 basis points compared to the same period in 2014.

Excluding the increases in wholesale brokered time deposits, average in-market interest-bearing deposits grew by $59.7 million, or 3%, primarily due to increases in average money market account balances, partially offset by a decrease in average in-market time deposit balances. The average rate paid on in-market interest-bearing deposits for the three months endedMarch 31, 2015 decreased by 5 basis points compared to the same period in 2014, due to lower rates on time deposits, offset, in part, by higher rates on money market deposits.

The average balance of noninterest-bearing demand deposits for the three months endedMarch 31, 2015 increased by $15.9 million compared to the average balances for the same period in 2014.

Average Balances / Net Interest Margin - Fully Taxable Equivalent (FTE) Basis

The following tables present average balance and interest rate information.  Tax-exempt income is converted to a FTE 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 gain (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 earned on these loans (to the extent recognized in the Consolidated Statements of Income) are included in amounts presented for loans.

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Three months ended March 31,	2015					2014
(Dollars in thousands)	Average Balance		Interest		Yield/ Rate	Average Balance		Interest		Yield/ Rate
Assets:
Commercial loans		$1,544,720		$15,313	4.02		$1,336,798		$14,601	4.43
Residential real estate loans, including mortgage loans held for sale	1,030,016		10,314		4.06	802,412		8,208		4.15
Consumer loans	336,333		3,168		3.82	327,793		3,097		3.83
Total loans	2,911,069		28,795		4.01	2,467,003		25,906		4.26
Cash, federal funds sold and short-term investments	51,058		25		0.20	62,246		35		0.23
FHLBB stock	37,730		165		1.77	37,730		142		1.53
Taxable debt securities	322,570		2,259		2.84	344,009		2,942		3.47
Nontaxable debt securities	44,659		664		6.03	59,958		884		5.98
Total securities	367,229		2,923		3.23	403,967		3,826		3.84
Total interest-earning assets	3,367,086		31,908		3.84	2,970,946		29,909		4.08
Noninterest-earning assets	221,795					203,335
Total assets		$3,588,881					$3,174,281
Liabilities and Shareholders’ Equity:
Interest-bearing demand deposits		$37,851		$8	0.09		$10,767		$—	—
NOW accounts	329,588		48		0.06	304,201		47		0.06
Money market accounts	800,036		883		0.45	685,142		609		0.36
Savings accounts	293,926		46		0.06	292,809		45		0.06
Time deposits (in-market)	567,063		1,469		1.05	675,836		1,931		1.16
Wholesale brokered time deposits	294,664		935		1.29	121,622		337		1.12
FHLBB advances	404,773		1,902		1.91	269,989		2,241		3.37
Junior subordinated debentures	22,681		241		4.31	22,681		241		4.31
Other	128		3		9.51	173		3		7.03
Total interest-bearing liabilities	2,750,710		5,535		0.82	2,383,220		5,454		0.93
Demand deposits	438,904					422,975
Other liabilities	48,052					33,057
Shareholders’ equity	351,215					335,029
Total liabilities and shareholders’ equity		$3,588,881					$3,174,281
Net interest income				$26,373					$24,455
Interest rate spread					3.02					3.15
Net interest margin					3.18					3.34

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

(Dollars in thousands)
Three months ended March 31,	2015		2014
Commercial loans		$442		$317
Nontaxable debt securities	229		302
Total		$671		$619

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Volume / Rate Analysis - Interest Income and Expense (Fully Taxable Equivalent Basis)

The following table presents certain information on a FTE basis regarding changes in our interest income and interest expense for the period indicated.  The net change attributable to both volume and rate has been allocated proportionately.

(Dollars in thousands)	Three months
	March 31, 2015 vs. 2014
	Increase (Decrease) Due to
	Volume			Rate			Net Change
Interest on Interest-Earning Assets:
Commercial loans		$2,141			($1,429	)		$712
Residential real estate loans, including mortgage loans held for sale	2,287			(181		)	2,106
Consumer loans	79			(8		)	71
Cash, federal funds sold and other short-term investments	(6		)	(4		)	(10		)
FHLBB stock	—			23			23
Taxable debt securities	(175		)	(508		)	(683		)
Nontaxable debt securities	(227		)	7			(220		)
Total interest income	4,099			(2,100		)	1,999
Interest on Interest-Bearing Liabilities:
Interest-bearing demand deposits	—			8			8
NOW accounts	1			—			1
Money market accounts	110			164			274
Savings accounts	1			—			1
Time deposits (in-market)	(291		)	(171		)	(462		)
Wholesale brokered time deposits	540			58			598
FHLBB advances	859			(1,198		)	(339		)
Junior subordinated debentures	—			—			—
Other	(1		)	1			—
Total interest expense	1,219			(1,138		)	81
Net interest income		$2,880			($962	)		$1,918

Provision and Allowance for Loan Losses

The provision for loan losses is based on management’s periodic assessment of the adequacy of the allowance for loan losses which, in turn, is based on such interrelated factors as the composition of the loan portfolio and its inherent risk characteristics; the level of nonperforming loans and net charge-offs, both current and historic; local economic and credit conditions; the direction of real estate values; and regulatory guidelines.  The provision for loan losses is charged against earnings in order to maintain an allowance for loan losses that reflects management’s best estimate of probable losses inherent in the loan portfolio at the balance sheet date.

Based on management’s assessment of the stable asset quality metrics, the relatively modest loan growth in the first quarter of 2015 and other favorable changes in loss exposure allocation, there was no provision for loan losses charged to earnings in the first quarter of 2015. A loan loss provision of $300 thousand was recognized in the first quarter of 2014.  Net charge-offs for the three months endedMarch 31, 2015 totaled $213 thousand. Net charge-offs for the three months endedMarch 31, 2014 totaled $1.1 million and included an $853 thousand charge-off recognized on one commercial mortgage relationship.

The level of nonaccrual loan formation in recent quarters has been relatively low, including $1.6 million in the first quarter of 2015 and $2.1 million in the fourth quarter of 2014. In comparison, the average quarterly amount of nonaccrual loan formation for the 7 quarters ended September 30, 2014 was $3.4 million. In addition, the amount of potential problem loans, as described under the caption “Asset Quality,” has decreased to $573 thousand at March 31, 2015. These factors have been and will continue to be taken into consideration in determining the level of future loan loss provisions along with the other factors mentioned above.

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The allowance for loan losses was $27.8 million, or 0.97% of total loans, at March 31, 2015, compared to $28.0 million, or 0.98% of total loans, at December 31, 2014. See additional discussion under the caption “Asset Quality” below for further information on the Allowance for Loan Losses.

Noninterest Income

Noninterest income is an important source of revenue for Washington Trust.  The principal categories of noninterest income are shown in the following table:

(Dollars in thousands)							Change
Three months ended March 31,	2015			2014			$			%
Noninterest income:
Wealth management revenues		$8,435			$8,065			$370		5	%
Merchant processing fees	—			1,291			(1,291		)	(100	)
Net gains on loan sales and commissions on loans originated for others	2,585			1,239			1,346			109
Service charges on deposit accounts	935			754			181			24
Card interchange fees	714			681			33			5
Income from bank-owned life insurance	490			445			45			10
Net gains on interest rate swap contracts	645			260			385			148
Equity in earnings (losses) of unconsolidated subsidiaries	(86		)	(43		)	(43		)	100
Net gain on sale of business line	—			6,265			(6,265		)	(100	)
Other income	302			413			(111		)	(27	)
Total noninterest income		$14,020			$19,370			($5,350	)	(28	)%

Noninterest Income Analysis

Revenue from wealth management services is our largest source of noninterest income. A substantial portion of wealth management revenues is largely dependent on the value of wealth management assets under administration and is closely tied to the performance of the financial markets. This portion of wealth management revenues is referred to as “asset-based” and includes trust and investment management fees and mutual fund fees. Wealth management revenues also include “transaction-based” revenues, such as financial planning, commissions and other service fees that are not primarily derived from the value of assets.

The categories of wealth management revenues are shown in the following table:

(Dollars in thousands)					Change
Three months ended March 31,	2015		2014		$			%
Wealth management revenues:
Trust and investment management fees		$7,142		$6,685		$457		7	%
Mutual fund fees	1,036		1,081		(45		)	(4	)
Asset-based revenues	8,178		7,766		412			5
Transaction-based revenues	257		299		(42		)	(14	)
Total wealth management revenues		$8,435		$8,065		$370		5	%

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The following table presents the changes in wealth management assets under administration:

(Dollars in thousands)
Three months ended March 31,	2015		2014
Wealth management assets under administration:
Balance at the beginning of period		$5,069,966		$4,781,958
Net investment appreciation & income	80,872		44,335
Net client cash flows	8,825		(19,912		)
Balance at the end of period		$5,159,663		$4,806,381

Wealth management revenues for the three months endedMarch 31, 2015 were $8.4 million, up by 5% from the same period in 2014, due to an increase in asset-based revenues.  Wealth management assets under administration totaled $5.2 billion at March 31, 2015, up by $89.7 million, or 2%, from December 31, 2014, and up by $353.3 million, or 7%, from a year-ago, largely due to net investment appreciation and income.

As disclosed in the Overview section under the caption “Composition of Earnings,” the Corporation sold its merchant processing services business line on March 1, 2014, resulting in a net gain on sale of business line of $6.3 million. Prior to the consummation of this business line sale, merchant processing fee revenues of $1.3 million were recognized in the first quarter of 2014. See discussion below regarding corresponding merchant processing costs under the caption “Noninterest Expenses.”

Mortgage banking revenues are dependent on mortgage origination volume and are sensitive to interest rates and the condition of housing markets. Mortgage origination activity increased in the first quarter of 2015 in response to a decline in market interest rates in recent months. Mortgage banking revenues totaled $2.6 million for the three months endedMarch 31, 2015, up by $1.3 million, or 109%, compared to the same period in 2014, reflecting increases in origination and sales activity. Residential mortgages sold to the secondary market, including brokered loans, totaled $127.9 million and $57.0 million, respectively, for the three months endedMarch 31, 2015 and 2014.

Net gains on interest rate swap contracts for the three months endedMarch 31, 2015 increased by $385 thousand, or 148%, from the same period in 2014. This increase was largely due to new customer-related interest rate swap transactions executed in the first quarter of 2015.

Noninterest Expense

The following table presents noninterest expense comparisons:

(Dollars in thousands)					Change
Three months ended March 31,	2015		2014		$			%
Noninterest expenses:
Salaries and employee benefits		$15,494		$14,558		$936		6	%
Net occupancy	1,886		1,640		246			15
Equipment	1,340		1,236		104			8
Merchant processing costs	—		1,050		(1,050		)	(100	)
Outsourced services	1,247		1,044		203			19
Legal, audit and professional fees	676		618		58			9
FDIC deposit insurance costs	473		440		33			8
Advertising and promotion	267		232		35			15
Amortization of intangibles	155		164		(9		)	(5	)
Debt prepayment penalties	—		6,294		(6,294		)	(100	)
Other	1,993		2,016		(23		)	(1	)
Total noninterest expense		$23,531		$29,292		($5,761	)	(20	)%

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Noninterest Expense Analysis

For the three months endedMarch 31, 2015, salaries and employee benefit costs totaled $15.5 million, up by $936 thousand, or 6%, compared to the same period in 2014. Included in salaries and employee benefits was $291 thousand of divestiture costs expensed in the first quarter of 2014. Excluding these divestiture costs, salaries and employee benefit costs increased $1.2 million, or 9%, reflecting higher levels of business development based compensation in the mortgage banking area and increased staffing levels in the wealth management business line, compared to the first quarter of 2014.

Net occupancy costs for the three months endedMarch 31, 2015 increased by $246 thousand, or 15%, from the comparable 2014 period, largely due to increased rental expense and other occupancy costs associated with a de novo branch that opened in the second quarter of 2014 and increased weather-related utilities and operating costs compared to the same period in 2014.

As disclosed in the Overview section under the caption “Composition of Earnings,” the Corporation sold its merchant processing services business line on March 1, 2014. Prior to the consummation of this business line sale, merchant processing costs of $1.1 million were recognized in the in the first quarter of 2014. See the discussion above regarding corresponding merchant processing fees under the caption “Noninterest Income.”

Outsourced services for the three months endedMarch 31, 2015 increased by $203 thousand, or 19%, from the same period in 2014, reflecting an increase in third party card processing services due to increased volume and execution costs associated with customer-related interest rate swap transactions.

The prepayment of FHLBB advances in the first quarter of 2014 resulted in debt prepayment penalty expense of $6.3 million. See additional discussion regarding the prepayments in the “Overview” section above under the caption “Composition of Earnings.” There was no such debt prepayment penalty expense in the first quarter of 2015.

Income Taxes

Income tax expense amounted to $5.2 million for the three months endedMarch 31, 2015, compared to $4.3 million for the same period in 2014. The Corporation’s effective tax rate for the three months endedMarch 31, 2015 and 2014, was 32.0% and 31.7%, respectively. The increase in the effective tax rate reflected a higher proportion of taxable income to pre-tax book income. The effective tax rates differed from the federal rate of 35% due largely to the benefits of tax-exempt income, income from BOLI and federal tax credits.

Financial Condition

Summary

Total assets amounted to $3.6 billion at March 31, 2015, up by $15.6 million from the end of 2014, largely due to net loan growth.

Nonperforming assets as a percent of total assets amounted to 0.48% at March 31, 2015, unchanged from the end of 2014. Management believes the overall credit quality has been stable to improving, generally in line with the pace of recovery in regional economic conditions.

At March 31, 2015, total deposits increased by $28.3 million, or 1%, from the end of 2014, which included a decrease of $8.3 million of out-of-market wholesale brokered time certificates of deposit. Excluding out-of-market wholesale brokered time certificates of deposit, in-market deposits increased by $36.6 million, or 1%. FHLBB advances amounted to $386.0 million as of March 31, 2015, down by $20.3 million, or 5%, from December 31, 2014.

Shareholders’ equity totaled $353.9 million at March 31, 2015, up by $7.6 million from the balance at the end of 2014.  Capital levels continue to exceed the regulatory minimum levels to be considered well-capitalized, with a total risk-based capital ratio of 12.80% at March 31, 2015, compared to 12.56% at December 31, 2014. See Note 9 to the Unaudited Consolidated Financial Statements for additional discussion on regulatory capital requirements.

Securities

Washington Trust’s securities portfolio is managed to generate interest income, to implement interest rate risk management strategies, and to provide a readily available source of liquidity for balance sheet management. Securities are designated as either available for sale, held to maturity or trading at the time of purchase. The Corporation does not currently maintain a portfolio of trading securities. Securities available for sale may be sold in response to changes in market conditions, prepayment risk, rate fluctuations, liquidity, or capital requirements. Securities available for sale are reported at fair value, with any unrealized gains

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and losses excluded from earnings and reported as a separate component of shareholders’ equity, net of tax, until realized. Securities held to maturity are reported at amortized cost.

Determination of Fair Value

The Corporation uses an independent pricing service to obtain quoted prices. The prices provided by the independent pricing service are generally based on observable market data in active markets. The determination of whether markets are active or inactive is based upon the level of trading activity for a particular security class. The Corporation reviews the independent pricing service’s documentation to gain an understanding of the appropriateness of the pricing methodologies. The Corporation also reviews the prices provided by the independent pricing service for reasonableness based upon current trading levels for similar securities. If the prices appear unusual, they are re-examined and the value is either confirmed or revised. In addition, the Corporation periodically performs independent price tests of securities to ensure proper valuation and to verify our understanding of how securities are priced. As of March 31, 2015 and December 31, 2014, the Corporation did not make any adjustments to the prices provided by the pricing service.

Our fair value measurements generally utilize Level 2 inputs, representing quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, and model-derived valuations in which all significant input assumptions are observable in active markets.

See Notes 4 and 11 to the Unaudited Consolidated Financial Statements for additional information regarding the determination of fair value of investment securities.

Securities Portfolio

The carrying amounts of securities held are as follows:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		%		Amount		%
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,301	9	%		$31,172	9	%
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	233,045		68		245,366		68
Obligations of states and political subdivisions	44,179		13		49,176		14
Individual name issuer trust preferred debt securities	26,287		8		25,774		7
Corporate bonds	6,130		2		6,174		2
Total securities available for sale		$340,942	100	%		$357,662	100	%

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		%		Amount		%
Securities Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$24,025	100	%		$25,222	100	%
Total securities held to maturity		$24,025	100	%		$25,222	100	%

As of March 31, 2015, the investment portfolio totaled $365.0 million, down by $17.9 million from the balance at December 31, 2014, reflecting maturities, calls and principal repayments of debt securities.

At March 31, 2015 and December 31, 2014, the net unrealized gain position on securities available for sale and held to maturity amounted to $8.5 million and $7.4 million, respectively, and included gross unrealized losses of $4.5 million and $5.0 million, respectively.  These gross unrealized losses were temporary in nature and concentrated in variable rate trust preferred securities issued by financial services companies.

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Obligations of States and Political Subdivisions

The carrying amount of obligations of states and political subdivisions included in our securities portfolio at March 31, 2015 totaled $44.2 million. The following table presents obligations of states and political subdivisions by geographic location:

(Dollars in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
March 31, 2015
New Jersey		$27,042		$939		$—		$27,981
New York	8,073		286		—		8,359
Pennsylvania	1,962		96		—		2,058
Illinois	1,901		47		—		1,948
Other	3,686		147		—		3,833
Total		$42,664		$1,515		$—		$44,179

The following table presents obligations of states and political subdivisions by category:

(Dollars in thousands)	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
March 31, 2015
General obligations		$40,349		$1,407		$—		$41,756
Revenue obligations (1)	2,315		108		—		2,423
Total		$42,664		$1,515		$—		$44,179

(1) Includes water and sewer districts, tax revenue obligations and other.

Washington Trust owns trust preferred security holdings of 7 individual name issuers in the financial services industry. The following table presents information concerning these holdings, including credit ratings.  The Corporation’s Investment Policy contains rating standards that specifically reference ratings issued by Moody’s and S&P.

Individual Name Issuer Trust Preferred Debt Securities

(Dollars in thousands)	March 31, 2015								Credit Ratings
									March 31, 2015			Form 10-Q Filing Date
Named Issuer (parent holding company)	(a)	Amortized Cost		Fair Value		Unrealized Loss			Moody’s	S&P		Moody’s	S&P
JPMorgan Chase & Co.	2		$9,770		$8,300		($1,470	)	Baa2	BBB-		Baa2	BBB-
Bank of America Corporation	3	5,772		4,847		(925		)	Ba1	BB	(b)	Ba1	BB	(b)
Wells Fargo & Company	2	5,146		4,594		(552		)	A3/Baa1	BBB+/BBB		A3/Baa1	BBB+/BBB
SunTrust Banks, Inc.	1	4,175		3,486		(689		)	Baa3	BB+	(b)	Baa3	BB+	(b)
Northern Trust Corporation	1	1,986		1,730		(256		)	Baa1	BBB+		Baa1	BBB+
State Street Corporation	1	1,977		1,730		(247		)	A3	BBB		A3	BBB
Huntington Bancshares Incorporated	1	1,936		1,600		(336		)	Baa3	BB	(b)	Baa3	BB	(b)
Totals	11		$30,762		$26,287		($4,475	)

(a) Number of separate issuances, including issuances of acquired institutions.

(b) Rating is below investment grade.

The Corporation’s evaluation of the impairment status of individual name trust preferred securities includes various considerations in addition to the degree of impairment and the duration of impairment.  We review the reported regulatory capital ratios of the issuer and, in all cases, the regulatory capital ratios were deemed to be in excess of the regulatory minimums.  Credit ratings were also taken into consideration, including ratings in effect as of the reporting period date as well as credit rating changes between the reporting period date and the filing date of this report.  We noted no additional downgrades to below investment

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grade between the reporting period date and the filing date of this report.  Where available, credit ratings from multiple rating agencies are obtained and rating downgrades are specifically analyzed.  Our review process for these credit-sensitive holdings also includes a periodic review of relevant financial information for each issuer, such as quarterly financial reports, press releases and analyst reports.  This information is used to evaluate the current and prospective financial condition of the issuer in order to assess the issuer’s ability to meet its debt obligations.  Through the filing date of this report, each of the individual name issuer securities was current with respect to interest payments.  Based on our evaluation of the facts and circumstances relating to each issuer, management concluded that all principal and interest payments for these individual name issuer trust preferred debt securities would be collected according to their contractual terms and it expects to recover the entire amortized cost basis of these securities.  Furthermore, Washington Trust does not intend to sell these securities and it is not more-likely-than-not that Washington Trust will be required to sell these securities before recovery of their cost basis, which may be at maturity.  Therefore, management does not consider these investments to be other-than-temporarily impaired at March 31, 2015.

Further deterioration in credit quality of the underlying issuers of the securities, further deterioration in the condition of the financial services industry, a continuation or worsening of the current economic environment, or additional declines in real estate values, amount other things, may further affect the fair value of these securities and increase the potential that certain unrealized losses may be designated as other-than-temporary in future periods, and the Corporation may incur write-downs.

Loans

Total loans amounted to $2.9 billion at March 31, 2015, up by $21.3 million, or 1%, in the first three months of 2015, largely due to growth in the commercial loan portfolio.

Commercial Loans

Commercial loans fall into two major categories, commercial real estate and commercial and industrial loans. Commercial real estate loans consist of commercial mortgages secured by real property where the primary source of repayment is derived from rental income associated with the property or the proceeds of the sale, refinancing or permanent financing of the property. Commercial real estate loans also include construction loans made to businesses for land development or the on-site construction of industrial, commercial, or residential buildings. Commercial and industrial loans primarily provide working capital, equipment financing and financing for other business-related purposes. Commercial and industrial loans are frequently collateralized by equipment, inventory, accounts receivable, and/or general business assets.  A significant portion of the Bank’s commercial and industrial loans is also collateralized by real estate.  Commercial and industrial loans also include tax exempt loans made to states and political subdivisions, as well as industrial development or revenue bonds issued through quasi-public corporations for the benefit of a private or non-profit entity where that entity rather than the governmental entity is obligated to pay the debt service.

Commercial Real Estate Loans

Commercial real estate loans amounted to $954.9 million at March 31, 2015, up by $31.3 million, or 3%, from $923.6 million at December 31, 2014. Included in these end of period amounts were commercial construction loans of $89.9 million and $79.6 million, respectively. The growth in commercial real estate loans was in large part due to enhanced business cultivation efforts with new and existing borrowers, with an emphasis on larger loan balances to borrowers or groups of related borrowers.

Commercial real estate loans are secured by a variety of property types, with approximately 85% of the total at March 31, 2015 composed of office buildings, retail facilities, commercial mixed use, multi-family dwellings, lodging and industrial and warehouse properties.

The following table presents a geographic summary of commercial real estate loans, including commercial construction, by property location:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		% of Total		Amount		% of Total
Rhode Island, Connecticut, Massachusetts		$882,400	93	%		$861,422	93	%
New York, New Jersey, Pennsylvania	58,832		6		53,625		6
New Hampshire	13,661		1		8,523		1
Total		$954,893	100	%		$923,570	100	%

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Commercial and Industrial Loans

Commercial and industrial loans amounted to $604.6 million at March 31, 2015, down by $7.3 million, or 1%, from the balance at December 31, 2014. This portfolio includes loans to a variety of business types.  Approximately 79% of the total is composed of owner occupied and other real estate, health care/social assistance, retail trade, manufacturing, accommodation and food services, public administration, entertainment and recreation, construction, professional, scientific and technical and wholesale trade businesses.

Residential Real Estate Loans

Residential real estate loans amounted to $987.6 million at March 31, 2015, up by $2.1 million, from the balance at December 31, 2014. Washington Trust originates residential real estate mortgages within our general market area of Southern New England for portfolio and for sale in the secondary market.  In recent years, the mortgage origination business has been expanded beyond our bank branch network, which is primarily located in Rhode Island, through the addition of residential mortgage lending offices in eastern Massachusetts and Connecticut. We also originate residential real estate mortgages for various investors in a broker capacity, including conventional mortgages and reverse mortgages. Total residential real estate loan originations for retention in portfolio were $54.7 million for the three months ended March 31, 2015, compared to $66.5 million for the three months ended March 31, 2014. Total residential real estate loan originations for sale to the secondary market, including loans originated in a broker capacity, were $129.0 million for the three months ended March 31, 2015, compared to $55.7 million for the three months ended March 31, 2014.

Loans are sold with servicing retained or released. In recent years, we began to retain servicing on a higher proportion of loans sold to the secondary market. In general, loans sold with the retention of servicing yield a larger gain on sale due to thecapitalization of servicing rights, which are subsequently amortized over the estimated period of servicing. The net balance of capitalized servicing rights amounted to $3.1 million and $3.0 million, respectively, as of March 31, 2015 and December 31, 2014. The balance of residential mortgage loans serviced for others, which are not included in the Consolidated Balance Sheets, amounted to $407.4 million and $378.8 million, respectively, as of March 31, 2015 and December 31, 2014.

Included in residential real estate loans were purchased residential mortgage balances totaling $31.8 million and $32.8 million, respectively, as of March 31, 2015 and December 31, 2014. These loans were purchased from other financial institutions prior to March 2009.

The following is a geographic summary of residential real estate mortgages by property location:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		% of Total		Amount		% of Total
Rhode Island, Connecticut, Massachusetts		$966,809	97.9	%		$965,452	98.1	%
New Hampshire	11,509		1.2		10,204		1.0
New York, Virginia, New Jersey, Maryland, Pennsylvania	4,659		0.5		5,096		0.5
Ohio	1,749		0.2		1,812		0.2
Washington, Oregon	1,325		0.1		1,331		0.1
Georgia	1,057		0.1		1,062		0.1
Other	456		—		458		—
Total		$987,564	100.0	%		$985,415	100.0	%

Consumer Loans

Consumer loans amounted to $333.5 million at March 31, 2015, down by $4.9 million, or 1%, from December 31, 2014.  Our consumer portfolio is predominantly home equity lines and home equity loans, representing 86% of the total consumer portfolio at March 31, 2015.  Consumer loans also include personal installment loans and loans to individuals secured by general aviation aircraft and automobiles.

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Asset Quality

Nonperforming Assets

Nonperforming assets include nonaccrual loans, nonaccrual investment securities and property acquired through foreclosure or repossession.

The following table presents nonperforming assets and additional asset quality data:

(Dollars in thousands)	Mar 31, 2015			Dec 31, 2014
Nonaccrual loans:
Commercial mortgages		$5,115			$5,315
Commercial construction & development	—			—
Commercial & industrial	2,193			1,969
Residential real estate mortgages	6,956			7,124
Consumer	1,601			1,537
Total nonaccrual loans	15,865			15,945
Nonaccrual investment securities	—			—
Property acquired through foreclosure or repossession, net	1,398			1,176
Total nonperforming assets		$17,263			$17,121
Nonperforming assets to total assets	0.48		%	0.48		%
Nonperforming loans to total loans	0.55		%	0.56		%
Total past due loans to total loans	0.66		%	0.63		%
Accruing loans 90 days or more past due		$—			$—

Nonperforming assets totaled $17.3 million, or 0.48% of total assets, at March 31, 2015, compared to $17.1 million, or 0.48% of total assets, at December 31, 2014. Property acquired through foreclosure or repossession increased modestly to $1.4 million at March 31, 2015 and consisted of 6 residential properties and 2 commercial properties. Nonaccrual loans totaled $15.9 million at March 31, 2015, down slightly from the balance at December 31, 2014.

Nonaccrual Loans

During the three months ended March 31, 2015, the Corporation made no changes in its practices or policies concerning the placement of loans or investment securities into nonaccrual status.  There were no significant commitments to lend additional funds to borrowers whose loans were on nonaccrual status at March 31, 2015.

The following table presents additional detail on nonaccrual loans:

(Dollars in thousands)	March 31, 2015								December 31, 2014
	Days Past Due								Days Past Due
	Over 90		Under 90		Total		% (1)		Over 90		Under 90		Total		% (1)
Commercial mortgages		$5,115		$—		$5,115	0.59	%		$5,315		$—		$5,315	0.63	%
Commercial construction & development	—		—		—		—		—		—		—		—
Commercial & industrial	721		1,472		2,193		0.36		181		1,788		1,969		0.32
Residential real estate mortgages	3,607		3,349		6,956		0.70		3,284		3,840		7,124		0.72
Consumer	723		878		1,601		0.48		897		640		1,537		0.45
Total nonaccrual loans		$10,166		$5,699		$15,865	0.55	%		$9,677		$6,268		$15,945	0.56	%

(1) Percentage of nonaccrual loans to the total loans outstanding within the respective category.

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Approximately 76% of total nonaccrual loans at March 31, 2015 consisted of commercial mortgages and residential real estate mortgage loans.

Nonaccrual commercial mortgage loans were $5.1 million at March 31, 2015, down by $200 thousand from the balance at the end of 2014. All of the nonaccrual commercial mortgage loans at March 31, 2015 and December 31, 2014 were located in Rhode Island and Connecticut.

As of March 31, 2015, the largest nonaccrual relationship in the commercial mortgage category was comprised of one troubled debt restructured loan with a carrying value of $4.7 million, which was classified into nonaccrual status in the third quarter of 2014 because the borrower failed to perform in accordance with the terms of the restructuring. This loan is secured by commercial property and is collateral dependent. Based on the fair value of the underlying collateral, a $1.1 million loss allocation was deemed necessary at March 31, 2015.

Nonaccrual residential real estate mortgage loans decreased modestly from the balance at the end of 2014. As of March 31, 2015, the $7.0 million balance of nonaccrual residential mortgage loans consisted of 29 loans, with $6.2 million located in Rhode Island, Connecticut and Massachusetts.  Included in total nonaccrual residential mortgages at March 31, 2015 were 12 loans purchased for portfolio and serviced by others amounting to $3.3 million.  Management monitors the collection efforts of its third party servicers as part of its assessment of the collectibility of nonperforming loans.

Past Due Loans

The following table presents past due loans by category as of the dates indicated:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		% (1)		Amount		% (1)
Commercial mortgages		$5,673	0.66	%		$5,315	0.63	%
Commercial construction & development	—		—		—		—
Commercial & industrial	1,179		0.19		3,519		0.58
Residential real estate mortgages	9,429		0.95		7,048		0.72
Consumer loans	2,800		0.84		2,196		0.65
Total past due loans		$19,081	0.66	%		$18,078	0.63	%

(1) Percentage of past due loans to the total loans outstanding within the respective category.

As of March 31, 2015, total past due loans amounted to $19.1 million, or 0.66% of total loans, compared to $18.1 million, or 0.63%, at December 31, 2014.

Included in past due loans as of March 31, 2015 were nonaccrual loans of $12.3 million. All loans 90 days or more past due at March 31, 2015 and December 31, 2014 were classified as nonaccrual.

Troubled Debt Restructurings

Loans are considered restructured in a troubled debt restructuring when the Corporation has granted concessions to a borrower due to the borrower’s financial condition that it otherwise would not have considered.  These concessions include modifications of the terms of the debt such as reduction of the stated interest rate other than normal market rate adjustments, extension of maturity dates, or reduction of principal balance or accrued interest.  The decision to restructure a loan, versus aggressively enforcing the collection of the loan, may benefit the Corporation by increasing the ultimate probability of collection.

Restructured loans are classified as accruing or non-accruing based on management’s assessment of the collectibility of the loan.  Loans which are already on nonaccrual status at the time of the restructuring generally remain on nonaccrual status for approximately six months before management considers such loans for return to accruing status.  Accruing restructured loans are placed into nonaccrual status if and when the borrower fails to comply with the restructured terms and management deems it unlikely that the borrower will return to a status of compliance in the near term.

