WASH 10-K & 10-Q changes, risk factors and insider trading

The economy in the U.S. and globally has experienced volatility in recent years and may continue to experience such volatility for the foreseeable future. Unfavorable or uncertain economic conditions can be caused by declines in economic growth, business activity, or investor or business confidence; limitations on the availability of or increases in the cost of credit and capital; increases in inflation or interest rates; uncertainties regarding fiscal and monetary policies; the timing and impact of changing governmental policies, including changes in guidance and interpretation by regulatory authorities; changes in trade policies by the U.S. or other countries, such as tariffs or retaliatory tariffs as those proposed by the incoming U.S. Administrationcountries; supply chain disruptions; consumer spending; employment levels; labor shortages; challenging labor market conditions; wage stagnation; federal government shutdowns; energy prices; home prices; commercial property values; bankruptcies and a default by a significant market participant or class of counterparties; natural disasters; climate change; epidemics; pandemics; terrorist attacks; acts of war; or a combination of these or other factors.

Liquidity is essential to our business. We must maintain sufficient funds to respond to the needs of depositors and borrowers. To manage liquidity, we draw upon a number of funding sources in addition to in-market deposit growth and repayments and maturities of loans and investments. Any inability to access the capital markets, illiquidity or volatility in the capital markets, thea decrease in value of eligible collateral or increasedan increase in collateral requirements (including as a result of credit concerns for short-term borrowing), changes to our relationships with our funding providers based on real or perceived changes in our risk profile, prolonged federal government shutdowns, or changes in regulations or regulatory guidance, or other events could negatively affect our access to or cost of funding, affecting our ongoing ability to accommodate liability maturities and deposit withdrawals, meet contractual obligations, or fund asset growth and new business initiatives at a reasonable cost, in a timely manner and without adverse consequences. Additionally, our liquidity or cost of funds may be negatively impacted by the unwillingness or inability of the Federal Reserve to act as lender of last resort, unexpected simultaneous draws on lines of credit or deposits, the withdrawal of or failure to attract customer deposits, or increased regulatory liquidity, capital and margin requirements.

Although we maintain a liquid asset portfolio and have implemented strategies to maintain sufficient and diverse sources of funding to accommodate planned, as well as unanticipated, changes in assets, liabilities, and off-balance sheet commitments under various economic conditions, a substantial, unexpected, or prolonged change in the level or cost of liquidity could have a material adverse effect on us. If the cost effectiveness or the availability of supply in these markets is reduced for a prolonged period of time, our funding needs may require us to access funding and manage liquidity by other means. These alternatives may include generating clientcustomer deposits, extending the maturity of wholesale borrowings, borrowing under certain secured borrowing arrangements, using relationships developed with a variety of fixed income investors, selling or securitizing loans, and further managing loan growth and investment opportunities. These alternative means of funding may result in an increase to the overall cost of funds and may not be available under stressed conditions, which would cause us to liquidate a portion of our liquid asset portfolio to meet any funding needs.

When we make loans, we sometimes obtain liens, such as real estate mortgages or other asset pledges, to provide us with a security interest in collateral. If there is a loan default, we may seek to foreclose upon collateral and enforce the security interests to obtain repayment and eliminate or mitigate our loss. Drafting errors, recording errors, other defects or imperfections in the security interests granted to us and/or changes in law may render liens granted to the us unenforceable. We may incur losses or expenses if security interests granted to us are not enforceable.

We are subject to a variety of risks in connection with any sale of loans we may be required to repurchase mortgage loans or indemnify buyers against losses in some circumstances,conduct, which could adversely affect our results of operations and financial condition.

We routinely sell newly originated residential mortgage loans and may also sell other loans or loan portfolios. When mortgage loans are sold, we are required to make customary representations and warranties to purchasers, guarantors and insurers, including government-sponsored entities, about the mortgage loans and the manner in which they were originated. Whole loan sale agreements require us to repurchase or substitute mortgage loans, or indemnify buyers against losses, in the event we breach these representations or warranties. In addition, we may be required to repurchase mortgage loans as a result of early payment default of the borrower on a mortgage loan. If repurchase and indemnity demands increase and such demands are valid claims and are in excess of our provision for potential losses, our results of operations and financial condition may be adversely affected.

OurIf ACLour onallowance loansfor maycredit losses is not be adequatesufficient to cover actual loan losses, and an increase in the ACL on loans will adversely affect our earnings.earnings may decrease.

We are a holding company and depend on the Bank for dividends, distributionsdistributions, and other payments.

The Bancorp is a legal entity separate and distinct from the Bank. Revenues and cash flows of the Bancorp (on a non-consolidated basis) are derived primarily from dividends paid to it by the Bank. The right of the Bancorp, and consequently the right of shareholders of the Bancorp, to participate in any distribution of the assets or earnings of the Bank, through the payment of such dividends or otherwise, is necessarily subject to the prior claims of creditors of the Bank (including depositors), except to the extent that certain claims of the Bancorp in a creditor capacity may be recognized.

