Balance Sheet Offsetting

For interest rate risk management contracts and loan-related derivative contracts, the Corporation records derivative assets and derivative liabilities on a net basis. The interest rate risk management contracts and loan related derivative contracts with counterparties are subject to master netting agreements. The following tables present the Corporation’s derivative asset and derivative liability positions and the effect of netting arrangements on the Unaudited Consolidated Balance Sheets:



(Dollars in thousands)	Gross Derivative Positions		Offsetting Derivative Positions		Net Amounts Presented in Balance Sheet		Cash Collateral Pledged		Net Amount
September 30, 2018	Gross Derivative Positions		Offsetting Derivative Positions		Net Amounts Presented in Balance Sheet		Cash Collateral Pledged		Net Amount
Derivative Assets:
Interest rate risk management contracts:
Interest rate caps		$83		$—		$83		$—		$83
Interest rate swaps	1,947		—		1,947		—		1,947
Interest rate floors	14		—		14		—		14
Loan-related derivative contracts:
Interest rate swaps with customers	463		430		33		—		33
Mirror swaps with counterparties	17,784		442		17,342		—		17,342
Foreign exchange contracts	37		—		37		—		37
Total		$20,328		$872		$19,456		$—		$19,456

Derivative Liabilities:
Loan-related derivative contracts:
Interest rate swaps with customers		$17,952		$430		$17,522		$—		$17,522
Mirror swaps with counterparties	475		442		33		—		33
Total		$18,427		$872		$17,555		$—		$17,555



(Dollars in thousands)	Gross Derivative Positions		Offsetting Derivative Positions		Net Amounts Presented in Balance Sheet		Cash Collateral Pledged		Net Amount
December 31, 2017	Gross Derivative Positions		Offsetting Derivative Positions		Net Amounts Presented in Balance Sheet		Cash Collateral Pledged		Net Amount
Derivative Assets:
Interest rate risk management contracts:
Interest rate caps		$25		$—		$25		$—		$25
Interest rate swaps	213		—		213		—		213
Interest rate floors	110		—		110		—		110
Loan-related derivative contracts:
Interest rate swaps with customers	2,857		2,589		268		—		268
Mirror swaps with counterparties	3,801		2,649		1,152		—		1,152
Total		$7,006		$5,238		$1,768		$—		$1,768

Derivative Liabilities:
Interest rate risk management contracts:
Interest rate swaps		$14		$—		$14		$14		$—
Loan-related derivative contracts:
Interest rate swaps with customers	3,884		2,589		1,295		1,025		270
Mirror swaps with counterparties	2,917		2,649		268		—		268
Foreign exchange contracts	26		—		26		—		26
Total		$6,841		$5,238		$1,603		$1,039		$564

As of September 30, 2018, there was no pledged collateral to derivative counterparties in the form of cash. As of December 31, 2017, Washington Trust pledged collateral to derivative counterparties in the form of cash totaling $1.0 million. Washington Trust may need to post additional collateral in the future in proportion to potential increases in unrealized loss positions.