Troubled debt restructurings are reported as such for at least one year from the date of the restructuring.  In years after the restructuring, troubled debt restructured loans are removed from this classification if the restructuring did not involve a below‑market rate concession and the loan is not deemed to be impaired based on the terms specified in the restructuring

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agreement. As of March 31, 2015, there were no significant commitments to lend additional funds to borrowers whose loans had been restructured.

The following table sets forth information on troubled debt restructured loans as of the dates indicated. The amounts below consist of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs. Accrued interest is not included in the carrying amounts set forth below. See Note 5 to the Unaudited Consolidated Financial Statements for additional information.

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Accruing troubled debt restructured loans:
Commercial mortgages		$9,448		$9,676
Commercial & industrial	881		954
Residential real estate mortgages	684		1,252
Consumer	134		135
Accruing troubled debt restructured loans	11,147		12,017
Nonaccrual troubled debt restructured loans:
Commercial mortgages	4,698		4,898
Commercial & industrial	1,442		1,193
Residential real estate mortgages	338		248
Consumer	34		—
Nonaccrual troubled debt restructured loans	6,512		6,339
Total troubled debt restructured loans		$17,659		$18,356

As of March 31, 2015, loans classified as troubled debt restructurings totaled $17.7 million, down by $697 thousand from the end of 2014.

As of March 31, 2015, 80% of the troubled debt restructured loans consisted of two relationships. The largest troubled debt restructured relationship at March 31, 2015 consisted of an accruing commercial mortgage relationship with a carrying value of $9.4 million, secured by mixed use properties. The restructuring took place in the second quarter of 2013 and included a modification of certain payment terms and a below-market rate concession for a temporary period. The second largest troubled debt restructured relationship consisted of a commercial mortgage with a carrying value of $4.7 million at March 31, 2015, secured by commercial property. The restructuring took place in the third quarter of 2013 and included a modification of certain payment terms and a below-market rate concession for a temporary period. In connection with this restructuring, a principal paydown of $1.2 million was provided by the borrower during the third quarter of 2013. This troubled debt restructuring loan was classified into nonaccrual status in the third quarter of 2014. See additional disclosure about this relationship above under the caption “Nonaccrual Loans.”

Potential Problem Loans

The Corporation classifies certain loans as “substandard,” “doubtful,” or “loss” based on criteria consistent with guidelines provided by banking regulators.  Potential problem loans consist of classified accruing commercial loans that were less than 90 days past due at March 31, 2015 and other loans for which known information about possible credit problems of the related borrowers causes management to have doubts as to the ability of such borrowers to comply with the present loan repayment terms and which may result in disclosure of such loans as nonperforming at some time in the future.  These loans are not included in the amounts of nonaccrual or restructured loans presented above.  Management cannot predict the extent to which economic conditions or other factors may impact borrowers and the potential problem loans.  Accordingly, there can be no assurance that other loans will not become 90 days or more past due, be placed on nonaccrual, become restructured, or require increased allowance coverage and provision for loan losses.  The Corporation has identified approximately $573 thousand in potential problem loans at March 31, 2015, compared to $1.2 million at December 31, 2014. Potential problem loans are assessed for loss exposure using the methods described in Note 5 to the Unaudited Consolidated Financial Statements under the caption “Credit Quality Indicators.”

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Allowance for Loan Losses

Establishing an appropriate level of allowance for loan losses necessarily involves a high degree of judgment.  The Corporation uses a methodology to systematically measure the amount of estimated loan loss exposure inherent in the loan portfolio for purposes of establishing a sufficient allowance for loan losses.  See additional discussion regarding the allowance for loan losses, in Item 7 under the caption “Critical Accounting Policies and Estimates” of Washington Trust’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 and in Note 6 to the Unaudited Consolidated Financial Statements.

The allowance for loan losses is management’s best estimate of probable loan losses inherent in the loan portfolio as of the balance sheet date.  The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans. The status of nonaccrual loans, delinquent loans and performing loans were all taken into consideration in the assessment of the adequacy of the allowance for loans losses.   In addition, the balance and trends of credit quality indicators, including the commercial loan categories of Pass, Special Mention and Classified, are integrated into the process used to determine the allocation of loss exposure.  See Note 5 to the Unaudited Consolidated Financial Statements for additional information under the caption “Credit Quality Indicators.”  Management believes that the level of allowance for loan losses at March 31, 2015 is adequate and consistent with asset quality and delinquency indicators. Management will continue to assess the adequacy of the allowance for loan losses in accordance with its established policies.

The Bank’s general practice is to identify problem credits early and recognize full or partial charge-offs as promptly as practicable when it is determined that the collection of loan principal is unlikely.  The Bank recognizes full or partial charge-offs on collateral dependent impaired loans when the collateral is deemed to be insufficient to support the carrying value of the loan.  The Bank does not recognize a recovery when an updated appraisal indicates a subsequent increase in value.

Appraisals are generally obtained with values determined on an “as is” basis from independent appraisal firms for real estate collateral dependent commercial loans in the process of collection or when warranted by other deterioration in the borrower’s credit status.  Updates to appraisals are generally obtained for troubled or nonaccrual loans or when management believes it is warranted.  The Corporation has continued to maintain appropriate professional standards regarding the professional qualifications of appraisers and has an internal review process to monitor the quality of appraisals.

For residential mortgages and real estate collateral dependent consumer loans that are in the process of collection, valuations are obtained from independent appraisal firms with values determined on an “as is” basis.

The estimation of loan loss exposure inherent in the loan portfolio includes, among other procedures, (1) identification of loss allocations for individual loans deemed to be impaired, (2) application of loss allocation factors for non-impaired loans based on credit grade, historical loss experience, estimated loss emergence period and delinquency status, with adjustments for various exposures not adequately presented in historical loss experience, and (3) an unallocated allowance maintained for measurement imprecision associated with impaired and nonaccrual loans. We periodically reassess and revise the loss allocation factors used in the assignment of loss exposure to appropriately reflect our analysis of migrational loss experience.  Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience in the various portfolios over periods deemed to be relevant to the inherent risk of loss in the respective portfolios and the related estimate of the loss emergence period as of the balance sheet date.

The following is a summary of impaired loans by measurement type:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Collateral dependent impaired loans (1)		$19,607		$19,761
Impaired loans measured on discounted cash flow method (2)	1,409		2,258
Total impaired loans		$21,016		$22,019

(1) Net of partial charge-offs of $764 thousand and $530 thousand, respectively, at March 31, 2015 and December 31, 2014.

(2) Net of partial charge-offs of $207 thousand and $264 thousand, respectively, at March 31, 2015 and December 31, 2014.

Impaired loans consist of nonaccrual commercial loans, troubled debt restructured loans and other loans classified as impaired that are individually evaluated for impairment. The loss allocation on impaired loans amounted to $1.7 million and $1.6 million, respectively, at March 31, 2015 and December 31, 2014.  Various loan loss allowance coverage ratios are affected by the timing

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and extent of charge-offs, particularly with respect to impaired collateral dependent loans.  For such loans, the Bank generally recognizes a partial charge-off equal to the identified loss exposure; therefore, the remaining allocation of loss is minimal.

Other individual commercial loans not deemed to be impaired are evaluated using the internal rating system and the application of loss allocation factors.  The loan rating system and the related loss allocation factors take into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral and the adequacy of guarantees.  Portfolios of more homogeneous populations of loans including residential mortgages and consumer loans are analyzed as groups, with loss allocation factors assigned to each group, taking into consideration delinquency status. Loss allocation factors are also adjusted for various exposures not adequately presented in historical loss experience. See additional disclosure under the caption “Credit Quality Indicators” in Note 5 to the Unaudited Consolidated Financial Statements.

The following table presents additional detail on the Corporation’s loan portfolio and associated allowance for loan losses:

(Dollars in thousands)	March 31, 2015						December 31, 2014
	Loans		Related Allowance		Allowance / Loans		Loans		Related Allowance		Allowance / Loans
Impaired loans individually evaluated for impairment		$21,016		$1,657	7.88	%		$22,019		$1,583	7.19	%
Loans collectively evaluated for impairment	2,859,576		23,792		0.83		2,837,257		24,049		0.85
Unallocated	—		2,361		—		—		2,391		—
Total		$2,880,592		$27,810	0.97	%		$2,859,276		$28,023	0.98	%

Based on management’s assessment of the stable asset quality metrics, the relatively modest loan growth in the first quarter of 2015 and other favorable changes in loss exposure allocation, there was no provision for loan losses charged to earnings in the first quarter of 2015. A loan loss provision of $300 thousand was recognized in the first quarter of 2014.  Net charge-offs for the three months endedMarch 31, 2015 totaled $213 thousand. Net charge-offs for the three months endedMarch 31, 2014 totaled $1.1 million and included an $853 thousand charge-off recognized on one commercial mortgage relationship.

As of March 31, 2015, the allowance for loan losses was $27.8 million, or 0.97% of total loans, compared to $28.0 million, or 0.98% of total loans, at December 31, 2014.  

The following table presents the allocation of the allowance for loan losses. The allocation below is neither indicative of the specific amounts or the loan categories in which future charge-offs may occur, nor is it an indicator of any future loss trends.

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		% (1)		Amount		% (1)
Commercial:
Mortgages		$8,331	30	%		$8,202	30	%
Construction & development	1,229		3		1,300		3
Commercial & industrial	7,803		21		7,987		21
Residential real estate:
Mortgage	5,233		33		5,228		33
Homeowner construction	122		1		202		1
Consumer	2,731		12		2,713		12
Unallocated	2,361				2,391
Balance at end of period		$27,810	100	%		$28,023	100	%

(1) Percentage of allocated allowance for loan losses to the total loans outstanding within the respective category.

Sources of Funds

Our sources of funds include deposits, brokered time certificates of deposit, FHLBB borrowings, other borrowings and proceeds from the sales, maturities and payments of loans and investment securities.  Washington Trust uses funds to originate and purchase loans, purchase investment securities, conduct operations, expand the branch network and pay dividends to shareholders.

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Management’s preferred strategy for funding asset growth is to grow low-cost deposits, including demand deposits, NOW and savings accounts.  Asset growth in excess of low-cost deposits is typically funded through higher-cost deposits (including certificates of deposit and money market accounts), brokered time certificates of deposit, FHLBB borrowings and securities portfolio cash flow.

Deposits

Washington Trust offers a wide variety of deposit products to consumer and business customers.  Deposits provide an important source of funding for the Bank as well as an ongoing stream of fee revenue.

Washington Trust is a participant in the Insured Cash Sweep (“ICS”) program, Demand Deposit Marketplace (“DDM”) program, and the Certificate of Deposit Account Registry Service (“CDARS”) program. Washington Trust uses these deposit sweep services to place customer funds into interest-bearing demand accounts, money market accounts, and/or time certificates of deposit issued by other participating banks. Customer funds are placed at one or more participating banks to ensure that each deposit customer is eligible for the full amount of FDIC insurance. As a program participant, we receive reciprocal amounts of deposits from other participating banks. ICS, DDM and CDARS deposits are considered to be brokered deposits for bank regulatory purposes. We consider these reciprocal deposit balances to be in-market deposits as distinguished from traditional out-of-market brokered deposits.

Total deposits amounted to $2.8 billion at March 31, 2015, up by $28.3 million, or 1%, from the balance at December 31, 2014. Included in deposits at March 31, 2015 were out-of-market brokered time certificates of deposit of $290.9 million, which were down by $8.3 million from the balance at December 31, 2014. Excluding out-of-market brokered time certificates of deposit, in-market deposits were up by $36.6 million, or 1%, for the three months ended March 31, 2015, reflecting growth in money market accounts, demand deposits and savings accounts, partially offset by declines in in-market time deposits.

Demand deposits totaled $477.0 million at March 31, 2015, up by $17.2 million, or 4%, from December 31, 2014. Included in demand deposits at March 31, 2015 and December 31, 2014 were DDM reciprocal demand deposits of $47.9 million and $33.4 million, respectively.

NOW account balances increased by $6.9 million, or 2%, from December 31, 2014 and totaled $333.3 million at March 31, 2015.

Savings accounts totaled $298.8 million at March 31, 2015, up by $7.1 million, or 2%, from December 31, 2014.

Money market accounts totaled $821.4 million at March 31, 2015, up by $18.6 million, or 2%, from the balance at December 31, 2014. Included in total money market deposits at March 31, 2015 and December 31, 2014 were ICS reciprocal money market deposits of $252.8 million and $267.9 million, respectively.

Time deposits amounted to $852.6 million at March 31, 2015, down by $21.5 million, or 2%, from the balance at December 31, 2014.  Included in time deposits at March 31, 2015 were out-of-market wholesale brokered time certificates of deposit of $290.9 million, which were down by $8.3 million from the balance at December 31, 2014 as noted above. Excluding out-of-market brokered certificates of deposits, in-market time deposits totaled $561.8 million at March 31, 2015, down by $13.2 million from December 31, 2014. Included in in-market time deposits were CDARS reciprocal time deposits of $89.6 million and $85.1 million, respectively, at March 31, 2015 and December 31, 2014.

Borrowings

The Corporation utilizes advances from the FHLBB as well as other borrowings as part of its overall funding strategy.  FHLBB advances are used to meet short-term liquidity needs, to purchase securities and to originate and purchase loans. FHLBB advances amounted to $386.0 million at March 31, 2015, down by $20.3 million from the balance at the end of 2014.

In March 2014, FHLBB advances totaling $99.3 million that had a weighted average rate of 3.01% and a weighted average remaining term of thirty-six months were prepaid. Brokered time deposits of $80.0 million and existing on-balance sheet liquidity were utilized for the prepayment of these advances. The brokered time deposits had an initial weighted average cost of 0.93% and weighted average maturity of thirty-five months.

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In February 2015, FHLBB advances totaling $69.2 million were modified to lower interest rates and the maturities of these advances were extended. Original maturity dates ranging from 2016 to 2018 were modified to 2018 to 2022. The original weighted average interest rate was 4.06% and was revised to 3.50%.

Liquidity and Capital Resources

Liquidity Management

Liquidity is the ability of a financial institution to meet maturing liability obligations and customer loan demand.  Washington Trust’s primary source of liquidity is deposits, which funded approximately 69% of total average assets in the three months ended March 31, 2015.  While the generally preferred funding strategy is to attract and retain low cost deposits, the ability to do so is affected by competitive interest rates and terms in the marketplace.  Other sources of funding include discretionary use of purchased liabilities (e.g., FHLBB term advances and brokered time certificates of deposit), cash flows from the Corporation’s securities portfolios and loan repayments.  Securities designated as available for sale may also be sold in response to short-term or long-term liquidity needs although management has no intention to do so at this time.  For a more detailed discussion on Washington Trust’s detailed liquidity funding policy and contingency funding plan, see additional information in Item 7 under the caption “Liquidity and Capital Resources” of Washington Trust’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

The Asset/Liability Committee (“ALCO”) establishes and monitors internal liquidity measures to manage liquidity exposure. Liquidity remained well within target ranges established by the ALCO during the three months ended March 31, 2015.  Based on its assessment of the liquidity considerations described above, management believes the Corporation’s sources of funding meets anticipated funding needs.

For the three months ended March 31, 2015, net cash provided by financing activities amounted to $3.4 million. Total deposits, including out-of-market brokered time deposits, increased by $28.3 million and net cash flows from FHLBB advances decreased by $20.3 million in the first three months of 2015. In addition, cash dividends paid totaled $5.4 million for the three months ended March 31, 2015. Net cash used in investing activities totaled $4.0 million for the three months ended March 31, 2015. The most significant elements of cash flow within investing activities were net outflows related to growth in the loan portfolio, which were offset by net cash inflows from maturities, calls and principal repayments of debt securities. Net cash provided by operating activities amounted to $9.3 million for the three months ended March 31, 2015. Net income totaled $11.0 million in the first three months of 2015 and the most significant adjustments to reconcile net income to net cash provided by operating activities pertain to mortgage banking activities. See the Corporation’s Consolidated Statements of Cash Flows for further information about sources and uses of cash.

Capital Resources

Total shareholders’ equity amounted to $353.9 million at March 31, 2015, up by $7.6 million from December 31, 2014, including net income of $11.0 million and a reduction of $5.8 million for dividend declarations.

The ratio of total equity to total assets amounted to 9.82% at March 31, 2015 compared to a ratio of 9.65% at December 31, 2014.  Book value per share at March 31, 2015 and December 31, 2014 amounted to $21.10 and $20.68, respectively.

The Bancorp and the Bank are subject to various regulatory capital requirements.  As of March 31, 2015, the Bancorp and the Bank exceeded the regulatory minimum levels to be considered “well-capitalized.”

See Note 9 to the Unaudited Consolidated Financial Statements for additional discussion of regulatory capital requirements.

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Contractual Obligations and Commitments

The Corporation has entered into numerous contractual obligations and commitments.  The following tables summarize our contractual cash obligations and other commitments at March 31, 2015:

(Dollars in thousands)	Payments Due by Period
	Total		Less Than 1 Year (1)		1-3 Years		3-5 Years		After 5 Years
Contractual Obligations:
FHLBB advances (2)		$385,992		$182,304		$75,261		$81,296		$47,131
Junior subordinated debentures	22,681		—		—		—		22,681
Operating lease obligations	39,473		2,807		5,592		4,409		26,665
Software licensing arrangements	2,679		2,454		225		—		—
Other borrowings	122		50		72		—		—
Total contractual obligations		$450,947		$187,615		$81,150		$85,705		$96,477

(1) Maturities or contractual obligations are considered by management in the administration of liquidity and are routinely refinanced in the ordinary course of business.

(2) All FHLBB advances are shown in the period corresponding to their scheduled maturity.

(Dollars in thousands)	Amount of Commitment Expiration – Per Period
	Total		Less Than 1 Year		1-3 Years		3-5 Years		After 5 Years
Other Commitments:
Commercial loans		$303,443		$136,308		$58,212		$51,009		$57,914
Home equity lines	206,515		—		—		—		206,515
Other loans	47,998		42,835		2,974		2,189		—
Standby letters of credit	5,248		5,025		223		—		—
Forward loan commitments to:
Originate loans	60,546		60,546		—		—		—
Sell loans	106,457		106,457		—		—		—
Customer related derivative contracts:
Interest rate swaps with customers	209,416		6,429		47,154		50,545		105,288
Mirror swaps with counterparties	209,416		6,429		47,154		50,545		105,288
Interest rate risk management contract:
Interest rate swap	22,681		22,681		—		—		—
Total commitments		$1,171,720		$386,710		$155,717		$154,288		$475,005

Off-Balance Sheet Arrangements

For additional information on derivative financial instruments and financial instruments with off-balance sheet risk see Notes 10 and 17 to the Unaudited Consolidated Financial Statements.

Asset/Liability Management and Interest Rate Risk

Interest rate risk is the primary market risk category associated with the Corporation’s operations.  Interest rate risk is the risk of loss to future earnings due to changes in interest rates.  The ALCO is responsible for establishing policy guidelines on liquidity and acceptable exposure to interest rate risk.  Periodically, the ALCO reports on the status of liquidity and interest rate risk matters to the Bank’s Board of Directors. The objective of the ALCO is to manage assets and funding sources to produce results that are consistent with Washington Trust’s liquidity, capital adequacy, growth, risk and profitability goals.

The ALCO manages the Corporation’s interest rate risk using income simulation to measure interest rate risk inherent in the Corporation’s on-balance sheet and off-balance sheet financial instruments at a given point in time by showing the effect of

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interest rate shifts on net interest income over a 12-month horizon, the 13- to 24-month horizon and a 60-month horizon.  The simulations assume that the size and general composition of the Corporation’s balance sheet remain static over the simulation horizons, with the exception of certain deposit mix shifts from low-cost core savings to higher-cost time deposits in selected interest rate scenarios.  Additionally, the simulations take into account the specific repricing, maturity, call options, and prepayment characteristics of differing financial instruments that may vary under different interest rate scenarios.  The characteristics of financial instrument classes are reviewed periodically by the ALCO to ensure their accuracy and consistency.

The ALCO reviews simulation results to determine whether the Corporation’s exposure to a decline in net interest income remains within established tolerance levels over the simulation horizons and to develop appropriate strategies to manage this exposure.  As of March 31, 2015 and December 31, 2014, net interest income simulations indicated that exposure to changing interest rates over the simulation horizons remained within tolerance levels established by the Corporation.  The Corporation defines maximum unfavorable net interest income exposure to be a change of no more than 5% in net interest income over the first 12 months, no more than 10% over the second 12 months, and no more than 10% over the full 60-month simulation horizon.  All changes are measured in comparison to the projected net interest income that would result from an “unchanged” rate scenario where both interest rates and the composition of the Corporation’s balance sheet remain stable for a 60-month period.  In addition to measuring the change in net interest income as compared to an unchanged interest rate scenario, the ALCO also measures the trend of both net interest income and net interest margin over a 60-month horizon to ensure the stability and adequacy of this source of earnings in different interest rate scenarios.

The ALCO regularly reviews a wide variety of interest rate shift scenario results to evaluate interest risk exposure, including scenarios showing the effect of steepening or flattening changes in the yield curve of up to 500 basis points as well as parallel changes in interest rates of up to 400 basis points.  Because income simulations assume that the Corporation’s balance sheet will remain static over the simulation horizon, the results do not reflect adjustments in strategy that the ALCO could implement in response to rate shifts.

The following table sets forth the estimated change in net interest income from an unchanged interest rate scenario over the periods indicated for parallel changes in market interest rates using the Corporation’s on- and off-balance sheet financial instruments as of March 31, 2015 and December 31, 2014.  Interest rates are assumed to shift by a parallel 100, 200 or 300 basis points upward or 100 basis points downward over a 12-month period, except for core savings deposits, which are assumed to shift by lesser amounts due to their relative historical insensitivity to market interest rate movements.  Further, deposits are assumed to have certain minimum rate levels below which they will not fall.  It should be noted that the rate scenarios shown do not necessarily reflect the ALCO’s view of the “most likely” change in interest rates over the periods indicated.

	March 31, 2015		December 31, 2014
	Months 1 - 12	Months 13 - 24	Months 1 - 12	Months 13 - 24
100 basis point rate decrease	(1.04)%	(3.48)%	(0.93)%	(3.43)%
100 basis point rate increase	1.36	1.39	1.15	0.87
200 basis point rate increase	3.70	4.49	3.37	3.66
300 basis point rate increase	6.18	7.60	5.67	6.30

The ALCO estimates that the negative exposure of net interest income to falling rates as compared to an unchanged rate scenario results from a more rapid decline in earning asset yields compared to rates paid on deposits.  If market interest rates were to fall from their already low levels and remain lower for a sustained period, certain core savings and time deposit rates could decline more slowly and by a lesser amount than other market rates.  Asset yields would likely decline more rapidly than deposit costs as current asset holdings mature or reprice, since cash flow from mortgage-related prepayments and redemption of callable securities would increase as market rates fall.

The positive exposure of net interest income to rising rates as compared to an unchanged rate scenario results from a more rapid projected relative rate of increase in asset yields than funding costs over the near term.  For simulation purposes, deposit rate changes are anticipated to lag behind other market rates in both timing and magnitude.  The ALCO’s estimate of interest rate risk exposure to rising rate environments, including those involving changes to the shape of the yield curve, incorporates certain assumptions regarding the shift in deposit balances from low-cost core savings categories to higher-cost deposit categories, which has characterized a shift in funding mix during the past rising interest rate cycles.

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While the ALCO reviews and updates simulation assumptions and also periodically back-tests the simulation results to ensure that the assumptions are reasonable and current, income simulation may not always prove to be an accurate indicator of interest rate risk or future net interest margin.  Over time, the repricing, maturity and prepayment characteristics of financial instruments and the composition of the Corporation’s balance sheet may change to a different degree than estimated.  Simulation modeling assumes a static balance sheet, with the exception of certain modeled deposit mix shifts from low-cost core savings deposits to higher-cost time deposits in rising rate scenarios as noted above.  Due to the current low level of market interest rates, the banking industry has experienced relatively strong growth in low-cost core deposits over the past several years.  The ALCO recognizes that a portion of these increased levels of low-cost balances could shift into higher yielding alternatives in the future, particularly if interest rates rise and as confidence in financial markets strengthens, and has modeled increased amounts of deposit shifts out of these low-cost categories into higher-cost alternatives in the rising rate simulation scenarios presented above.  Deposit balances may also be subject to possible outflow to non-bank alternatives in a rising rate environment, which may cause interest rate sensitivity to differ from the results as presented. Another significant simulation assumption is the sensitivity of core savings deposits to fluctuations in interest rates.  Income simulation results assume that changes in both core savings deposit rates and balances are related to changes in short-term interest rates.  The relationship between short-term interest rate changes and core deposit rate and balance changes may differ from the ALCO’s estimates used in income simulation.  It should be noted that the static balance sheet assumption does not necessarily reflect the Corporation’s expectation for future balance sheet growth, which is a function of the business environment and customer behavior.  Lastly, mortgage-backed securities and mortgage loans involve a level of risk that unforeseen changes in prepayment speeds may cause related cash flows to vary significantly in differing rate environments.  Such changes could affect the level of reinvestment risk associated with cash flow from these instruments, as well as their market value.  Changes in prepayment speeds could also increase or decrease the amortization of premium or accretion of discounts related to such instruments, thereby affecting interest income.

The Corporation also monitors the potential change in market value of its available for sale debt securities in changing interest rate environments.  The purpose is to determine market value exposure that may not be captured by income simulation, but which might result in changes to the Corporation’s capital position.  Results are calculated using industry-standard analytical techniques and securities data.  

The following table summarizes the potential change in market value of the Corporation’s available for sale debt securities as of March 31, 2015 and December 31, 2014 resulting from immediate parallel rate shifts:

(Dollars in thousands)
Security Type	Down 100 Basis Points		Up 200 Basis Points
U.S. government sponsored enterprise securities (callable)		$87		($1,742	)
Obligations of states and political subdivisions	517		(1,004		)
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	3,423		(15,223		)
Trust preferred debt and other corporate debt securities	24		655
Total change in market value as of March 31, 2015		$4,051		($17,314	)
Total change in market value as of December 31, 2014		$4,777		($20,218	)

ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk

Information regarding quantitative and qualitative disclosures about market risk appears under Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” under the caption “Asset/Liability Management and Interest Rate Risk.”

ITEM 4.  Controls and Procedures

Disclosure Controls and Procedures

As required by Rule 13a-15 under the Exchange Act, as amended (the “Exchange Act”), the Corporation carried out an evaluation under the supervision and with the participation of the Corporation’s management, including the Corporation’s principal executive officer and principal financial officer, of the Corporation’s disclosure controls and procedures as of the period ended March 31, 2015.  Based upon that evaluation, the principal executive officer and principal financial officer concluded that the Corporation’s disclosure controls and procedures are effective and designed to ensure that information required to be disclosed by the Corporation in the reports it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within

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the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to the Corporation’s management including its Chief Executive Officer and Chief Financial Officer as appropriate to allow timely decisions regarding required disclosures.  The Corporation will continue to review and document its disclosure controls and procedures and consider such changes in future evaluations of the effectiveness of such controls and procedures, as it deems appropriate.

Internal Control Over Financial Reporting

The Corporation’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined by the Exchange Act Rule 13a-15(f). The Corporation’s internal control system was designed to provide reasonable assurance to its management and the Board of Directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. The Corporation’s management assessed the effectiveness of its internal control over financial reporting as of the end of the period covered by this report.

There has been no change in our internal control over financial reporting during the period ended March 31, 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

In May 2013, the Committee of Sponsoring Organizations of the Treadway Commission issued its Internal Control - Integrated Framework (the “2013 Framework”). While the 2013 Framework’s internal control components (i.e., control environment, risk assessment, control activities, information and communication, and monitoring activities) are the same as those in the 1992 Framework, the new framework requires companies to assess whether 17 principles are present and functioning in determining whether their system of internal control is effective. The Corporation expects to adopt the 2013 Framework during 2015.

PART II.  Other Information

Item 1.  Legal Proceedings

The Corporation is involved in various claims and legal proceedings arising out of the ordinary course of business.  Management is of the opinion, based on its review with counsel of the development of such matters to date, that the ultimate disposition of such matters will not materially affect the consolidated financial position or results of operations of the Corporation.

Item 1A.  Risk Factors

There have been no material changes in the risk factors described in Item IA to Part I of Washington Trust’s Annual Report on Form 10-K for the year ended December 31, 2014.

Item 6.  Exhibits

(a) Exhibits.  The following exhibits are included as part of this Form 10-Q:

Exhibit Number
10.1	Terms of Deferred Stock Unit Award Agreement with certain executive officers, dated January 20, 2015 - Filed herewith. (1)
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Filed herewith.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Filed herewith.
32.1	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Furnished herewith. (2)
101	The following materials from Washington Trust Bancorp, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Shareholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) related notes to these financial statements - Filed herewith.

____________________

(1) Management contract or compensatory plan or arrangement.

(2) These certifications are not “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any filing under the Securities Act or the Securities Exchange Act.

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Signatures

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

			WASHINGTON TRUST BANCORP, INC.
			(Registrant)
Date:	May 8, 2015	By:	/s/ Joseph J. MarcAurele
			Joseph J. MarcAurele
			Chairman and Chief Executive Officer
			(principal executive officer)
Date:	May 8, 2015	By:	/s/ David V. Devault
			David V. Devault
			Vice Chair, Secretary and Chief Financial Officer
			(principal financial and accounting officer)

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Exhibit Index

Exhibit Number
10.1	Terms of Deferred Stock Unit Award Agreement with certain executive officers, dated January 20, 2015 - Filed herewith. (1)
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Filed herewith.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 – Filed herewith.
32.1	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 – Furnished herewith. (2)
101	The following materials from Washington Trust Bancorp, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015 formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Shareholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) related notes to these financial statements - Filed herewith.

____________________

(1) Management contract or compensatory plan or arrangement.

(2) These certifications are not “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any filing under the Securities Act or the Securities Exchange Act.

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EX-10.1

EXHIBIT 10.1

TERMS OF DEFERRED STOCK UNIT AWARD AGREEMENT WITH CERTAIN EXECUTIVE OFFICERS

The form of Deferred Stock Unit Award Agreement (the “Agreement”), filed as Exhibit 10.6 to the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2008, contains blanks where the executive's name, target number of shares, grant date, vesting date, performance period, shortened performance period start date, and months in term provided under the Agreement vary for each executive.

On January 20, 2015, performance share awards were granted providing certain executives the opportunity to earn common stock, the number of which is determined pursuant to, and subject to the attainment of, performance goals. The performance share awards were granted with a term of 36 months and vest on January 20, 2018. The performance period start date was January 1, 2015 thereby making the performance period January 1, 2015 through December 31, 2017. The target number of shares for each executive awarded performance shares on January 20, 2015 is listed below.

Executive Officer	Target number of shares
Joseph J. MarcAurele	8,500
David V. Devault	4,200
Edward O. Handy, III	4,200
Stephen M. Bessette	2,800
James M. Hagerty	2,800
Mark K.W. Gim	2,800
Barbara J. Perino	2,000
Kristen L. DiSanto	2,000
Debra A. Gormley	2,000

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Joseph J. MarcAurele, Chairman, President and Chief Executive Officer of Washington Trust Bancorp, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q, for the period ended March 31, 2015, of Washington Trust Bancorp, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date:	May 8, 2015	By:	/s/ Joseph J. MarcAurele
			Joseph J. MarcAurele
			Chairman and Chief Executive Officer
			(principal executive officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, David V. Devault, Vice Chair, Secretary and Chief Financial Officer of Washington Trust Bancorp, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q, for the period ended March 31, 2015, of Washington Trust Bancorp, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date:	May 8, 2015	By:	/s/ David V. Devault
			David V. Devault
			Vice Chair, Secretary and Chief Financial Officer
			(principal financial and accounting officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

The undersigned officer of Washington Trust Bancorp, Inc. (the “Corporation”), hereby certifies that the Corporation’s Quarterly Report on Form 10-Q for the period ended March 31, 2015 to which this certification is attached (the “Report”), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

Date:	May 8, 2015	By:	/s/ Joseph J. MarcAurele
			Joseph J. MarcAurele
			Chairman and Chief Executive Officer
			(principal executive officer)

The undersigned officer of Washington Trust Bancorp, Inc. (the “Corporation”), hereby certifies that the Corporation’s Quarterly Report on Form 10-Q for the period ended March 31, 2015 to which this certification is attached (the “Report”), as filed with the Securities and Exchange Commission on the date hereof, fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended, and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation.

