Washington Trust Bancorp Annual Report 2008

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FY2008 Annual Report · Washington Trust Bancorp

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2 0 0 8 A n n u a l R e p o r t

W a s h i n g t o n T r u s t B a n c o r p ,

I n c .

Strength. Focus. Direction.

Steady Navigation in Turbulent Times

For 208 years, people have looked to Washington Trust for guidance.

Just as sailors in centuries past relied on a compass, astrolabe, and

sextant for direction in unknown waters, customers in 2008 turned

to Washington Trust to help them navigate turbulent financial markets

and chart a course for financial security and peace of mind.

Letter to Shareholders ~ 4

Corporate Profile ~ 8

2008 Financial Highlights ~ 9

The Year In Review ~ 10

Consolidated Balance Sheets ~ 14

Consolidated Statements of Income ~ 15

Shareholder Information ~ 16

Corporate Directory ~ 17

Washington Trust Locations ~ 19

This report contains certain statements that may be considered “forward-looking

statements” within the meaning of Section 27A of the Securities Act of 1933, as

amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All

statements, other than statements of historical facts, including statements regarding

our strategy, effectiveness of investment programs, evaluations of future interest rate

trends and liquidity, expectations as to growth in assets, deposits and results of operations,

success of acquisitions, future operations, market position, financial position, and

prospects, plans, goals and objectives of management are forward-looking statements.

The actual results, performance or achievements of the Corporation could differ

materially from those projected in the forward-looking statements as a result of,

among other factors, changes in general national, regional or international economic

conditions or conditions affecting the banking or financial services industries or financial

capital markets, volatility and disruption in national and international financial markets,

government intervention in the U.S. financial system, reductions in net interest income

resulting from interest rate volatility as well as changes in the balance and mix of

loans and deposits, reductions in the market value of wealth management assets under

administration, changes in the value of securities and other assets, reductions in loan

demand, changes in loan collectibility, default and charge-off rates, changes in the size

and nature of the Corporation’s competition, changes in legislation or regulation and

accounting principles, policies and guidelines, and changes in the assumptions used in

making such forward-looking statements. In addition, the factors described under

“Risk Factors” in Item 1A of our Annual Report on Form 10-K for the fiscal year

ended December 31, 2008, as filed with the Securities and Exchange Commission,

may result in these differences. You should carefully review all of these factors, and

you should be aware that there may be other factors that could cause these differences.

These forward-looking statements were based on information, plans and estimates

at the date of this report, and the Corporation assumes no obligation to update

forward-looking statements to reflect changes in underlying assumptions or factors,

new information, future events or other changes.

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John C. Warren, Chairman and CEO; John F. Treanor, President and COO

o one could have predicted that 2008 would feature such a confluence

of negative events, including a global recession, an international banking crisis,

and a precipitous decline in the financial markets. As we look back at 2008, it is

clear that for Washington Trust it was a year of “strength, focus and direction.”

We knew the challenges, stuck to our principles, and remained focused on the core

business that has driven our company for more than 208 years. For Washington

Trust, 2008 was a solid year.

Despite all of the turmoil, Washington

Trust was successful – particularly in

contrast to the widely-reported problems in

the financial services industry. We generated

$22.2 million in earnings in 2008, increased

our dividend for the 16th consecutive year,

and raised approximately $47 million in new

capital with select institutional investors.

Already well-capitalized by regulatory

standards, this capital raise made our

company even stronger and we therefore

chose not to accept government funding

under the Troubled Asset Relief

Program (TARP).

Washington Trust is the largest independent bank headquartered in Rhode Island.

In 2008, our independence and local roots played pivotal roles in our performance.

As both the marketplace and larger financial institutions experienced major dis-

ruptions, our position as “a pillar of strength for 208 years” resonated.

Consumers, commercial customers, and investors sought strength and stability in

the management of their financial affairs – and found it in Washington Trust. The

values that we have held close for more than two centuries – trustworthiness,

commitment to excellence, sound judgment, and a willingness to help – were never

more important to our customers or more instrumental to our success.

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When the credit conduits on Wall Street dried up in 2008, capital conservation

was the order of the day at many institutions, but not at Washington Trust. In

fact, our commercial loan portfolio grew by a record 29% in 2008. We attracted

new customers and provided financing for existing clients. Best of all, as we grew

our portfolio, we continued to maintain good asset quality.