Holders of our common stock are entitled to receive dividends only when, asas, and if declared by our Board of Directors. Although we have historically declared cash dividends on our common stock, we are not required to do so, and our Board of Directors may reduce or eliminate our common stock dividend in the future. The FederalBancorp Reserve has authority to prohibit bank holding companies from paying dividends if such payment is deemed to be an unsafe or unsound practice. Additionally, the FDIC has the authority to use its enforcement powers to prohibitand the Bank fromare payingpotentially dividendssubject if,to invarious itsregulatory opinion,restrictions the payment of dividends would constitute an unsafe or unsound practice. Further,on our ability to pay dividends would be restricted if we do not maintain a capital conservation buffer. A reduction or elimination of dividends could adversely affect the market price of our common stock.dividends. See Item,Item 1 “Business-Supervision and Regulation-Dividend Restrictions” and “Business-Supervision and Regulation-Capital Adequacy and Safety and Soundness-Regulatory Capital Requirements.”

We maintain a securities portfolio, which may include obligations of U.S. government-sponsored enterprises and agencies, including mortgage-backed securities; obligations of states and political subdivisions; individual name issuer trust preferred debt securities; and corporate bonds. We seek to limit credit losses in our securities portfolios by generally purchasing only highly-rated securities. The valuation and liquidity of our securities could be adversely impacted by reduced market liquidity, increased normal bid-asked spreads and increased uncertainty of market participants, which could reduce the market value of our securities, even those with no apparent credit exposure. Inflation and rapid increases in interest rates led to a decline in the trading value of previously issued government securities with interest rates below current market interest rates. The valuation of our securities requires judgment and as market conditions change security values may also change. Significant negative changes to valuations could result in impairments in the value of our securities portfolio, which could have an adverse effect on our financial condition or results of operations.

A possible future downgrade of the sovereign credit ratingsrating of the U.S. government and a decline in the perceived creditworthiness of U.S. government-related obligations could impact our ability to obtain funding that is collateralized by affected instruments, as well as affect the pricing of that funding when it is available. A downgrade may also adversely affect the market value of such instruments. We cannot predict if, when or how any changes to the credit ratings or perceived creditworthiness of these organizations will affect economic conditions. Such ratings actions could result inhave a significant adverse impact on us. Among other things, a downgrade of the sovereign credit ratingsrating of the U.S. government could adversely impact the value of our investment securities portfolio and may trigger requirements to post additional collateral for trades relative to these securities. A downgrade of the sovereign credit ratingsrating of the U.S. government or the credit ratings of related institutions, agencies or instruments could significantly exacerbate the other risks to which we are subject and any related adverse effects on the business, financial condition and results of operations.

We face continuing and growing security risks to our information base,data, including the information we maintain relating to our customers.

We regularly assess and test our security systems and disaster preparedness, including back-up systems, but the risks are escalating. We also review and assess the cybersecurity risk of our third-party service providers.ongoing. As a result, cybersecurity and the continued enhancement of our controls and processes to protect our systems, data and networks from attacks, unauthorized access or significant damage remain a priority. Accordingly, we may be required to expend additional resources to enhance our protective measures or to investigate and remediate any information security vulnerabilities or exposures. Any breach of our system security could result in disruption of our operations, unauthorized access to confidential customer information, significant regulatory costs, litigation exposureexposure, and other possible damages, loss, or liability. ASuch costs or losses could exceed the amount of available insurance coverage, if any, and would adversely affect our earnings. Also, any failure to prevent a security breach or to quickly and effectively deal with such a breach could negatively impact customer confidence, damaging our reputation and undermining our ability to attract and keep customers.

We competeoperate within a highly competitive environment that includes financial and non-financial services firms, including traditional banks, online banks, financial technology companies, and investment management and wealth advisory firms, including commercial banks and trust companies, investment advisory firms, mutual fund companies, stock brokerage firms. These companies compete on the basis of, among other factors, size, location, quality and type of products and services offered, price, technology, brand recognitionrecognition, and reputation. Emerging technologiestechnologies, such as artificial intelligence (including machine learning and generative artificial intelligence) and quantum computing, have the potential to further intensify competition and accelerate disruption in the financial services industry. In recent years, non-financial services firms, such as financialFinancial technology companies,companies have begun tonow offer services traditionally provided by financial institutions. These firms attempt to use technology and mobile platforms to enhance the ability of companies and individuals to borrow, save and invest money. Additionally, financial technology companies and other firms have begun to offer services such as stablecoins that may serve as alternatives to traditional banking products such as deposits. Many of these non-financial services competitors have fewer regulatory constraints and may have lower cost structures than we do. Our long-term success depends on our ability to develop and execute strategic plans and initiatives; to develop competitive products and technologies; and to attract, retain and develop a highly skilled employee workforce. We may not be as timely or successful in assessing the evolving competitive landscape and developing or introducing new products and services as our competitors. Our abilitybusiness may be negatively impacted if we, or our third-party providers, do not timely develop and apply emerging technologies, or if our initiatives in these areas are deficient or fail. Our, or our third-party providers’, inability or resistance to successfullytimely attractinnovate or adapt operations, products, and retainservices wealthto managementevolving clientsregulatory isand dependentmarket uponenvironments, industry standards, and consumer preferences could result in service disruptions, harm our ability to compete with competitors’ investment products, level of investment performance, client servicesbusiness, and marketingadversely and distribution capabilities. If we are not successful,affect our results of operations and financial condition may be negatively impacted.reputation.

