Loans

6 Months Ended

Jun. 30, 2025

The following table presents the carrying value of loans, segregated by class of loans:


(Dollars in thousands)	June 30, 2025	December 31, 2024
Commercial:


Commercial real estate (1)	$2,178,925	$2,154,504
Commercial & industrial (2)	547,318	542,474
Total commercial	2,726,243	2,696,978
Residential Real Estate:


Residential real estate (3)	2,096,250	2,126,171
Consumer:


Home equity	300,917	297,119
Other (4)	16,850	17,570
Total consumer	317,767	314,689
Total loans (5)	$5,140,260	$5,137,838

(1)CRE consists of commercial mortgages primarily secured by non-owner occupied income-producing property, as well as construction and development loans. Construction and development loans are made to businesses for land development or the on-site construction of industrial, commercial, or residential buildings.

(2)C&I consists of loans to businesses and individuals, a portion of which are fully or partially collateralized by owner occupied real estate.

(3)Residential real estate consists of mortgage and homeowner construction loans secured by one- to four-family residential properties. Also, includes negative basis adjustments associated with fair value hedges of $179 thousand and $1.5 million, respectively, at June 30, 2025 and December 31, 2024. See Note 7 for additional disclosure.

(4)Other consists of loans to individuals secured by general aviation aircraft and other personal installment loans.

(5)Includes net unamortized loan origination costs of $11.5 million and $10.9 million, respectively, at June 30, 2025 and December 31, 2024 and net unamortized premiums on loans purchased from and serviced by other financial institutions of $217 thousand and $242 thousand, respectively, at June 30, 2025 and December 31, 2024.

The carrying value of loans excludes accrued interest receivable of $20.6 million and $22.1 million, respectively, as of June 30, 2025 and December 31, 2024.

As of June 30, 2025 and December 31, 2024, loans amounting to $3.0 billion and $2.8 billion, respectively, were pledged as collateral to the FHLB under a blanket pledge agreement and to the FRBB for the discount window. See Note 10 for additional disclosure regarding borrowings.

Concentrations of Credit Risk

A significant portion of our loan portfolio is concentrated among borrowers in southern New England, and a substantial portion of the portfolio is collateralized by real estate in this area. The ability of single family residential and consumer borrowers to honor their repayment commitments is generally dependent on the level of overall economic activity within the market area and real estate values. The ability of commercial borrowers to honor their repayment commitments is dependent on the general economy, as well as the health of the real estate economic sector in the Corporation’s market area.

Past Due Loans

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


(Dollars in thousands)		Days Past Due
June 30, 2025	Current	30-59	60-89	90 or More	Total Past Due	Total Loans
Commercial:
Commercial real estate	$2,178,925	$—	$—	$—	$—	$2,178,925
Commercial & industrial	545,519	1,376	—	423	1,799	547,318
Total commercial	2,724,444	1,376	—	423	1,799	2,726,243
Residential Real Estate:
Residential real estate	2,086,478	5,745	2,518	1,509	9,772	2,096,250
Consumer:
Home equity	298,487	1,833	456	141	2,430	300,917
Other	16,816	34	—	—	34	16,850
Total consumer	315,303	1,867	456	141	2,464	317,767
Total loans	$5,126,225	$8,988	$2,974	$2,073	$14,035	$5,140,260


(Dollars in thousands)		Days Past Due
December 31, 2024	Current	30-59	60-89	90 or More	Total Past Due	Total Loans
Commercial:
Commercial real estate	$2,154,504	$—	$—	$—	$—	$2,154,504
Commercial & industrial	541,574	518	382	—	900	542,474
Total commercial	2,696,078	518	382	—	900	2,696,978
Residential Real Estate:
Residential real estate	2,118,430	3,476	1,892	2,373	7,741	2,126,171
Consumer:
Home equity	294,172	1,630	410	907	2,947	297,119
Other	17,176	44	350	—	394	17,570
Total consumer	311,348	1,674	760	907	3,341	314,689
Total loans	$5,125,856	$5,668	$3,034	$3,280	$11,982	$5,137,838

Included in past due loans as of June 30, 2025 and December 31, 2024, were nonaccrual loans of $8.2 million and $6.4 million, respectively. In addition, all loans 90 days or more past due at June 30, 2025 and December 31, 2024 were classified as nonaccrual.