As consumers turned from Wall Street to Main Street, our local presence combined

with our reputation for providing exceptional service across all lines of business

offered compelling reasons for people to choose us. What’s more, being a local

bank with strong roots helped us stand out in a market dominated by three large

institutions, all three of which are headquartered out of state. People wanted to do

business with someone they knew, someone they could see or talk to at a

moment’s notice. Many found that trusted advisor at Washington Trust.

Service excellence sets us apart. It is a key part of our brand and helps us retain

and grow profitable client relationships. Statistics and surveys indicate that we

enjoy a high loyalty and satisfaction rate – once people become Washington Trust

customers, they rarely leave. When customers are truly pleased with the service

they receive, they not only become long-term customers; they also tell their

friends and associates about us. This was especially valuable to us in 2008 when

unprecedented dislocation in the marketplace had people looking for new banking

relationships. There is no better catalyst for new business than the referral of a

satisfied customer.

At Washington Trust, people matter. Much of our success can be attributed to our

focus on people – our employees, our customers, and our community. Washington

Trust has a legacy of providing personalized service, trusted advice, and financial

solutions. We have continued to recruit employees who embody that spirit, and

invest in training programs and technology to ensure that our people possess the

skills and talents that they need.

Few prognosticators foresaw the events of 2008; fewer still would commit to

predictions for 2009. Amid this uncertainty, we will remain focused on financial

strength, sound lending practices, local decision-making, and a willingness to

work with people to help them achieve their goals. We are hopeful that President

Obama’s stimulus package will generate the confidence needed to move the

economy forward.

We recently announced that Jack Treanor, President and Chief Operating Officer,

has elected to retire in October 2009. Jack has been a key strategic leader and has

contributed immensely to the success of this organization. He will continue to

serve as a member of our board of directors and we look forward to his continued

contributions and dedication to our organization.

We are grateful for the outstanding efforts of our employees, the confidence of

our customers, and the unwavering support of our shareholders. Ultimately, our

strong performance in 2008 is a tribute to all of you. We are thankful to have the

opportunity to lead your company and look forward to creating value for you

over the long term.

John C. Warren

Chairman and Chief Executive Officer

John F. Treanor

President and Chief Operating Officer

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Corporate Profile

Auditors: KPMG LLP, Providence, Rhode Island
Counsel: Goodwin Procter LLP, Boston, Massachusetts

Annual Meeting of Shareholders

Tuesday, April 28, 2009, 11:00 a.m.
The Granite Theatre
1 Granite Street, Westerly, Rhode Island 02891
Free shareholder parking is available at the Washington Trust parking garage
at 23 Broad Street, Westerly, RI. The Granite Theatre is handicapped
accessible. Shareholders may call 401-348-1566 with questions.

Vote Your Proxy Online Or By Phone

For your convenience, you can vote your shares online
or by phone. Please have your proxy card available.
INTERNET – Access www.voteproxy.com and follow
the on-screen instructions.
TELEPHONE – Call toll-free 800-PROXIES
(800-776-9437) from any touch-tone telephone and
follow the instructions.

2008 Quarters
Stock prices:
High
Low
Close

Dividend declared

2007 Quarters
Stock prices:
High
Low
Close

Dividend declared

$26.50
21.84
24.82
.20

$26.49
19.70
19.70
.21

$33.34 $27.30
16.33
19.75
.21

18.43
26.60
.21

$28.98
25.32
26.81
.20

$27.69
23.90
25.21
.20

$28.42 $28.65
23.49
25.23
.20

22.87
26.97
.20

Washington Trust Profile

As of December 31, 2008
$3.0 billion in assets
$315 million in market capitalization

Washington Trust Bancorp, Inc. is the
publicly-owned holding company of The
Washington Trust Company (the Bank), a
Rhode Island chartered commercial bank
founded in 1800. Through the Bank and its
other subsidiaries, Washington Trust offers a
broad range of financial services, including
wealth management, by way of its branch
offices in Rhode Island, Massachusetts and
southeastern Connecticut.