Date:	May 8, 2015	By:	/s/ David V. Devault
			David V. Devault
			Vice Chair, Secretary and Chief Financial Officer
			(principal financial and accounting officer)

XML

Borrowings (Tables)

3 Months Ended

Mar. 31, 2015

Debt Disclosure [Abstract]

Federal Home Loan Bank Advances Maturities

The following table presents maturities and weighted average interest rates on FHLBB advances outstanding as of March 31, 2015:

(Dollars in thousands)	Total Outstanding		Weighted Average Rate
April 1, 2015 to December 31, 2015		$160,520	0.49	%
2016	31,792		0.60	%
2017	30,075		5.44	%
2018	58,634		1.56	%
2019	42,661		4.40	%
2020 and thereafter	62,310		3.17	%
Balance at March 31, 2015		$385,992	1.91	%

XML

Loans (Narrative - Troubled Debt Restructurings) (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Receivables [Abstract]
Recorded investment in troubled debt restructurings	$ 17,700,000	$ 18,400,000
Interest Receivable	30,000	33,000
Specific Reserves on Troubled Debt Restructurings	$ 1,500,000	$ 1,200,000

XML

Cash and Due from Banks (Narrative) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Cash and Cash Equivalents [Abstract]
Average reserve deposited with the Board of Governors of the Federal Reserve Bank	$ 10.1	$ 8.0
Interest-bearing deposits in other banks	$ 47.0	$ 42.7

XML

Borrowings (Federal Home Loan Bank Advances Maturity Schedule) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Federal Home Loan Bank advances	$ 385,992	$ 406,297
Federal Home Loan Bank of Boston [Member]
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Scheduled maturity through the end of the current year	160,520
Weighted average rate for scheduled maturity through the end of the current year	0.49%
Scheduled maturity in year two	31,792
Weighted average rate for scheduled maturity in year two	0.60%
Scheduled maturity in year three	30,075
Weighted average rate for scheduled maturity in year three	5.44%
Scheduled maturity in year four	58,634
Weighted average rate for scheduled maturity in year four	1.56%
Scheduled maturity in year five	42,661
Weighted average rate for scheduled maturity in year five	4.40%
Scheduled maturity after year five	62,310
Weighted average rate for scheduled maturity after year five	3.17%
Federal Home Loan Bank advances	$ 385,992	$ 406,300
Total weighted average rate	1.91%

XML

Loans (Narrative - Credit Quality Indicators) (Details)	Mar. 31, 2015 rating	Dec. 31, 2014 rating
Receivables [Abstract]
Weighted Average Risk Rating, Commercial Loans	4.68	4.67

XML

Fair Value Measurements (Fair Value Mortgage Loans Held For Sale, Commitments to Originate And Commitments to Sell Changes in Fair Value Disclosures) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) on mortgage loans held for sale	$ 341	$ 76
Gain (Loss) Recognized in Income	0	0
Total change in fair value	(28)	40
Interest Rate Commitments [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	572	277
Commitments to sell mortgage loans [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	$ (941)	$ (313)

XML

Earnings Per Common Share (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Calculation of Earnings Per Share

The following table presents the calculation of earnings per common share:

(Dollars and shares in thousands, except per share amounts)
Three months ended March 31,	2015			2014
Earnings per common share - basic:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Earnings per common share - basic		$0.65			$0.56
Earnings per common share - diluted:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Dilutive effect of common stock equivalents	180			174
Weighted average diluted common shares	16,939			16,800
Earnings per common share - diluted		$0.65			$0.55

Weighted average common stock equivalents, not included in common stock equivalents above because they were anti-dilutive, totaled 77,450 and 54,600, respectively, for the three months endedMarch 31, 2015 and 2014.

XML

Earnings Per Common Share (Policies)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share Policy

Washington Trust utilizes the two-class method earnings allocation formula to determine earnings per share of each class of stock according to dividends and participation rights in undistributed earnings.  Share-based payments that entitle holders to receive non-forfeitable dividends before vesting are considered participating securities and included in earnings allocation for computing basic earnings per share under this method.  Undistributed income is allocated to common shareholders and participating securities under the two-class method based upon the proportion of each to the total weighted average shares available.

XML

Fair Value Measurements (Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	$ 340,942	$ 357,662
Mortgage loans held for sale	36,672	30,321
Derivative assets	9,245	5,807
Derivative liabilities	11,041	7,316
Obligations of U.S. government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	31,301	31,172
Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	233,045	245,366
Obligations of states and political subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	44,179	49,176
Individual name issuer trust preferred debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	26,287	25,774
Corporate bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	6,130	6,174
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	9,245	5,807
Derivative liabilities	11,041	7,316
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage loans held for sale	36,672	30,321
Total assets at fair value on a recurring basis	386,859	393,790
Total liabilities at fair value on a recurring basis	11,041	7,316
Recurring [Member] | Obligations of U.S. government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	31,301	31,172
Recurring [Member] | Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	233,045	245,366
Recurring [Member] | Obligations of states and political subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	44,179	49,176
Recurring [Member] | Individual name issuer trust preferred debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	26,287	25,774
Recurring [Member] | Corporate bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	6,130	6,174
Recurring [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage loans held for sale	0	0
Total assets at fair value on a recurring basis	0	0
Total liabilities at fair value on a recurring basis	0	0
Recurring [Member] | Level 1 [Member] | Obligations of U.S. government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 1 [Member] | Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 1 [Member] | Obligations of states and political subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 1 [Member] | Individual name issuer trust preferred debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 1 [Member] | Corporate bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage loans held for sale	36,672	30,321
Total assets at fair value on a recurring basis	386,859	393,790
Total liabilities at fair value on a recurring basis	11,041	7,316
Recurring [Member] | Level 2 [Member] | Obligations of U.S. government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	31,301	31,172
Recurring [Member] | Level 2 [Member] | Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	233,045	245,366
Recurring [Member] | Level 2 [Member] | Obligations of states and political subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	44,179	49,176
Recurring [Member] | Level 2 [Member] | Individual name issuer trust preferred debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	26,287	25,774
Recurring [Member] | Level 2 [Member] | Corporate bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	6,130	6,174
Recurring [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage loans held for sale	0	0
Total assets at fair value on a recurring basis	0	0
Total liabilities at fair value on a recurring basis	0	0
Recurring [Member] | Level 3 [Member] | Obligations of U.S. government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 3 [Member] | Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 3 [Member] | Obligations of states and political subdivisions [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 3 [Member] | Individual name issuer trust preferred debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Recurring [Member] | Level 3 [Member] | Corporate bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	$ 0	$ 0

XML

Derivative Financial Instruments (Fair Value of Derivatives by Balance Sheet Location) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Derivatives, Fair Value [Line Items]
Total derivative assets	$ 9,245	$ 5,807
Total derivative liabilities	11,041	7,316
Other assets [Member]
Derivatives, Fair Value [Line Items]
Total derivative assets	9,245	5,807
Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Total derivative liabilities	11,041	7,316
Derivatives Designated as Cash Flow Hedging Instruments [Member] | Interest Rate Swaps [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset designated as a cash flow hedge	0	0
Derivatives Designated as Cash Flow Hedging Instruments [Member] | Interest Rate Swaps [Member] | Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability designated as a cash flow hedge	367	497
Derivatives not Designated as Hedging Instruments [Member] | Interest Rate Commitments [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset not designated	1,769	1,212
Derivatives not Designated as Hedging Instruments [Member] | Interest Rate Commitments [Member] | Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability not designated	5	20
Derivatives not Designated as Hedging Instruments [Member] | Commitments to sell mortgage loans [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset not designated	14	13
Derivatives not Designated as Hedging Instruments [Member] | Commitments to sell mortgage loans [Member] | Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability not designated	2,970	2,028
Derivatives not Designated as Hedging Instruments [Member] | Interest rate swaps with customers [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset not designated	7,415	4,554
Derivatives not Designated as Hedging Instruments [Member] | Interest rate swaps with customers [Member] | Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability not designated	0	23
Derivatives not Designated as Hedging Instruments [Member] | Mirror swaps with counterparties [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset not designated	0	28
Derivatives not Designated as Hedging Instruments [Member] | Mirror swaps with counterparties [Member] | Other liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability not designated	7,699	4,748
Derivatives not Designated as Hedging Instruments [Member] | Risk participation agreement [Member] | Other assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset not designated	$ 47	$ 0

XML

Commitments and Contingencies (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Commitments and Contingencies Disclosure [Line Items]
Operating leases rental expense	$ 790	$ 737
Minimum [Member]
Commitments and Contingencies Disclosure [Line Items]
Lease Expiration Period	4 months
Lease Expiration Period, Renewal Option	1 month
Maximum [Member]
Commitments and Contingencies Disclosure [Line Items]
Lease Expiration Period	26 years
Lease Expiration Period, Renewal Option	25 years
Commitments to extend credit on standby letters of credit [Member] | Commitments to Extend Credit [Member]
Commitments and Contingencies Disclosure [Line Items]
Contract amount	$ 5,248		$ 5,102

XML

Loans (Nonaccrual Loans) (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	$ 15,865,000	$ 15,945,000
Accruing loans 90 days or more past due	0	0
Current Payment Status [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans Receivable, Nonaccrual of Interest, Current	3,600,000	3,200,000
Commercial Mortgages [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	5,115,000	5,315,000
Commercial Construction & Development [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	0	0
Commercial & Industrial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	2,193,000	1,969,000
Residential Mortgage [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	6,956,000	7,124,000
Homeowner Construction [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	0	0
Home Equity Lines [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	1,051,000	1,217,000
Home Equity Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	511,000	317,000
Other Consumer [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Nonaccrual loans	$ 39,000	$ 3,000

XML

Fair Value Measurements (Narrative) (Details) (Nonrecurring [Member], Level 3 [Member], USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Nonrecurring [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Allowance For Loan Loss Allocation on Collateral Dependent Impaired Loans	$ 1.2	$ 1.3

XML

Other Comprehensive Income (Activity in Other Comprehensive Income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract]
Net change in fair value of securities available for sale, before tax	$ 1,053		$ 964
Net change in fair value of securities available for sale, tax	389		352
Net change in fair value of securities available for sale	664		612
Change in fair value of cash flow hedges, before tax	(32)		(43)
Change in fair value of cash flow hedges, tax	(24)		(27)
Change in fair value of cash flow hedges	(8)		(16)
Net cash flow hedge losses reclassified into earnings, before tax	145	[1]	145	[1]
Net cash flow hedge losses reclassified into earnings, tax	52	[1]	53	[1]
Net cash flow hedge losses reclassified into earnings	93	[1]	92	[1]
Net change in fair value of cash flow hedges, before tax	113		102
Net change in fair value of cash flow hedges, tax	28		26
Net change in fair value of cash flow hedges	85		76
Defined benefit plan obligation adjustment, before tax	367	[2]	88	[2]
Defined benefit plan obligation adjustment, tax	132	[2]	0	[2]
Defined benefit plan obligation adjustment, net of tax	235	[2]	88	[2]
Total other comprehensive (loss) income, before tax	1,533		1,154
Total other comprehensive (loss) income, tax	549		378
Total other comprehensive (loss) income, net of tax	$ 984		$ 776

[1] Included in interest expense on junior subordinated debentures in the Consolidated Statements of Income.

[2] Included in salaries and employee benefits expense in the Consolidated Statements of Income.

XML

Fair Value Measurements (Qualitative Information About Level 3 Assets Measured at Fair Value on a Nonrecurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014		Dec. 31, 2014
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired Loans	17,901	[1]			$ 19,096	[1]
Nonrecurring [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired Loans	3,962				5,728
Property acquired through foreclosure or repossession	318				348
Nonrecurring [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Impaired Loans	3,962				5,728
Property acquired through foreclosure or repossession	318				$ 348
Nonrecurring [Member] | Minimum [Member] | Collateral Dependent Impaired Loans [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	0.00%		0.00%
Appraisal Adjustments	0.00%	[2]	0.00%	[2]
Nonrecurring [Member] | Minimum [Member] | Property Acquired Through Foreclosure Or Repossession [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	0.00%		6.00%
Appraisal Adjustments	7.00%	[2]	5.00%	[2]
Nonrecurring [Member] | Maximum [Member] | Collateral Dependent Impaired Loans [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	25.00%		10.00%
Appraisal Adjustments	15.00%	[2]	40.00%	[2]
Nonrecurring [Member] | Maximum [Member] | Property Acquired Through Foreclosure Or Repossession [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	10.00%		10.00%
Appraisal Adjustments	13.00%	[2]	23.00%	[2]
Nonrecurring [Member] | Weighted Average [Member] | Collateral Dependent Impaired Loans [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	10.00%		2.00%
Appraisal Adjustments	1.00%	[2]	3.00%	[2]
Nonrecurring [Member] | Weighted Average [Member] | Property Acquired Through Foreclosure Or Repossession [Member] | Appraisals Of Collateral [Member] | Level 3 [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount For Costs To Sell	6.00%		8.00%
Appraisal Adjustments	10.00%	[2]	14.00%	[2]

[1] The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

[2] Management may adjust appraisal values to reflect market value declines or other discounts resulting from its knowledge of the property.

XML

Other Comprehensive Income (Components of Accumulated Other Comprehensive Income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Accumulated other comprehensive income (loss), beginning balance	$ (8,809)	$ (1,553)
Other Comprehensive Income Before Reclassifcations	656	596
Amounts reclassed from accumulated other comprehensive income	328	180
Total other comprehensive income, net of tax	984	776
Accumulated other comprehensive income (loss), ending balance	(7,825)	(777)
Net Unrealized Gains on AFS Securities [Member]
Accumulated other comprehensive income (loss), beginning balance	4,110	3,089
Other Comprehensive Income Before Reclassifcations	664	612
Amounts reclassed from accumulated other comprehensive income	0	0
Total other comprehensive income, net of tax	664	612
Accumulated other comprehensive income (loss), ending balance	4,774	3,701
Noncredit-related Impairment [Member]
Accumulated other comprehensive income (loss), beginning balance	112	112
Other Comprehensive Income Before Reclassifcations	0	0
Amounts reclassed from accumulated other comprehensive income	0	0
Total other comprehensive income, net of tax	0	0
Accumulated other comprehensive income (loss), ending balance	112	112
Net Unrealized Losses on Cash Flow Hedges [Member]
Accumulated other comprehensive income (loss), beginning balance	(287)	(618)
Other Comprehensive Income Before Reclassifcations	(8)	(16)
Amounts reclassed from accumulated other comprehensive income	93	92
Total other comprehensive income, net of tax	85	76
Accumulated other comprehensive income (loss), ending balance	(202)	(542)
Pension Benefit Adjustment [Member]
Accumulated other comprehensive income (loss), beginning balance	(12,744)	(4,136)
Other Comprehensive Income Before Reclassifcations	0	0
Amounts reclassed from accumulated other comprehensive income	235	88
Total other comprehensive income, net of tax	235	88
Accumulated other comprehensive income (loss), ending balance	$ (12,509)	$ (4,048)

XML

Fair Value Measurements (Fair Value Mortgage Loans Held For Sale Disclosures) (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Fair Value Disclosures [Abstract]
Mortgage loans held for sale, amortized cost	$ 35,600,000	$ 29,500,000
Mortgage loans held for sale, at fair value	47,117,000	45,693,000
Mortgage Loans Held for Sale Difference between Fair Value and Principal Amount	$ 1,100,000	$ 779,000

XML

Shareholders' Equity (Regulatory Captial Requirements) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Corporation [Member]
Total Capital (to Risk-Weighted Assets):
Total Capital	$ 352,521		$ 343,934
Total Capital to Risk-Weighted Assets	12.80%		12.56%
Total Capital for Capital Adequacy Purposes	220,262		219,149
Total Capital for Capital Adequacy Purposes to Risk-Weighted Assets	8.00%		8.00%
Total Capital To Be Well Capitalized			273,936
Tier 1 Capital (to Risk-Weighted Assets):
Tier 1 Capital	324,375		315,575
Tier 1 Capital to Risk Weighted-Assets	11.78%		11.52%
Tier 1 Capital Required For Capital Adequacy Purposes	165,196		109,574
Tier 1 Capital Required for Capital Adequacy Purposes to Risk Weighted-Assets	6.00%		4.00%
Tier 1 Capital Required To Be Well Capitalized			164,361
Tier 1 Capital (to Average Assets):
Tier 1 Leverage Capital	324,375	[1]	315,575	[1]
Tier 1 Leverage Capital to Average Assets	9.21%	[1]	9.14%	[1]
Tier 1 Leverage Capital Required for Capital Adequacy Purposes	140,864	[1]	138,090	[1]
Tier 1 Leverage Capital Required for Capital Adequacy Purposes to Average Assets	4.00%	[1]	4.00%	[1]
Tier 1 Leverage Capital Required To Be Well Capitalized			172,612	[1]
Common Equity Tier 1 Capital [Abstract]
Common Equity Tier 1 Capital	302,376	[2]
Common Equity Tier 1 Capital to Risk Weighted Assets	10.98%	[2]
Common Equity Tier 1 Capital Required for Capital Adequacy	123,897	[2]
Common Equity Tier 1 Capital for Capital Adequacy to Risk Weighted Assets	4.50%	[2]
Bank [Member]
Total Capital (to Risk-Weighted Assets):
Total Capital	347,674		339,268
Total Capital to Risk-Weighted Assets	12.63%		12.39%
Total Capital for Capital Adequacy Purposes	220,187		219,075
Total Capital for Capital Adequacy Purposes to Risk-Weighted Assets	8.00%		8.00%
Total Capital To Be Well Capitalized	275,234		273,844
Total Capital To Be Well Capitalized to Risk Weighted-Assets	10.00%		10.00%
Tier 1 Capital (to Risk-Weighted Assets):
Tier 1 Capital	319,528		310,909
Tier 1 Capital to Risk Weighted-Assets	11.61%		11.35%
Tier 1 Capital Required For Capital Adequacy Purposes	165,140		109,537
Tier 1 Capital Required for Capital Adequacy Purposes to Risk Weighted-Assets	6.00%		4.00%
Tier 1 Capital Required To Be Well Capitalized	220,187		164,306
Tier 1 Capital Required To Be Well Capitalized to Risk Weighted-Assets	8.00%		6.00%
Tier 1 Capital (to Average Assets):
Tier 1 Leverage Capital	319,528	[1]	310,909	[1]
Tier 1 Leverage Capital to Average Assets	9.08%	[1]	9.01%	[1]
Tier 1 Leverage Capital Required for Capital Adequacy Purposes	140,738	[1]	137,964	[1]
Tier 1 Leverage Capital Required for Capital Adequacy Purposes to Average Assets	4.00%	[1]	4.00%	[1]
Tier 1 Leverage Capital Required To Be Well Capitalized	175,922	[1]	172,454	[1]
Tier 1 Leverage Capital Required To Be Well Capitalized to Average Assets	5.00%	[1]	5.00%	[1]
Common Equity Tier 1 Capital [Abstract]
Common Equity Tier 1 Capital	319,528	[2]
Common Equity Tier 1 Capital to Risk Weighted Assets	11.61%	[2]
Common Equity Tier 1 Capital Required for Capital Adequacy	123,855	[2]
Common Equity Tier 1 Capital for Capital Adequacy to Risk Weighted Assets	4.50%	[2]
Common Equity Tier 1 Capital Required to be Well Capitalized	$ 178,902	[2]
Common Equity Tier 1 Capital Required to be Well Capitalized to Risk Weighted Assets	6.50%	[2]

[1] Leverage ratio.

[2] (1)New capital ratio effective January 1, 2015 under the Basel III capital requirements. See additional discussion of Basel III and the new regulatory capital requirements in the “Supervision and Regulation” section in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

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Sale of Business Line

3 Months Ended

Mar. 31, 2015

Sale of Business Line [Abstract]

Sale of Business Line

Sale of Business Line

On March 1, 2014, the Corporation sold its merchant processing service business line to a third party. The sale resulted in a net gain of $6.3 million; after-tax $4.0 million, or 24 cents per diluted share.  In connection with the sale, Washington Trust incurred divestiture related costs of $355 thousand; after-tax $227 thousand, or 1 cent per diluted share, in the first quarter of 2014. The net proceeds received from the sale totaled $7.2 million, including $900 thousand of deferred revenue that can be earned over a 5-year period by providing business referrals to the buyer. As of March 31, 2015, $720 thousand of deferred revenue remained to be earned under this arrangement.

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Securities (Summary of Investments) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	$ 333,295	$ 351,068
Available for sale securities unrealized gains	12,147	11,630
Available for sale securities unrealized losses	(4,500)	(5,036)
Available for sale, at fair value	340,942	357,662
Held to maturity securities	24,025	25,222
Held to maturity securities unrealized gains	809	786
Held to maturity securities unrealized losses	0	0
Held to maturity securities fair value	24,834	26,008
Total available for sale and held to maturity securities amortized cost	357,320	376,290
Total available for sale and held to maturity securities unrealized gains	12,956	12,416
Total available for sale and held to maturity securities unrealized losses	(4,500)	(5,036)
Total available for sale and held to maturity securities fair value	365,776	383,670
Obligations of U.S. government-sponsored enterprises [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	31,203	31,205
Available for sale securities unrealized gains	98	21
Available for sale securities unrealized losses	0	(54)
Available for sale, at fair value	31,301	31,172
Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	222,547	235,343
Available for sale securities unrealized gains	10,498	10,023
Available for sale securities unrealized losses	0	0
Available for sale, at fair value	233,045	245,366
Held to maturity securities	24,025	25,222
Held to maturity securities unrealized gains	809	786
Held to maturity securities unrealized losses	0	0
Held to maturity securities fair value	24,834	26,008
Obligations of states and political subdivisions [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	42,664	47,647
Available for sale securities unrealized gains	1,515	1,529
Available for sale securities unrealized losses	0	0
Available for sale, at fair value	44,179	49,176
Individual name issuer trust preferred debt securities
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	30,762	30,753
Available for sale securities unrealized gains	0	0
Available for sale securities unrealized losses	(4,475)	(4,979)
Available for sale, at fair value	26,287	25,774
Corporate bonds [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale securities amortized cost basis	6,119	6,120
Available for sale securities unrealized gains	36	57
Available for sale securities unrealized losses	(25)	(3)
Available for sale, at fair value	$ 6,130	$ 6,174

XML

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Change in Fair Value Mortgage Loans Held For Sale, Interest Rate Lock Commitments and Commitments to Sell Disclosures

The following table presents the changes in fair value related to mortgage loans held for sale, interest rate lock commitments and commitments to sell residential real estate mortgage loans, for which the fair value option was elected. Changes in fair values are reported as a component of net gains on loan sales and commissions on loans originated for others in the Consolidated Statements of Income.

(Dollars in thousands)
Three months ended March 31,	2015			2014
Mortgage loans held for sale		$341			$76
Interest rate lock commitments	572			277
Commitments to sell mortgage loans	(941		)	(313		)
Total changes in fair value		($28	)		$40

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Items Recorded at Fair Value on a Recurring Basis

The following tables present the balances of assets and liabilities reported at fair value on a recurring basis:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
March 31, 2015
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,301		$—		$31,301		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	233,045		—		233,045		—
Obligations of states and political subdivisions	44,179		—		44,179		—
Individual name issuer trust preferred debt securities	26,287		—		26,287		—
Corporate bonds	6,130		—		6,130		—
Mortgage loans held for sale	36,672		—		36,672		—
Derivative assets (1)	9,245		—		9,245		—
Total assets at fair value on a recurring basis		$386,859		$—		$386,859		$—
Liabilities:
Derivative liabilities (2)		$11,041		$—		$11,041		$—
Total liabilities at fair value on a recurring basis		$11,041		$—		$11,041		$—

(1) Derivative assets include interest rate swaps contracts with customers, a risk participation agreement and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheets.

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2014
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,172		$—		$31,172		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	245,366		—		245,366		—
Obligations of states and political subdivisions	49,176		—		49,176		—
Individual name issuer trust preferred debt securities	25,774		—		25,774		—
Corporate bonds	6,174		—		6,174		—
Mortgage loans held for sale	30,321		—		30,321		—
Derivative assets (1)	5,807		—		5,807		—
Total assets at fair value on a recurring basis		$393,790		$—		$393,790		$—
Liabilities:
Derivative liabilities (2)		$7,316		$—		$7,316		$—
Total liabilities at fair value on a recurring basis		$7,316		$—		$7,316		$—

(1) Derivative assets include interest rate swaps contracts with customers and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheet

Schedule of Changes in Level Three Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Items Recorded at Fair Value on a Nonrecurring Basis

Certain assets are measured at fair value on a nonrecurring basis in accordance with GAAP.  These adjustments to fair value usually result from the application of lower of cost or market accounting or write-downs of individual assets.  The valuation methodologies used to measure these fair value adjustments are described above.

The following table summarizes the carrying value of such assets held at March 31, 2015, which were written down to fair value during the three months endedMarch 31, 2015:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$3,962		$—		$—		$3,962
Property acquired through foreclosure or repossession	318		—		—		318
Total assets at fair value on a nonrecurring basis		$4,280		$—		$—		$4,280

The allowance for loan losses on collateral dependent impaired loans amounted to $1.2 million at March 31, 2015.

The following table summarizes the carrying value of such assets held at December 31, 2014, which were written down to fair value during the year ended December 31, 2014:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$5,728		$—		$—		$5,728
Property acquired through foreclosure or repossession	348		—		—		348
Total assets at fair value on a nonrecurring basis		$6,076		$—		$—		$6,076

The allowance for loan losses on collateral dependent impaired loans amounted to $1.3 million at December 31, 2014.

Quantitative Information About Level 3 Assets Measured at Fair Value on a Nonrecurring Basis

The following tables present valuation techniques and unobservable inputs for assets measured at fair value on a nonrecurring basis for which the Corporation has utilized Level 3 inputs to determine fair value:

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
March 31, 2015
Collateral dependent impaired loans		$3,962	Appraisals of collateral	Discount for costs to sell	0% - 25% (10%)
				Appraisal adjustments (1)	0% - 15% (1%)
Property acquired through foreclosure or repossession		$318	Appraisals of collateral	Discount for costs to sell	0% - 10% (6%)
				Appraisal adjustments (1)	7% - 13% (10%)

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
December 31, 2014
Collateral dependent impaired loans		$5,728	Appraisals of collateral	Discount for costs to sell	0% - 10% (2%)
				Appraisal adjustments (1)	0% - 40% (3%)
Property acquired through foreclosure or repossession		$348	Appraisals of collateral	Discount for costs to sell	6% - 10% (8%)
				Appraisal adjustments (1)	5% - 23% (14%)

(1) Management may adjust appraisal values to reflect market value declines or other discounts resulting from its knowledge of the property.

Carrying Amounts and Estimated Fair Values of Financial Instruments

The following tables present the carrying amount, estimated fair value and placement in the fair value hierarchy of the Corporation’s financial instruments. The tables exclude financial instruments for which the carrying value approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB stock, accrued interest receivable and bank-owned life insurance. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits and accrued interest payable.

(Dollars in thousands)
March 31, 2015	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$24,025		$24,834		$—		$24,834		$—
Loans, net of allowance for loan losses	2,852,782		2,898,369		—		—		2,898,369
Financial Liabilities:
Time deposits		$852,621		$854,780		$—		$854,780		$—
FHLBB advances	385,992		400,770		—		400,770		—
Junior subordinated debentures	22,681		16,974		—		16,974		—

(Dollars in thousands)
December 31, 2014	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$25,222		$26,008		$—		$26,008		$—
Loans, net of allowance for loan losses	2,831,253		2,866,907		—		—		2,866,907
Financial Liabilities:
Time deposits		$874,102		$872,570		$—		$872,570		$—
FHLBB advances	406,297		418,005		—		418,005		—
Junior subordinated debentures	22,681		17,201		—		17,201		—

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Derivative Financial Instruments (Derivatives not Designated as Hedging Instruments, Effect in Statements of Income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	$ 0	$ 0
Interest Rate Commitments [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	572	277
Commitments to sell mortgage loans [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	(941)	(313)
Derivatives not Designated as Hedging Instruments [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	276	224
Derivatives not Designated as Hedging Instruments [Member] | Interest Rate Commitments [Member] | Net gains on loan sales and commissions on loans originated for others [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	572	277
Derivatives not Designated as Hedging Instruments [Member] | Commitments to sell mortgage loans [Member] | Net gains on loan sales and commissions on loans originated for others [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	(941)	(313)
Derivatives not Designated as Hedging Instruments [Member] | Interest rate swaps with customers [Member] | Net gains (losses) on interest rate swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	3,633	1,030
Derivatives not Designated as Hedging Instruments [Member] | Mirror swaps with counterparties [Member] | Net gains (losses) on interest rate swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	(2,836)	(770)
Derivatives not Designated as Hedging Instruments [Member] | Risk participation agreement [Member] | Net gains (losses) on interest rate swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income	$ (152)	$ 0

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Allowance for Loan Losses (Tables)

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Allowance for Loan Losses Rollforward Analysis

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2015:

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,202			$1,300			$7,987			$17,489			$5,430			$2,713			$2,391			$28,023
Charge-offs	(200		)	—			(7		)	(207		)	(48		)	(66		)	—			(321		)
Recoveries	80			—			14			94			2			12			—			108
Provision	249			(71		)	(191		)	(13		)	(29		)	72			(30		)	—
Ending Balance		$8,331			$1,229			$7,803			$17,363			$5,355			$2,731			$2,361			$27,810

(1) Commercial & industrial loans.

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2014. Prior to December 31, 2014, the unallocated allowance included amounts for management’s qualitative and quantitative assessment of certain other loan portfolio risks not captured in other components of the allowance. The 2014 presentation of the allowance for loan losses by portfolio segment, set forth below, has been revised to conform to the December 31, 2014 presentation format. The reclassification resulted in a reduction of $5.3 million in the unallocated allowance previously reported as of March 31, 2014, with a corresponding increase to the allowance by portfolio segment. The reclassification resulted in no change in the total allowance.

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,022			$383			$7,835			$16,240			$6,450			$2,511			$2,685			$27,886
Charge-offs	(945		)	—			(196		)	(1,141		)	(42		)	(40		)	—			(1,223		)
Recoveries	6			—			26			32			35			13			—			80
Provision	(536		)	(114		)	805			155			705			93			(653		)	300
Ending Balance		$6,547			$269			$8,470			$15,286			$7,148			$2,577			$2,032			$27,043

(1) Commercial & industrial loans.