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. When loans are placed on nonaccrual status, interest previously accrued but not collected 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 collectability of the loan. Loans are removed from nonaccrual status when they have been current as to principal and interest (generally for six months), 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 table is a summary of nonaccrual loans, segregated by class of loans:


(Dollars in thousands)	June 30, 2025			December 31, 2024
	Nonaccrual Loans			Nonaccrual Loans
	With an ACL	Without an ACL	Total	With an ACL	Without an ACL	Total
Commercial:
Commercial real estate	$—	$4,276	$4,276	$10,053	$—	$10,053
Commercial & industrial	9,288	423	9,711	515	—	515
Total commercial	9,288	4,699	13,987	10,568	—	10,568
Residential Real Estate:
Residential real estate	9,601	1,013	10,614	9,743	1,024	10,767
Consumer:
Home equity	1,507	—	1,507	1,972	—	1,972
Other	—	—	—	—	—	—
Total consumer	1,507	—	1,507	1,972	—	1,972
Total nonaccrual loans	$20,396	$5,712	$26,108	$22,283	$1,024	$23,307
Accruing loans 90 days or more past due			$—			$—

Nonaccrual loans of $17.9 million and $16.9 million, respectively, at June 30, 2025 and December 31, 2024 were current as to the payment of principal and interest.

As of June 30, 2025 and December 31, 2024, nonaccrual loans secured by one- to four-family residential properties amounting to $1.5 million and $1.0 million, respectively, were in process of foreclosure.

The following table presents interest income recognized on nonaccrual loans:


(Dollars in thousands)	Three Months		Six Months

Periods ended June 30,	2025	2024	2025	2024
Commercial:
Commercial real estate	$—	$—	$—	$—
Commercial & industrial	2	—	32	—
Total commercial	2	—	32	—
Residential Real Estate:
Residential real estate	124	71	268	186
Consumer:
Home equity	48	32	83	69
Other	—	—	—	—
Total consumer	48	32	83	69
Total	$174	$103	$383	$255

Troubled Loan Modifications

A loan that has been modified is considered a TLM when the modification is made to a borrower experiencing financial difficulty and the modification has a direct impact to the contractual cash flows. If both of the aforementioned criteria are met, then the modification is considered a TLM and subject to the enhanced disclosure requirements.

In the course of resolving problem loans, the Corporation may choose to modify the contractual terms of loans to borrowers who are experiencing financial difficulty. Such modifications to borrowers experiencing financial difficulty may include modified contractual terms that have a direct impact to contractual cash flows, including principal forgiveness, interest rate reductions, maturity extensions, other-than-insignificant payment delays, or any combination thereof. Debt could be

bifurcated with separate terms for each tranche of the TLM. Executing a TLM in lieu of aggressively enforcing the collection of the loan may benefit the Corporation by increasing the ultimate probability of collection.

Nonaccrual loans that become TLMs generally remain on nonaccrual status for six months, subsequent to being modified, before management considers their return to accrual status. If a TLM is on accrual status prior to being modified, it is reviewed to determine if the modified loan should remain on accrual status.

If the TLM successfully meets all repayment terms according to the modification documents for a specified period of time (generally 12 months) and the borrower is no longer experiencing financial difficulty, it would be declassified from TLM status.

The following tables present the carrying value of TLMs made during the periods indicated, segregated by class of loans and type of concession granted:



(Dollars in thousands)
Three months ended June 30, 2025	Other-than-Insignificant Payment Delay	Combination (1)	Total	% of Loan Class (2)
Commercial:
Commercial real estate	$—	$4,276	$4,276	—	%
Commercial & industrial	—	—	—	—
Total commercial	—	4,276	4,276	—






Total	$—	$4,276	$4,276	—	%

(1)Combination includes an interest rate reduction, maturity extension and other-than-insignificant payment delay.

(2)Percentage of TLMs to the total loans outstanding within the respective loan class.



(Dollars in thousands)
Six months ended June 30, 2025	Other-than-Insignificant Payment Delay	Combination (1)	Total	% of Loan Class (2)
Commercial:
Commercial real estate	$—	$4,276	$4,276	—	%
Commercial & industrial	—	—	—	—
Total commercial	—	4,276	4,276	—
Residential Real Estate:
Residential real estate	$1,429	$—	$1,429	—	%




Total	$1,429	$4,276	$5,705	—	%

(1)Combination includes an interest rate reduction, maturity extension and other-than-insignificant payment delay.