At December 31, 2008, Washington Trust
had 483 employees. The Corporation has
an Affirmative Action Plan and is an Equal
Opportunity Employer. Washington Trust is
also a member of the FDIC and an Equal
Housing Lender.

Market and Dividend Information

Washington Trust’s common stock trades on
the NASDAQ Global Select® Market under
the symbol WASH. As of December 31, 2008,
there were 2,005 shareholders of record.

Shareholder Return Performance
Presentation

At right is a line graph comparing the
cumulative total shareholder return on the
Corporation’s Common Stock against the
cumulative total return of the NASDAQ
Bank Stocks index and the NASDAQ
Market (U.S.) for the five years ended
December 31. The historical information
below is not necessarily indicative of
future performance.

December 31,

Washington Trust Bancorp, Inc.
NASDAQ Bank Stocks
NASDAQ Market (U.S.)

2003

$100.00
$100.00
$100.00

2004

$114.73
$110.99
$108.59

2005

$105.22
$106.18
$110.08

2006

$115.31
$117.87
$120.56

2007

$107.54
$91.85
$132.39

2008

$87.28
$69.88
$78.72

The results presented assume that the value of the Corporation’s Common Stock and each index was $100.00 on
December 31, 2003. The total return assumes reinvestment of dividends.

Financial Highlights

At or for the years ended December 31,
(Dollars in thousands, except per share amounts)

2008

2007

2006

Financial Condition
Total assets
Total loans
Allowance for loan losses
Total securities
Total deposits
Total shareholders’ equity

Financial Results
Net interest income
Provision for loan losses
Net realized gains on securities
(Losses) on write-downs of investments to fair value
Other noninterest income
Noninterest expense
Net income

Per Share Information
Diluted earnings per share
Cash dividends declared
Book value per share
Tangible book value per share
Market value per share

Selected Ratios
Return on average assets
Return on average equity
Net interest margin (taxable equivalent basis)
Total risk based capital
Tangible equity to tangible assets

Asset Quality Data
Total past due loans to total loans
Nonperforming assets to total assets
Allowance for loan losses to total loans
Net charge-offs to average loans

$2,965,466
1,839,154
23,725
866,219
1,790,868
235,111

$2,539,940
1,573,652
20,277
751,778
1,646,205
186,513

$2,399,165
1,459,986
18,894
703,851
1,677,997
173,056

$65,513
4,800
2,224
(5,937)
44,233
71,742
22,172

$1.57
.83
14.75
10.47
19.75

$59,944
1,900
455
–
45,054
68,906
23,800

$1.75
.80
13.97
9.33
25.23

$61,474
1,200
443
–
41,740
65,335
25,031

$1.82
.76
12.89
8.61
27.89

0.82%

0.99%

1.04%

11.12
2.64
12.54
5.76

0.96%
0.30
1.29
0.08

13.48
2.76
10.39
5.03

0.45%
0.17
1.29
0.03

14.99
2.80
10.96
4.94

0.49%
0.11
1.29
0.02

Other Selected Data
Wealth management assets under administration
Number of ATMs

$3,147,649
134

$4,014,352
141

$3,609,180
132

Total Loans

Total Deposits

Total Shareholders’ Equity

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Flight to Quality

At the core of our story for 2008 is the “flight to quality” that occurred in the
marketplace as customers across all lines of business sought strength and stability
in the management of their financial affairs. Many turned to Washington Trust –
and for good reason. We are strong, well capitalized, and willing to do business.
The principles that have guided our company for more than two centuries
prevailed once again.

The fact is, it was business as usual at Washington Trust in 2008. What changed
were the market conditions outside our doors, which prompted people to turn to us.

Record Commercial Growth

Our commercial lending group achieved record growth in 2008, with balanced
increases in both commercial and industrial lending and commercial real estate.
This was the cumulative result of efforts made over the last ten years as we
established our name in influential business circles, built a reputation for significant
lending capacity and excellent service, and recruited top-notch talent. We put
ourselves in position to take advantage of opportunities when they presented
themselves – and they did throughout 2008.