Our success depends, in large part, on our ability to attract and retain key personnel. Certain key personnel that have regular direct contact with customers and clients often build strong relationships that are important to our business. In addition, we rely on key personnel to manage and operate itsour business, including major revenue producing functions, such as loan and deposit generation and wealth management services. Competition for qualified personnel in the financial services industry can be intense, and we may not be able to hire or retain the key personnel that we depend upon for success. Frequently, we compete in the market for talent with entities that are not subject to comprehensive regulation, including with respect to the structure of incentive compensation. The unexpected loss of services of one or more of our key personnel could have a material adverse impact on our business because of their skills, knowledge of the markets in which we operate, years of industry experience and the difficulty of promptly finding qualified replacement personnel. Also, the loss of key personnel could jeopardize our relationships with customers and clients and could lead to the loss of accounts. Losses of such accounts could have a material adverse impact on our business.

The current and anticipated effects of climate change are creating an increasing level of concern for the state of the global environment. As a result, political and social attention to the issue of climate change has increased. In recent years, governments across the world have entered into international agreements to attempt to reduce global temperatures, in part by limiting greenhouse gas emissions. Despite the recent changes in the U.S. Administration, Congressional leadership and regulatory agency leadership, state legislatures and federal and state regulatory agencies may continue to propose and advance numerous legislative and regulatory initiatives seeking to mitigate the effects of climate change. These agreements and measures may result in the imposition of taxes and fees, the required purchase of emission credits, and the implementation of significant operational changes, each of which may require us to expend significant capital and incur compliance, operating, maintenance, and remediation costs. Consumers and businesses may also change their behavior on their own as a result of these concerns. The impact on our customers will likely vary depending on their specific attributes, including reliance on, or role in, carbon intensive activities. Our efforts to take these risks into account in making lending and other decisions, including by increasing our business with climate-friendly companies, may not be effective in protecting us from the negative impact of new laws and regulations or changes in consumer or business behavior.

OnAs Septemberpreviously 27,disclosed in 2023, the Bank entered into a settlement with the DOJ through an agreement to resolve allegations that it violated fair lending laws in the state of Rhode Island from 2016 to 2021. Under the settlement, the Bank agreedagreed, over a five-year period, to (i) provide $7.0 million in loan subsidies over a five-year period with the goal of increasing home mortgage loans, home improvement loans, and home refinance loans in specific census tracts in Rhode Island. Loan subsidies may include originating a loan for a home purchase, refinancing or home improvement at an interest rate below the otherwise prevailing market interest rate offered by Washington Trust and payment of the initial mortgage insurance premium on loans subject to such mortgage insurance. The cost of such subsidies will generally be recognized over the life of the respective loans. Loan subsidies may also include down payment assistance and closing cost assistance. The Bank also agreed to(ii) commit $2.0 million for focused community outreach and marketing efforts over a five-year period.efforts. The expenses associated with community outreach and marketing efforts are being recorded in the period in which the activities occur and are consistent with historical spending levels. In addition, the Bank committed to opening two full-service branches in specific census tracts in Rhode Island, including the previously announced new branch in Olneyville, Rhode Island.Island that opened in 2024 and the branch in Pawtucket, Rhode Island, which is expected to open in the latter half of 2026. The settlement included no civil penalties levied against the Bank.

The following analysis is intended to provide the reader with a further understanding of the consolidated financial condition and results of operations of the Corporation for the periods shown. For a full understanding of this analysis, it should be read in conjunction with other sections of this Annual Report on Form 10-K, including Part I, “Item 1.1 “Business” and Part II, “Item 8.8 “Financial Statements and Supplementary Data.”

The following table presents adjusted noninterest income, adjusted noninterest expense, adjusted income before income taxes, adjusted income tax expense, adjusted effective tax rate, adjusted net income, and adjusted net income available to common shareholders:

(1)Net income (incomeloss) loss divided by total average assets.

Our largest source of operating income is net interest income, which is 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, mortgage banking activities, and deposit services. Our principal noninterest expenses include salaries and employee benefit costs, outsourced services (including software-as-a-service) provided by third-party vendors, occupancy and facility-related costs, and other administrative expenses.

We continue to leverage our strong regional brand to build market share and remain steadfast in our commitment to provide superior service. We believe the key to future growth is providing customers with convenient in-person service and digital banking solutions. InWe Januaryplan 2024,to we openedopen a new full-service branch in Smithfield,Pawtucket, Rhode Island and in September 2024, we opened a new full-service branch in the Olneyvillelatter sectionhalf of Providence.2026.