(2)Percentage of TLMs to the total loans outstanding within the respective loan class.



(Dollars in thousands)
Three months ended June 30, 2024	Maturity Extension	Other-than-Insignificant Payment Delay	Total	% of Loan Class (1)




Residential Real Estate:
Residential real estate	—	$267	$267	—




Total	$—	$267	$267	—	%

(1)Percentage of TLMs to the total loans outstanding within the respective loan class.



(Dollars in thousands)
Six months ended June 30, 2024	Maturity Extension	Other-than-Insignificant Payment Delay	Total	% of Loan Class (1)
Commercial:
Commercial real estate	$—	$—	$—	—	%
Commercial & industrial	642	—	642	—
Total commercial	642	—	642	—
Residential Real Estate:
Residential real estate	—	267	267	—




Total	$642	$267	$909	—	%

(1)Percentage of TLMs to the total loans outstanding within the respective loan class.

The following tables describe the financial effect of TLMs made during the periods indicated, segregated by class of loans:


Three months ended June 30, 2025			Financial Effect
Combination - Interest Rate Reduction, Maturity Extension and Other-than Insignificant Payment Delay:
Commercial real estate			Provided interest rate reduction by a weighted average rate of 1.7%, maturity extension for a weighted average period of 8 months, and payment delay for a weighted average period of 8 months


Six months ended June 30, 2025			Financial Effect
Combination - Interest Rate Reduction, Maturity Extension and Other-than Insignificant Payment Delay:
Commercial real estate			Provided interest rate reduction by a weighted average rate of 1.7%, maturity extension for a weighted average period of 8 months, and payment delay for a weighted average period of 8 months

Other-than-Insignificant Payment Delay:
Residential real estate			Provided payment delay for a weighted average period of 6 months


Three months ended June 30, 2024			Financial Effect



Other-than-Insignificant Payment Delay:
Residential real estate			Provided payment delay for a weighted average period of 6 months



Six months ended June 30, 2024			Financial Effect
Maturity Extension:
Commercial & industrial			Extended maturity by a weighted average of 120 months
Other-than-Insignificant Payment Delay:
Residential real estate			Provided payment delay for a weighted average period of 6 months

Management closely monitors the performance of TLMs to understand the effectiveness of the modifications. As of the dates indicated, the following tables present an aging analysis of TLMs that have been modified in the past 12 months:


(Dollars in thousands)		Days Past Due
June 30, 2025	Current	30-59	60-89	90 or More	Total Past Due	Total Loans
Commercial:
Commercial real estate	$4,276	$—	$—	$—	$—	$4,276
Commercial & industrial	5,000	—	—	—	—	5,000
Total commercial	9,276	—	—	—	—	9,276
Residential Real Estate:
Residential real estate	1,429	—	—	—	—	1,429




Total loans	$10,705	$—	$—	$—	$—	$10,705

At June 30, 2025, there were no TLMs made in the previous 12 months for which there was a subsequent payment default.



(Dollars in thousands)		Days Past Due
June 30, 2024	Current	30-59	60-89	90 or More	Total Past Due	Total Loans
Commercial:
Commercial real estate	$7,612	$—	$—	$—	$—	$7,612
Commercial & industrial	910	—	—	—	—	910
Total commercial	8,522	—	—	—	—	8,522
Residential Real Estate:
Residential real estate	267	—	—	—	—	267




Total loans	$8,789	$—	$—	$—	$—	$8,789

At June 30, 2024, there were no TLMs made in the previous 12 months for which there was a subsequent payment default.

There were no significant commitments to lend additional funds to borrowers experiencing financial difficulty whose loans were TLMs at June 30, 2025.

Individually Analyzed Loans

Individually analyzed loans include nonaccrual commercial loans, TLMs, as well as certain other loans based on the underlying risk characteristics and the discretion of management to individually analyze such loans.

As of June 30, 2025 and December 31, 2024, the carrying value of individually analyzed loans amounted to $21.4 million and $16.6 million, respectively.