As the credit and financial markets started to crumble and it became evident
that some of the larger banks were tightening up on credit, or not lending at all,
borrowers turned to Washington Trust. The message was loud and clear:
Washington Trust was lending to businesses throughout New England. As a result,
our commercial portfolio grew substantially and we attracted quality credits of all
types and sizes throughout our market area. We worked with existing clients, brought
in multi-million-dollar deals from new clients, and financed loans for local small
businesses. And once again we were one of the top SBA lenders in Rhode Island.

Ultimately, commercial lending and commercial real estate lending is a relationship
business and Washington Trust professionals continued to work closely with
attorneys, accountants, developers, and borrowers to nurture those relationships.
We have a strong network of professionals committed to working with us in the
best interests of the business community.

Attracting New Investors

It was a difficult year for investors, regardless of asset class. Still, our wealth
management team outperformed the equity market indices in a year where stocks

finished below levels of ten years ago. While it may be the proverbial “moral
victory,” the fact is, Washington Trust wealth management clients fared better
than most in 2008. Over the long term, they continue to outperform the benchmarks.

Difficult market conditions drove business to our wealth management group. As
investors lost confidence in Wall Street, they looked for local, proven providers
that they knew they could trust. Many clients who were investing with other firms
in addition to Washington Trust consolidated their savings and investments with
us, especially as the larger, out-of-state firms experienced difficulties.

Despite market challenges, we enjoyed one of our best years ever for garnering
new business and assets. Much of the new business was from existing clients and
professional advisors who showed confidence in our proven abilities by referring
friends, family, and clients to us.

In 2008, our wealth management group implemented technology solutions to
enhance relationships with clients and strengthen our competitive advantage. A
new open-architecture overlay gives our advisors the ability to employ any of our
proprietary investment capabilities as well as third-party managers, mutual funds,
and exchange-traded funds. What’s more, the technology analyzes client portfolios
to ensure adherence to their goals and objectives, and to maximize tax efficiency.
As a result, portfolio managers are able to act more quickly and knowledgeably
on our clients’ behalf.

Trusted Lender

Despite tightening credit markets, declining home values, and lower overall home
sales, Washington Trust had solid mortgage lending activity in 2008. When the
real estate market contracted and many lenders were saddled with bad debt, we
had money to lend to creditworthy borrowers, and in 2008 they sought us out.
Throughout our history, we have always embraced traditional, thorough under-
writing practices. Such an approach was not “in vogue” in recent years when
loosened lending practices were prevalent.

Another factor in our loan growth was the changing landscape of the mortgage
origination business. As recently as 2007, up to 75% of all mortgages in Rhode
Island were written by mortgage companies. Amid the arrival of the sub-prime
loan crisis, many of these mortgage companies shut their doors. The industry
returned to more traditional loan products and a more rigorous lending approach.
Borrowers sought out banks in general and Washington Trust in particular as a
trusted resource for financing.

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While industry numbers for reverse mortgages were down due to declining home
equity and reduced borrowing activity, our book of business remained consistent
with 2007. We have established ourselves as experts on reverse mortgages and
continue to educate key influencers – accountants, financial planners, attorneys,
healthcare professionals, and realtors – on how reverse mortgages can benefit
their clients. We are ahead of the pack in this category and see promising growth
opportunities in the future.

Security and Peace of Mind

Just a short time ago, the thought of stuffing your money in the mattress was
ridiculous. However, the financial events in 2008 left everyone shaken and led
many to question the safest place for their money. And, even while the FDIC
increased insurance coverage to $250,000 per depositor, per institution, through
December 2009, some depositors sought a safe haven for their money.

Many customers turned to Washington Trust in 2008 for the security of their
deposits and peace of mind. In August, we introduced a solution for high balance
depositors, a new product called the Certificate of Deposit Account Registry Service
(CDARS). As part of the CDARS network, Washington Trust now provides
depositors with access of up to $50 million in FDIC insurance on their certificates
of deposit. This product was tremendously successful in generating new deposits
and new relationships.

New Downtown Location, Same Uptown Service

In December, we relocated our Providence branch to the heart of the capital
city’s financial district. Featuring a contemporary design and catering to busy
professionals, the new branch gave us a high-visibility presence among the city’s
movers and shakers – attorneys, accountants, and other key centers of influence.
It also provided a natural complement to our commercial lending office, which is
right around the corner, and our wealth management location across the river.
Now clients at these offices have convenient access to Washington Trust banking
services whenever they need them.