FTE net interest income in 20242025 amounted to $129.4$154.0 million, downup by $8.7$24.7 million, or 6%,19%, from 2023.2024. IncreasesDecreases in average interest-bearing liability balances,balances net of increasesdecreases in average interest-earning assets, reducedincreased net interest income by $4.4$9.5 million in 2024.2025. IncreasesDecreases in funding costs outpaced increasesdecreases in asset yields, reducingincreasing net interest income by $4.3$15.2 million.million Seein additional2025. discussionNIM regardingwas interest2.40% ratein sensitivity2025, underup theby caption53 “Asset/Liabilitybasis Managementpoints andfrom Interest1.87% Ratein Risk.”2024.

Total average securities for 20242025 decreased by $66.8$58.4 million, or 6%,5%, from the average balance for 2023,2024, primarily due to routine pay downs. The FTE rate of return on securities was 2.49%3.45% in 2024,2025, up by 496 basis points from 2.45% in 2023.2024.

Total average loan balances increaseddecreased by $195.9$463.2 million, or 4%,8%, from the2024, averagelargely balancereflecting fora 2023. This reflected growthdecrease in average CRE and residential real estate loans. The yield on total loans in 20242025 was 5.37%,5.28%, updown by 349 basis points from 5.03% in 2023, reflecting higher market interest rates in 2024.

The Bank utilizes FHLB advances and brokered time deposits are utilized as wholesale funding sources. Wholesale funding balances decreased in 2025, largely reflecting benefits from the balance sheet repositioning transactions mentioned above, as well as in-market deposit growth. Rates paid on wholesale funding have declined from the prior year reflecting lower market interest rates. The average balance of FHLB advances for 20242025 increaseddecreased by $255.7$426.7 million, or 24%,33%, comparedfrom to2024. the average balance for 2023. Due to increases in market rates, theThe average rate paid on such advances in 20242025 was 4.92%,4.48%, updown 2344 basis points from 4.69% in 2023.2024. Included in total average interest-bearing deposits were wholesale brokered deposits, which decreased by $101.8$455.9 million, or 17%,90%, from 2023.2024. The average rate paid on wholesale brokered deposits in 20242025 was 5.22%,5.04%, updown by 4618 basis points from 4.76% in 2023.2024.

As market interest rates rose, deposit balances shifted from lower cost deposits to higher cost deposits. Average in-market interest-bearing deposits, which excludes wholesale brokered deposits, increased by $132.9$395.8 million, or 3%,10%, from the2024, average balance in 2023, withreflecting increases inacross timemost depositsdeposit and interest-bearing demand deposits.categories. The average rate paid on in-market interest-bearing deposits in 20242025 was 2.96%,2.74%, updown by 6222 basis points from 2.34%2024, inlargely 2023.reflecting lower market interest rates. The average balance of noninterest-bearing demand deposits for 20242025 decreased by $113.6$31.4 million, or 15%,5%, from the average balance in 2023.2024.

Noninterest income amounted to $75.9 million in 2025, compared to a net loss of $27.8 million in 2024,2024. comparedAs todescribed above, total noninterest income of $56.1 million in 2023. Noninterest income in 2024 was impacted by theinfrequent recognition of $93.9 milliontransactions in netboth realized losses on securities and net losses on the sale of portfolio loans associated with balance sheet repositioning transactions. In addition, other income in 2024 included income of $2.1 million associated with a litigation settlement and a net gain of $988 thousand recognized on the sale of a bank-owned operations facility.years. Excluding the impact of these transactions, adjusted noninterest income (non-GAAP) was $68.9 million in 2025, compared to $63.1 million in 2024, compared to $56.1 million in 2023, up by $6.9$5.8 million, or 12.3%.9%.

Wealth management revenues for 20242025 increased by $3.5$2.2 million, or 10%,6%, from 2023,2024, largely reflecting an increase in asset-based revenues. The changeincrease in asset-based revenues correlated with the increasechange in average AUA balances in 2024.balances. The average balance of AUA in 2024 increased by 10%7% fromover the2024, averageprimarily balancereflecting innet 2023.investment appreciation of AUA.

Mortgage banking revenues are dependent on mortgage origination volume and are sensitive to interest rates and the condition of housing markets. WhileIn 2025, loan origination and refinancing activities decreasedincreased in response to increasesdecreases in market interest rates, a larger proportion of loans were originated for sale in 2024.rates. The composition of mortgage banking revenues and the volume of loans sold to the secondary market are shown in the following table:

Mortgage banking revenues increased by $4.3$1.1 million, or 65%,10%, in 2024.2025. The increase in mortgage banking revenues waslargely mainlyreflected attributablean to increasesincrease in both sales volume and sales yield.volume.

Loan related derivative income from interest rate swap contracts with commercial borrowers decreasedincreased by $923$1.7 thousand, or 66%,million in 2024,2025, reflecting ahigher decline intransaction volume.

Other income was updown by $3.2$1.9 million, or 242%,53%, from 2023,2024, primarily due to the receipt of income associated with a litigation settlement and the net gain on the sale of a bank-owned operations facility as mentioned above.

Salaries and employee benefits expense, the largest component of noninterest expense, increased by $3.8$5.5 million, or 5%,6%, from 2023.2024. This included higher performance-basedlevels incentiveof performance- and volume-based compensation, merit increases, and lowerincreased staffing levels.