The carrying value of collateral dependent individually analyzed loans was $16.4 million and $11.6 million, respectively, at June 30, 2025 and December 31, 2024. For collateral dependent loans where management has determined that foreclosure of the collateral is probable, or where the borrower is experiencing financial difficulty and repayment of the loan is to be provided substantially through the operation or sale of the collateral, the ACL is measured based on the difference between the fair value of the collateral and the amortized cost basis of the loan as of the measurement date. See Note 8 for additional disclosure regarding fair value of individually analyzed collateral dependent loans.

The following table presents the carrying value of collateral dependent individually analyzed loans:


(Dollars in thousands)	June 30, 2025		December 31, 2024
	Carrying Value	Related Allowance	Carrying Value	Related Allowance
Commercial:
Commercial real estate (1)	$4,276	$—	$10,053	$1,252
Commercial & industrial (2)	9,711	2,269	515	259
Total commercial	13,987	2,269	10,568	1,511
Residential Real Estate:
Residential real estate (3)	2,442	—	1,023	—




Total	$16,429	$2,269	$11,591	$1,511

(1) Secured by income-producing property.

(2) Secured by business assets.

(3) Secured by one- to four-family residential properties.

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 risk 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. The Corporation takes the risk rating into consideration along with other credit attributes in the establishment of an appropriate ACL on loans. See Note 5 for additional information.

A description of the commercial loan categories is 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 may exhibit some weakness in various credit metrics such as collateral adequacy, cash flow, performance or may be in an industry or of a loan type known to have a higher degree of risk. These weaknesses may be mitigated by secondary sources of repayment, including SBA guarantees.

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 collectability. A “doubtful” loan is placed on nonaccrual 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 risk ratings and classifications to be revised whenever information becomes available that indicates a change is warranted. On a quarterly basis, management reviews a watched asset list, which generally consists of commercial loans that are risk-rated 6 or worse, highly leveraged transaction loans, high-volatility

commercial real estate, and other selected loans. Management’s review focuses on the current status of the loans, the appropriateness of risk ratings and strategies to improve the credit.

An annual credit 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 and Consumer

Management monitors the relatively homogeneous residential real estate and consumer loan portfolios on an ongoing basis using delinquency information by loan type.

In addition, other techniques are utilized to monitor indicators of credit deterioration in the residential real estate loans and home equity consumer loans. Among these techniques is the periodic tracking of loans with an updated Fair Isaac Corporation (commonly known as “FICO”) score and an updated estimated LTV ratio. LTV is estimated based on such factors as geographic location, the original appraised value, and changes in median home prices, and takes into consideration the age of the loan. The results of these analyses and other credit review procedures, including selected targeted internal reviews, are taken into account in the determination of qualitative loss factors for residential real estate and home equity consumer credits.

The following table includes information on credit quality indicators and gross charge-offs for the Corporation’s loan portfolio, segregated by class of loans as of June 30, 2025:


(Dollars in thousands)	Term Loans Amortized Cost by Origination Year
	2025	2024	2023	2022	2021	Prior	Revolving Loans Amortized Cost	Revolving Loans Converted to Term Loans	Total
Commercial:
CRE:
Pass	$114,831	$134,816	$463,479	$581,435	$322,274	$501,784	$11,986	$965	$2,131,570
Special mention	—	—	6,509	5,330	—	2,197	—	—	14,036
Classified	4,276	22,830	—	—	—	6,213	—	—	33,319
Total CRE	119,107	157,646	469,988	586,765	322,274	510,194	11,986	965	2,178,925
Gross charge-offs	—	—	—	—	—	2,724	—	—	2,724

C&I:
Pass	24,204	47,122	45,816	140,956	21,506	177,291	61,397	357	518,649
Special mention	—	800	—	3,518	1,208	7,614	5,674	—	18,814
Classified	—	—	9,275	—	144	—	436	—	9,855
Total C&I	24,204	47,922	55,091	144,474	22,858	184,905	67,507	357	547,318





Gross charge-offs	25	—	—	—	—	299	—	—	324

Residential Real Estate:
Residential real estate:
Current (1)	66,290	62,061	361,499	721,464	361,530	513,813	—	—	2,086,657
Past due	—	—	1,149	2,724	—	5,899	—	—	9,772
Total residential real estate	66,290	62,061	362,648	724,188	361,530	519,712	—	—	2,096,429
Gross charge-offs	—	—	—	—	—	—	—	—	—