Schedule of Allowance for Loan Loss by Segment & Impairment Methodology

The following table presents the Corporation’s loan portfolio and associated allowance for loan loss by portfolio segment and by impairment methodology:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Loans		Related Allowance		Loans		Related Allowance
Loans Individually Evaluated for Impairment:
Commercial:
Mortgages		$14,563		$1,173		$14,991		$927
Construction & development	—		—		—		—
Commercial & industrial	3,074		185		2,921		177
Residential real estate	2,912		222		3,698		326
Consumer	467		77		409		153
Subtotal		$21,016		$1,657		$22,019		$1,583
Loans Collectively Evaluated for Impairment:
Commercial:
Mortgages		$850,479		$7,158		$828,987		$7,275
Construction & development	89,851		1,229		79,592		1,300
Commercial & industrial	601,556		7,618		608,997		7,810
Residential real estate	984,652		5,133		981,717		5,104
Consumer	333,038		2,654		337,964		2,560
Subtotal		$2,859,576		$23,792		$2,837,257		$24,049
Unallocated	—		2,361		—		2,391
Total		$2,880,592		$27,810		$2,859,276		$28,023

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Securities (Securities in a Continuous Unrealized Loss Position) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015 security	Dec. 31, 2014 security
Schedule of Available-for-sale Securities [Line Items]
Number of securities in a continuous unrealized loss position for less than 12 months	1
Fair value of securities in a continuous unrealized loss position for less than 12 months	$ 1,975
Unrealized losses of securities in a continuous unrealized loss position for less than 12 months	(25)
Number of securities in a continuous unrealized loss position for 12 months or longer	11
Fair value of securities in a continuous unrealized loss position for 12 months or longer	26,287
Unrealized losses of securities in a continuous unrealized loss position for 12 months or longer	(4,475)
Number of securities in a continuous unrealized loss position total	12
Fair value of securities in a continuous unrealized loss position total	28,262
Unrealized losses of securities in a continuous unrealized loss position total	(4,500)
Obligations of U.S. government-sponsored enterprises [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of securities in a continuous unrealized loss position for less than 12 months		3
Fair value of securities in a continuous unrealized loss position for less than 12 months		20,952
Unrealized losses of securities in a continuous unrealized loss position for less than 12 months		(54)
Number of securities in a continuous unrealized loss position for 12 months or longer		0
Fair value of securities in a continuous unrealized loss position for 12 months or longer		0
Unrealized losses of securities in a continuous unrealized loss position for 12 months or longer		0
Number of securities in a continuous unrealized loss position total		3
Fair value of securities in a continuous unrealized loss position total		20,952
Unrealized losses of securities in a continuous unrealized loss position total		(54)
Individual name issuer trust preferred debt securities
Schedule of Available-for-sale Securities [Line Items]
Number of securities in a continuous unrealized loss position for less than 12 months	0	0
Fair value of securities in a continuous unrealized loss position for less than 12 months	0	0
Unrealized losses of securities in a continuous unrealized loss position for less than 12 months	0	0
Number of securities in a continuous unrealized loss position for 12 months or longer	11	11
Fair value of securities in a continuous unrealized loss position for 12 months or longer	26,287	25,774
Unrealized losses of securities in a continuous unrealized loss position for 12 months or longer	(4,475)	(4,979)
Number of securities in a continuous unrealized loss position total	11	11
Fair value of securities in a continuous unrealized loss position total	26,287	25,774
Unrealized losses of securities in a continuous unrealized loss position total	(4,475)	(4,979)
Corporate bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Number of securities in a continuous unrealized loss position for less than 12 months	1	0
Fair value of securities in a continuous unrealized loss position for less than 12 months	1,975	0
Unrealized losses of securities in a continuous unrealized loss position for less than 12 months	(25)	0
Number of securities in a continuous unrealized loss position for 12 months or longer	0	1
Fair value of securities in a continuous unrealized loss position for 12 months or longer	0	199
Unrealized losses of securities in a continuous unrealized loss position for 12 months or longer	0	(3)
Number of securities in a continuous unrealized loss position total	1	1
Fair value of securities in a continuous unrealized loss position total	1,975	199
Unrealized losses of securities in a continuous unrealized loss position total	$ (25)	$ (3)

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Allowance for Loan Losses (Allowance for Loan Losses by Segment & Impairment Methodology) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	$ 21,016		$ 22,019
Loans related allowance individually evaluated for impairment	1,657		1,583
Loans collectively evaluated for impairment	2,859,576		2,837,257
Loans related allowance collectively evaluated for impairment	23,792		24,049
Total loans	2,880,592	[1]	2,859,276	[1]
Allowance	27,810		28,023
Commercial Mortgages [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	14,563		14,991
Loans related allowance individually evaluated for impairment	1,173		927
Loans collectively evaluated for impairment	850,479		828,987
Loans related allowance collectively evaluated for impairment	7,158		7,275
Total loans	865,042		843,978
Commercial Construction & Development [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	0		0
Loans related allowance individually evaluated for impairment	0		0
Loans collectively evaluated for impairment	89,851		79,592
Loans related allowance collectively evaluated for impairment	1,229		1,300
Total loans	89,851		79,592
Commercial & Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	3,074		2,921
Loans related allowance individually evaluated for impairment	185		177
Loans collectively evaluated for impairment	601,556		608,997
Loans related allowance collectively evaluated for impairment	7,618		7,810
Total loans	604,630		611,918
Residential Segment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	2,912		3,698
Loans related allowance individually evaluated for impairment	222		326
Loans collectively evaluated for impairment	984,652		981,717
Loans related allowance collectively evaluated for impairment	5,133		5,104
Consumer Segment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans individually evaluated for impairment	467		409
Loans related allowance individually evaluated for impairment	77		153
Loans collectively evaluated for impairment	333,038		337,964
Loans related allowance collectively evaluated for impairment	2,654		2,560
Unallocated [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Total loans	0		0
Allowance	$ 2,361		$ 2,391

[1] Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

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Loans (Troubled Debt Restructurings) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015 loan		Mar. 31, 2014 loan
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	3		2
Pre-Modification Recorded Investment	$ 428	[1]	$ 479	[1]
Post-Modification Recorded Investment	428	[1]	479	[1]
Commercial Mortgages [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Pre-Modification Recorded Investment	0	[1]	0	[1]
Post-Modification Recorded Investment	0	[1]	0	[1]
Commercial Construction & Development [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Pre-Modification Recorded Investment	0	[1]	0	[1]
Post-Modification Recorded Investment	0	[1]	0	[1]
Commercial & Industrial [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		0
Pre-Modification Recorded Investment	300	[1]	0	[1]
Post-Modification Recorded Investment	300	[1]	0	[1]
Residential Mortgage [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		2
Pre-Modification Recorded Investment	93	[1]	479	[1]
Post-Modification Recorded Investment	93	[1]	479	[1]
Homeowner Construction [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Pre-Modification Recorded Investment	0	[1]	0	[1]
Post-Modification Recorded Investment	0	[1]	0	[1]
Home Equity Lines [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Pre-Modification Recorded Investment	0	[1]	0	[1]
Post-Modification Recorded Investment	0	[1]	0	[1]
Home Equity Loans [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Pre-Modification Recorded Investment	0	[1]	0	[1]
Post-Modification Recorded Investment	0	[1]	0	[1]
Other Consumer [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		0
Pre-Modification Recorded Investment	35	[1]	0	[1]
Post-Modification Recorded Investment	$ 35	[1]	$ 0	[1]

[1] The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs, at the time of the restructuring. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Financial Instruments with Off Balance Sheet Risk

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Financial instruments whose contract amounts represent credit risk:
Commitments to extend credit:
Commercial loans		$303,443		$325,402
Home equity lines	206,515		200,932
Other loans	47,998		48,551
Standby letters of credit	5,248		5,102
Financial instruments whose notional amounts exceed the amount of credit risk:
Forward loan commitments:
Interest rate lock commitments	60,546		40,015
Commitments to sell mortgage loans	106,457		84,808
Customer related derivative contracts:
Interest rate swaps with customers	209,416		165,795
Mirror swaps with counterparties	209,416		165,795
Interest rate risk management contracts:
Interest rate swaps	22,681		22,681

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Recently Issued Accounting Pronouncements

3 Months Ended

Mar. 31, 2015

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

Receivables - Troubled Debt Restructurings by Creditors - Topic 310

Accounting Standards Update No. 2014-04, “Reclassifications of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure” (“ASU 2014-04”), was issued in January 2014 and clarifies when banks and similar institutions (creditors) should reclassify mortgage loans collateralized by residential real estate properties from the loan portfolio to other real estate owned (“OREO”). ASU 2014-04 is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2014. The Corporation elected the prospective transition method and the adoption of ASU 2014-04 did not have a material impact on the Corporation’s consolidated financial statements.

Revenue from Contracts with Customers - Topic 606

Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), was issued in May 2014 and provides a revenue recognition framework for any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of non-financial assets unless those contracts are within the scope of other accounting standards. ASU 2014-09 is effective for annual periods beginning after December 15, 2016, including interim periods within that reporting period with early adoption not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Corporation is currently evaluating the impact that ASU 2014-09 will have on the its consolidated financial statements and related disclosures. The Corporation has not yet selected a transition method nor has it determined the effect of ASU 2014-09 on its ongoing financial reporting.

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Loans (Troubled Debt Restructurings Type of Modification) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	$ 428	[1]	$ 479	[1]
Below market interest rate concession [Member]
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	335		0
Payment deferral [Member]
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	93		479
Maturity / amortization concession [Member]
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	0		0
Interest only payments [Member]
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	0		0
Combination of concessions [Member]
Financing Receivable, Modifications [Line Items]
Pre-Modification Recorded Investment	$ 0	[2]	$ 0	[2]

[1] The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs, at the time of the restructuring. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

[2] Loans included in this classification were modified with a combination of any two of the concessions listed in this table.

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Defined Benefit Pension Plans (Tables)

3 Months Ended

Mar. 31, 2015

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Components of Net Periodic Benefit Cost

The composition of net periodic benefit cost was as follows:

(Dollars in thousands)	Qualified Pension Plan						Non-Qualified Retirement Plans
Three months ended March 31,	2015			2014			2015		2014
Net Periodic Benefit Cost:
Service cost		$615			$538			$20		$12
Interest cost	732			723			122		120
Expected return on plan assets	(1,129		)	(1,016		)	—		—
Amortization of prior service (credit) cost	(6		)	(6		)	—		—
Recognized net actuarial loss	312			115			61		16
Net periodic benefit cost		$524			$354			$203		$148

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Derivative Financial Instruments (Policies)

3 Months Ended

Mar. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives Policy

Derivative Financial Instruments

The Corporation’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Corporation’s known or expected cash receipts and its known or expected cash payments principally to manage the Corporation’s interest rate risk. Additionally, the Corporation enters into interest rate derivatives to accommodate the business requirements of its customers. All derivatives are recognized as either assets or liabilities on the balance sheet and are measured at fair value.  The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and resulting designation.

Interest Rate Risk Management Agreements

Interest rate swaps are used from time to time as part of the Corporation’s interest rate risk management strategy.  Swaps are agreements in which the Corporation and another party agree to exchange interest payments (e.g., fixed-rate for variable-rate payments) computed on a notional principal amount.  The credit risk associated with swap transactions is the risk of default by the counterparty.  To minimize this risk, the Corporation enters into interest rate agreements only with highly rated counterparties that management believes to be creditworthy.  The notional amounts of these agreements do not represent amounts exchanged by the parties and, thus, are not a measure of the potential loss exposure.

Cash Flow Hedging Instruments

As of March 31, 2015 and December 31, 2014, the Bancorp had two interest rate swap contracts designated as cash flow hedges to hedge the interest rate associated with $22.7 million of variable rate junior subordinated debentures. The effective portion of the changes in fair value of derivatives designated as cash flow hedges is recorded in other comprehensive income and subsequently reclassified to earnings when gains or losses are realized.  The ineffective portion of changes in fair value of the derivatives is recognized directly in earnings as interest expense.  As of March 31, 2015 and December 31, 2014, the Bancorp has pledged collateral to derivative counterparties in the form of cash totaling $800 thousand and $939 thousand, respectively.  The Bancorp may need to post additional collateral in the future in proportion to potential increases in unrealized loss positions.

Customer Related Derivative Contracts

The Corporation has entered into interest rate swap contracts to help commercial loan borrowers manage their interest rate risk.  The interest rate swap contracts with commercial loan borrowers allow them to convert floating-rate loan payments to fixed-rate loan payments.  When we enter into an interest rate swap contract with a commercial loan borrower, we simultaneously enter into a “mirror” swap contract with a third party.  The third party exchanges the client’s fixed‑rate loan payments for floating-rate loan payments.  We retain the risk that is associated with the potential failure of counterparties and the risk inherent in originating loans.  As of March 31, 2015 and December 31, 2014, Washington Trust had interest rate swap contracts with commercial loan borrowers with notional amounts of $209.4 million and $165.8 million, respectively, and equal amounts of “mirror” swap contracts with third-party financial institutions.  These derivatives are not designated as hedges and therefore, changes in fair value are recognized in earnings.

Risk Participation Agreements

In 2015, the Corporation entered into a risk participation agreement (“RPA”) with another bank participating in a commercial loan arrangement. The participating bank guarantees the performance on a borrower-related interest rate swap contract. The RPA represents a purchased guarantee that is recorded as an asset and under the RPA the Corporation participates out the risk associated with the interest rate swap position executed with the commercial borrower, for a net fee paid to the participating bank, classified in net gains on interest rate swap contracts. The RPA derivative asset is recorded at fair value and changes in the fair value of the derivative asset are recognized in earnings in the period of change. As of March 31, 2015, the notional amount of the RPA was $12.5 million.

Loan Commitments

Interest rate lock commitments are extended to borrowers and relate to the origination of residential real estate mortgage loans held for sale.  To mitigate the interest rate risk inherent in these rate locks, as well as closed residential real estate mortgage loans held for sale, forward commitments are established to sell individual residential real estate mortgage loans.  Both interest rate lock commitments and commitments to sell residential real estate mortgage loans are derivative financial instruments, but do not meet criteria for hedge accounting and, as such are treated as derivatives not designated as hedging instruments. These derivative financial instruments are recorded at fair value and changes in fair value of these commitments are reflected in earnings in the period of change. The Corporation has elected to carry certain closed residential real estate mortgage loans held for sale at fair value, as changes in fair value in these loans held for sale generally offset changes in interest rate lock and forward sale commitments.

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Allowance for Loan Losses (Policies)

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Allowance for Loan Losses Policy

The allowance for loan losses is management’s best estimate of the inherent risk of loss in the loan portfolio as of the balance sheet date. The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans. The Corporation uses a methodology to systematically measure the amount of estimated loan loss exposure inherent in the loan portfolio for purposes of establishing a sufficient allowance for loan losses. The methodology includes three elements: (1) identification of loss allocations for individual loans deemed to be impaired, (2) application of loss allocation factors for non-impaired loans based on credit grade, historical loss experience, estimated loss emergence period and delinquency status, with adjustments for various exposures not adequately presented in historical loss experience, and (3) an unallocated allowance maintained for measurement imprecision associated with impaired and nonaccrual loans.

Loss allocations for loans deemed to be impaired are measured on a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or, if the loan is collateral dependent, at the fair value of the collateral. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of circumstances associated with the property.

Individual commercial loans not deemed to be impaired are evaluated using an internal rating system and the application of loss allocation factors. The loan rating system is described under the caption “Credit Quality Indicators” in Note 5. The loan rating system and the related loss allocation factors take into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral and the adequacy of guarantees. We periodically reassess and revise the loss allocation factors used in the assignment of loss exposure to appropriately reflect our analysis of migrational loss experience. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in the commercial loan portfolio and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience, including our assessments of credit risk associated with certain industries, an ongoing trend toward larger credit relationships, recent changes in portfolio composition, conditions that may affect the ability of borrowers to meet debt service requirements, trends in rental rates on commercial real estate and conditions that may affect the collateral position, such as environmental matters.

Portfolios of more homogeneous populations of loans, including the various categories of residential mortgages and consumer loans, are analyzed as groups, with loss allocation factors assigned to each group based on account delinquency status. We periodically reassess and revise the loss allocation factors. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in residential mortgage and consumer loan portfolios and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience including trends in real estate values, consideration of general economic conditions, increases in delinquency levels and regulatory changes affecting the foreclosure process. These matters are also evaluated taking into account the geographic location of the underlying loans.

Because the methodology is based upon historical experience and trends, current economic data as well as management’s judgment, factors may arise that result in different estimations. Significant factors that could give rise to changes in these estimates may include, but are not limited to, changes in economic conditions in our market area, concentration of risk and declines in local property values. Adversely different conditions or assumptions could lead to increases in the allowance. In addition, various regulatory agencies periodically review the allowance for loan losses. Such agencies may require additions to the allowance based on their judgments about information available to them at the time of their examination.

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Loans (Summary of Loans) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	$ 1,559,523		$ 1,535,488
Residential real estate	987,564		985,415
Consumer	333,505		338,373
Total loans	2,880,592	[1]	2,859,276	[1]
Percent of Total Loans	100.00%	[1]	100.00%	[1]
Commercial Mortgages [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	865,042	[2]	843,978	[2]
Total loans	865,042		843,978
Percent of Total Loans	30.00%	[2]	30.00%	[2]
Commercial Construction & Development [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	89,851	[3]	79,592	[3]
Total loans	89,851		79,592
Percent of Total Loans	3.00%	[3]	3.00%	[3]
Commercial & Industrial [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	604,630	[4]	611,918	[4]
Total loans	604,630		611,918
Percent of Total Loans	21.00%	[4]	21.00%	[4]
Commercial Segment [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commercial	1,559,523		1,535,488
Percent of Total Loans	54.00%		54.00%
Residential Mortgage [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Residential real estate	954,905		948,731
Total loans	954,905		948,731
Percent of Total Loans	33.00%		33.00%
Homeowner Construction [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Residential real estate	32,659		36,684
Total loans	32,659		36,684
Percent of Total Loans	1.00%		1.00%
Residential Segment [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Residential real estate	987,564		985,415
Percent of Total Loans	34.00%		34.00%
Home Equity Lines [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer	239,537		242,480
Total loans	239,537		242,480
Percent of Total Loans	8.00%		8.00%
Home Equity Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer	46,727		46,967
Total loans	46,727		46,967
Percent of Total Loans	2.00%		2.00%
Other Consumer [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer	47,241	[5]	48,926	[5]
Total loans	47,241		48,926
Percent of Total Loans	2.00%	[5]	2.00%	[5]
Consumer Segment [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer	$ 333,505		$ 338,373
Percent of Total Loans	12.00%		12.00%

[1] Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

[2] Loans primarily secured by income producing property.

[3] Loans for construction of commercial properties, loans to developers for construction of residential properties and loans for land development.

[4] Loans to businesses and individuals, a substantial portion of which are fully or partially collateralized by real estate.

[5] Consumer installment loans and loans secured by general aviation aircraft and automobiles.

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Business Segments (Tables)

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Statement of Operations and Total Assets by Reportable Segment

The following table presents the statement of operations and total assets for Washington Trust’s reportable segments:

(Dollars in thousands)	Commercial Banking				Wealth Management Services						Corporate				Consolidated Total
Three months ended March 31,	2015		2014		2015			2014			2015		2014		2015		2014
Net interest income (expense)		$20,625		$19,739		($14	)		($4	)		$5,091		$4,101		$25,702		$23,836
Provision for loan losses	—		300		—			—			—		—		—		300
Net interest income (expense) after provision for loan losses	20,625		19,439		(14		)	(4		)	5,091		4,101		25,702		23,536
Noninterest income	5,078		4,541		8,435			8,065			507		6,764		14,020		19,370
Noninterest expenses:
Depreciation and amortization expense	671		585		306			311			60		51		1,037		947
Other noninterest expenses	13,587		13,553		5,915			5,387			2,992		9,405		22,494		28,345
Total noninterest expenses	14,258		14,138		6,221			5,698			3,052		9,456		23,531		29,292
Income before income taxes	11,445		9,842		2,200			2,363			2,546		1,409		16,191		13,614
Income tax expense	3,730		3,261		844			876			607		179		5,181		4,316
Net income		$7,715		$6,581		$1,356			$1,487			$1,939		$1,230		$11,010		$9,298
Total assets at period end		$3,015,691		$2,577,350		$52,568			$52,475			$534,255		$564,321		$3,602,514		$3,194,146
Expenditures for long-lived assets	1,067		1,075		114			171			45		45		1,226		1,291

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Fair Value Measurements (Policies)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurement Policy

Items Measured at Fair Value on a Recurring Basis

Securities

Securities available for sale are recorded at fair value on a recurring basis.  When available, the Corporation uses quoted market prices to determine the fair value of securities; such items are classified as Level 1. There were no Level 1 securities held at March 31, 2015 and December 31, 2014.

Level 2 securities include debt securities with quoted prices, which are traded less frequently than exchange-traded instruments, whose value is determined using matrix pricing with inputs that are observable in the market or can be derived principally from or corroborated by observable market data.  This category generally includes obligations of U.S. government-sponsored enterprises, mortgage‑backed securities issued by U.S. government agencies and U.S. government‑sponsored enterprises, obligations of states and political subdivisions, trust preferred debt securities and corporate bonds.

Securities not actively traded whose fair value is determined through the use of cash flows utilizing inputs that are unobservable are classified as Level 3. There were no Level 3 securities held at March 31, 2015 and December 31, 2014.

Mortgage Loans Held for Sale

The fair values of mortgage loans held for sale are generally estimated based on secondary market rates offered for loans with similar characteristics. When secondary market information exists, these loans are classified as Level 2. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. Any changes in the valuation of mortgage loans held for sale is based upon the change in market interest rates between the loan closing date and the measurement date and an immaterial portion attributable to changes in instrument-specific credit risk. There were no Level 3 mortgage loans held for sale at March 31, 2015 and December 31, 2014.

Derivatives

Interest rate swap contracts are traded in over-the-counter markets where quoted market prices are not readily available.  Fair value measurements are determined using independent pricing models that utilize primarily market observable inputs, such as swap rates of different maturities and LIBOR rates and, accordingly, are classified as Level 2. For purposes of potential valuation adjustments to its interest rate swap contracts and risk participation agreements, the Corporation evaluates the credit risk of its counterparties as well as that of the Corporation.  Accordingly, Washington Trust considers factors such as the likelihood of default by the Corporation and its counterparties, its net exposures and remaining contractual life, among other factors, in determining if any fair value adjustments related to credit risk are required.  Counterparty exposure is evaluated by netting positions that are subject to master netting agreements, as well as considering the amount of collateral securing the position.

Level 2 fair value measurements of forward loan commitments (interest rate lock commitments and commitments to sell residential real estate mortgages) are estimated using the anticipated market price based on pricing indications provided by other financial institutions. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. There were no Level 3 forward loan commitments held at March 31, 2015 and December 31, 2014.

Items Measured at Fair Value on a Nonrecurring Basis

Collateral Dependent Impaired Loans

Collateral dependent loans that are deemed to be impaired are valued based upon the fair value of the underlying collateral. Such collateral primarily consists of real estate and, to a lesser extent, other business assets. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values resulting from its knowledge of the property. Internal valuations are utilized to determine the fair value of other business assets. Collateral dependent impaired loans are categorized as Level 3.

Property Acquired Through Foreclosure or Repossession

Property acquired through foreclosure or repossession included in other assets in the Consolidated Balance Sheets is adjusted to fair value less costs to sell upon transfer out of loans through a charge to allowance for loan losses. Subsequently, it is carried at the lower of carrying value or fair value less costs to sell. Such subsequent valuation charges are charged through earnings. Fair value is generally based upon appraised values of the collateral. Management may adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of the property, and such property is categorized as Level 3.

Fair Value Transfer Policy

It is the Corporation’s policy to review and reflect transfers between Levels as of the financial statement reporting date.  During the three months endedMarch 31, 2015 and 2014, there were no transfers in and/or out of Level 1, 2 or 3.

Fair Value of Financial Instruments Policy

Valuation of Other Financial Instruments

The methodologies for estimating the fair value of financial instruments that are measured at fair value on a recurring or nonrecurring basis are discussed above. The methodologies for other financial instruments are discussed below.

Loans

Fair values are estimated for categories of loans with similar financial characteristics. Loans are segregated by type and are then further segmented into fixed-rate and adjustable-rate interest terms to determine their fair value. The fair value of fixed-rate commercial and consumer loans is calculated by discounting scheduled cash flows through the estimated maturity of the loan using interest rates offered at the measurement date that reflect the credit and interest rate risk inherent in the loan. The estimate of maturity is based on the Corporation’s historical repayment experience. For residential mortgages, fair value is estimated by using market prices for sales of similar loans on the secondary market. The fair value of floating rate commercial and consumer loans approximates carrying value. Fair value for impaired loans is estimated using a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or if the loan is collateral dependent, at the fair value of the collateral. Loans are classified within Level 3 of the fair value hierarchy.

Time Deposits

The discounted values of cash flows using the rates currently offered for deposits of similar remaining maturities were used to estimate the fair value of time deposits. Time deposits are classified within Level 2 of the fair value hierarchy.

Federal Home Loan Bank Advances

Rates currently available to the Corporation for advances with similar terms and remaining maturities are used to estimate fair value of existing advances. FHLBB advances are categorized as Level 2.

Junior Subordinated Debentures

The fair value of the junior subordinated debentures is estimated using rates currently available to the Corporation for debentures with similar terms and maturities. Junior subordinated debentures are categorized as Level 2.

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Defined Benefit Pension Plans (Policies)

3 Months Ended

Mar. 31, 2015

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Pension and Other Postretirement Plans Policy

The Corporation maintains a tax-qualified defined benefit pension plan for the benefit of certain eligible employees who were hired prior to October 1, 2007. The Corporation also has non-qualified retirement plans to provide supplemental retirement benefits to certain employees, as defined in the plans. Defined benefit pension plans were previously amended to freeze benefit accruals after a 10-year transition period ending in December 2023.

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General Information

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

General Information

General Information

Washington Trust Bancorp, Inc. (the “Bancorp”) is a publicly-owned registered bank holding company and financial holding company.  The Bancorp owns all of the outstanding common stock of The Washington Trust Company, of Westerly (the “Bank”), a Rhode Island chartered commercial bank founded in 1800.  Through its subsidiaries, the Bancorp offers a complete product line of financial services including commercial, residential and consumer lending, retail and commercial deposit products, and wealth management services through its offices in Rhode Island, eastern Massachusetts and Connecticut.

The consolidated financial statements include the accounts of the Bancorp and its subsidiaries (collectively, the “Corporation” or “Washington Trust”).  All significant intercompany transactions have been eliminated.

The accounting and reporting policies of the Corporation conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices of the banking industry.  In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period.  Actual results could differ from those estimates.  Material estimates that are particularly susceptible to change are the determination of the allowance for loan losses, the review of goodwill for impairment and the assessment of investment securities for impairment.

The unaudited consolidated financial statements of the Corporation presented herein have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by GAAP. In the opinion of management, all adjustments (consisting of normal recurring adjustments) and disclosures considered necessary for the fair presentation of the accompanying consolidated financial statements have been included. Interim results are not necessarily reflective of the results of the entire year. The accompanying unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

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Business Segments (Policies)

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Segment Reporting Policy

Washington Trust segregates financial information in assessing its results among its Commercial Banking and Wealth Management Services operating segments.  The amounts in the Corporate unit include activity not related to the segments. The methodologies and organizational hierarchies that define the business segments are periodically reviewed and revised.  Results may be restated, when necessary, to reflect changes in organizational structure or allocation methodology. Any changes in estimates and allocations that may affect the reported results of any business segment will not affect the consolidated financial position or results of operations of Washington Trust as a whole.

Management uses certain methodologies to allocate income and expenses to the business lines.  A funds transfer pricing methodology is used to assign interest income and interest expense to each interest-earning asset and interest-bearing liability on a matched maturity funding basis.  Certain indirect expenses are allocated to segments.  These include support unit expenses such as technology and processing operations and other support functions.

Commercial Banking

The Commercial Banking segment includes commercial, residential and consumer lending activities; equity in losses of unconsolidated investments in real estate limited partnerships; mortgage banking, secondary market and loan servicing activities; deposit generation; merchant credit card services; cash management activities; and direct banking activities, which include the operation of ATMs, telephone and Internet banking services and customer support and sales.

Wealth Management Services

Wealth Management Services includes investment management; financial planning; personal trust services, including services as trustee, administrator, custodian and guardian; and estate settlement. Institutional trust services are also provided, including fiduciary services.

Corporate

Corporate includes the Treasury Unit, which is responsible for managing the wholesale investment portfolio and wholesale funding needs.  It also includes income from bank-owned life insurance, net gain on sale of business line as well as administrative and executive expenses not allocated to the operating segments and the residual impact of methodology allocations such as funds transfer pricing offsets.

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Defined Benefit Pension Plans (Components of Net Periodic Benefit Cost) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		120 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 30, 2023
Qualified Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Service Cost	$ 615	$ 538
Interest Cost	732	723
Expected Return on Plan Assets	(1,129)	(1,016)
Amortization of Prior Service Cost	(6)	(6)
Recognized Net Actuarial Loss	312	115
Net Periodic Benefit Cost	524	354
Non-Qualified Retirement Plans [Member]
Defined Benefit Plan Disclosure [Line Items]
Service Cost	20	12
Interest Cost	122	120
Expected Return on Plan Assets	0	0
Amortization of Prior Service Cost	0	0
Recognized Net Actuarial Loss	61	16
Net Periodic Benefit Cost	$ 203	$ 148
Scenario, Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Transition Period Pension Plan Amendment			10 years

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Shareholders' Equity (Tables)

3 Months Ended

Mar. 31, 2015

Regulatory Capital Requirements [Abstract]

Regulatory Capital Requirements

The following table presents the Corporation’s and the Bank’s actual capital amounts and ratios, as well as the corresponding minimum required capital ratios and minimum capital ratios required for the Bank to be “well capitalized” for purposes of the Federal Deposit Insurance Corporation’s (“FDIC”) prompt corrective action provisions:

(Dollars in thousands)	Actual				For Capital Adequacy Purposes				To Be “Well Capitalized” Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
March 31, 2015
Total Capital (to Risk-Weighted Assets):
Corporation		$352,521	12.80	%		$220,262	8.00	%		N/A	N/A
Bank	347,674		12.63		220,187		8.00		275,234		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	324,375		11.78		165,196		6.00		N/A		N/A
Bank	319,528		11.61		165,140		6.00		220,187		8.00
Common Equity Tier 1 Capital (to Risk-Weighted Assets): (1)
Corporation	302,376		10.98		123,897		4.50		N/A		N/A
Bank	319,528		11.61		123,855		4.50		178,902		6.50
Tier 1 Capital (to Average Assets): (2)
Corporation	324,375		9.21		140,864		4.00		N/A		N/A
Bank	319,528		9.08		140,738		4.00		175,922		5.00
December 31, 2014
Total Capital (to Risk-Weighted Assets):
Corporation	343,934		12.56		219,149		8.00		273,936		N/A
Bank	339,268		12.39		219,075		8.00		273,844		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	315,575		11.52		109,574		4.00		164,361		N/A
Bank	310,909		11.35		109,537		4.00		164,306		6.00
Tier 1 Capital (to Average Assets): (2)
Corporation	315,575		9.14		138,090		4.00		172,612		N/A
Bank	310,909		9.01		137,964		4.00		172,454		5.00

(1) New capital ratio effective January 1, 2015 under the Basel III capital requirements. See additional discussion of Basel III and the new regulatory capital requirements in the “Supervision and Regulation” section in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

(2)    Leverage ratio.