FDIC deposit insurance costs for the 20242025 increaseddecreased by $846$933 thousand, or 18%,17%, from 2023,2024, reflecting the impact of increasesa decline in average assets from a year ago and a higherlower FDIC deposit assessment rate.

Other expensesnoninterest expense for 20242025 decreasedincreased by $1.8$3.0 million, or 17%,34%, from 2023.2024. InIncluded 2023,in this increase was a charitablefourth contributionquarter expense as a2025 $1.0 million contribution wasmade madeby Washington Trust to Washington Trust’sits charitable foundation.foundation, Thereas waswell noas suchsystem conversion costs associated with changes in technology, and increases across a variety of noninterest expense in 2024.categories.

The effective tax rates differed from the federal rate of 21%, primarily due to state income tax benefits,expense, which was partially offset by benefits from tax-exempt income, income from BOLI, and federal tax credits. The blended statutory rates include the federal income tax rate of 21% and a blended state income tax rate net of a federal tax benefit.

The following discussion should be read in conjunction with the Corporation’s Audited Consolidated Financial Statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025, 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 and six months ended MarchJune 31,30, 2026 are not necessarily indicative of the results for the full-year ended December 31, 2026 or any future period.

•changes in general business and economic conditions (including the impact of ongoing armed conflicts, tariffs, inflation, current or future U.S. government shutdowns, and concerns about liquidity) on a national basis and in the local markets in which we operate;

We continue to leverage our strong regional brand to build market share and remain steadfast in our commitment to provide superior service. We believe the key to future growth is providing customers with convenient in-person service and digital banking solutions. We have plans to open two new full-service branches later in 2026; one in Pawtucket and another in Bristol, Rhode Island.

Net income totaled $12.6$16.0 million and $28.6 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $12.2$13.2 million and $25.4 million, respectively, reported for the same periodperiods in 2025. TheseThe prior year results included the following infrequent transactions:

Excluding these items, adjusted net income (non-GAAP) for the three and six months ended MarchJune 31,30, 2026 was $12.6$16.0 million and $28.6 million, respectively, compared to $11.8$13.2 million and $25.0 million, respectively, for the same periodperiods in 2025, up by $838 thousand, or 7%.2025. These results reflected higher net interest income, as well as growth in wealth management and mortgage banking revenues, partially offset by an elevated provision for credit losses and higher salaries and benefits costs.

Net interest income, the primary source of our operating income, totaled $40.5$41.8 million and $82.3 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $36.4$37.2 million and $73.6 million, respectively, for the same periodperiods in 2025.

FTE net interest income for the three and six months ended MarchJune 31,30, 2026 amounted to $40.7$42.0 million and $82.7 million, respectively, up by $4.1$4.6 million and $8.7 million, respectively, from the same periodperiods in 2025. For the three and six months ended MarchJune 31,30, 2026, decreases in average interest-bearing liability balances net of decreases in average interest-earning assets increased net interest income by $793$1.3 thousand.million and $2.0 million, respectively. Decreases in funding costs outpaced decreases in asset yields, increasing net interest income by $3.3 million and $6.7 million, respectively, for the three and six months ended MarchJune 31,30, 2026.

NIM was 2.63%2.73% and 2.68%, respectively, for the three and six months ended MarchJune 31,30, 2026, up by 34 basis points from 2.29%2.36% and 2.32%, respectively, for the same periodperiods in 2025.

Total average securities for the three and six months ended MarchJune 31,30, 2026 decreased by $20.1$70.5 million and $45.4 million, respectively, from the same periodperiods a year earlier primarily due to routine pay-downs. The FTE rate of return on the securities portfolio for the three and six months ended MarchJune 31,30, 2026 was 3.48%,3.41% upand 3.44%, respectively, down by 56 and 1 basis pointspoints, respectively, from the same periodperiods in 2025.

Total average loan balances for the three and six months ended MarchJune 31,30, 2026 decreased by $21.8$116.5 million and $69.4 million, respectively, from the comparable 2025 period, largelyperiods, reflecting a decreasedecreases in the residential and commercial real estate loan portfolio.portfolios. The yield on total loans for the three and six months ended MarchJune 31,30, 2026 was 5.14%,5.20% and 5.17%, respectively, down by 179 and 13 basis pointspoints, respectively, from the same periodperiods in 2025. The decrease reflected the impact of lower market interest rates, partially offset by the benefit from the cessation of deferred loss amortization discussed above.

FHLB advances and brokered time deposits are utilized as wholesale funding sources. The average balance of FHLB advances for the three and six months ended MarchJune 31,30, 2026 decreased by $299.2$397.2 million and $348.5 million, respectively, from the comparable periodperiods in 2025. The average rate paid on such advances for the three and six months ended MarchJune 31,30, 2026 was 4.16%,4.10% and 4.13%, respectively, down by 4639 and 43 basis pointspoints, respectively, from the same periodperiods in 2025. There were no wholesale brokered time deposits for the three and six months ended MarchJune 31,30, 2026,2026. This compared to $188.4$8.5 million and $97.9 million, respectively for the three and six months ended MarchJune 31,30, 2025 that had anwith average raterates of 5.05%.4.96% and 5.05%, respectively. The decline in wholesale funding balances reflected the benefits from the balance sheet repositioning transactions mentioned above, as well as increases in the average balances of in-market deposits. Rates paid on wholesale funding have declined from the prior year reflecting lower market interest rates.