One of our key strategic goals is to unveil a new branch every two years. We took
a step to fulfilling that goal in 2008 with the purchase of a prime high-traffic parcel
in the Governor Francis section of Warwick. Slated to open in 2009, subject to state
and federal regulatory approvals, the new Governor Francis branch will give us a
second location in Warwick and expand our footprint and presence in the West Bay.

Brand Strength

The Washington Trust brand is one of our most valuable assets. We have invested
consistently to ensure our name is synonymous with outstanding service, significant
capacity, steady management, and more than two centuries of experience. Our tag
line, “Trusted Advisors Since 1800,” emphasizes our service orientation and heritage.
Those four words could not have been more relevant to the marketplace than they
were in 2008 as dislocated consumers looked to Washington Trust as a financial
institution they could rely on.

Nowhere is the Washington Trust service ethic more evident than on the front
line. It’s not just that our branch personnel embrace the Washington Trust core
value of providing outstanding service to every customer. Many of them are
long-term employees who are very familiar with their customers’ financial
situation and needs.

Washington Trust is also well known for our community outreach and involvement.
We not only respond to the critical needs around us through volunteerism, board
leadership, and financial contributions; our people are an integral part of the
communities where they live and work, as well. You see them at food drives,
walk-a-thons, beach cleanups, and other community fundraisers. As an organization
and as individuals, we are civically engaged and making a difference in the
community each day.

Looking Forward

Washington Trust is well served by the banking fundamentals that have held us in
good stead for 208 years. In 2009, we will continue to honor these principles,
while keeping our focus on our customers. We will look for opportunities that can
augment our client base, talent pool, revenue, profitability, and capabilities at a
price that makes sense to our shareholders. And always, we will remain true to
our role as trusted advisor to our clients and customers, which is the cornerstone
of our success.

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Washington Trust Bancorp, Inc. and Subsidiaries Consolidated Balance Sheets

December 31,
(Dollars in thousands)

Assets:
Cash and noninterest-bearing balances due from banks
Interest-bearing balances due from banks
Federal funds sold and securities purchased under resale agreements
Other short-term investments
Mortgage loans held for sale
Securities available for sale, at fair value;

amortized cost $869,433 in 2008 and $750,583 in 2007

Federal Home Loan Bank stock, at cost
Loans:

Commercial and other
Residential real estate
Consumer
Total loans
Less allowance for loan losses
Net loans

Premises and equipment, net
Accrued interest receivable
Investment in bank-owned life insurance
Goodwill
Identifiable intangible assets, net
Other assets

Total assets

Liabilities:
Deposits:

Demand deposits
NOW accounts
Money market accounts
Savings accounts
Time deposits
Total deposits
Dividends payable
Federal Home Loan Bank advances
Junior subordinated debentures
Other borrowings
Accrued expenses and other liabilities

Total liabilities

2008

2007

11,644
41,780
2,942
1,824
2,543

866,219
42,008

880,313
642,052
316,789
1,839,154
23,725
1,815,429
25,102
11,036
43,163
58,114
10,152
33,510
$2,965,466

$172,771
171,306
305,879
173,485
967,427
1,790,868
3,351
829,626
32,991
26,743
46,776
2,730,355

30,817
1,973
7,600
722
1,981

751,778
31,725

680,266
599,671
293,715
1,573,652
20,277
1,553,375
25,420
11,427
41,363
50,479
11,433
19,847
$2,539,940

$175,542
164,944
321,600
176,278
807,841
1,646,205
2,677
616,417
22,681
32,560
32,887
2,353,427

Shareholders’ Equity:
Common stock of $.0625 par value; authorized 30,000,000 shares;
issued 16,018,868 shares in 2008 and 13,492,110 shares in 2007

Paid-in capital
Retained earnings
Accumulated other comprehensive loss
Treasury stock, at cost; 84,191 shares in 2008 and 137,652 shares in 2007

Total shareholders’ equity
Total liabilities and shareholders’ equity

1,001
82,095
164,679
(10,458)
(2,206)
235,111
$2,965,466

843
34,874
154,647
( 239)
(3,612)
186,513
$2,539,940

Refer to Washington Trust Bancorp, Inc.’s 2008 Annual Report on Form 10-K for a complete set of consolidated financial statements.