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Loans (Narrative) (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Receivables [Abstract]
Loans Receivable Net Deferred Cost Originated	$ 2,200,000	$ 2,100,000
Loans Receivable Net Deferred Premium on Purchased Loans	92,000	94,000
Loans Pledged as Collateral	1,240,000,000	1,210,000,000
Past Due Loans on Nonaccrual	$ 12,300,000	$ 12,700,000

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Derivative Financial Instruments (Narrative) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Interest Rate Swaps [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	$ 22,681	$ 22,681
Interest rate swaps with customers [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,416	165,795
Mirror swaps with counterparties [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,416	165,795
Derivatives Designated as Cash Flow Hedging Instruments [Member] | Interest Rate Swaps [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Number of Instruments Held	2	2
Notional Amount	22,681	22,681
Pledged collateral to derivative counterparties	800	939
Derivatives not Designated as Hedging Instruments [Member] | Interest rate swaps with customers [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,400	165,800
Derivatives not Designated as Hedging Instruments [Member] | Mirror swaps with counterparties [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,416	165,795
Derivatives not Designated as Hedging Instruments [Member] | Risk participation agreement [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	$ 12,500

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CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Assets:
Cash and due from banks	$ 84,842		$ 76,386
Short-term investments	4,191		3,964
Mortgage loans held for sale, at fair value	47,117		45,693
Securities:
Available for sale, at fair value	340,942		357,662
Held to maturity, at cost	24,025		25,222
Total securities	364,967		382,884
Federal Home Loan Bank stock, at cost	37,730		37,730
Loans:
Commercial	1,559,523		1,535,488
Residential real estate	987,564		985,415
Consumer	333,505		338,373
Total loans	2,880,592	[1]	2,859,276	[1]
Less allowance for loan losses	27,810		28,023
Net loans	2,852,782		2,831,253
Premises and equipment, net	27,839		27,495
Investment in bank-owned life insurance	64,009		63,519
Goodwill	58,114		58,114
Identifiable intangible assets, net	4,694		4,849
Other assets	56,229		54,987
Total assets	3,602,514		3,586,874
Liabilities:
Demand deposits	477,046		459,852
NOW accounts	333,321		326,375
Money market accounts	821,353		802,764
Savings accounts	298,802		291,725
Time deposits	852,621		874,102
Total deposits	2,783,143		2,754,818
Federal Home Loan Bank advances	385,992		406,297
Junior subordinated debentures	22,681		22,681
Other liabilities	56,819		56,799
Total liabilities	3,248,635		3,240,595
Commitments and contingencies
Shareholders' Equity:
Common stock	1,048		1,047
Paid-in capital	102,587		101,204
Retained earnings	258,069		252,837
Accumulated other comprehensive income (loss)	(7,825)		(8,809)
Total shareholders' equity	353,879		346,279
Total liabilities and shareholders’ equity	$ 3,602,514		$ 3,586,874

[1] Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

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Other Comprehensive Income (Tables)

3 Months Ended

Mar. 31, 2015

Equity [Abstract]

Activity in Other Comprehensive Income

The following table presents the activity in other comprehensive income:

Three months ended March 31,	2015									2014
(Dollars in thousands)	Pre-tax Amounts			Income Taxes			Net of Tax			Pre-tax Amounts			Income Taxes			Net of Tax
Securities available for sale:
Net change in fair value of securities available for sale	1,053			389			664			964			352			612
Cash flow hedges:
Change in fair value of cash flow hedges	(32		)	(24		)	(8		)	(43		)	(27		)	(16		)
Net cash flow hedge losses reclassified into earnings (1)	145			52			93			145			53			92
Net change in fair value of cash flow hedges	113			28			85			102			26			76
Defined benefit plan obligation adjustment (2)	367			132			235			88			—			88
Total other comprehensive income		$1,533			$549			$984			$1,154			$378			$776

(1) Included in interest expense on junior subordinated debentures in the Consolidated Statements of Income.

(2) Included in salaries and employee benefits expense in the Consolidated Statements of Income.

Components of Accumulated Other Comprehensive Income

The following tables present the changes in accumulated other comprehensive income (loss) by component, net of tax:

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2014		$4,110		$112		($287	)		($12,744	)		($8,809	)
Other comprehensive income (loss) before reclassifications	664		—		(8		)	—			656
Amounts reclassified from accumulated other comprehensive income	—		—		93			235			328
Net other comprehensive income	664		—		85			235			984
Balance at March 31, 2015		$4,774		$112		($202	)		($12,509	)		($7,825	)

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2013		$3,089		$112		($618	)		($4,136	)		($1,553	)
Other comprehensive income (loss) before reclassifications	612		—		(16		)	—			596
Amounts reclassified from accumulated other comprehensive income	—		—		92			88			180
Net other comprehensive income	612		—		76			88			776
Balance at March 31, 2014		$3,701		$112		($542	)		($4,048	)		($777	)

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CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Unaudited) (USD $) In Thousands, except Share data	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Shareholders' Equity, Beginning Balance at Dec. 31, 2013	$ 329,646	$ 1,038	$ 97,566	$ 232,595	$ (1,553)
Common Stock, Shares Outstanding, Beginning Balance at Dec. 31, 2013		16,614,000
Net income	9,298			9,298
Total other comprehensive income, net of tax	776				776
Cash dividends declared	(4,894)			(4,894)
Share-based compensation	491		491
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit, shares		21,000
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit	541	2	539
Shareholders' Equity, Ending Balance at Mar. 31, 2014	335,858	1,040	98,596	236,999	(777)
Common Stock, Shares Outstanding, Ending Balance at Mar. 31, 2014		16,635,000
Shareholders' Equity, Beginning Balance at Dec. 31, 2014	346,279	1,047	101,204	252,837	(8,809)
Common Stock, Shares Outstanding, Beginning Balance at Dec. 31, 2014	16,746,363	16,746,000
Net income	11,010			11,010
Total other comprehensive income, net of tax	984				984
Cash dividends declared	(5,778)			(5,778)
Share-based compensation	580		580
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit, shares		27,000
Exercise of stock options, issuance of other compensation-related equity instruments and related tax benefit	804	1	803
Shareholders' Equity, Ending Balance at Mar. 31, 2015	$ 353,879	$ 1,048	$ 102,587	$ 258,069	$ (7,825)
Common Stock, Shares Outstanding, Ending Balance at Mar. 31, 2015	16,772,956	16,773,000

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Loans (Impaired Loans) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	$ 3,145	[1]	$ 2,956	[1]
Recorded Investment of Impaired Loans with Related Allowance	17,901	[1]	19,096	[1]
Total Recorded Investment of Impaired Loans	21,046	[1]	22,052	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	3,440		3,276
Unpaid Principal of Impaired Loans with Related Allowance	18,809		19,765
Total Unpaid Principal of Impaired Loans	22,249		23,041
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	1,657		1,583
Commercial Mortgages [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	205	[1]	432	[1]
Recorded Investment of Impaired Loans with Related Allowance	14,384	[1]	14,585	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	205		432
Unpaid Principal of Impaired Loans with Related Allowance	14,564		14,564
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	1,173		927
Commercial Construction & Development [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	0	[1]	0	[1]
Recorded Investment of Impaired Loans with Related Allowance	0	[1]	0	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	0		0
Unpaid Principal of Impaired Loans with Related Allowance	0		0
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	0		0
Commercial & Industrial [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	1,322	[1]	1,047	[1]
Recorded Investment of Impaired Loans with Related Allowance	1,754	[1]	1,878	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	1,323		1,076
Unpaid Principal of Impaired Loans with Related Allowance	2,305		2,437
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	185		177
Residential Mortgage [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	1,618	[1]	1,477	[1]
Recorded Investment of Impaired Loans with Related Allowance	1,296	[1]	2,226	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	1,912		1,768
Unpaid Principal of Impaired Loans with Related Allowance	1,423		2,338
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	222		326
Homeowner Construction [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	0	[1]	0	[1]
Recorded Investment of Impaired Loans with Related Allowance	0	[1]	0	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	0		0
Unpaid Principal of Impaired Loans with Related Allowance	0		0
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	0		0
Home Equity Lines [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	0	[1]	0	[1]
Recorded Investment of Impaired Loans with Related Allowance	244	[1]	250	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	0		0
Unpaid Principal of Impaired Loans with Related Allowance	250		250
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	76		141
Home Equity Loans [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	0	[1]	0	[1]
Recorded Investment of Impaired Loans with Related Allowance	72	[1]	45	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	0		0
Unpaid Principal of Impaired Loans with Related Allowance	116		62
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	1		12
Other Consumer [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment of Impaired Loans with No Related Allowance	0	[1]	0	[1]
Recorded Investment of Impaired Loans with Related Allowance	151	[1]	112	[1]
Unpaid Principal of Impaired Loans with No Related Allowance	0		0
Unpaid Principal of Impaired Loans with Related Allowance	151		114
No Related Allowance on Impaired Loans	0		0
Related Allowance on Impaired Loans	0		0
Commercial Segment [Member]
Financing Receivable, Impaired [Line Items]
Total Recorded Investment of Impaired Loans	17,665	[1]	17,942	[1]
Total Unpaid Principal of Impaired Loans	18,397		18,509
Related Allowance on Impaired Loans	1,358		1,104
Residential Segment [Member]
Financing Receivable, Impaired [Line Items]
Total Recorded Investment of Impaired Loans	2,914	[1]	3,703	[1]
Total Unpaid Principal of Impaired Loans	3,335		4,106
Related Allowance on Impaired Loans	222		326
Consumer Segment [Member]
Financing Receivable, Impaired [Line Items]
Total Recorded Investment of Impaired Loans	467	[1]	407	[1]
Total Unpaid Principal of Impaired Loans	517		426
Related Allowance on Impaired Loans	$ 77		$ 153

[1] The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

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Securities (Tables)

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Summary of Investments

The following tables present the amortized cost, gross unrealized holding gains, gross unrealized holding losses and fair value of securities by major security type and class of security:

(Dollars in thousands)
March 31, 2015	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,203		$98		$—			$31,301
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	222,547		10,498		—			233,045
Obligations of states and political subdivisions	42,664		1,515		—			44,179
Individual name issuer trust preferred debt securities	30,762		—		(4,475		)	26,287
Corporate bonds	6,119		36		(25		)	6,130
Total securities available for sale		$333,295		$12,147		($4,500	)		$340,942
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$24,025		$809		$—			$24,834
Total securities held to maturity		$24,025		$809		$—			$24,834
Total securities		$357,320		$12,956		($4,500	)		$365,776

(Dollars in thousands)
December 31, 2014	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,205		$21		($54	)		$31,172
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	235,343		10,023		—			245,366
Obligations of states and political subdivisions	47,647		1,529		—			49,176
Individual name issuer trust preferred debt securities	30,753		—		(4,979		)	25,774
Corporate bonds	6,120		57		(3		)	6,174
Total securities available for sale		$351,068		$11,630		($5,036	)		$357,662
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$25,222		$786		$—			$26,008
Total securities held to maturity		$25,222		$786		$—			$26,008
Total securities		$376,290		$12,416		($5,036	)		$383,670

Securities by Contractual Maturity

The schedule of maturities of debt securities available for sale and held to maturity is presented below. Mortgage-backed securities are included based on weighted average maturities, adjusted for anticipated prepayments.  All other debt securities are included based on contractual maturities.  Actual maturities may differ from amounts presented because certain issuers have the right to call or prepay obligations with or without call or prepayment penalties.  Yields on tax exempt obligations are not computed on a tax equivalent basis.

(Dollars in thousands)
March 31, 2015	Within 1 Year			1-5 Years			5-10 Years			After 10 Years			Totals
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises:
Amortized cost		$—			$31,003			$200			$—			$31,203
Weighted average yield	—		%	1.72		%	2.32		%	—		%	1.73		%
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost	37,723			100,409			57,461			26,954			222,547
Weighted average yield	3.71			3.30			2.81			1.76			3.06
Obligations of state and political subdivisions:
Amortized cost	3,601			24,267			14,796			—			42,664
Weighted average yield	3.78			3.94			3.99			—			3.95
Individual name issuer trust preferred debt securities:
Amortized cost	—			—			—			30,762			30,762
Weighted average yield	—			—			—			1.11			1.11
Corporate bonds:
Amortized cost	5,713			203			203			—			6,119
Weighted average yield	2.84			1.62			3.21			—			2.81
Total debt securities available for sale:
Amortized cost		$47,037			$155,882			$72,660			$57,716			$333,295
Weighted average yield	3.61		%	3.09		%	3.05		%	1.42		%	2.86		%
Fair value		$48,955			$161,578			$75,897			$54,512			$340,942
Securities Held to Maturity:
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost		$3,007			$9,323			$7,364			$4,331			$24,025
Weighted average yield	3.11		%	3.03		%	2.78		%	0.89		%	2.58		%
Fair value		$3,108			$9,637			$7,612			$4,477			$24,834

Included in the above table are debt securities with an amortized cost balance of $98.1 million and a fair value of $95.0 million at March 31, 2015 that are callable at the discretion of the issuers.  Final maturities of the callable securities range from 6 months to 22 years, with call features ranging from 1 month to 2 years.

Securities in a Continuous Unrealized Loss Position

Other-Than-Temporary Impairment Assessment

The Corporation assesses whether the decline in fair value of investment securities is other-than-temporary on a regular basis. Unrealized losses on debt securities may occur from current market conditions, increases in interest rates since the time of purchase, a structural change in an investment, volatility of earnings of a specific issuer, or deterioration in credit quality of the issuer.  Management evaluates impairments in value both qualitatively and quantitatively to assess whether they are other‑than‑temporary.

The following tables summarize temporarily impaired securities, segregated by length of time the securities have been in a continuous unrealized loss position:

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
March 31, 2015	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Individual name issuer trust preferred debt securities	—		$—		$—		11		$26,287		($4,475	)	11		$26,287		($4,475	)
Corporate bonds	1	1,975		(25		)	—	—		—			1	1,975		(25		)
Total temporarily impaired securities	1		$1,975		($25	)	11		$26,287		($4,475	)	12		$28,262		($4,500	)

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
December 31, 2014	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Obligations of U.S. government-sponsored enterprises	3		$20,952		($54	)	—		$—		$—		3		$20,952		($54	)
Individual name issuer trust preferred debt securities	—	—		—			11	25,774		(4,979		)	11	25,774		(4,979		)
Corporate bonds	—	—		—			1	199		(3		)	1	199		(3		)
Total temporarily impaired securities	3		$20,952		($54	)	12		$25,973		($4,982	)	15		$46,925		($5,036	)

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Loans (Credit Quality Indicators - Residential, Consumer) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Under 90 Days Past Due [Member] | Accruing Residential Mortgage [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	$ 947,949	$ 941,607
Under 90 Days Past Due [Member] | Nonaccrual Residential Mortgage [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	3,349	3,840
Under 90 Days Past Due [Member] | Homeowner Construction [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	32,659	36,684
Under 90 Days Past Due [Member] | Residential Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	983,957	982,131
Under 90 Days Past Due [Member] | Home Equity Lines [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	239,074	241,639
Under 90 Days Past Due [Member] | Home Equity Loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	46,472	46,911
Under 90 Days Past Due [Member] | Other Consumer [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	47,236	48,926
Under 90 Days Past Due [Member] | Consumer Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	332,782	337,476
Over 90 Days Past Due [Member] | Accruing Residential Mortgage [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	0	0
Over 90 Days Past Due [Member] | Nonaccrual Residential Mortgage [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	3,607	3,284
Over 90 Days Past Due [Member] | Homeowner Construction [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	0	0
Over 90 Days Past Due [Member] | Residential Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	3,607	3,284
Over 90 Days Past Due [Member] | Home Equity Lines [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	463	841
Over 90 Days Past Due [Member] | Home Equity Loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	255	56
Over 90 Days Past Due [Member] | Other Consumer [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	5	0
Over 90 Days Past Due [Member] | Consumer Segment [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	$ 723	$ 897

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Other Comprehensive Income

3 Months Ended

Mar. 31, 2015

Equity [Abstract]

Other Comprehensive Income

Other Comprehensive Income

The following table presents the activity in other comprehensive income:

Three months ended March 31,	2015									2014
(Dollars in thousands)	Pre-tax Amounts			Income Taxes			Net of Tax			Pre-tax Amounts			Income Taxes			Net of Tax
Securities available for sale:
Net change in fair value of securities available for sale	1,053			389			664			964			352			612
Cash flow hedges:
Change in fair value of cash flow hedges	(32		)	(24		)	(8		)	(43		)	(27		)	(16		)
Net cash flow hedge losses reclassified into earnings (1)	145			52			93			145			53			92
Net change in fair value of cash flow hedges	113			28			85			102			26			76
Defined benefit plan obligation adjustment (2)	367			132			235			88			—			88
Total other comprehensive income		$1,533			$549			$984			$1,154			$378			$776

(1) Included in interest expense on junior subordinated debentures in the Consolidated Statements of Income.

(2) Included in salaries and employee benefits expense in the Consolidated Statements of Income.

The following tables present the changes in accumulated other comprehensive income (loss) by component, net of tax:

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2014		$4,110		$112		($287	)		($12,744	)		($8,809	)
Other comprehensive income (loss) before reclassifications	664		—		(8		)	—			656
Amounts reclassified from accumulated other comprehensive income	—		—		93			235			328
Net other comprehensive income	664		—		85			235			984
Balance at March 31, 2015		$4,774		$112		($202	)		($12,509	)		($7,825	)

(Dollars in thousands)	Net Unrealized Gains on Available For Sale Securities		Noncredit -related Impairment		Net Unrealized Losses on Cash Flow Hedges			Pension Benefit Adjustment			Total
Balance at December 31, 2013		$3,089		$112		($618	)		($4,136	)		($1,553	)
Other comprehensive income (loss) before reclassifications	612		—		(16		)	—			596
Amounts reclassified from accumulated other comprehensive income	—		—		92			88			180
Net other comprehensive income	612		—		76			88			776
Balance at March 31, 2014		$3,701		$112		($542	)		($4,048	)		($777	)

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Loans (Tables)

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Summary of Loans

The following is a summary of loans:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		%		Amount		%
Commercial:
Mortgages (1)		$865,042	30	%		$843,978	30	%
Construction & development (2)	89,851		3		79,592		3
Commercial & industrial (3)	604,630		21		611,918		21
Total commercial	1,559,523		54		1,535,488		54
Residential real estate:
Mortgages	954,905		33		948,731		33
Homeowner construction	32,659		1		36,684		1
Total residential real estate	987,564		34		985,415		34
Consumer:
Home equity lines	239,537		8		242,480		8
Home equity loans	46,727		2		46,967		2
Other (4)	47,241		2		48,926		2
Total consumer	333,505		12		338,373		12
Total loans (5)		$2,880,592	100	%		$2,859,276	100	%

(1) Loans primarily secured by income producing property.

(2) Loans for construction of commercial properties, loans to developers for construction of residential properties and loans for land development.

(3) Loans to businesses and individuals, a substantial portion of which are fully or partially collateralized by real estate.

(4) Consumer installment loans and loans secured by general aviation aircraft and automobiles.

(5) Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

Nonaccrual Loans

The following is a summary of nonaccrual loans, segregated by class of loans:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Commercial:
Mortgages		$5,115		$5,315
Construction & development	—		—
Commercial & industrial	2,193		1,969
Residential real estate:
Mortgages	6,956		7,124
Homeowner construction	—		—
Consumer:
Home equity lines	1,051		1,217
Home equity loans	511		317
Other	39		3
Total nonaccrual loans		$15,865		$15,945
Accruing loans 90 days or more past due		$—		$—

As of March 31, 2015 and December 31, 2014, nonaccrual loans of $3.6 million and $3.2 million, respectively, were current as to the payment of principal and interest.

Past Due Loans

Past due status is based on the contractual payment terms of the loan. The following tables present an age analysis of past due loans, segregated by class of loans:

(Dollars in thousands)	Days Past Due
March 31, 2015	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$497		$61		$5,115		$5,673		$859,369		$865,042
Construction & development	—		—		—		—		89,851		89,851
Commercial & industrial	229		229		721		1,179		603,451		604,630
Residential real estate:
Mortgages	4,470		1,352		3,607		9,429		945,476		954,905
Homeowner construction	—		—		—		—		32,659		32,659
Consumer:
Home equity lines	1,244		429		463		2,136		237,401		239,537
Home equity loans	213		111		255		579		46,148		46,727
Other	55		25		5		85		47,156		47,241
Total loans		$6,708		$2,207		$10,166		$19,081		$2,861,511		$2,880,592

(Dollars in thousands)	Days Past Due
December 31, 2014	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$—		$—		$5,315		$5,315		$838,663		$843,978
Construction & development	—		—		—		—		79,592		79,592
Commercial & industrial	2,136		1,202		181		3,519		608,399		611,918
Residential real estate:
Mortgages	2,943		821		3,284		7,048		941,683		948,731
Homeowner construction	—		—		—		—		36,684		36,684
Consumer:
Home equity lines	570		100		841		1,511		240,969		242,480
Home equity loans	349		240		56		645		46,322		46,967
Other	35		5		—		40		48,886		48,926
Total loans		$6,033		$2,368		$9,677		$18,078		$2,841,198		$2,859,276

Included in past due loans as of March 31, 2015 and December 31, 2014, were nonaccrual loans of $12.3 million and $12.7 million, respectively. All loans 90 days or more past due at March 31, 2015 and December 31, 2014 were classified as nonaccrual.

Impaired Loans

The following is a summary of impaired loans:

(Dollars in thousands)	Recorded Investment (1)				Unpaid Principal				Related Allowance
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
No Related Allowance Recorded:
Commercial:
Mortgages		$205		$432		$205		$432		$—		$—
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,322		1,047		1,323		1,076		—		—
Residential real estate:
Mortgages	1,618		1,477		1,912		1,768		—		—
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	—		—		—		—		—		—
Home equity loans	—		—		—		—		—		—
Other	—		—		—		—		—		—
Subtotal	3,145		2,956		3,440		3,276		—		—
With Related Allowance Recorded:
Commercial:
Mortgages		$14,384		$14,585		$14,564		$14,564		$1,173		$927
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,754		1,878		2,305		2,437		185		177
Residential real estate:
Mortgages	1,296		2,226		1,423		2,338		222		326
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	244		250		250		250		76		141
Home equity loans	72		45		116		62		1		12
Other	151		112		151		114		—		—
Subtotal	17,901		19,096		18,809		19,765		1,657		1,583
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583
Total:
Commercial		$17,665		$17,942		$18,397		$18,509		$1,358		$1,104
Residential real estate	2,914		3,703		3,335		4,106		222		326
Consumer	467		407		517		426		77		153
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583

(1) The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

The following table presents the average recorded investment balance of impaired loans and interest income recognized on impaired loans segregated by loan class:

(Dollars in thousands)	Average Recorded Investment				Interest Income Recognized
Three months ended March 31,	2015		2014		2015		2014
Commercial:
Mortgages		$14,942		$28,340		$79		$165
Construction & development	—		—		—		—
Commercial & industrial	3,036		2,366		19		23
Residential real estate:
Mortgages	3,457		3,744		16		14
Homeowner construction	—		—		—		—
Consumer:
Home equity lines	247		134		—		1
Home equity loans	74		95		—		1
Other	146		125		3		2
Totals		$21,902		$34,804		$117		$206

Troubled Debt Restructurings

The following table presents loans modified as a troubled debt restructuring:

(Dollars in thousands)			Outstanding Recorded Investment (1)
	# of Loans		Pre-Modifications				Post-Modifications
Three months ended March 31,	2015	2014	2015		2014		2015		2014
Commercial:
Mortgages	—	—		$—		$—		$—		$—
Construction & development	—	—	—		—		—		—
Commercial & industrial	1	—	300		—		300		—
Residential real estate:
Mortgages	1	2	93		479		93		479
Homeowner construction	—	—	—		—		—		—
Consumer:
Home equity lines	—	—	—		—		—		—
Home equity loans	—	—	—		—		—		—
Other	1	—	35		—		35		—
Totals	3	2		$428		$479		$428		$479

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs, at the time of the restructuring. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

Troubled Debt Restructurings Type of Modification

The following table provides information on how loans were modified as a troubled debt restructuring:

(Dollars in thousands)
Three months ended March 31,	2015		2014
Below-market interest rate concession		$335		$—
Payment deferral	93		479
Maturity / amortization concession	—		—
Interest only payments	—		—
Combination(1)	—		—
Total		$428		$479

(1) Loans included in this classification were modified with a combination of any two of the concessions listed in this table.

Troubled Debt Restructurings Subsequent Default

The following table presents loans modified in a troubled debt restructuring within the previous twelve months for which there was a payment default:

(Dollars in thousands)	# of Loans		Recorded Investment (1)
Three months ended March 31,	2015	2014	2015		2014
Commercial:
Mortgages	—	—		$—		$—
Construction & development	—	—	—		—
Commercial & industrial	2	6	11		1,191
Residential real estate:
Mortgages	2	—	338		—
Homeowner construction	—	—	—		—
Consumer:
Home equity lines	—	—	—		—
Home equity loans	—	—	—		—
Other	—	—	—		—
Totals	4	6		$349		$1,191

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

Credit Quality Indicators - Commercial

The following table presents the commercial loan portfolio, segregated by category of credit quality indicator:

(Dollars in thousands)	Pass				Special Mention				Classified
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Mortgages		$842,516		$819,857		$17,207		$18,372		$5,319		$5,749
Construction & development	89,851		79,592		—		—		—		—
Commercial & industrial	586,370		592,206		15,536		16,311		2,724		3,401
Total commercial loans		$1,518,737		$1,491,655		$32,743		$34,683		$8,043		$9,150

Credit Quality Indicators Residential & Consumer

The following table presents the residential and consumer loan portfolios, segregated by category of credit quality indicator:

(Dollars in thousands)	Current and Under 90 Days Past Due				Over 90 Days Past Due
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Residential real estate:
Accruing mortgages		$947,949		$941,607		$—		$—
Nonaccrual mortgages	3,349		3,840		3,607		3,284
Homeowner construction	32,659		36,684		—		—
Total residential loans		$983,957		$982,131		$3,607		$3,284
Consumer:
Home equity lines		$239,074		$241,639		$463		$841
Home equity loans	46,472		46,911		255		56
Other	47,236		48,926		5		—
Total consumer loans		$332,782		$337,476		$723		$897

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Financial Instruments with Off-Balance Sheet Risk

The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers and to manage the Corporation’s exposure to fluctuations in interest rates.  These financial instruments include commitments to extend credit, standby letters of credit, interest rate swap agreements and interest rate lock commitments and commitments to sell residential real estate mortgage loans.  These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the Corporation’s Consolidated Balance Sheets.  The contract or notional amounts of these instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.  The Corporation’s credit policies with respect to interest rate swap agreements with commercial borrowers, commitments to extend credit, and financial guarantees are similar to those used for loans.  The interest rate swaps with other counterparties are generally subject to bilateral collateralization terms.

The following table presents the contractual and notional amounts of financial instruments with off-balance sheet risk:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Financial instruments whose contract amounts represent credit risk:
Commitments to extend credit:
Commercial loans		$303,443		$325,402
Home equity lines	206,515		200,932
Other loans	47,998		48,551
Standby letters of credit	5,248		5,102
Financial instruments whose notional amounts exceed the amount of credit risk:
Forward loan commitments:
Interest rate lock commitments	60,546		40,015
Commitments to sell mortgage loans	106,457		84,808
Customer related derivative contracts:
Interest rate swaps with customers	209,416		165,795
Mirror swaps with counterparties	209,416		165,795
Interest rate risk management contracts:
Interest rate swaps	22,681		22,681

Commitments to Extend Credit

Commitments to extend credit are agreements to lend to a customer as long as there are no violations of any condition established in the contract.  Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee.  Since some of the commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements.  Each borrower’s creditworthiness is evaluated on a case-by-case basis.  The amount of collateral obtained is based on management’s credit evaluation of the borrower.

Standby Letters of Credit

Standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. These standby letters of credit are primarily issued to support the financing needs of the Bank’s commercial customers. The credit risk involved in issuing standby letters of credit is essentially the same as that involved in extending loan facilities to customers. The collateral supporting those commitments is essentially the same as for other commitments. Most standby letters of credit extend for one year. As of March 31, 2015 and December 31, 2014, the maximum potential amount of undiscounted future payments, not reduced by amounts that may be recovered, totaled $5.2 million and $5.1 million, respectively. At March 31, 2015 and December 31, 2014, there were no liabilities to beneficiaries resulting from standby letters of credit.  Fee income on standby letters of credit was insignificant for the three months endedMarch 31, 2015 and 2014.

Forward Loan Commitments

Interest rate lock commitments are extended to borrowers and relate to the origination of residential real estate mortgage loans held for sale. To mitigate the interest rate risk inherent in these rate locks, as well as closed residential real estate mortgage loans held for sale, forward commitments are established to sell individual residential real estate mortgage loans.  Both interest rate lock commitments and commitments to sell residential real estate mortgage loans are derivative financial instruments.

Leases

As of March 31, 2015 and December 31, 2014, the Corporation was obligated under various non-cancellable operating leases for properties used as banking offices and other office facilities.  Lease expiration dates range from 4 months to 26 years, with renewal options on certain leases of 1 month to 25 years. Rental expense under the operating leases amounted to $790 thousand for the three months endedMarch 31, 2015, compared to $737 thousand for the same period in 2014. Rental expense is recorded as a component of net occupancy expense in the accompanying Consolidated Statements of Income. There have been no significant changes in the future minimum lease payments payable from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

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Time Certificates of Deposit (Schedule of Time Certifcates of Deposit Maturities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Deposits [Abstract]
Time deposits amounts scheduled to mature through the end of the current year	$ 296,731
Time deposits weighted average rate for maturities through the end of the current year	0.67%
Time deposits amounts scheduled to mature in year two	177,667
Time deposits weighted average rate for maturities in year two	1.02%
Time deposits amounts scheduled to mature in year three	152,730
Time deposits weighted average rate for maturities in year three	1.11%
Time deposits amounts scheduled to mature in year four	77,579
Time deposits weighted average rate for maturities in year four	1.35%
Time deposits amounts scheduled to mature in year five	122,693
Time deposits weighted average rate for maturities in year five	1.76%
Time deposits amounts schedule to mature after year five	25,221
Time deposits weighted average rate for maturities after year five	1.52%
Time deposits	$ 852,621	$ 874,102
Time deposits weighted average rate	1.07%

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities:
Net income	$ 11,010	$ 9,298
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses	0	300
Depreciation of premises and equipment	882	783
Net amortization of premium and discount	358	219
Net amortization of intangibles	155	164
Share-based compensation	580	491
Income from bank-owned life insurance	(490)	(445)
Net gain on sale of business line	0	(6,265)
Net gains on loan sales and commissions on loans originated for others	(2,585)	(1,239)
Net losses (gains) on interest rate swap contracts	(645)	(260)
Equity in earnings (losses) of unconsolidated subsidiaries	86	43
Proceeds from sales of loans	117,571	48,296
Loans originated for sale	(116,502)	(46,159)
Decrease (increase) in other assets	814	(81)
Decrease in other liabilities	(1,936)	(3,723)
Net cash provided by operating activities	9,298	1,422
Cash flows from investing activities:
Proceeds from sale of other investment securities available for sale	0	547
Maturities and principal payments of mortgage-backed securities available for sale	12,533	11,313
Maturities and principal payments of other investment securities available for sale	4,986	20,844
Maturities and principal payments of mortgage-backed securities held to maturity	1,137	960
Net proceeds from sale of business line	0	7,205
Net increase in loans	(20,620)	(13,584)
Purchases of loans, including purchased interest	(856)	(2,934)
Proceeds from the sale of property acquired through foreclosure or repossession	0	659
Purchases of premises and equipment	(1,226)	(1,291)
Net cash (used in) provided by investing activities	(4,046)	23,719
Cash flows from financing activities:
Net increase (decrease) in deposits	28,325	86,333
Net increase (decrease) in other borrowings	(12)	(11)
Proceeds from Federal Home Loan Bank advances	120,000	54,000
Repayment of Federal Home Loan Bank advances	(140,305)	(138,653)
Proceeds from the exercise of stock options and issuance of other compensation-related equity instruments	698	496
Tax benefit from stock option exercises and issuance of other compensation-related equity instruments	106	45
Cash dividends paid	(5,381)	(4,511)
Net cash provided by (used in) financing activities	3,431	(2,301)
Net increase in cash and cash equivalents	8,683	22,840
Cash and cash equivalents at beginning of period	80,350	85,317
Cash and cash equivalents at end of period	89,033	108,157
Noncash Investing and Financing Activities:
Loans charged off	321	1,223
Loans transferred to property acquired through foreclosure or repossession	230	421
Supplemental Disclosures:
Interest payments	5,459	5,175
Income tax payments	$ 310	$ 265

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CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Statement of Financial Position [Abstract]
Mortgage loans held for sale	$ 36,672	$ 30,321
Securities held to maturity, fair value	$ 24,834	$ 26,008
Common stock, par value	$ 0.0625	$ 0.0625
Common stock, shares authorized	30,000,000	30,000,000
Common stock, shares issued	16,772,956	16,746,363
Common stock, shares outstanding	16,772,956	16,746,363

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Derivative Financial Instruments

3 Months Ended

Mar. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

The Corporation’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Corporation’s known or expected cash receipts and its known or expected cash payments principally to manage the Corporation’s interest rate risk. Additionally, the Corporation enters into interest rate derivatives to accommodate the business requirements of its customers. All derivatives are recognized as either assets or liabilities on the balance sheet and are measured at fair value.  The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and resulting designation.