Consumer:
Home equity:
Current	9,106	11,509	16,706	11,479	5,771	7,531	223,004	13,381	298,487
Past due	—	—	88	—	90	319	970	963	2,430
Total home equity	9,106	11,509	16,794	11,479	5,861	7,850	223,974	14,344	300,917
Gross charge-offs	—	—	—	—	—	—	—	—	—

Other:
Current	1,930	3,261	3,872	1,959	2,070	3,492	232	—	16,816
Past due	24	4	—	—	6	—	—	—	34
Total other	1,954	3,265	3,872	1,959	2,076	3,492	232	—	16,850




Gross charge-offs	140	—	1	—	—	—	—	—	141

Total loans, amortized cost	$220,661	$282,403	$908,393	$1,468,865	$714,599	$1,226,153	$303,699	$15,666	$5,140,439
Total gross charge-offs	$165	$—	$1	$—	$—	$3,023	$—	$—	$3,189

(1)Excludes a $179 thousand negative basis adjustment associated with fair value hedges. See Note 7 for additional disclosure.

The following table includes information on credit quality indicators and gross charge-offs for the Corporation’s loan portfolio, segregated by class of loans as of December 31, 2024:


(Dollars in thousands)	Term Loans Amortized Cost by Origination Year
	2024	2023	2022	2021	2020	Prior	Revolving Loans Amortized Cost	Revolving Loans Converted to Term Loans	Total
Commercial:
CRE:
Pass	$172,931	$432,763	$598,805	$362,292	$125,834	$405,381	$9,879	$989	$2,108,874
Special mention	—	6,116	—	—	—	2,237	—	—	8,353
Classified	31,010	—	—	—	—	6,267	—	—	37,277
Total CRE	203,941	438,879	598,805	362,292	125,834	413,885	9,879	989	2,154,504
Gross charge-offs	—	—	—	—	—	1,961	—	—	1,961

C&I:
Pass	38,128	51,162	136,449	23,474	36,954	159,522	76,857	469	523,015
Special mention	—	—	3,593	1,172	1,398	6,428	5,381	—	17,972
Classified	811	—	—	161	—	515	—	—	1,487
Total C&I	38,939	51,162	140,042	24,807	38,352	166,465	82,238	469	542,474
Gross charge-offs	33	—	—	—	—	175	—	—	208






Residential Real Estate:
Residential real estate:
Current (1)	74,458	383,983	746,566	375,848	173,676	365,380	—	—	2,119,911
Past due	—	287	1,434	—	1,290	4,730	—	—	7,741
Total residential real estate	74,458	384,270	748,000	375,848	174,966	370,110	—	—	2,127,652
Gross charge-offs	—	—	—	—	—	—	—	—	—

Consumer:
Home equity:
Current	12,850	18,301	12,749	6,165	2,282	4,815	225,522	11,488	294,172
Past due	—	61	—	—	142	630	871	1,243	2,947
Total home equity	12,850	18,362	12,749	6,165	2,424	5,445	226,393	12,731	297,119
Gross charge-offs	—	—	—	—	—	—	—	—	—

Other:
Current	4,176	4,497	2,331	2,175	757	2,989	251	—	17,176
Past due	24	—	370	—	—	—	—	—	394
Total other	4,200	4,497	2,701	2,175	757	2,989	251	—	17,570
Gross charge-offs	229	10	—	—	2	3	—	—	244





Total loans, amortized cost	$334,388	$897,170	$1,502,297	$771,287	$342,333	$958,894	$318,761	$14,189	$5,139,319
Total gross charge-offs	$262	$10	$—	$—	$2	$2,139	$—	$—	$2,413

(1)Excludes a $1.5 million negative basis adjustment associated with fair value hedges. See Note 7 for additional disclosure.

Washington Trust may renew commercial loans at or immediately prior to their maturity. In the tables above, renewals subject to full credit evaluation before being granted are reported as originations in the period renewed. Loans with extensions of maturity dates of more than three months, including TLMs, are reported as originations in the period extended. Gross charge-offs are reported in the loan’s initial origination year.