Washington Trust Bancorp, Inc. and Subsidiaries Consolidated Statements of Income

Years ended December 31,
(Dollars and shares in thousands, except per share amounts)

2008

2007

2006

Interest income:

Interest and fees on loans
Interest on securities:

Taxable
Nontaxable

Dividends on corporate stock and Federal Home Loan Bank stock
Other interest income
Total interest income

Interest expense:

Deposits
Federal Home Loan Bank advances
Junior subordinated debentures
Other interest expense
Total interest expense

Net interest income
Provision for loan losses
Net interest income after provision for loan losses
Noninterest income:

Wealth management services:

Trust and investment advisory fees
Mutual fund fees
Financial planning, commissions and other service fees

Wealth management services
Service charges on deposit accounts
Merchant processing fees
Income from bank-owned life insurance
Net gains on loan sales and commissions on loans originated for others
Net realized gains on securities
Losses on write-downs of investments to fair value
Net unrealized gains (losses) on interest rate swap contracts
Other income
Total noninterest income

Noninterest expense:

Salaries and employee benefits
Net occupancy
Equipment
Merchant processing costs
Outsourced services
Advertising and promotion
Legal, audit and professional fees
Amortization of intangibles
Debt prepayment penalties
Other expenses
Total noninterest expense
Income before income taxes
Income tax expense

Net income

Weighted average shares outstanding - basic
Weighted average shares outstanding - diluted
Per share information:

Basic earnings per share
Diluted earnings per share
Cash dividends declared per share

$ 100,939

$ 98,720

$ 92,190

34,382
3,125
1,882
334
140,662

41,195
30,894
1,879
1,181
75,149
65,513
4,800
60,713

20,316
5,205
2,752
28,273
4,781
6,900
1,800
1,396
2,224
(5,937)
(542)
1,625
40,520

31,163
2,983
2,737
831
136,434

33,763
1,618
2,842
721
131,134

52,422
21,641
1,352
1,075
76,490
59,944
1,900
58,044

21,124
5,430
2,462
29,016
4,713
6,710
1,593
1,493
455
–
27
1,502
45,509

46,982
20,916
1,352
410
69,660
61,474
1,200
60,274

19,099
4,665
2,616
26,380
4,915
6,208
1,410
1,423
443
–
–
1,404
42,183

41,037
4,536
3,838
5,769
2,859
1,729
2,325
1,281
–
8,368
71,742
29,491
7,319
$ 22,172

39,986
4,150
3,473
5,686
2,180
2,024
1,761
1,383
1,067
7,196
68,906
34,647
10,847
$ 23,800

38,698
3,888
3,370
5,257
2,009
1,894
1,637
1,593
–
6,989
65,335
37,122
12,091
$ 25,031

13,981.9
14,146.3

13,355.5
13,604.1

13,424.1
13,723.2

$1.59
$1.57
$0.83

$1.78
$1.75
$0.80

$1.86
$1.82
$0.76

Refer to Washington Trust Bancorp, Inc.’s 2008 Annual Report on Form 10-K for a complete set of consolidated financial statements.

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Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders
Washington Trust Bancorp, Inc.:

We have audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the consolidated balance sheets of
Washington Trust Bancorp, Inc. and Subsidiaries as of December 31, 2008 and
2007, and the related consolidated statements of income, changes in shareholders’
equity (not present herein) and cash flows (not presented herein) for each of the
years in the three-year period ended December 31, 2008; and in our report dated
February 27, 2009, we expressed an unqualified opinion on those consolidated
financial statements.

In our opinion, the information set forth in the accompanying consolidated
financial statements is fairly stated, in all material respects, in relation to the
consolidated financial statements from which it has been derived.

Providence, Rhode Island
February 27, 2009

Stock Transfer and Dividend Disbursing Agent

American Stock Transfer & Trust Company LLC (AST), our stock transfer and
dividend disbursing agent, is responsible for our shareholder records, issuance of
stock certificates, distribution of dividend checks, and IRS Form 1099. AST is
also responsible for the Corporation’s Dividend Reinvestment (DRIP) and Stock
Purchase Plan, which enables shareholders to reinvest their quarterly dividends
in Washington Trust shares.