Interest Rate Risk Management Agreements

Interest rate swaps are used from time to time as part of the Corporation’s interest rate risk management strategy.  Swaps are agreements in which the Corporation and another party agree to exchange interest payments (e.g., fixed-rate for variable-rate payments) computed on a notional principal amount.  The credit risk associated with swap transactions is the risk of default by the counterparty.  To minimize this risk, the Corporation enters into interest rate agreements only with highly rated counterparties that management believes to be creditworthy.  The notional amounts of these agreements do not represent amounts exchanged by the parties and, thus, are not a measure of the potential loss exposure.

Cash Flow Hedging Instruments

As of March 31, 2015 and December 31, 2014, the Bancorp had two interest rate swap contracts designated as cash flow hedges to hedge the interest rate associated with $22.7 million of variable rate junior subordinated debentures. The effective portion of the changes in fair value of derivatives designated as cash flow hedges is recorded in other comprehensive income and subsequently reclassified to earnings when gains or losses are realized.  The ineffective portion of changes in fair value of the derivatives is recognized directly in earnings as interest expense.  As of March 31, 2015 and December 31, 2014, the Bancorp has pledged collateral to derivative counterparties in the form of cash totaling $800 thousand and $939 thousand, respectively.  The Bancorp may need to post additional collateral in the future in proportion to potential increases in unrealized loss positions.

Customer Related Derivative Contracts

The Corporation has entered into interest rate swap contracts to help commercial loan borrowers manage their interest rate risk.  The interest rate swap contracts with commercial loan borrowers allow them to convert floating-rate loan payments to fixed-rate loan payments.  When we enter into an interest rate swap contract with a commercial loan borrower, we simultaneously enter into a “mirror” swap contract with a third party.  The third party exchanges the client’s fixed‑rate loan payments for floating-rate loan payments.  We retain the risk that is associated with the potential failure of counterparties and the risk inherent in originating loans.  As of March 31, 2015 and December 31, 2014, Washington Trust had interest rate swap contracts with commercial loan borrowers with notional amounts of $209.4 million and $165.8 million, respectively, and equal amounts of “mirror” swap contracts with third-party financial institutions.  These derivatives are not designated as hedges and therefore, changes in fair value are recognized in earnings.

Risk Participation Agreements

In 2015, the Corporation entered into a risk participation agreement (“RPA”) with another bank participating in a commercial loan arrangement. The participating bank guarantees the performance on a borrower-related interest rate swap contract. The RPA represents a purchased guarantee that is recorded as an asset and under the RPA the Corporation participates out the risk associated with the interest rate swap position executed with the commercial borrower, for a net fee paid to the participating bank, classified in net gains on interest rate swap contracts. The RPA derivative asset is recorded at fair value and changes in the fair value of the derivative asset are recognized in earnings in the period of change. As of March 31, 2015, the notional amount of the RPA was $12.5 million.

Loan Commitments

Interest rate lock commitments are extended to borrowers and relate to the origination of residential real estate mortgage loans held for sale.  To mitigate the interest rate risk inherent in these rate locks, as well as closed residential real estate mortgage loans held for sale, forward commitments are established to sell individual residential real estate mortgage loans.  Both interest rate lock commitments and commitments to sell residential real estate mortgage loans are derivative financial instruments, but do not meet criteria for hedge accounting and, as such are treated as derivatives not designated as hedging instruments. These derivative financial instruments are recorded at fair value and changes in fair value of these commitments are reflected in earnings in the period of change. The Corporation has elected to carry certain closed residential real estate mortgage loans held for sale at fair value, as changes in fair value in these loans held for sale generally offset changes in interest rate lock and forward sale commitments.

The following table presents the fair values of derivative instruments in the Corporation’s Consolidated Balance Sheets:

(Dollars in thousands)	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	Mar 31, 2015		Dec 31, 2014		Balance Sheet Location	Mar 31, 2015		Dec 31, 2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts	Other assets		$—		$—	Other liabilities		$367		$497
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Other assets	1,769		1,212		Other liabilities	5		20
Commitments to sell mortgage loans	Other assets	14		13		Other liabilities	2,970		2,028
Customer related derivative contracts:
Interest rate swaps with customers	Other assets	7,415		4,554		Other liabilities	—		23
Mirror swaps with counterparties	Other assets	—		28		Other liabilities	7,699		4,748
Risk participation agreement	Other assets	47		—		Other liabilities	—		—
Total			$9,245		$5,807			$11,041		$7,316

The following tables present the effect of derivative instruments in the Corporation’s Consolidated Statements of Income and Changes in Shareholders’ Equity:

(Dollars in thousands)	Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion)				Location of Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Gain (Loss) Recognized in Income (Ineffective Portion)
Three months ended March 31,	2015		2014			2015		2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts		$85		$76	Interest Expense		$—		$—
Total		$85		$76			$—		$—

(Dollars in thousands)		Amount of Gain (Loss) Recognized in Income on Derivative
Three months ended March 31,	Statement of Income Location	2015			2014
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Net gains on loan sales & commissions on loans originated for others		$572			$277
Commitments to sell mortgage loans	Net gains on loan sales & commissions on loans originated for others	(941		)	(313		)
Customer related derivative contracts:
Interest rate swaps with customers	Net gains on interest rate swap contracts	3,633			1,030
Mirror swaps with counterparties	Net gains on interest rate swap contracts	(2,836		)	(770		)
Risk participation agreement	Net gains on interest rate swap contracts	(152		)	—
Total			$276			$224

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Sale of Business Line (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Sale of Business Line [Abstract]
Gain on sale of business line		$ 6,300,000
Gain on Sale of Business Line, After-Tax		4,000,000
Gain on Sale of Business Line, Earnings Per Share		$ 0.24
Divestiture Related Costs		355,000
Divestiture Related Costs, After Tax		227,000
Earnings Per Share, Divestiture Costs		$ 0.01
Net proceeds from sale of business line	0	7,205,000
Increase Decrease In Deferred Revenue From Sale Of Business Line		900,000
Deferred Merchant Referral Revenue remaining	$ 720,000

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DOCUMENT AND ENTITY INFORMATION	3 Months Ended
	Mar. 31, 2015	Apr. 30, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	Washington Trust Bancorp Inc
Entity Central Index Key	0000737468
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Document Type	10-Q
Document Period End Date	Mar. 31, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		16,811,770

XML

Fair Value Measurements

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

The Corporation uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures.  As of March 31, 2015 and December 31, 2014, securities available for sale, certain residential real estate mortgage loans held for sale and derivatives are recorded at fair value on a recurring basis.  Additionally, from time to time, we may be required to record at fair value other assets on a nonrecurring basis, such as collateral dependent impaired loans, property acquired through foreclosure or repossession, certain residential real estate mortgage loans held for sale and mortgage servicing rights.  These nonrecurring fair value adjustments typically involve the application of lower of cost or market accounting or write-downs of individual assets.

Fair value is a market-based measurement, not an entity-specific measurement.  Fair value measurements are determined based on the assumptions the market participants would use in pricing the asset or liability.  In addition, GAAP specifies a hierarchy of valuation techniques based on whether the types of valuation information (“inputs”) are observable or unobservable.  Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Corporation’s market assumptions.  These two types of inputs have created the following fair value hierarchy:

• Level 1 – Quoted prices for identical assets or liabilities in active markets.

• Level 2 – Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

• Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable in the markets and which reflect the Corporation’s market assumptions.

Fair Value Option Election

GAAP allows for the irrevocable option to elect fair value accounting for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis. The Corporation elected the fair value option for certain residential real estate mortgage loans held for sale to better match changes in fair value of the loans with changes in the fair value of the derivative loan sale contracts used to economically hedge them.

The aggregate principal amount of the residential real estate mortgage loans held for sale recorded at fair value was $35.6 million and $29.5 million, respectively, at March 31, 2015 and December 31, 2014. The aggregate fair value of these loans as of the same dates was $36.7 million and $30.3 million, respectively. As of March 31, 2015 and December 31, 2014, the aggregate fair value of residential real estate mortgage loans held for sale exceeded the aggregate principal amount by $1.1 million and $779 thousand, respectively.

There were no residential real estate mortgage loans held for sale 90 days or more past due as of March 31, 2015 and December 31, 2014.

The following table presents the changes in fair value related to mortgage loans held for sale, interest rate lock commitments and commitments to sell residential real estate mortgage loans, for which the fair value option was elected. Changes in fair values are reported as a component of net gains on loan sales and commissions on loans originated for others in the Consolidated Statements of Income.

(Dollars in thousands)
Three months ended March 31,	2015			2014
Mortgage loans held for sale		$341			$76
Interest rate lock commitments	572			277
Commitments to sell mortgage loans	(941		)	(313		)
Total changes in fair value		($28	)		$40

Items Measured at Fair Value on a Recurring Basis

Securities

Securities available for sale are recorded at fair value on a recurring basis.  When available, the Corporation uses quoted market prices to determine the fair value of securities; such items are classified as Level 1. There were no Level 1 securities held at March 31, 2015 and December 31, 2014.

Level 2 securities include debt securities with quoted prices, which are traded less frequently than exchange-traded instruments, whose value is determined using matrix pricing with inputs that are observable in the market or can be derived principally from or corroborated by observable market data.  This category generally includes obligations of U.S. government-sponsored enterprises, mortgage‑backed securities issued by U.S. government agencies and U.S. government‑sponsored enterprises, obligations of states and political subdivisions, trust preferred debt securities and corporate bonds.

Securities not actively traded whose fair value is determined through the use of cash flows utilizing inputs that are unobservable are classified as Level 3. There were no Level 3 securities held at March 31, 2015 and December 31, 2014.

Mortgage Loans Held for Sale

The fair values of mortgage loans held for sale are generally estimated based on secondary market rates offered for loans with similar characteristics. When secondary market information exists, these loans are classified as Level 2. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. Any changes in the valuation of mortgage loans held for sale is based upon the change in market interest rates between the loan closing date and the measurement date and an immaterial portion attributable to changes in instrument-specific credit risk. There were no Level 3 mortgage loans held for sale at March 31, 2015 and December 31, 2014.

Derivatives

Interest rate swap contracts are traded in over-the-counter markets where quoted market prices are not readily available.  Fair value measurements are determined using independent pricing models that utilize primarily market observable inputs, such as swap rates of different maturities and LIBOR rates and, accordingly, are classified as Level 2. For purposes of potential valuation adjustments to its interest rate swap contracts and risk participation agreements, the Corporation evaluates the credit risk of its counterparties as well as that of the Corporation.  Accordingly, Washington Trust considers factors such as the likelihood of default by the Corporation and its counterparties, its net exposures and remaining contractual life, among other factors, in determining if any fair value adjustments related to credit risk are required.  Counterparty exposure is evaluated by netting positions that are subject to master netting agreements, as well as considering the amount of collateral securing the position.

Level 2 fair value measurements of forward loan commitments (interest rate lock commitments and commitments to sell residential real estate mortgages) are estimated using the anticipated market price based on pricing indications provided by other financial institutions. In certain cases when quoted market prices are not available, fair value is determined by utilizing a discounted cash flow analysis and these assets are classified as Level 3. There were no Level 3 forward loan commitments held at March 31, 2015 and December 31, 2014.

Items Measured at Fair Value on a Nonrecurring Basis

Collateral Dependent Impaired Loans

Collateral dependent loans that are deemed to be impaired are valued based upon the fair value of the underlying collateral. Such collateral primarily consists of real estate and, to a lesser extent, other business assets. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values resulting from its knowledge of the property. Internal valuations are utilized to determine the fair value of other business assets. Collateral dependent impaired loans are categorized as Level 3.

Property Acquired Through Foreclosure or Repossession

Property acquired through foreclosure or repossession included in other assets in the Consolidated Balance Sheets is adjusted to fair value less costs to sell upon transfer out of loans through a charge to allowance for loan losses. Subsequently, it is carried at the lower of carrying value or fair value less costs to sell. Such subsequent valuation charges are charged through earnings. Fair value is generally based upon appraised values of the collateral. Management may adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of the property, and such property is categorized as Level 3.

Items Recorded at Fair Value on a Recurring Basis

The following tables present the balances of assets and liabilities reported at fair value on a recurring basis:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
March 31, 2015
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,301		$—		$31,301		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	233,045		—		233,045		—
Obligations of states and political subdivisions	44,179		—		44,179		—
Individual name issuer trust preferred debt securities	26,287		—		26,287		—
Corporate bonds	6,130		—		6,130		—
Mortgage loans held for sale	36,672		—		36,672		—
Derivative assets (1)	9,245		—		9,245		—
Total assets at fair value on a recurring basis		$386,859		$—		$386,859		$—
Liabilities:
Derivative liabilities (2)		$11,041		$—		$11,041		$—
Total liabilities at fair value on a recurring basis		$11,041		$—		$11,041		$—

(1) Derivative assets include interest rate swaps contracts with customers, a risk participation agreement and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheets.

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2014
Assets:
Securities available for sale:
Obligations of U.S. government-sponsored enterprises		$31,172		$—		$31,172		$—
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	245,366		—		245,366		—
Obligations of states and political subdivisions	49,176		—		49,176		—
Individual name issuer trust preferred debt securities	25,774		—		25,774		—
Corporate bonds	6,174		—		6,174		—
Mortgage loans held for sale	30,321		—		30,321		—
Derivative assets (1)	5,807		—		5,807		—
Total assets at fair value on a recurring basis		$393,790		$—		$393,790		$—
Liabilities:
Derivative liabilities (2)		$7,316		$—		$7,316		$—
Total liabilities at fair value on a recurring basis		$7,316		$—		$7,316		$—

(1) Derivative assets include interest rate swaps contracts with customers and forward loan commitments and are included in other assets in the Consolidated Balance Sheets.

(2) Derivative liabilities include mirror swaps with counterparties, interest rate risk management contracts and forward loan commitments and are included in other liabilities in the Consolidated Balance Sheets.

It is the Corporation’s policy to review and reflect transfers between Levels as of the financial statement reporting date.  During the three months endedMarch 31, 2015 and 2014, there were no transfers in and/or out of Level 1, 2 or 3.

Items Recorded at Fair Value on a Nonrecurring Basis

Certain assets are measured at fair value on a nonrecurring basis in accordance with GAAP.  These adjustments to fair value usually result from the application of lower of cost or market accounting or write-downs of individual assets.  The valuation methodologies used to measure these fair value adjustments are described above.

The following table summarizes the carrying value of such assets held at March 31, 2015, which were written down to fair value during the three months endedMarch 31, 2015:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$3,962		$—		$—		$3,962
Property acquired through foreclosure or repossession	318		—		—		318
Total assets at fair value on a nonrecurring basis		$4,280		$—		$—		$4,280

The allowance for loan losses on collateral dependent impaired loans amounted to $1.2 million at March 31, 2015.

The following table summarizes the carrying value of such assets held at December 31, 2014, which were written down to fair value during the year ended December 31, 2014:

(Dollars in thousands)	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Collateral dependent impaired loans		$5,728		$—		$—		$5,728
Property acquired through foreclosure or repossession	348		—		—		348
Total assets at fair value on a nonrecurring basis		$6,076		$—		$—		$6,076

The allowance for loan losses on collateral dependent impaired loans amounted to $1.3 million at December 31, 2014.

The following tables present valuation techniques and unobservable inputs for assets measured at fair value on a nonrecurring basis for which the Corporation has utilized Level 3 inputs to determine fair value:

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
March 31, 2015
Collateral dependent impaired loans		$3,962	Appraisals of collateral	Discount for costs to sell	0% - 25% (10%)
				Appraisal adjustments (1)	0% - 15% (1%)
Property acquired through foreclosure or repossession		$318	Appraisals of collateral	Discount for costs to sell	0% - 10% (6%)
				Appraisal adjustments (1)	7% - 13% (10%)

(Dollars in thousands)	Fair Value		Valuation Technique	Unobservable Input	Range of Inputs Utilized (Weighted Average)
December 31, 2014
Collateral dependent impaired loans		$5,728	Appraisals of collateral	Discount for costs to sell	0% - 10% (2%)
				Appraisal adjustments (1)	0% - 40% (3%)
Property acquired through foreclosure or repossession		$348	Appraisals of collateral	Discount for costs to sell	6% - 10% (8%)
				Appraisal adjustments (1)	5% - 23% (14%)

(1) Management may adjust appraisal values to reflect market value declines or other discounts resulting from its knowledge of the property.

Valuation of Other Financial Instruments

The methodologies for estimating the fair value of financial instruments that are measured at fair value on a recurring or nonrecurring basis are discussed above. The methodologies for other financial instruments are discussed below.

Loans

Fair values are estimated for categories of loans with similar financial characteristics. Loans are segregated by type and are then further segmented into fixed-rate and adjustable-rate interest terms to determine their fair value. The fair value of fixed-rate commercial and consumer loans is calculated by discounting scheduled cash flows through the estimated maturity of the loan using interest rates offered at the measurement date that reflect the credit and interest rate risk inherent in the loan. The estimate of maturity is based on the Corporation’s historical repayment experience. For residential mortgages, fair value is estimated by using market prices for sales of similar loans on the secondary market. The fair value of floating rate commercial and consumer loans approximates carrying value. Fair value for impaired loans is estimated using a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or if the loan is collateral dependent, at the fair value of the collateral. Loans are classified within Level 3 of the fair value hierarchy.

Time Deposits

The discounted values of cash flows using the rates currently offered for deposits of similar remaining maturities were used to estimate the fair value of time deposits. Time deposits are classified within Level 2 of the fair value hierarchy.

Federal Home Loan Bank Advances

Rates currently available to the Corporation for advances with similar terms and remaining maturities are used to estimate fair value of existing advances. FHLBB advances are categorized as Level 2.

Junior Subordinated Debentures

The fair value of the junior subordinated debentures is estimated using rates currently available to the Corporation for debentures with similar terms and maturities. Junior subordinated debentures are categorized as Level 2.

The following tables present the carrying amount, estimated fair value and placement in the fair value hierarchy of the Corporation’s financial instruments. The tables exclude financial instruments for which the carrying value approximates fair value. Financial assets for which the fair value approximates carrying value include cash and cash equivalents, FHLBB stock, accrued interest receivable and bank-owned life insurance. Financial liabilities for which the fair value approximates carrying value include non-maturity deposits and accrued interest payable.

(Dollars in thousands)
March 31, 2015	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$24,025		$24,834		$—		$24,834		$—
Loans, net of allowance for loan losses	2,852,782		2,898,369		—		—		2,898,369
Financial Liabilities:
Time deposits		$852,621		$854,780		$—		$854,780		$—
FHLBB advances	385,992		400,770		—		400,770		—
Junior subordinated debentures	22,681		16,974		—		16,974		—

(Dollars in thousands)
December 31, 2014	Carrying Amount		Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Financial Assets:
Securities held to maturity		$25,222		$26,008		$—		$26,008		$—
Loans, net of allowance for loan losses	2,831,253		2,866,907		—		—		2,866,907
Financial Liabilities:
Time deposits		$874,102		$872,570		$—		$872,570		$—
FHLBB advances	406,297		418,005		—		418,005		—
Junior subordinated debentures	22,681		17,201		—		17,201		—

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Fair Value Measurements (Asset and Liabilities Measured on a Nonrecurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Loans	$ 17,901	[1]	$ 19,096	[1]
Nonrecurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Loans	3,962		5,728
Property acquired through foreclosure or repossession	318		348
Total assets at fair value on a nonrecurring basis	4,280		6,076
Nonrecurring [Member] | Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Loans	0		0
Property acquired through foreclosure or repossession	0		0
Total assets at fair value on a nonrecurring basis	0		0
Nonrecurring [Member] | Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Loans	0		0
Property acquired through foreclosure or repossession	0		0
Total assets at fair value on a nonrecurring basis	0		0
Nonrecurring [Member] | Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Loans	3,962		5,728
Property acquired through foreclosure or repossession	318		348
Total assets at fair value on a nonrecurring basis	$ 4,280		$ 6,076

[1] The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

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Commitments and Contingencies (Financial Instruments with Off Balance Sheet Risk) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Interest Rate Commitments [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	$ 60,546	$ 40,015
Commitments to sell mortgage loans [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	106,457	84,808
Interest rate swaps with customers [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,416	165,795
Mirror swaps with counterparties [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	209,416	165,795
Interest Rate Swaps [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Notional Amount	22,681	22,681
Commitments to extend credit on commerical loans [Member] | Commitments to Extend Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Contract amount	303,443	325,402
Commitments to extend credit on home equity lines [Member] | Commitments to Extend Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Contract amount	206,515	200,932
Commitments to extend credit on other loans [Member] | Commitments to Extend Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Contract amount	47,998	48,551
Commitments to extend credit on standby letters of credit [Member] | Commitments to Extend Credit [Member]
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items]
Contract amount	$ 5,248	$ 5,102

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CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Interest income:
Interest and fees on loans	$ 28,353	$ 25,589
Interest on securities: Taxable	2,259	2,942
Interest on securities: Nontaxable	435	582
Dividends on Federal Home Loan Bank stock	165	142
Other interest income	25	35
Total interest and dividend income	31,237	29,290
Interest expense:
Deposits	3,389	2,969
Federal Home Loan Bank advances	1,902	2,241
Junior subordinated debentures	241	241
Other interest expense	3	3
Total interest expense	5,535	5,454
Net interest income	25,702	23,836
Provision for loan losses	0	300
Net interest income after provision for loan losses	25,702	23,536
Noninterest income:
Wealth management revenues	8,435	8,065
Merchant processing fees	0	1,291
Net gains on loan sales and commissions on loans originated for others	2,585	1,239
Service charges on deposit accounts	935	754
Card interchange fees	714	681
Income from bank-owned life insurance	490	445
Net gains on interest rate swap contracts	645	260
Equity in earnings (losses) of unconsolidated subsidiaries	(86)	(43)
Net gain on sale of business line	0	6,265
Other income	302	413
Total noninterest income	14,020	19,370
Noninterest expense:
Salaries and employee benefits	15,494	14,558
Net occupancy	1,886	1,640
Equipment	1,340	1,236
Merchant processing costs	0	1,050
Outsourced services	1,247	1,044
Legal, audit and professional fees	676	618
FDIC deposit insurance costs	473	440
Advertising and promotion	267	232
Amortization of intangibles	155	164
Debt prepayment penalties	0	6,294
Other expenses	1,993	2,016
Total noninterest expense	23,531	29,292
Income before income taxes	16,191	13,614
Income tax expense	5,181	4,316
Net income	$ 11,010	$ 9,298
Weighted average common shares outstanding - basic	16,759	16,626
Weighted average common shares outstanding - diluted	16,939	16,800
Per share information:
Basic earnings per common share	$ 0.65	$ 0.56
Diluted earnings per common share	$ 0.65	$ 0.55
Cash dividends declared per share	$ 0.34	$ 0.29

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Loans

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Loans

Loans

The following is a summary of loans:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Amount		%		Amount		%
Commercial:
Mortgages (1)		$865,042	30	%		$843,978	30	%
Construction & development (2)	89,851		3		79,592		3
Commercial & industrial (3)	604,630		21		611,918		21
Total commercial	1,559,523		54		1,535,488		54
Residential real estate:
Mortgages	954,905		33		948,731		33
Homeowner construction	32,659		1		36,684		1
Total residential real estate	987,564		34		985,415		34
Consumer:
Home equity lines	239,537		8		242,480		8
Home equity loans	46,727		2		46,967		2
Other (4)	47,241		2		48,926		2
Total consumer	333,505		12		338,373		12
Total loans (5)		$2,880,592	100	%		$2,859,276	100	%

(1) Loans primarily secured by income producing property.

(2) Loans for construction of commercial properties, loans to developers for construction of residential properties and loans for land development.

(3) Loans to businesses and individuals, a substantial portion of which are fully or partially collateralized by real estate.

(4) Consumer installment loans and loans secured by general aviation aircraft and automobiles.

(5) Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

At March 31, 2015 and December 31, 2014, there were $1.24 billion and $1.21 billion, respectively, of loans pledged as collateral to the FHLBB under a blanket pledge agreement and to the FRB for the discount window. See Note 8 for additional disclosure regarding borrowings.

Nonaccrual Loans

Loans, with the exception of certain well-secured loans that are in the process of collection, are placed on nonaccrual status and interest recognition is suspended when such loans are 90 days or more overdue with respect to principal and/or interest, or sooner if considered appropriate by management. Well-secured loans are permitted to remain on accrual status provided that full collection of principal and interest is assured and the loan is in the process of collection. Loans are also placed on nonaccrual status when, in the opinion of management, full collection of principal and interest is doubtful. Interest previously accrued but not collected on such loans is reversed against current period income. Subsequent interest payments received on nonaccrual loans are applied to the outstanding principal balance of the loan or recognized as interest income depending on management’s assessment of the ultimate collectibility of the loan. Loans are removed from nonaccrual status when they have been current as to principal and interest for a period of time, the borrower has demonstrated an ability to comply with repayment terms, and when, in management’s opinion, the loans are considered to be fully collectible.

The following is a summary of nonaccrual loans, segregated by class of loans:

(Dollars in thousands)	Mar 31, 2015		Dec 31, 2014
Commercial:
Mortgages		$5,115		$5,315
Construction & development	—		—
Commercial & industrial	2,193		1,969
Residential real estate:
Mortgages	6,956		7,124
Homeowner construction	—		—
Consumer:
Home equity lines	1,051		1,217
Home equity loans	511		317
Other	39		3
Total nonaccrual loans		$15,865		$15,945
Accruing loans 90 days or more past due		$—		$—

As of March 31, 2015 and December 31, 2014, nonaccrual loans of $3.6 million and $3.2 million, respectively, were current as to the payment of principal and interest.

At March 31, 2015, there were no significant commitments to lend additional funds to borrowers whose loans were on nonaccrual status.

Past Due Loans

Past due status is based on the contractual payment terms of the loan. The following tables present an age analysis of past due loans, segregated by class of loans:

(Dollars in thousands)	Days Past Due
March 31, 2015	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$497		$61		$5,115		$5,673		$859,369		$865,042
Construction & development	—		—		—		—		89,851		89,851
Commercial & industrial	229		229		721		1,179		603,451		604,630
Residential real estate:
Mortgages	4,470		1,352		3,607		9,429		945,476		954,905
Homeowner construction	—		—		—		—		32,659		32,659
Consumer:
Home equity lines	1,244		429		463		2,136		237,401		239,537
Home equity loans	213		111		255		579		46,148		46,727
Other	55		25		5		85		47,156		47,241
Total loans		$6,708		$2,207		$10,166		$19,081		$2,861,511		$2,880,592

(Dollars in thousands)	Days Past Due
December 31, 2014	30-59		60-89		Over 90		Total Past Due		Current		Total Loans
Commercial:
Mortgages		$—		$—		$5,315		$5,315		$838,663		$843,978
Construction & development	—		—		—		—		79,592		79,592
Commercial & industrial	2,136		1,202		181		3,519		608,399		611,918
Residential real estate:
Mortgages	2,943		821		3,284		7,048		941,683		948,731
Homeowner construction	—		—		—		—		36,684		36,684
Consumer:
Home equity lines	570		100		841		1,511		240,969		242,480
Home equity loans	349		240		56		645		46,322		46,967
Other	35		5		—		40		48,886		48,926
Total loans		$6,033		$2,368		$9,677		$18,078		$2,841,198		$2,859,276

Included in past due loans as of March 31, 2015 and December 31, 2014, were nonaccrual loans of $12.3 million and $12.7 million, respectively. All loans 90 days or more past due at March 31, 2015 and December 31, 2014 were classified as nonaccrual.

Impaired Loans

Impaired loans consist of nonaccrual commercial loans, troubled debt restructured loans and other loans classified as impaired that are individually evaluated for impairment. Impaired loans are loans for which it is probable that the Corporation will not be able to collect all amounts due according to the contractual terms of the loan agreements and loans restructured in a troubled debt restructuring. Impaired loans do not include large groups of smaller-balance homogeneous loans that are collectively evaluated for impairment, which consist of most residential mortgage loans and consumer loans.

The following is a summary of impaired loans:

(Dollars in thousands)	Recorded Investment (1)				Unpaid Principal				Related Allowance
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
No Related Allowance Recorded:
Commercial:
Mortgages		$205		$432		$205		$432		$—		$—
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,322		1,047		1,323		1,076		—		—
Residential real estate:
Mortgages	1,618		1,477		1,912		1,768		—		—
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	—		—		—		—		—		—
Home equity loans	—		—		—		—		—		—
Other	—		—		—		—		—		—
Subtotal	3,145		2,956		3,440		3,276		—		—
With Related Allowance Recorded:
Commercial:
Mortgages		$14,384		$14,585		$14,564		$14,564		$1,173		$927
Construction & development	—		—		—		—		—		—
Commercial & industrial	1,754		1,878		2,305		2,437		185		177
Residential real estate:
Mortgages	1,296		2,226		1,423		2,338		222		326
Homeowner construction	—		—		—		—		—		—
Consumer:
Home equity lines	244		250		250		250		76		141
Home equity loans	72		45		116		62		1		12
Other	151		112		151		114		—		—
Subtotal	17,901		19,096		18,809		19,765		1,657		1,583
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583
Total:
Commercial		$17,665		$17,942		$18,397		$18,509		$1,358		$1,104
Residential real estate	2,914		3,703		3,335		4,106		222		326
Consumer	467		407		517		426		77		153
Total impaired loans		$21,046		$22,052		$22,249		$23,041		$1,657		$1,583

(1) The recorded investment in impaired loans consists of unpaid principal balance net of charge-offs, interest payments received applied to principal and unamortized deferred loan origination fees and costs. For impaired accruing loans (troubled debt restructurings for which management has concluded that the collectibility of the loan is not in doubt), the recorded investment also includes accrued interest.

The following table presents the average recorded investment balance of impaired loans and interest income recognized on impaired loans segregated by loan class:

(Dollars in thousands)	Average Recorded Investment				Interest Income Recognized
Three months ended March 31,	2015		2014		2015		2014
Commercial:
Mortgages		$14,942		$28,340		$79		$165
Construction & development	—		—		—		—
Commercial & industrial	3,036		2,366		19		23
Residential real estate:
Mortgages	3,457		3,744		16		14
Homeowner construction	—		—		—		—
Consumer:
Home equity lines	247		134		—		1
Home equity loans	74		95		—		1
Other	146		125		3		2
Totals		$21,902		$34,804		$117		$206

Troubled Debt Restructurings

Loans are considered restructured in a troubled debt restructuring when the Corporation has granted concessions to a borrower due to the borrower’s financial condition that it otherwise would not have considered. These concessions may include modifications of the terms of the debt such as deferral of payments, extension of maturity, reduction of principal balance, reduction of the stated interest rate other than normal market rate adjustments, or a combination of these concessions. Debt may be bifurcated with separate terms for each tranche of the restructured debt. Restructuring a loan in lieu of aggressively enforcing the collection of the loan may benefit the Corporation by increasing the ultimate probability of collection.