Average in-market interest-bearing deposits, which excludes wholesale brokered deposits, for the three and six months ended MarchJune 31,30, 2026 increased by $279.1$192.2 million and $235.4 million, respectively, from the same periodperiods in 2025, largely reflecting increases in average balances of savings accounts and interest-bearing demand deposits. The average rate paid on in-market interest-bearing deposits for both the three and six months ended MarchJune 31,30, 2026 was 2.42%,2.41%, down by 3540 and 38 basis pointspoints, respectively, from the same periodperiods in 2025, largely reflecting lower market interest rates. The average balance of noninterest-bearing demand deposits for the three and six months ended MarchJune 31,30, 2026 increased by $6.0 million and decreased by $16.5$5.2 millionmillion, respectively, from the same periodperiods in 2025.

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

The following table presents the provision for credit losses for the periods indicated:

The provision for credit losses for the three and six months ended MarchJune 31,30, 2026,2026 largelyprovided reflectedfor an increase in specific reserves onand twofor CRE office segment loans, which was partially offset by a declinechanges in our loan portfolio balances.portfolio. See additional discussion regarding these two loans under the caption “Nonaccrual Loans.”

Net charge-offs totaled $10$55 thousand and $65 thousand, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $2.3$647 millionthousand and $3.0 million, respectively, for the same periodperiods in 2025. See additional discussion regarding the ACL under the caption “Asset Quality” below.

Total noninterest income amounted to $17.3$18.7 million and $36.0 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $22.6$17.1 million and $39.7 million, respectively, for the same periodperiods in 2025. Total noninterest income in the six months ended 2025 was impacted by the gain on sale-leaseback transactions as described under the caption “Summary” above. Excluding the impact of this infrequent transaction, adjusted noninterest income (non-GAAP) for the three and six months ended MarchJune 31,30, 2026 was up by $1.7$1.6 million and $3.2 million, or 11%,respectively, from the same periodperiods in 2025.

Wealth management revenues for the three and six months ended MarchJune 31,30, 2026 increased by $756$1.1 thousand,million orand 8%,$1.8 million, respectively, from the same periodperiods in 2025, largely reflecting an increase in asset-based revenues. The increase in asset-based revenues correlated with the change in average AUA balances. The average balance of AUA for the three and six months ended MarchJune 31,30, 2026 increased by 10%13% and 11%, respectively, over the average balancebalances for the same periodperiods in 2025, primarilylargely reflecting net investment appreciation of AUA.

For the three and six months ended MarchJune 31,30, 2026, mortgage banking revenues were up by $741$439 thousand,thousand orand 32%,$1.2 million, respectively, compared to the same periodperiods in 2025, largely reflecting an increase in sales volume. Mortgage banking revenues are also impacted by changes in the fair value of mortgage loans held for sale and forward loan commitments, which are primarily based on current market prices in the secondary market and correlate to changes in the size of the mortgage pipeline.

Total noninterest expense amounted to $37.8$38.6 million and $76.4 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $42.2$36.5 million and $78.7 million, respectively, for the same periodperiods in 2025. Total noninterest expense in the six months ended 2025 was impacted by the settlement charge associated with termination of the Corporation’s qualified pension plan, as described under the caption “Summary” above. Excluding the impact of this infrequent transaction, adjusted noninterest expense (non-GAAP) for the three and six months ended MarchJune 31,30, 2026, was up by $2.0$2.1 million and $4.1 million, or 6%,respectively, from the same periodperiods in 2025.

Salaries and employee benefits expense, the largest component of total noninterest expense, for the three and six months ended MarchJune 31,30, 2026 increased by $1.9$2.3 million and $4.2 million, or 9%,respectively, compared to the same periodperiods in 2025. This primarilyreflected reflectedannual merit increasesand andstaffing increases, including the addition of resources in our commercial banking and wealth management business lines, as well as volume-related increases in mortgage originator commission expense.lines.

FDIC insurance costs for the three and six months ended MarchJune 31,30, 2026 decreased by $327$283 thousand and $610 thousand, or 26%,respectively, compared to the same periodperiods in 2025, reflecting a decrease in average assets from a year ago and a lower FDIC deposit assessment rate.

The decrease in the effective tax rate in 2026 reflected changes in state tax expense and increased federal tax credit benefits.

The Corporation’s net deferred tax assets are reported in other assets and amounted to $36.6$36.3 million at MarchJune 31,30, 2026, downcompared fromto $36.9 million at December 31, 2025. Management believes deferred tax assets, net of the valuation allowance, are more-likely-than-not to be realized.

Net interest income for the Banking segment for the three and six months ended MarchJune 31,30, 2026 increased by $4.1$4.6 million and $8.7 million, respectively, from the same periodperiods in 2025. Net interest income benefited from lower rates paid on, and decreases in, average interest-bearing liability balances, which was partially offset by decreases in, and lower yields on, and decreases in, average interest-earning asset balances. See additional discussion under the caption “Net Interest Income” above.