For information, contact AST on the toll-free Shareholder Information Line,
800-852-0354, via the secure AST Shareholder Services website, www.amstock.com,
or by writing to: American Stock Transfer LLC, 6201 15th Avenue, Brooklyn,
New York, NY 11219. For transaction processing, contact AST in writing to
Plan Administration Department, P.O. Box 922, Wall Street Station, New York,
NY 10269-0560.

To receive a duplicate copy of your 2008 IRS Form 1099, please visit
www.amstock.com or call 800-852-0354.

Important Notice Regarding the Availability of Proxy Materials for the Annual
Meeting to be held April 28, 2009: The Corporation’s 2009 Proxy Statement,
Form 10-K and Annual Report for 2008 are available online by visiting:
www.washtrust.com/proxy or by visiting the Corporation’s website,
www.washtrust.com under Investor Relations – SEC Filings. These documents
are also available by calling the Corporation’s toll-free number, 800- 475-2265
extension 1566, or by contacting Elizabeth B. Eckel, Senior Vice President, by
email at investor.relations@washtrust.com.

Corporate Directory, Washington Trust Bancorp, Inc.

Board of Directors

Gary P. Bennett, Retired Chairman and Chief Executive Officer, Analysis and Technology, Inc.

Steven J. Crandall, Vice President, Ashaway Line & Twine Mfg. Co.

Larry J. Hirsch, Esq., Retired President, Westerly Jewelry Co.

Barry G. Hittner, Esq., Of Counsel, Cameron & Mittleman, LLP

Katherine W. Hoxsie, CPA, Retired Vice President, Hoxsie Buick-Pontiac-GMC Truck, Inc.

Mary E. Kennard, Esq., Vice President and University Counsel, The American University

Edward M. Mazze, Ph.D., Distinguished University Professor of Business Administration,

University of Rhode Island

Kathleen McKeough, Retired Senior Vice President of Human Resources,

GTECH Holdings Corporation

Victor J. Orsinger, II, Esq., Partner, Orsinger and Nardone, Attorneys at Law

H. Douglas Randall, III, President, H.D. Randall, Realtors

Patrick J. Shanahan, Jr., Former Chairman, President and Chief Executive Officer,

First Financial Corp.

Neil H. Thorp, President, Thorp & Trainer, Inc.

John F. Treanor, President and Chief Operating Officer, Washington Trust Bancorp, Inc.

John C. Warren, Chairman and Chief Executive Officer, Washington Trust Bancorp, Inc.

Officers of the Corporation

John C. Warren, Chairman and Chief Executive Officer

John F. Treanor, President and Chief Operating Officer

Galan G. Daukas, Executive Vice President, Wealth Management

David V. Devault, Executive Vice President, Chief Financial Officer and Secretary

Mark K. W. Gim, Executive Vice President and Treasurer

The Washington Trust Company Directors’ Advisory Council

Alcino G. Almeida, Charles M. Baker, Jr., Charles C. Buffum, Richard A. Grills,

Joseph J. Kirby, Jacques de Laporte, James W. McCormick, Jr., Thomas F. Moore,

Brendan P. O’Donnell, Joseph H. Potter, Joseph E. Pucci, Joyce Olson Resnikoff,

Anthony J. Rose, Jr., James P. Sullivan, William Blunt White

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S

Corporate Directory, The Washington Trust Company

Senior Management

John C. Warren, Chairman and Chief Executive Officer

John F. Treanor, President and Chief Operating Officer

Dennis L. Algiere, Senior Vice President, Chief Compliance Officer and

Director of Community Affairs

Carl M. Amaral, Senior Vice President, Branch Sales and Service

Stephen M. Bessette, Executive Vice President, Retail Lending

Vernon F. Bliven, Senior Vice President, Human Resources

Galan G. Daukas, Executive Vice President, Wealth Management

David V. Devault, Executive Vice President, Chief Financial Officer and Secretary