Restructured loans are classified as accruing or non-accruing based on management’s assessment of the collectibility of the loan. Loans which are already on nonaccrual status at the time of the restructuring generally remain on nonaccrual status for approximately six months before management considers such loans for return to accruing status. Accruing restructured loans are placed into nonaccrual status if and when the borrower fails to comply with the restructured terms and management deems it unlikely that the borrower will return to a status of compliance in the near term.

Troubled debt restructurings are reported as such for at least one year from the date of the restructuring. In years after the restructuring, troubled debt restructured loans are removed from this classification if the restructuring did not involve a below-market rate concession and the loan is not deemed to be impaired based on the terms specified in the restructuring agreement.

Troubled debt restructurings are classified as impaired loans. The Corporation identifies loss allocations for impaired loans on an individual loan basis. The recorded investment in troubled debt restructurings was $17.7 million and $18.4 million, respectively, at March 31, 2015 and December 31, 2014. These amounts included accrued interest of $30 thousand and $33 thousand, respectively. The allowance for loan losses included specific reserves for these troubled debt restructurings of $1.5 million and $1.2 million, respectively, at March 31, 2015 and December 31, 2014. As of March 31, 2015, there were no significant commitments to lend additional funds to borrowers whose loans had been restructured.

The following table presents loans modified as a troubled debt restructuring:

(Dollars in thousands)			Outstanding Recorded Investment (1)
	# of Loans		Pre-Modifications				Post-Modifications
Three months ended March 31,	2015	2014	2015		2014		2015		2014
Commercial:
Mortgages	—	—		$—		$—		$—		$—
Construction & development	—	—	—		—		—		—
Commercial & industrial	1	—	300		—		300		—
Residential real estate:
Mortgages	1	2	93		479		93		479
Homeowner construction	—	—	—		—		—		—
Consumer:
Home equity lines	—	—	—		—		—		—
Home equity loans	—	—	—		—		—		—
Other	1	—	35		—		35		—
Totals	3	2		$428		$479		$428		$479

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs, at the time of the restructuring. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

The following table provides information on how loans were modified as a troubled debt restructuring:

(Dollars in thousands)
Three months ended March 31,	2015		2014
Below-market interest rate concession		$335		$—
Payment deferral	93		479
Maturity / amortization concession	—		—
Interest only payments	—		—
Combination(1)	—		—
Total		$428		$479

(1) Loans included in this classification were modified with a combination of any two of the concessions listed in this table.

The following table presents loans modified in a troubled debt restructuring within the previous twelve months for which there was a payment default:

(Dollars in thousands)	# of Loans		Recorded Investment (1)
Three months ended March 31,	2015	2014	2015		2014
Commercial:
Mortgages	—	—		$—		$—
Construction & development	—	—	—		—
Commercial & industrial	2	6	11		1,191
Residential real estate:
Mortgages	2	—	338		—
Homeowner construction	—	—	—		—
Consumer:
Home equity lines	—	—	—		—
Home equity loans	—	—	—		—
Other	—	—	—		—
Totals	4	6		$349		$1,191

(1) The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

Credit Quality Indicators

Commercial

The Corporation utilizes an internal rating system to assign a risk to each of its commercial loans. Loans are rated on a scale of 1 to 10. This scale can be assigned to three broad categories including “pass” for ratings 1 through 6, “special mention” for 7-rated loans, and “classified” for loans rated 8, 9 or 10. The loan rating system takes into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral, the adequacy of guarantees and other credit quality characteristics. As of March 31, 2015 and December 31, 2014, the weighted average risk rating of the Corporation’s commercial loan portfolio was 4.68 and 4.67, respectively. For non-impaired loans, the Corporation assigns a loss allocation factor to each loan, based on its risk rating for purposes of establishing an appropriate allowance for loan losses. See Note 6 for additional information.

A description of the commercial loan categories are as follows:

Pass - Loans with acceptable credit quality, defined as ranging from superior or very strong to a status of lesser stature. Superior or very strong credit quality is characterized by a high degree of cash collateralization or strong balance sheet liquidity. Lesser stature loans have an acceptable level of credit quality but exhibit some weakness in various credit metrics such as collateral adequacy, cash flow, secondary sources of repayment, or performance inconsistency or may be in an industry or of a loan type known to have a higher degree of risk.

Special Mention - Loans with potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Bank’s position as creditor at some future date. Special Mention assets are not adversely classified and do not expose the Bank to sufficient risk to warrant adverse classification. Examples of these conditions include but are not limited to outdated or poor quality financial data, strains on liquidity and leverage, losses or negative trends in operating results, marginal cash flow, weaknesses in occupancy rates or trends in the case of commercial real estate and frequent delinquencies.

Classified - Loans identified as “substandard”, “doubtful” or “loss” based on criteria consistent with guidelines provided by banking regulators. A “substandard” loan has defined weaknesses which make payment default or principal exposure likely, but not yet certain. Such loans are apt to be dependent upon collateral liquidation, a secondary source of repayment or an event outside of the normal course of business. The loans are closely watched and are either already on nonaccrual status or may be placed on nonaccrual status when management determines there is uncertainty of collectibility. A “doubtful” loan is placed on non-accrual status and has a high probability of loss, but the extent of the loss is difficult to quantify due to dependency upon collateral having a value that is difficult to determine or upon some near-term event which lacks certainty. A loan in the “loss” category is considered generally uncollectible or the timing or amount of payments cannot be determined. “Loss” is not intended to imply that the loan has no recovery value but rather it is not practical or desirable to continue to carry the asset.

The Corporation’s procedures call for loan ratings and classifications to be revised whenever information becomes available that indicates a change is warranted. The criticized loan portfolio, which consists of commercial loans that are risk rated special mention or worse, are reviewed by management on a quarterly basis, focusing on the current status and strategies to improve the credit. An annual loan review program is conducted by a third party to provide an independent evaluation of the creditworthiness of the commercial loan portfolio, the quality of the underwriting and credit risk management practices and the appropriateness of the risk rating classifications. This review is supplemented with selected targeted internal reviews of the commercial loan portfolio.

The following table presents the commercial loan portfolio, segregated by category of credit quality indicator:

(Dollars in thousands)	Pass				Special Mention				Classified
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Mortgages		$842,516		$819,857		$17,207		$18,372		$5,319		$5,749
Construction & development	89,851		79,592		—		—		—		—
Commercial & industrial	586,370		592,206		15,536		16,311		2,724		3,401
Total commercial loans		$1,518,737		$1,491,655		$32,743		$34,683		$8,043		$9,150

Residential and Consumer

The residential and consumer portfolios are monitored on an ongoing basis by the Corporation using delinquency information and loan type as credit quality indicators. These credit quality indicators are assessed on an aggregate basis in these relatively homogeneous portfolios. For non-impaired loans, the Corporation assigns loss allocation factors to each respective loan type and delinquency status. See Note 6 for additional information.

Various other techniques are utilized to monitor indicators of credit deterioration in the portfolios of residential real estate mortgages and home equity lines and loans. Among these techniques is the periodic tracking of loans with an updated FICO score and an estimated loan to value (“LTV”) ratio. LTV is determined via statistical modeling analyses. The indicated LTV levels are estimated based on such factors as the location, the original LTV, and the date of origination of the loan and do not reflect actual appraisal amounts. The results of these analyses and other loan review procedures are taken into consideration in the determination of loss allocation factors for residential mortgage and home equity consumer credits. See Note 6 for additional information.

The following table presents the residential and consumer loan portfolios, segregated by category of credit quality indicator:

(Dollars in thousands)	Current and Under 90 Days Past Due				Over 90 Days Past Due
	Mar 31, 2015		Dec 31, 2014		Mar 31, 2015		Dec 31, 2014
Residential real estate:
Accruing mortgages		$947,949		$941,607		$—		$—
Nonaccrual mortgages	3,349		3,840		3,607		3,284
Homeowner construction	32,659		36,684		—		—
Total residential loans		$983,957		$982,131		$3,607		$3,284
Consumer:
Home equity lines		$239,074		$241,639		$463		$841
Home equity loans	46,472		46,911		255		56
Other	47,236		48,926		5		—
Total consumer loans		$332,782		$337,476		$723		$897

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Securities

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Securities

Securities

The following tables present the amortized cost, gross unrealized holding gains, gross unrealized holding losses and fair value of securities by major security type and class of security:

(Dollars in thousands)
March 31, 2015	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,203		$98		$—			$31,301
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	222,547		10,498		—			233,045
Obligations of states and political subdivisions	42,664		1,515		—			44,179
Individual name issuer trust preferred debt securities	30,762		—		(4,475		)	26,287
Corporate bonds	6,119		36		(25		)	6,130
Total securities available for sale		$333,295		$12,147		($4,500	)		$340,942
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$24,025		$809		$—			$24,834
Total securities held to maturity		$24,025		$809		$—			$24,834
Total securities		$357,320		$12,956		($4,500	)		$365,776

(Dollars in thousands)
December 31, 2014	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises		$31,205		$21		($54	)		$31,172
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises	235,343		10,023		—			245,366
Obligations of states and political subdivisions	47,647		1,529		—			49,176
Individual name issuer trust preferred debt securities	30,753		—		(4,979		)	25,774
Corporate bonds	6,120		57		(3		)	6,174
Total securities available for sale		$351,068		$11,630		($5,036	)		$357,662
Held to Maturity:
Mortgage-backed securities issued by U.S. government agencies and U.S. government-sponsored enterprises		$25,222		$786		$—			$26,008
Total securities held to maturity		$25,222		$786		$—			$26,008
Total securities		$376,290		$12,416		($5,036	)		$383,670

At March 31, 2015 and December 31, 2014, securities available for sale and held to maturity with a fair value of $347.6 million and $350.5 million, respectively, were pledged as collateral for Federal Home Loan Bank of Boston (“FHLBB”) borrowings and letters of credit, potential borrowings with the FRB, certain public deposits and for other purposes. See Note 8 for additional discussion of FHLBB borrowings.

The schedule of maturities of debt securities available for sale and held to maturity is presented below. Mortgage-backed securities are included based on weighted average maturities, adjusted for anticipated prepayments.  All other debt securities are included based on contractual maturities.  Actual maturities may differ from amounts presented because certain issuers have the right to call or prepay obligations with or without call or prepayment penalties.  Yields on tax exempt obligations are not computed on a tax equivalent basis.

(Dollars in thousands)
March 31, 2015	Within 1 Year			1-5 Years			5-10 Years			After 10 Years			Totals
Securities Available for Sale:
Obligations of U.S. government-sponsored enterprises:
Amortized cost		$—			$31,003			$200			$—			$31,203
Weighted average yield	—		%	1.72		%	2.32		%	—		%	1.73		%
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost	37,723			100,409			57,461			26,954			222,547
Weighted average yield	3.71			3.30			2.81			1.76			3.06
Obligations of state and political subdivisions:
Amortized cost	3,601			24,267			14,796			—			42,664
Weighted average yield	3.78			3.94			3.99			—			3.95
Individual name issuer trust preferred debt securities:
Amortized cost	—			—			—			30,762			30,762
Weighted average yield	—			—			—			1.11			1.11
Corporate bonds:
Amortized cost	5,713			203			203			—			6,119
Weighted average yield	2.84			1.62			3.21			—			2.81
Total debt securities available for sale:
Amortized cost		$47,037			$155,882			$72,660			$57,716			$333,295
Weighted average yield	3.61		%	3.09		%	3.05		%	1.42		%	2.86		%
Fair value		$48,955			$161,578			$75,897			$54,512			$340,942
Securities Held to Maturity:
Mortgage-backed securities issued by U.S. government-sponsored enterprises:
Amortized cost		$3,007			$9,323			$7,364			$4,331			$24,025
Weighted average yield	3.11		%	3.03		%	2.78		%	0.89		%	2.58		%
Fair value		$3,108			$9,637			$7,612			$4,477			$24,834

Included in the above table are debt securities with an amortized cost balance of $98.1 million and a fair value of $95.0 million at March 31, 2015 that are callable at the discretion of the issuers.  Final maturities of the callable securities range from 6 months to 22 years, with call features ranging from 1 month to 2 years.

Other-Than-Temporary Impairment Assessment

The Corporation assesses whether the decline in fair value of investment securities is other-than-temporary on a regular basis. Unrealized losses on debt securities may occur from current market conditions, increases in interest rates since the time of purchase, a structural change in an investment, volatility of earnings of a specific issuer, or deterioration in credit quality of the issuer.  Management evaluates impairments in value both qualitatively and quantitatively to assess whether they are other‑than‑temporary.

The following tables summarize temporarily impaired securities, segregated by length of time the securities have been in a continuous unrealized loss position:

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
March 31, 2015	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Individual name issuer trust preferred debt securities	—		$—		$—		11		$26,287		($4,475	)	11		$26,287		($4,475	)
Corporate bonds	1	1,975		(25		)	—	—		—			1	1,975		(25		)
Total temporarily impaired securities	1		$1,975		($25	)	11		$26,287		($4,475	)	12		$28,262		($4,500	)

(Dollars in thousands)	Less than 12 Months						12 Months or Longer						Total
December 31, 2014	#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses			#	Fair Value		Unrealized Losses
Obligations of U.S. government-sponsored enterprises	3		$20,952		($54	)	—		$—		$—		3		$20,952		($54	)
Individual name issuer trust preferred debt securities	—	—		—			11	25,774		(4,979		)	11	25,774		(4,979		)
Corporate bonds	—	—		—			1	199		(3		)	1	199		(3		)
Total temporarily impaired securities	3		$20,952		($54	)	12		$25,973		($4,982	)	15		$46,925		($5,036	)

Further deterioration in credit quality of the underlying issuers of the securities, further deterioration in the condition of the financial services industry, a continuation or worsening of the current economic environment, or additional declines in real estate values, among other things, may further affect the fair value of these securities and increase the potential that certain unrealized losses be designated as other-than-temporary in future periods, and the Corporation may incur additional write-downs.

Trust Preferred Debt Securities of Individual Name Issuers

Included in debt securities in an unrealized loss position at March 31, 2015 were 11 trust preferred security holdings issued by 7 individual companies in the banking sector.  Management believes the unrealized loss position in these holdings is attributable to the general widening of spreads for this category of debt securities issued by financial services companies since the time these securities were purchased.  Based on the information available through the filing date of this report, all individual name issuer trust preferred debt securities held in our portfolio continue to accrue and make payments as expected with no payment deferrals or defaults on the part of the issuers.  As of March 31, 2015, individual name issuer trust preferred debt securities with an amortized cost of $11.9 million and unrealized losses of $2.0 million were rated below investment grade by Standard & Poors, Inc. (“S&P”).  Management reviewed the collectibility of these securities taking into consideration such factors as the financial condition of the issuers, reported regulatory capital ratios of the issuers, credit ratings, including ratings in effect as of the reporting period date as well as credit rating changes between the reporting period date and the filing date of this report, and other information.  We noted no additional downgrades to below investment grade between the reporting period date and the filing date of this report.  Based on these analyses, management concluded that it expects to recover the entire amortized cost basis of these securities.  Furthermore, Washington Trust does not intend to sell these securities and it is not more‑likely‑than‑not that Washington Trust will be required to sell these securities before recovery of their cost basis, which may be maturity.  Therefore, management does not consider these investments to be other-than-temporarily impaired at March 31, 2015.

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Earnings Per Common Share

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Common Share

Earnings Per Common Share

Washington Trust utilizes the two-class method earnings allocation formula to determine earnings per share of each class of stock according to dividends and participation rights in undistributed earnings.  Share-based payments that entitle holders to receive non-forfeitable dividends before vesting are considered participating securities and included in earnings allocation for computing basic earnings per share under this method.  Undistributed income is allocated to common shareholders and participating securities under the two-class method based upon the proportion of each to the total weighted average shares available.

The following table presents the calculation of earnings per common share:

(Dollars and shares in thousands, except per share amounts)
Three months ended March 31,	2015			2014
Earnings per common share - basic:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Earnings per common share - basic		$0.65			$0.56
Earnings per common share - diluted:
Net income		$11,010			$9,298
Less dividends and undistributed earnings allocated to participating securities	(39		)	(41		)
Net income applicable to common shareholders		$10,971			$9,257
Weighted average common shares	16,759			16,626
Dilutive effect of common stock equivalents	180			174
Weighted average diluted common shares	16,939			16,800
Earnings per common share - diluted		$0.65			$0.55

Weighted average common stock equivalents, not included in common stock equivalents above because they were anti-dilutive, totaled 77,450 and 54,600, respectively, for the three months endedMarch 31, 2015 and 2014.

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Defined Benefit Pension Plans

3 Months Ended

Mar. 31, 2015

Defined Benefit Pension Plans and Defined Benefit Postretirement Plans Disclosure [Abstract]

Defined Benefit Pension Plans

Defined Benefit Pension Plans

The Corporation maintains a tax-qualified defined benefit pension plan for the benefit of certain eligible employees who were hired prior to October 1, 2007. The Corporation also has non-qualified retirement plans to provide supplemental retirement benefits to certain employees, as defined in the plans. Defined benefit pension plans were previously amended to freeze benefit accruals after a 10-year transition period ending in December 2023.

The composition of net periodic benefit cost was as follows:

(Dollars in thousands)	Qualified Pension Plan						Non-Qualified Retirement Plans
Three months ended March 31,	2015			2014			2015		2014
Net Periodic Benefit Cost:
Service cost		$615			$538			$20		$12
Interest cost	732			723			122		120
Expected return on plan assets	(1,129		)	(1,016		)	—		—
Amortization of prior service (credit) cost	(6		)	(6		)	—		—
Recognized net actuarial loss	312			115			61		16
Net periodic benefit cost		$524			$354			$203		$148

The pension plan is funded on a current basis, in compliance with the requirements of ERISA.

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Share-Based Compensation Arrangements (Nonvested Performance Shares) (Details) (Performance Based Nonvested Shares [Member], USD $)	3 Months Ended
	Mar. 31, 2015
Performance Based Nonvested Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grant date fair value	$ 38.02
Award Vesting Period	3 years
Equity Instruments Other than Options Minimum Shares Earned to Target Percentage	0.00%
Equity Instruments Other than Options Maximum Shares Earned to Target Percentage	200.00%
Performance share awards, shares vesting percentage	150.00%
Performance share awards, shares vesting	46,950

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Borrowings

3 Months Ended

Mar. 31, 2015

Debt Disclosure [Abstract]

Borrowings

Borrowings

Federal Home Loan Bank Advances

Advances payable to the FHLBB amounted to $386.0 million and $406.3 million, respectively, at March 31, 2015 and December 31, 2014.

The following table presents maturities and weighted average interest rates on FHLBB advances outstanding as of March 31, 2015:

(Dollars in thousands)	Total Outstanding		Weighted Average Rate
April 1, 2015 to December 31, 2015		$160,520	0.49	%
2016	31,792		0.60	%
2017	30,075		5.44	%
2018	58,634		1.56	%
2019	42,661		4.40	%
2020 and thereafter	62,310		3.17	%
Balance at March 31, 2015		$385,992	1.91	%

As of March 31, 2015 and December 31, 2014, the Bank also has access to an unused line of credit with the FHLBB amounting to $40.0 million. In addition, the FHLBB has issued standby letters of credit to depositor customers of the Bank to collateralize public deposits. The Bank’s FHLBB borrowings, line of credit and letters of credit are collateralized by a blanket pledge agreement on the Bank’s FHLBB stock, certain qualified investment securities and loans, as well as amounts maintained on deposit at the FHLBB. The Bank’s unused remaining available borrowing capacity at the FHLBB was approximately $613.7 million and $569.4 million, respectively, at March 31, 2015 and December 31, 2014.

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Loans (Impaired Loans Interest Income Recognized) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	$ 21,902	$ 34,804
Interest Income Recognized on Impaired Loans	117	206
Commercial Mortgages [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	14,942	28,340
Interest Income Recognized on Impaired Loans	79	165
Commercial Construction & Development [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	0	0
Interest Income Recognized on Impaired Loans	0	0
Commercial & Industrial [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	3,036	2,366
Interest Income Recognized on Impaired Loans	19	23
Residential Mortgage [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	3,457	3,744
Interest Income Recognized on Impaired Loans	16	14
Homeowner Construction [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	0	0
Interest Income Recognized on Impaired Loans	0	0
Home Equity Lines [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	247	134
Interest Income Recognized on Impaired Loans	0	1
Home Equity Loans [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	74	95
Interest Income Recognized on Impaired Loans	0	1
Other Consumer [Member]
Financing Receivable, Impaired [Line Items]
Average Recorded Investment of Impaired Loans	146	125
Interest Income Recognized on Impaired Loans	$ 3	$ 2

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Allowance for Loan Losses

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Allowance for Loan Losses

Allowance for Loan Losses

The allowance for loan losses is management’s best estimate of the inherent risk of loss in the loan portfolio as of the balance sheet date. The allowance is increased by provisions charged to earnings and by recoveries of amounts previously charged off, and is reduced by charge-offs on loans. The Corporation uses a methodology to systematically measure the amount of estimated loan loss exposure inherent in the loan portfolio for purposes of establishing a sufficient allowance for loan losses. The methodology includes three elements: (1) identification of loss allocations for individual loans deemed to be impaired, (2) application of loss allocation factors for non-impaired loans based on credit grade, historical loss experience, estimated loss emergence period and delinquency status, with adjustments for various exposures not adequately presented in historical loss experience, and (3) an unallocated allowance maintained for measurement imprecision associated with impaired and nonaccrual loans.

Loss allocations for loans deemed to be impaired are measured on a discounted cash flow method based upon the loan’s contractual effective interest rate, or at the loan’s observable market price, or, if the loan is collateral dependent, at the fair value of the collateral. For collateral dependent loans for which repayment is dependent on the sale of the collateral, management adjusts the fair value for estimated costs to sell. For collateral dependent loans for which repayment is dependent on the operation of the collateral, such as accruing troubled debt restructured loans, estimated costs to sell are not incorporated into the measurement. Management may also adjust appraised values to reflect estimated market value declines or apply other discounts to appraised values for unobservable factors resulting from its knowledge of circumstances associated with the property.

Individual commercial loans not deemed to be impaired are evaluated using an internal rating system and the application of loss allocation factors. The loan rating system is described under the caption “Credit Quality Indicators” in Note 5. The loan rating system and the related loss allocation factors take into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral and the adequacy of guarantees. We periodically reassess and revise the loss allocation factors used in the assignment of loss exposure to appropriately reflect our analysis of migrational loss experience. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in the commercial loan portfolio and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience, including our assessments of credit risk associated with certain industries, an ongoing trend toward larger credit relationships, recent changes in portfolio composition, conditions that may affect the ability of borrowers to meet debt service requirements, trends in rental rates on commercial real estate and conditions that may affect the collateral position, such as environmental matters.

Portfolios of more homogeneous populations of loans, including the various categories of residential mortgages and consumer loans, are analyzed as groups, with loss allocation factors assigned to each group based on account delinquency status. We periodically reassess and revise the loss allocation factors. Revisions to loss allocation factors are not retroactively applied. We analyze historical loss experience over periods deemed to be relevant to the inherent risk of loss in residential mortgage and consumer loan portfolios and the related estimate of the loss emergence period as of the balance sheet date. We also adjust loss factor allocations for various exposures we believe are not adequately presented in historical loss experience including trends in real estate values, consideration of general economic conditions, increases in delinquency levels and regulatory changes affecting the foreclosure process. These matters are also evaluated taking into account the geographic location of the underlying loans.

Because the methodology is based upon historical experience and trends, current economic data as well as management’s judgment, factors may arise that result in different estimations. Significant factors that could give rise to changes in these estimates may include, but are not limited to, changes in economic conditions in our market area, concentration of risk and declines in local property values. Adversely different conditions or assumptions could lead to increases in the allowance. In addition, various regulatory agencies periodically review the allowance for loan losses. Such agencies may require additions to the allowance based on their judgments about information available to them at the time of their examination.

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2015:

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,202			$1,300			$7,987			$17,489			$5,430			$2,713			$2,391			$28,023
Charge-offs	(200		)	—			(7		)	(207		)	(48		)	(66		)	—			(321		)
Recoveries	80			—			14			94			2			12			—			108
Provision	249			(71		)	(191		)	(13		)	(29		)	72			(30		)	—
Ending Balance		$8,331			$1,229			$7,803			$17,363			$5,355			$2,731			$2,361			$27,810

(1) Commercial & industrial loans.

The following table presents the activity in the allowance for loan losses for three months endedMarch 31, 2014. Prior to December 31, 2014, the unallocated allowance included amounts for management’s qualitative and quantitative assessment of certain other loan portfolio risks not captured in other components of the allowance. The 2014 presentation of the allowance for loan losses by portfolio segment, set forth below, has been revised to conform to the December 31, 2014 presentation format. The reclassification resulted in a reduction of $5.3 million in the unallocated allowance previously reported as of March 31, 2014, with a corresponding increase to the allowance by portfolio segment. The reclassification resulted in no change in the total allowance.

(Dollars in thousands)	Commercial
	Mortgages			Construction			C&I (1)			Total Commercial			Residential			Consumer			Un-allocated			Total
Beginning Balance		$8,022			$383			$7,835			$16,240			$6,450			$2,511			$2,685			$27,886
Charge-offs	(945		)	—			(196		)	(1,141		)	(42		)	(40		)	—			(1,223		)
Recoveries	6			—			26			32			35			13			—			80
Provision	(536		)	(114		)	805			155			705			93			(653		)	300
Ending Balance		$6,547			$269			$8,470			$15,286			$7,148			$2,577			$2,032			$27,043

(1) Commercial & industrial loans.

The following table presents the Corporation’s loan portfolio and associated allowance for loan loss by portfolio segment and by impairment methodology:

(Dollars in thousands)	March 31, 2015				December 31, 2014
	Loans		Related Allowance		Loans		Related Allowance
Loans Individually Evaluated for Impairment:
Commercial:
Mortgages		$14,563		$1,173		$14,991		$927
Construction & development	—		—		—		—
Commercial & industrial	3,074		185		2,921		177
Residential real estate	2,912		222		3,698		326
Consumer	467		77		409		153
Subtotal		$21,016		$1,657		$22,019		$1,583
Loans Collectively Evaluated for Impairment:
Commercial:
Mortgages		$850,479		$7,158		$828,987		$7,275
Construction & development	89,851		1,229		79,592		1,300
Commercial & industrial	601,556		7,618		608,997		7,810
Residential real estate	984,652		5,133		981,717		5,104
Consumer	333,038		2,654		337,964		2,560
Subtotal		$2,859,576		$23,792		$2,837,257		$24,049
Unallocated	—		2,361		—		2,391
Total		$2,880,592		$27,810		$2,859,276		$28,023

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Time Certificates of Deposit

3 Months Ended

Mar. 31, 2015

Deposits [Abstract]

Time Certificates of Deposit

Time Certificates of Deposit

The following table presents scheduled maturities of time certificates of deposit:

(Dollars in thousands)	Scheduled Maturity		Weighted Average Rate
April 1, 2015 to December 31, 2015		$296,731	0.67	%
2016	177,667		1.02
2017	152,730		1.11
2018	77,579		1.35
2019	122,693		1.76
2020 and thereafter	25,221		1.52
Balance at March 31, 2015		$852,621	1.07	%

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Shareholders' Equity

3 Months Ended

Mar. 31, 2015

Regulatory Capital Requirements [Abstract]

Regulatory Capital Requirements

Shareholders’ Equity

Regulatory Capital Requirements

The following table presents the Corporation’s and the Bank’s actual capital amounts and ratios, as well as the corresponding minimum required capital ratios and minimum capital ratios required for the Bank to be “well capitalized” for purposes of the Federal Deposit Insurance Corporation’s (“FDIC”) prompt corrective action provisions:

(Dollars in thousands)	Actual				For Capital Adequacy Purposes				To Be “Well Capitalized” Under Prompt Corrective Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio
March 31, 2015
Total Capital (to Risk-Weighted Assets):
Corporation		$352,521	12.80	%		$220,262	8.00	%		N/A	N/A
Bank	347,674		12.63		220,187		8.00		275,234		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	324,375		11.78		165,196		6.00		N/A		N/A
Bank	319,528		11.61		165,140		6.00		220,187		8.00
Common Equity Tier 1 Capital (to Risk-Weighted Assets): (1)
Corporation	302,376		10.98		123,897		4.50		N/A		N/A
Bank	319,528		11.61		123,855		4.50		178,902		6.50
Tier 1 Capital (to Average Assets): (2)
Corporation	324,375		9.21		140,864		4.00		N/A		N/A
Bank	319,528		9.08		140,738		4.00		175,922		5.00
December 31, 2014
Total Capital (to Risk-Weighted Assets):
Corporation	343,934		12.56		219,149		8.00		273,936		N/A
Bank	339,268		12.39		219,075		8.00		273,844		10.00
Tier 1 Capital (to Risk-Weighted Assets):
Corporation	315,575		11.52		109,574		4.00		164,361		N/A
Bank	310,909		11.35		109,537		4.00		164,306		6.00
Tier 1 Capital (to Average Assets): (2)
Corporation	315,575		9.14		138,090		4.00		172,612		N/A
Bank	310,909		9.01		137,964		4.00		172,454		5.00

(1) New capital ratio effective January 1, 2015 under the Basel III capital requirements. See additional discussion of Basel III and the new regulatory capital requirements in the “Supervision and Regulation” section in the Annual Report on Form 10-K for the fiscal year ended December 31, 2014.

(2)    Leverage ratio.