The provision for credit losses for the three and six months ended MarchJune 31,30, 2026 increased by $2.8$1.0 million and $3.8 million, respectively, from the same periodperiods in 2025. See additional discussion under the caption “Provision for Credit Losses” above.

Noninterest income derived from the Banking segment was $6.4$7.3 million and $13.7 million, respectively, for the three and six months ended MarchJune 31,30, 2026, compared to $12.6$6.7 million and $19.4 million, respectively, for the same periodperiods in 2025. Included in the threesix months ended MarchJune 31,30, 2025 was a $7.0 million net gain recognized on sale-leaseback transactions. Excluding this item, Banking noninterest income for the three and six months ended June 30, 2026 increased by $789$530 thousand,thousand and $1.3 million, respectively, largely reflecting increases in mortgage banking revenues. See additional disclosure under the caption “Noninterest Income” above.

Banking noninterest expenses for the three and six months ended MarchJune 31,30, 2026 totaled $30.1$31.0 million and $61.1 million, respectively, compared to $32.5$28.5 million and $61.1 million, respectively, for the same periodperiods in 2025. Included in the threesix months ended MarchJune 31,30, 2025 was $4.9 million of the total pension plan settlement charge that was allocated to the Banking segment. Excluding this item, noninterest expenses for the Banking segment for the three and six months ended June 30, 2026 increased by $2.5 million and $4.9 million, respectively, reflecting increases in salaries and employee benefits expense and outsourced services expense, partially offset by a decrease in FDIC deposit insurance costs. The increase in outsourced services reflected changes in third-party provided services, including software as a service and processing costs. See additional discussion of salaries and employee benefits expense and FDIC deposit insurance costs under the caption “Noninterest Expense” above.

Noninterest income derived from the Wealth Management Services segment for the three and six months ended MarchJune 31,30, 2026 increased by $865$1.1 thousandmillion and $1.9 million, respectively, from the same periodperiods in 2025, largely reflecting an increase in asset-based revenues. See further discussion under the caption “Noninterest Income” above.

Noninterest expenses for the Wealth Management Services segment for the three and six months ended MarchJune 31,30, 2026 totaled $7.7$7.6 million and $15.3 million, respectively, compared to $9.7$8.0 million and $17.7 million, respectively, for the same periodperiods in 2025. Included in the threesix months ended MarchJune 31,30, 2025 was $1.5 million of the total pension plan settlement charge that was allocated to the Wealth Management Services segment. Excluding this item, noninterest expenses for the Wealth Management Services segment for the three and six months ended June 30, 2026 decreased by $451$421 thousand.thousand Thisand included$872 athousand, decreaserespectively, reflecting decreases in outsourced services expense, partially offset by higheran increase in salaries and employee benefits expense. The decrease in outsourced services was attributable to changes in third-party provided services, including software as a service. See additional discussion of salaries and employee benefits expense under the caption “Noninterest Expense” above.

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. Management reviews the independent pricing service’s documentation to gain an understanding of the appropriateness of the pricing methodologies. Management 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, management periodically performs independent price tests of securities to ensure proper valuation and to verify our understanding of how securities are priced. As of MarchJune 31,30, 2026 and December 31, 2025, management did not make any adjustments to the prices provided by the pricing service.

The securities portfolio represented 14% of total assets at both MarchJune 31,30, 2026 and December 31, 2025. The largest component of the securities portfolio is mortgage-backed securities, all of which are issued by U.S. government agencies or U.S. government-sponsored enterprises.

The securities portfolio decreased by $28.4$55.0 million, or 3%,6%, from the end of 2025. This2025, largely reflectedreflecting routine pay-downs on mortgage-backed securities.

The carrying amounts of available for sale debt securities as of MarchJune 31,30, 2026 and December 31, 2025 included net unrealized losses of $96.6$96.7 million and $94.9 million, respectively. The net unrealized losses were primarily concentrated in obligations of U.S. government agencies and U.S. government-sponsored enterprises, including mortgage-backed securities, and primarily attributable to relative changes in market interest rates since the time of purchase. See Note 3 to the Unaudited Consolidated Financial Statements for additional information.

We primarily serve individuals and businesses located in southern New England, and a substantial portion of our loans are secured by properties in southern New England. Total loans amounted to $5.0$5.1 billion at MarchJune 31,30, 2026, down by $119.5$31.3 million, or 2%,1%, from the end of 2025.

(1)Includes negative basis adjustments associated with fair value hedges of $923$1.5 thousandmillion and $335 thousand, respectively, at MarchJune 31,30, 2026 and December 31, 2025. See Note 6 to the Unaudited Consolidated Financial Statements for additional disclosure.

The commercial loan portfolio represented 53% of total loans at MarchJune 31,30, 2026, compared to 54% at December 31, 2025.

In making commercial loans, we may occasionally solicit the participation of other banks. The Bank also participates in commercial loans originated by other banks. In such cases, these loans are individually underwritten by us using standards similar to those employed for our self-originated loans. Our participation in commercial loans originated by other banks amounted to $543.6$528.6 million and $613.5 million, respectively, at MarchJune 31,30, 2026 and December 31, 2025. Our participation in commercial loans originated by other banks also includes sharedSNCs. national credits. Shared national creditsSNCs are defined as participation in loans or loan commitments of at least $100.0 million that are shared by three or more banks.