Elizabeth B. Eckel, Senior Vice President, Marketing

Gerald J. Fogarty, Jr., Managing Director, Washington Trust Investors

Philip L. Friend, Senior Vice President, Retail Lending

William D. Gibson, Senior Vice President, Risk Management

Mark K. W. Gim, Executive Vice President and Treasurer

Russell W. Hahn, Senior Vice President, Commercial Lending

Marie J. Langlois, Managing Director, Washington Trust Investors

Rogean B. Makowski, Senior Vice President, Wealth Management Client Services

Mary M. McGoldrick, Senior Vice President and Chief Investment Officer

Barbara J. Perino, CPA, Senior Vice President, Operations and Technology

Harvey C. Perry, II, Senior Vice President, Director of Office for

Non-Profit Resources

B. Michael Rauh, Jr., Executive Vice President, Sales, Service and Delivery

Brenda H. Senak, Senior Vice President, Risk Management

Julia Anne M. Slom, Senior Vice President, Commercial Real Estate Group

James M. Vesey, Executive Vice President and Chief Credit Officer

James J. Walther, Senior Vice President, Director of Internal Audit

Weston Financial Group, Inc.

Galan G. Daukas, Executive Managing Director

Douglas A. Biggar, Managing Director

Wayne M. Grzecki, Managing Director

Joseph Robbat, Jr., Managing Director

Ronald A. Sugameli, Managing Director

Washington Trust Locations

Rhode Island Offices

CORPORATE OFFICE
23 Broad Street
Westerly, RI 02891
401-348-1200

BLOCK ISLAND
Block Island Office
Ocean Avenue
Block Island, RI 02807
401-466-7710

CHARLESTOWN
Charlestown Office
4137 Old Post Road
Charlestown, RI 02813
401-364-4000

CRANSTON
Oaklawn Avenue Office
1203 Oaklawn Avenue
Cranston, RI 02920
401-732-0049

Reservoir Avenue Office
645 Reservoir Avenue
Cranston, RI 02910
401-946-1004

NARRAGANSETT
Bonnet Shores Office
885 Boston Neck Road
Narragansett, RI 02882
401-782-4800

Sweet Meadows Office
20 Point Judith Road
Narragansett, RI 02882
401-782-1000

NORTH KINGSTOWN
North Kingstown Office
7625 Post Road
North Kingstown, RI 02852
401-295-4700

PROVIDENCE
Providence Office
156 Westminster Street
Providence, RI 02903
401-421-3600

Providence Commercial
Lending Office
10 Weybosset Street
Suite 100
Providence, RI 02903
401-331-5090

Providence Wealth
Management Offices
66-70 South Main Street
Providence, RI 02903
401-861-8440
401-331-6650

RICHMOND
Richmond Office
1200 Main Street
Wyoming, RI 02898
401-539-2427

SOUTH KINGSTOWN
Wakefield Office
730 Kingstown Road
Wakefield, RI 02879
401-782-4200

WARWICK
Centerville Road Office
236 Centerville Road
Warwick, RI 02886
401-739-2353

OPENING 2009
Warwick Avenue Office
1473 Warwick Avenue
Warwick, RI 02888

WESTERLY
Main Office
23 Broad Street
Westerly, RI 02891
401-348-1200

Franklin Street Office
126 Franklin Street
Westerly, RI 02891
401-348-1367

McQuade’s Marketplace
106 Main Street
Westerly, RI 02891
401-348-1201

Connecticut Offices

MYSTIC
A&P Super Foodmart
179 Stonington Road
Mystic, CT 06355
860-572-7100

McQuade’s Marketplace
14 Clara Drive
Mystic, CT 06355
860-572-2058

Mystic Office
Olde Mistick Village
Mystic, CT 06355
860-536-1200

Massachusetts Office

WELLESLEY
Weston Financial Group
Wellesley Office Park
40 William Street
Wellesley, MA 02481
781-235-7055

Account Information Center

To speak with a customer
service representative, call
401-348-1200 or toll-free
800-475-2265.
In Connecticut, call
860-443-1508.

Online Banking

Bank and pay bills via the
Internet 24 hours a day,
7 days a week at
www.washtrust.com.

XPress Banking

Automated banking by
phone 24 hours a day, 7 days
a week at 401-348-1399 or
toll-free 800-226-5877.

Website

Current company and share-
holder information available
at www.washtrust.com.

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Printed with vegetable-based inks.
A portion of the energy used in printing was supplied by wind-generated electricity.