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Loans (Credit Quality Indicators - Commercial) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Pass [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	$ 1,518,737	$ 1,491,655
Pass [Member] | Commercial Mortgages [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	842,516	819,857
Pass [Member] | Commercial Construction & Development [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	89,851	79,592
Pass [Member] | Commercial & Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	586,370	592,206
Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	32,743	34,683
Special Mention [Member] | Commercial Mortgages [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	17,207	18,372
Special Mention [Member] | Commercial Construction & Development [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	0	0
Special Mention [Member] | Commercial & Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	15,536	16,311
Classified [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	8,043	9,150
Classified [Member] | Commercial Mortgages [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	5,319	5,749
Classified [Member] | Commercial Construction & Development [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	0	0
Classified [Member] | Commercial & Industrial [Member]
Financing Receivable, Recorded Investment [Line Items]
Loans Receivable	$ 2,724	$ 3,401

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Business Segments (Statement of Operations and Total Assets by Reportable Segment) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Segment Reporting Information [Line Items]
Net interest income	$ 25,702	$ 23,836
Provision for loan losses	0	300
Net interest income after provision for loan losses	25,702	23,536
Noninterest income	14,020	19,370
Depreciation and amortization expense	1,037	947
Other noninterest expenses related to segments	22,494	28,345
Total noninterest expense	23,531	29,292
Income before income taxes	16,191	13,614
Income tax expense	5,181	4,316
Net income	11,010	9,298
Total assets	3,602,514	3,194,146	3,586,874
Expenditures for long-lived assets	1,226	1,291
Commercial Banking [Member]
Segment Reporting Information [Line Items]
Net interest income	20,625	19,739
Provision for loan losses	0	300
Net interest income after provision for loan losses	20,625	19,439
Noninterest income	5,078	4,541
Depreciation and amortization expense	671	585
Other noninterest expenses related to segments	13,587	13,553
Total noninterest expense	14,258	14,138
Income before income taxes	11,445	9,842
Income tax expense	3,730	3,261
Net income	7,715	6,581
Total assets	3,015,691	2,577,350
Expenditures for long-lived assets	1,067	1,075
Wealth Management Services [Member]
Segment Reporting Information [Line Items]
Net interest income	(14)	(4)
Provision for loan losses	0	0
Net interest income after provision for loan losses	(14)	(4)
Noninterest income	8,435	8,065
Depreciation and amortization expense	306	311
Other noninterest expenses related to segments	5,915	5,387
Total noninterest expense	6,221	5,698
Income before income taxes	2,200	2,363
Income tax expense	844	876
Net income	1,356	1,487
Total assets	52,568	52,475
Expenditures for long-lived assets	114	171
Corporate [Member]
Segment Reporting Information [Line Items]
Net interest income	5,091	4,101
Provision for loan losses	0	0
Net interest income after provision for loan losses	5,091	4,101
Noninterest income	507	6,764
Depreciation and amortization expense	60	51
Other noninterest expenses related to segments	2,992	9,405
Total noninterest expense	3,052	9,456
Income before income taxes	2,546	1,409
Income tax expense	607	179
Net income	1,939	1,230
Total assets	534,255	564,321
Expenditures for long-lived assets	$ 45	$ 45

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Allowance for Loan Losses (Allowance for Loan Losses Rollforward Analysis) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	$ 28,023	$ 27,886
Charge-offs	(321)	(1,223)
Recoveries	108	80
Provision	0	300
Allowance, Ending Balance	27,810	27,043
Reclassification of unallocated allowance [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Ending Balance	5,300
Commercial Mortgages [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	8,202	8,022
Charge-offs	(200)	(945)
Recoveries	80	6
Provision	249	(536)
Allowance, Ending Balance	8,331	6,547
Commercial Construction & Development [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	1,300	383
Charge-offs	0	0
Recoveries	0	0
Provision	(71)	(114)
Allowance, Ending Balance	1,229	269
Commercial & Industrial [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	7,987	7,835
Charge-offs	(7)	(196)
Recoveries	14	26
Provision	(191)	805
Allowance, Ending Balance	7,803	8,470
Commercial Segment [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	17,489	16,240
Charge-offs	(207)	(1,141)
Recoveries	94	32
Provision	(13)	155
Allowance, Ending Balance	17,363	15,286
Residential Segment [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	5,430	6,450
Charge-offs	(48)	(42)
Recoveries	2	35
Provision	(29)	705
Allowance, Ending Balance	5,355	7,148
Consumer Segment [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	2,713	2,511
Charge-offs	(66)	(40)
Recoveries	12	13
Provision	72	93
Allowance, Ending Balance	2,731	2,577
Unallocated [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Allowance, Beginning Balance	2,391	2,685
Charge-offs	0	0
Recoveries	0	0
Provision	(30)	(653)
Allowance, Ending Balance	$ 2,361	$ 2,032

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Loans (Troubled Debt Restructurings Subsequent Default) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015 loan		Mar. 31, 2014 loan
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	3		2
Commercial Mortgages [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Commercial Construction & Development [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Commercial & Industrial [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		0
Residential Mortgage [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		2
Homeowner Construction [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Home Equity Lines [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Home Equity Loans [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Other Consumer [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	1		0
Payment Default [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	4		6
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	349	[1]	1,191	[1]
Payment Default [Member] | Commercial Mortgages [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]
Payment Default [Member] | Commercial Construction & Development [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]
Payment Default [Member] | Commercial & Industrial [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	2		6
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	11	[1]	1,191	[1]
Payment Default [Member] | Residential Mortgage [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	2		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	338	[1]	0	[1]
Payment Default [Member] | Homeowner Construction [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]
Payment Default [Member] | Home Equity Lines [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]
Payment Default [Member] | Home Equity Loans [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]
Payment Default [Member] | Other Consumer [Member]
Financing Receivable, Modifications [Line Items]
Number of Loans Modified as a Troubled Debt Restructuring	0		0
Financing Receivable, Modifications, Subsequent Default, Recorded Investment	0	[1]	0	[1]

[1] The recorded investment in troubled debt restructurings consists of unpaid principal balance, net of charge-offs and unamortized deferred loan origination fees and costs. For accruing troubled debt restructured loans, the recorded investment also includes accrued interest.

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Commitments and Contingencies (Policies)

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Off-Balance-Sheet Credit Exposure Policy

The Corporation is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers and to manage the Corporation’s exposure to fluctuations in interest rates.  These financial instruments include commitments to extend credit, standby letters of credit, interest rate swap agreements and interest rate lock commitments and commitments to sell residential real estate mortgage loans.  These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the Corporation’s Consolidated Balance Sheets.  The contract or notional amounts of these instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.  The Corporation’s credit policies with respect to interest rate swap agreements with commercial borrowers, commitments to extend credit, and financial guarantees are similar to those used for loans.  The interest rate swaps with other counterparties are generally subject to bilateral collateralization terms.

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Securities (Securities by Contractual Maturity) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	$ 47,037
Available for sale debt securities maturities 1-5 years amortized cost	155,882
Available for sale debt securities maturities 5-10 years amortized cost	72,660
Available for sale debt securities maturities after 10 years amortized cost	57,716
Available for sale debt securities maturities total amortized cost	333,295
Available for sale debt securities maturities within 1 year weighted average yield	3.61%
Available for sale debt securities maturities 1-5 years weighted average yield	3.09%
Available for sale debt securities maturities 5-10 years weighted average yield	3.05%
Available for sale debt securities maturities after 10 years weighted average yield	1.42%
Available for sale debt securities maturities total weighted average yield	2.86%
Available for sale debt securities maturities within 1 year fair value	48,955
Available for sale debt securities maturities 1-5 years fair value	161,578
Available for sale debt securities maturities 5-10 years fair value	75,897
Available for sale debt securities maturities after 10 years fair value	54,512
Available for sale debt securities fair value	340,942
Held to maturity securities	24,025	25,222
Held to maturity debt securities maturities within 1 year fair value	3,108
Held to maturity debt securities maturities 1-5 years fair value	9,637
Held to maturity debt securities maturities 5-10 years fair value	7,612
Held to maturity debt securities maturities after 10 years fair value	4,477
Held to maturity securities fair value	24,834	26,008
Obligations of U.S. government-sponsored enterprises [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	0
Available for sale debt securities maturities 1-5 years amortized cost	31,003
Available for sale debt securities maturities 5-10 years amortized cost	200
Available for sale debt securities maturities after 10 years amortized cost	0
Available for sale debt securities maturities total amortized cost	31,203
Available for sale debt securities maturities within 1 year weighted average yield	0.00%
Available for sale debt securities maturities 1-5 years weighted average yield	1.72%
Available for sale debt securities maturities 5-10 years weighted average yield	2.32%
Available for sale debt securities maturities after 10 years weighted average yield	0.00%
Available for sale debt securities maturities total weighted average yield	1.73%
Mortgage-backed securities issued by US Government-sponsored enterprises [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	37,723
Available for sale debt securities maturities 1-5 years amortized cost	100,409
Available for sale debt securities maturities 5-10 years amortized cost	57,461
Available for sale debt securities maturities after 10 years amortized cost	26,954
Available for sale debt securities maturities total amortized cost	222,547
Available for sale debt securities maturities within 1 year weighted average yield	3.71%
Available for sale debt securities maturities 1-5 years weighted average yield	3.30%
Available for sale debt securities maturities 5-10 years weighted average yield	2.81%
Available for sale debt securities maturities after 10 years weighted average yield	1.76%
Available for sale debt securities maturities total weighted average yield	3.06%
Held to maturity debt securities maturities within 1 year amortized cost	3,007
Held to maturity debt securities maturities 1-5 years amortized cost	9,323
Held to maturity debt securities maturities 5-10 years amortized cost	7,364
Held to maturity debt securities maturities after 10 years amortized cost	4,331
Held to maturity securities	24,025	25,222
Held to maturity debt securities maturities within 1 year weighted average yield	3.11%
Held to maturity debt securities maturities 1-5 years weighted average yield	3.03%
Held to maturity debt securities maturities 5-10 years weighted average yield	2.78%
Held to maturity debt securities maturities after 10 years weighted average yield	0.89%
Held to maturity debt securities maturities total weighted average yield	2.58%
Held to maturity securities fair value	24,834	26,008
Obligations of states and political subdivisions [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	3,601
Available for sale debt securities maturities 1-5 years amortized cost	24,267
Available for sale debt securities maturities 5-10 years amortized cost	14,796
Available for sale debt securities maturities after 10 years amortized cost	0
Available for sale debt securities maturities total amortized cost	42,664
Available for sale debt securities maturities within 1 year weighted average yield	3.78%
Available for sale debt securities maturities 1-5 years weighted average yield	3.94%
Available for sale debt securities maturities 5-10 years weighted average yield	3.99%
Available for sale debt securities maturities after 10 years weighted average yield	0.00%
Available for sale debt securities maturities total weighted average yield	3.95%
Individual name issuer trust preferred debt securities
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	0
Available for sale debt securities maturities 1-5 years amortized cost	0
Available for sale debt securities maturities 5-10 years amortized cost	0
Available for sale debt securities maturities after 10 years amortized cost	30,762
Available for sale debt securities maturities total amortized cost	30,762
Available for sale debt securities maturities within 1 year weighted average yield	0.00%
Available for sale debt securities maturities 1-5 years weighted average yield	0.00%
Available for sale debt securities maturities 5-10 years weighted average yield	0.00%
Available for sale debt securities maturities after 10 years weighted average yield	1.11%
Available for sale debt securities maturities total weighted average yield	1.11%
Corporate bonds [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available for sale debt securities maturities within 1 year amortized cost	5,713
Available for sale debt securities maturities 1-5 years amortized cost	203
Available for sale debt securities maturities 5-10 years amortized cost	203
Available for sale debt securities maturities after 10 years amortized cost	0
Available for sale debt securities maturities total amortized cost	$ 6,119
Available for sale debt securities maturities within 1 year weighted average yield	2.84%
Available for sale debt securities maturities 1-5 years weighted average yield	1.62%
Available for sale debt securities maturities 5-10 years weighted average yield	3.21%
Available for sale debt securities maturities after 10 years weighted average yield	0.00%
Available for sale debt securities maturities total weighted average yield	2.81%

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Business Segments

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Business Segments

Business Segments

Washington Trust segregates financial information in assessing its results among its Commercial Banking and Wealth Management Services operating segments.  The amounts in the Corporate unit include activity not related to the segments. The methodologies and organizational hierarchies that define the business segments are periodically reviewed and revised.  Results may be restated, when necessary, to reflect changes in organizational structure or allocation methodology. Any changes in estimates and allocations that may affect the reported results of any business segment will not affect the consolidated financial position or results of operations of Washington Trust as a whole.

Management uses certain methodologies to allocate income and expenses to the business lines.  A funds transfer pricing methodology is used to assign interest income and interest expense to each interest-earning asset and interest-bearing liability on a matched maturity funding basis.  Certain indirect expenses are allocated to segments.  These include support unit expenses such as technology and processing operations and other support functions.

Commercial Banking

The Commercial Banking segment includes commercial, residential and consumer lending activities; equity in losses of unconsolidated investments in real estate limited partnerships; mortgage banking, secondary market and loan servicing activities; deposit generation; merchant credit card services; cash management activities; and direct banking activities, which include the operation of ATMs, telephone and Internet banking services and customer support and sales.

Wealth Management Services

Wealth Management Services includes investment management; financial planning; personal trust services, including services as trustee, administrator, custodian and guardian; and estate settlement. Institutional trust services are also provided, including fiduciary services.

Corporate

Corporate includes the Treasury Unit, which is responsible for managing the wholesale investment portfolio and wholesale funding needs.  It also includes income from bank-owned life insurance, net gain on sale of business line as well as administrative and executive expenses not allocated to the operating segments and the residual impact of methodology allocations such as funds transfer pricing offsets.

The following table presents the statement of operations and total assets for Washington Trust’s reportable segments:

(Dollars in thousands)	Commercial Banking				Wealth Management Services						Corporate				Consolidated Total
Three months ended March 31,	2015		2014		2015			2014			2015		2014		2015		2014
Net interest income (expense)		$20,625		$19,739		($14	)		($4	)		$5,091		$4,101		$25,702		$23,836
Provision for loan losses	—		300		—			—			—		—		—		300
Net interest income (expense) after provision for loan losses	20,625		19,439		(14		)	(4		)	5,091		4,101		25,702		23,536
Noninterest income	5,078		4,541		8,435			8,065			507		6,764		14,020		19,370
Noninterest expenses:
Depreciation and amortization expense	671		585		306			311			60		51		1,037		947
Other noninterest expenses	13,587		13,553		5,915			5,387			2,992		9,405		22,494		28,345
Total noninterest expenses	14,258		14,138		6,221			5,698			3,052		9,456		23,531		29,292
Income before income taxes	11,445		9,842		2,200			2,363			2,546		1,409		16,191		13,614
Income tax expense	3,730		3,261		844			876			607		179		5,181		4,316
Net income		$7,715		$6,581		$1,356			$1,487			$1,939		$1,230		$11,010		$9,298
Total assets at period end		$3,015,691		$2,577,350		$52,568			$52,475			$534,255		$564,321		$3,602,514		$3,194,146
Expenditures for long-lived assets	1,067		1,075		114			171			45		45		1,226		1,291

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General Information (Policies)

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidation Policy

The consolidated financial statements include the accounts of the Bancorp and its subsidiaries (collectively, the “Corporation” or “Washington Trust”).  All significant intercompany transactions have been eliminated.

Use of Estimates Policy

The accounting and reporting policies of the Corporation conform to accounting principles generally accepted in the United States of America (“GAAP”) and to general practices of the banking industry.  In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheet and revenues and expenses for the period.  Actual results could differ from those estimates.  Material estimates that are particularly susceptible to change are the determination of the allowance for loan losses, the review of goodwill for impairment and the assessment of investment securities for impairment.

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Securities (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Fair Value of Available for Sale and Held to Maturity securities pledged as collateral	347.6	$ 350.5
Amortized cost of callable debt securities	98.1
Fair value of callable debt securities	95.0
Available-for-sale Securities, Continuous Unrealized Loss Position, Total, Number	12
Securities in unrealized loss position, number of companies issuing securities	7
Amortized cost of trust preferred securities of individual name issuers that are below investment grade	11.9
Unrealized losses of trust preferred securities of individual name issuers that are below investment grade	2.0
Individual name issuer trust preferred debt securities
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Available-for-sale Securities, Continuous Unrealized Loss Position, Total, Number	11	11
Minimum [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Callable Debt Securities, Maturity Period	6 months
Callable Debt Securities, Call Feature, Period	1 month
Maximum [Member]
Schedule of Available for Sale and Held to Maturty Securities [Line Items]
Callable Debt Securities, Maturity Period	22 years
Callable Debt Securities, Call Feature, Period	2 years

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Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value of Derivatives by Balance Sheet Location

The following table presents the fair values of derivative instruments in the Corporation’s Consolidated Balance Sheets:

(Dollars in thousands)	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	Mar 31, 2015		Dec 31, 2014		Balance Sheet Location	Mar 31, 2015		Dec 31, 2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts	Other assets		$—		$—	Other liabilities		$367		$497
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Other assets	1,769		1,212		Other liabilities	5		20
Commitments to sell mortgage loans	Other assets	14		13		Other liabilities	2,970		2,028
Customer related derivative contracts:
Interest rate swaps with customers	Other assets	7,415		4,554		Other liabilities	—		23
Mirror swaps with counterparties	Other assets	—		28		Other liabilities	7,699		4,748
Risk participation agreement	Other assets	47		—		Other liabilities	—		—
Total			$9,245		$5,807			$11,041		$7,316

Derivative Instruments Effect in Statements of Income and Changes in Shareholders' Equity

The following tables present the effect of derivative instruments in the Corporation’s Consolidated Statements of Income and Changes in Shareholders’ Equity:

(Dollars in thousands)	Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion)				Location of Gain (Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Gain (Loss) Recognized in Income (Ineffective Portion)
Three months ended March 31,	2015		2014			2015		2014
Derivatives Designated as Cash Flow Hedging Instruments:
Interest rate risk management contracts:
Interest rate swap contracts		$85		$76	Interest Expense		$—		$—
Total		$85		$76			$—		$—

(Dollars in thousands)		Amount of Gain (Loss) Recognized in Income on Derivative
Three months ended March 31,	Statement of Income Location	2015			2014
Derivatives not Designated as Hedging Instruments:
Forward loan commitments:
Interest rate lock commitments	Net gains on loan sales & commissions on loans originated for others		$572			$277
Commitments to sell mortgage loans	Net gains on loan sales & commissions on loans originated for others	(941		)	(313		)
Customer related derivative contracts:
Interest rate swaps with customers	Net gains on interest rate swap contracts	3,633			1,030
Mirror swaps with counterparties	Net gains on interest rate swap contracts	(2,836		)	(770		)
Risk participation agreement	Net gains on interest rate swap contracts	(152		)	—
Total			$276			$224

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015		Mar. 31, 2014
Statement of Comprehensive Income [Abstract]
Net income	$ 11,010		$ 9,298
Securities available for sale:
Net change in fair value of securities available for sale	664		612
Cash flow hedges:
Change in fair value of cash flow hedges	(8)		(16)
Net cash flow hedge losses reclassified into earnings	93	[1]	92	[1]
Net change in fair value of cash flow hedges	85		76
Defined benefit plan obligation adjustment	235	[2]	88	[2]
Total other comprehensive (loss) income, net of tax	984		776
Total comprehensive income	$ 11,994		$ 10,074

[1] Included in interest expense on junior subordinated debentures in the Consolidated Statements of Income.

[2] Included in salaries and employee benefits expense in the Consolidated Statements of Income.

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Earnings Per Common Share (Calculation of Earnings Per Share) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Earnings Per Share [Abstract]
Net income	$ 11,010	$ 9,298
Less dividends and undistributed earnings allocated to participating securities	(39)	(41)
Net income applicable to common shareholders	10,971	9,257
Weighted average common shares outstanding - basic	16,759,000	16,626,000
Basic earnings per common share	$ 0.65	$ 0.56
Less dividends and undistributed earnings allocated to participating securities	(39)	(41)
Net Income (Loss) Available to Common Stockholders, Diluted	$ 10,971	$ 9,257
Dilutive effect of common stock equivalents	180,000	174,000
Weighted average common shares outstanding - diluted	16,939,000	16,800,000
Diluted earnings per common share	$ 0.65	$ 0.55
Antidilutive common stock equivalents	77,450	54,600

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Cash and Due from Banks

3 Months Ended

Mar. 31, 2015

Cash and Cash Equivalents [Abstract]

Cash and Due from Banks

Cash and Due from Banks

The Bank maintains certain average reserve balances to meet the requirements of the Board of Governors of the Federal Reserve System (“FRB”).  Some or all of these reserve requirements may be satisfied with vault cash. Reserve balances amounted to $10.1 million at March 31, 2015 and $8.0 million at December 31, 2014 and were included in cash and due from banks in the Consolidated Balance Sheets.

As of March 31, 2015 and December 31, 2014, cash and due from banks included interest-bearing deposits in other banks of $47.0 million and $42.7 million, respectively.

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Loans (Past Due Loans) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015		Dec. 31, 2014
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	$ 6,708		$ 6,033
Loans 60 to 89 Days Past Due	2,207		2,368
Loans Over 90 Days Past Due	10,166		9,677
Total Loans Past Due	19,081		18,078
Current Loans	2,861,511		2,841,198
Total loans	2,880,592	[1]	2,859,276	[1]
Commercial Mortgages [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	497		0
Loans 60 to 89 Days Past Due	61		0
Loans Over 90 Days Past Due	5,115		5,315
Total Loans Past Due	5,673		5,315
Current Loans	859,369		838,663
Total loans	865,042		843,978
Commercial Construction & Development [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	0		0
Loans 60 to 89 Days Past Due	0		0
Loans Over 90 Days Past Due	0		0
Total Loans Past Due	0		0
Current Loans	89,851		79,592
Total loans	89,851		79,592
Commercial & Industrial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	229		2,136
Loans 60 to 89 Days Past Due	229		1,202
Loans Over 90 Days Past Due	721		181
Total Loans Past Due	1,179		3,519
Current Loans	603,451		608,399
Total loans	604,630		611,918
Residential Mortgage [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	4,470		2,943
Loans 60 to 89 Days Past Due	1,352		821
Loans Over 90 Days Past Due	3,607		3,284
Total Loans Past Due	9,429		7,048
Current Loans	945,476		941,683
Total loans	954,905		948,731
Homeowner Construction [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	0		0
Loans 60 to 89 Days Past Due	0		0
Loans Over 90 Days Past Due	0		0
Total Loans Past Due	0		0
Current Loans	32,659		36,684
Total loans	32,659		36,684
Home Equity Lines [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	1,244		570
Loans 60 to 89 Days Past Due	429		100
Loans Over 90 Days Past Due	463		841
Total Loans Past Due	2,136		1,511
Current Loans	237,401		240,969
Total loans	239,537		242,480
Home Equity Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	213		349
Loans 60 to 89 Days Past Due	111		240
Loans Over 90 Days Past Due	255		56
Total Loans Past Due	579		645
Current Loans	46,148		46,322
Total loans	46,727		46,967
Other Consumer [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Loans 30 to 59 Days Past Due	55		35
Loans 60 to 89 Days Past Due	25		5
Loans Over 90 Days Past Due	5		0
Total Loans Past Due	85		40
Current Loans	47,156		48,886
Total loans	$ 47,241		$ 48,926

[1] Includes net unamortized loan origination costs of $2.2 million and $2.1 million, respectively, and net unamortized premiums on purchased loans of $92 thousand and $94 thousand, respectively, at March 31, 2015 and December 31, 2014.

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Fair Value Measurements (Carrying Amounts and Estimated Fair Values of Financial Instruments) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	$ 24,025	$ 25,222
Loans, net of allowance of loan losses	2,852,782	2,831,253
Time deposits	852,621	874,102
Federal Home Loan Bank advances	385,992	406,297
Junior subordinated debentures	22,681	22,681
Reported Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	24,025	25,222
Loans, net of allowance of loan losses	2,852,782	2,831,253
Time deposits	852,621	874,102
Federal Home Loan Bank advances	385,992	406,297
Junior subordinated debentures	22,681	22,681
Fair Value Measurement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	24,834	26,008
Loans, net of allowance of loan losses	2,898,369	2,866,907
Time deposits	854,780	872,570
Federal Home Loan Bank advances	400,770	418,005
Junior subordinated debentures	16,974	17,201
Fair Value Measurement [Member] | Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	0	0
Loans, net of allowance of loan losses	0	0
Time deposits	0	0
Federal Home Loan Bank advances	0	0
Junior subordinated debentures	0	0
Fair Value Measurement [Member] | Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	24,834	26,008
Loans, net of allowance of loan losses	0	0
Time deposits	854,780	872,570
Federal Home Loan Bank advances	400,770	418,005
Junior subordinated debentures	16,974	17,201
Fair Value Measurement [Member] | Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Held to maturity securities	0	0
Loans, net of allowance of loan losses	2,898,369	2,866,907
Time deposits	0	0
Federal Home Loan Bank advances	0	0
Junior subordinated debentures	$ 0	$ 0

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Borrowings (Narrative Federal Home Loan Bank Advances) (Details) (USD $)	Mar. 31, 2015	Dec. 31, 2014
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Federal Home Loan Bank advances	$ 385,992,000	$ 406,297,000
Federal Home Loan Bank of Boston [Member]
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items]
Federal Home Loan Bank advances	385,992,000	406,300,000
Unused line of credit with FHLB	40,000,000	40,000,000
Unused line of credit with FHLB	$ 613,700,000	$ 569,400,000

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Loans (Policies)

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Nonaccrual Loan Status Policy

Loans, with the exception of certain well-secured loans that are in the process of collection, are placed on nonaccrual status and interest recognition is suspended when such loans are 90 days or more overdue with respect to principal and/or interest, or sooner if considered appropriate by management. Well-secured loans are permitted to remain on accrual status provided that full collection of principal and interest is assured and the loan is in the process of collection. Loans are also placed on nonaccrual status when, in the opinion of management, full collection of principal and interest is doubtful. Interest previously accrued but not collected on such loans is reversed against current period income. Subsequent interest payments received on nonaccrual loans are applied to the outstanding principal balance of the loan or recognized as interest income depending on management’s assessment of the ultimate collectibility of the loan. Loans are removed from nonaccrual status when they have been current as to principal and interest for a period of time, the borrower has demonstrated an ability to comply with repayment terms, and when, in management’s opinion, the loans are considered to be fully collectible.

Troubled Debt Restructuring Policy

Loans are considered restructured in a troubled debt restructuring when the Corporation has granted concessions to a borrower due to the borrower’s financial condition that it otherwise would not have considered. These concessions may include modifications of the terms of the debt such as deferral of payments, extension of maturity, reduction of principal balance, reduction of the stated interest rate other than normal market rate adjustments, or a combination of these concessions. Debt may be bifurcated with separate terms for each tranche of the restructured debt. Restructuring a loan in lieu of aggressively enforcing the collection of the loan may benefit the Corporation by increasing the ultimate probability of collection.

Restructured loans are classified as accruing or non-accruing based on management’s assessment of the collectibility of the loan. Loans which are already on nonaccrual status at the time of the restructuring generally remain on nonaccrual status for approximately six months before management considers such loans for return to accruing status. Accruing restructured loans are placed into nonaccrual status if and when the borrower fails to comply with the restructured terms and management deems it unlikely that the borrower will return to a status of compliance in the near term.

Troubled debt restructurings are reported as such for at least one year from the date of the restructuring. In years after the restructuring, troubled debt restructured loans are removed from this classification if the restructuring did not involve a below-market rate concession and the loan is not deemed to be impaired based on the terms specified in the restructuring agreement.

Troubled debt restructurings are classified as impaired loans. The Corporation identifies loss allocations for impaired loans on an individual loan basis.

Commercial Loan Credit Quality Policy

Commercial

The Corporation utilizes an internal rating system to assign a risk to each of its commercial loans. Loans are rated on a scale of 1 to 10. This scale can be assigned to three broad categories including “pass” for ratings 1 through 6, “special mention” for 7-rated loans, and “classified” for loans rated 8, 9 or 10. The loan rating system takes into consideration parameters including the borrower’s financial condition, the borrower’s performance with respect to loan terms, the adequacy of collateral, the adequacy of guarantees and other credit quality characteristics. As of March 31, 2015 and December 31, 2014, the weighted average risk rating of the Corporation’s commercial loan portfolio was 4.68 and 4.67, respectively. For non-impaired loans, the Corporation assigns a loss allocation factor to each loan, based on its risk rating for purposes of establishing an appropriate allowance for loan losses. See Note 6 for additional information.

A description of the commercial loan categories are as follows:

Pass - Loans with acceptable credit quality, defined as ranging from superior or very strong to a status of lesser stature. Superior or very strong credit quality is characterized by a high degree of cash collateralization or strong balance sheet liquidity. Lesser stature loans have an acceptable level of credit quality but exhibit some weakness in various credit metrics such as collateral adequacy, cash flow, secondary sources of repayment, or performance inconsistency or may be in an industry or of a loan type known to have a higher degree of risk.

Special Mention - Loans with potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Bank’s position as creditor at some future date. Special Mention assets are not adversely classified and do not expose the Bank to sufficient risk to warrant adverse classification. Examples of these conditions include but are not limited to outdated or poor quality financial data, strains on liquidity and leverage, losses or negative trends in operating results, marginal cash flow, weaknesses in occupancy rates or trends in the case of commercial real estate and frequent delinquencies.

Classified - Loans identified as “substandard”, “doubtful” or “loss” based on criteria consistent with guidelines provided by banking regulators. A “substandard” loan has defined weaknesses which make payment default or principal exposure likely, but not yet certain. Such loans are apt to be dependent upon collateral liquidation, a secondary source of repayment or an event outside of the normal course of business. The loans are closely watched and are either already on nonaccrual status or may be placed on nonaccrual status when management determines there is uncertainty of collectibility. A “doubtful” loan is placed on non-accrual status and has a high probability of loss, but the extent of the loss is difficult to quantify due to dependency upon collateral having a value that is difficult to determine or upon some near-term event which lacks certainty. A loan in the “loss” category is considered generally uncollectible or the timing or amount of payments cannot be determined. “Loss” is not intended to imply that the loan has no recovery value but rather it is not practical or desirable to continue to carry the asset.

The Corporation’s procedures call for loan ratings and classifications to be revised whenever information becomes available that indicates a change is warranted. The criticized loan portfolio, which consists of commercial loans that are risk rated special mention or worse, are reviewed by management on a quarterly basis, focusing on the current status and strategies to improve the credit. An annual loan review program is conducted by a third party to provide an independent evaluation of the creditworthiness of the commercial loan portfolio, the quality of the underwriting and credit risk management practices and the appropriateness of the risk rating classifications. This review is supplemented with selected targeted internal reviews of the commercial loan portfolio.

Residential/Consumer Credit Quality Policy

The residential and consumer portfolios are monitored on an ongoing basis by the Corporation using delinquency information and loan type as credit quality indicators. These credit quality indicators are assessed on an aggregate basis in these relatively homogeneous portfolios. For non-impaired loans, the Corporation assigns loss allocation factors to each respective loan type and delinquency status. See Note 6 for additional information.

Various other techniques are utilized to monitor indicators of credit deterioration in the portfolios of residential real estate mortgages and home equity lines and loans. Among these techniques is the periodic tracking of loans with an updated FICO score and an estimated loan to value (“LTV”) ratio. LTV is determined via statistical modeling analyses. The indicated LTV levels are estimated based on such factors as the location, the original LTV, and the date of origination of the loan and do not reflect actual appraisal amounts. The results of these analyses and other loan review procedures are taken into consideration in the determination of loss allocation factors for residential mortgage and home equity consumer credits. See Note 6 for additional information.

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Derivative Financial Instruments (Derivatives in Cash Flow Hedging Relationships, Effect in Statements of Income and Changes in Shareholders' Equity) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income (Ineffective Portion)	$ 0	$ 0
Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion)	85	76
Interest Rate Swaps [Member] | Cash Flow Hedge [Member] | Interest Expense [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Income (Ineffective Portion)	0	0
Interest Rate Swaps [Member] | Cash Flow Hedge [Member] | Other Comprehensive Income (Loss) [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion)	$ 85	$ 76

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Time Certificates of Deposit (Tables)

3 Months Ended

Mar. 31, 2015

Deposits [Abstract]

Schedule of Time Certificates of Deposit Maturities

The following table presents scheduled maturities of time certificates of deposit:

(Dollars in thousands)	Scheduled Maturity		Weighted Average Rate
April 1, 2015 to December 31, 2015		$296,731	0.67	%
2016	177,667		1.02
2017	152,730		1.11
2018	77,579		1.35
2019	122,693		1.76
2020 and thereafter	25,221		1.52
Balance at March 31, 2015		$852,621	1.07	%

Schedule of Time Certificates of Deposit $100 Thousand or More Maturities

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Share-Based Compensation Arrangements

3 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation Arrangements

Share-Based Compensation Arrangements

During the three months endedMarch 31, 2015, performance share awards were granted to certain executive officers providing the opportunity to earn shares of common stock of the Corporation. The performance shares awarded were valued at the fair market value as of the award date, or $38.02, and will be earned over a 3-year performance period. The number of shares earned will range from zero to 200% of the target number of shares dependent upon the Corporation’s core return on equity and core earnings per share growth ranking compared to an industry peer group. The current assumption based on the most recent peer group information available results in shares earned at 150% of the target, or 46,950 shares.