CRE loans totaled $2.1 billion at MarchJune 31,30, 2026, down by $99.2$133.7 million, or 4.5%,6%, from the balance at December 31, 2025. In the first threesix months of 2026, CRE advances and originations amounted to $39.3$147.3 millionmillion, andwhich were more than offset by payments.

(1)Does not include unfunded commitments of $144.3$147.4 million and $127.1 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025.

(2)Includes shared national creditsSNC balances of $27.5$27.9 million and $45.6 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025. There were no classified shared national creditSNC balances as of MarchJune 31,30, 2026 or December 31, 2025.

Multi-family, our largest single CRE segment, totaled $640.0$644.2 million as of MarchJune 31,30, 2026, representing 13% of total loans and 31% of the total CRE portfolio. This segment includes non-owner occupied residential properties consisting of four or more units that are rented to tenants. At MarchJune 31,30, 2026, the credit quality of the multi-family segment was 100% pass-rated. Also, there were no nonaccrual loans and all loans were current with respect to payment terms at MarchJune 31,30, 2026 in this segment.

There continues to be heightened focus in the banking industry on the CRE office sector, given the continuation of remote work and elevated vacancies across the office market. As of MarchJune 31,30, 2026, Washington Trust’s CRE office loan segment totaled $231.0$212.1 million, or 5%4% of total loans and 11%10% of the total CRE loans. The loans are secured by non-owner occupied office properties, including medical office and lab space, located in our primary lending market area of southern New England - Massachusetts, Connecticut, and Rhode Island. Furthermore, approximately 65%62% of the CRE office segment balance is secured by properties located in suburban areas. As of MarchJune 31,30, 2026, 97% of the CRE office segment was current with respect to payment terms, and 87%86% of the CRE office segment was on accruing status.status and current with respect to payment terms. Additionally, the credit quality of the CRE office loan segment was 71%69% pass-rated, 14%15% special mention-rated, and 15%17% classified as of MarchJune 31,30, 2026.

C&I loans amounted to $568.2$665.9 million at MarchJune 31,30, 2026, up by $4.1$101.8 million, or 1%,18%, from the balance at December 31, 2025.2025, largely reflecting growth from our institutional banking team who serve educational, healthcare and non-profit institutions. In the first threesix months of 2026, C&I originations and advances amounted to $19.6$123.7 million and were partially offset by payments.

(1)Does not include unfunded commitments of $320.2$304.8 million and $306.9 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025.

(2)Includes shared national creditsSNC balances of $79.3$76.5 million and $72.0 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025, all of which were pass-rated.

Healthcare and social assistance, our largest single C&I segment, totaled $149.3$150.4 million as of MarchJune 31,30, 2026, representing 3% of total loans and 26%23% of the total C&I portfolio. This segment includes specialty medical practices, elder services, and community and mental health centers. At MarchJune 31,30, 2026, the credit quality of the healthcare and social assistance segment was 100% pass-rated. Also, there were no nonaccrual loans and all loans were current with respect to payment terms at MarchJune 31,30, 2026 in this segment.

The residential real estate loan portfolio represented 40% of total loans at both MarchJune 31,30, 2026 and December 31, 2025.

Residential real estate loans amounted to $2.0 billion at MarchJune 31,30, 2026, down by $21.3$8.0 million, or 1%,0.4%, from the balance at December 31, 2025, as loan originations were more than offset by payments.

(1)Includes residential mortgage loans purchased from and serviced by other financial institutions totaling $37.6$35.1 million and $38.5 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025.

Loans are sold with servicing retained or released. Loans sold with servicing rights retained result in the capitalization of servicing rights. Loan servicing rights are included in other assets and are subsequently amortized as an offset to mortgage banking revenues over the estimated period of servicing. The net balance of capitalized servicing rights amounted to $6.3$6.1 million and $6.6 million, respectively, as of MarchJune 31,30, 2026 and December 31, 2025. The balance of residential mortgage loans serviced for others, which are not included in the Unaudited Consolidated Balance Sheets, amounted to $1.3 billion at both MarchJune 31,30, 2026 and December 31, 2025.

The consumer loan portfolio represented 7% of total loans at MarchJune 31,30, 2026, compared to 6% at December 31, 2025.

Consumer loans include home equity loans and lines of credit and personal installment loans. Home equity lines of credit and home equity loans represented 95% of the total consumer portfolio at MarchJune 31,30, 2026. Our home equity line and home equity loan origination activities are conducted primarily in southern New England. The Bank estimates that approximately 45% of the combined home equity lines of credit and home equity loan balances are first lien positions or subordinate to other Washington Trust mortgages.

The consumer loan portfolio totaled $332.8$344.6 million at MarchJune 31,30, 2026, downup by $3.1$8.6 million, or 1%,3%, from December 31, 2025, largely reflecting aan decreaseincrease in home equity lines.lines and loans.