Washington Trust (NASDAQ: WASH) takes $11.3M loan charge-offs in Q3 2025

Rhea-AI Filing Summary

Washington Trust Bancorp, Inc. reports that its third quarter 2025 results will be hit by $11.3 million in charge-offs on two commercial loan relationships and a related $7.0 million provision for credit losses on loans. One problem credit is a shared national telecom infrastructure construction loan that went into Chapter 11 in the second quarter; after being placed on nonaccrual, it carried $9.3 million with a $2.3 million specific reserve as of June 30, 2025, and generated an $8.3 million charge-off, leaving $1.0 million expected to be collected in the fourth quarter of 2025.

The other is a nonaccrual commercial real estate loan secured by a Class B office property that had a $4.3 million carrying value on June 30, 2025; its sale at the end of September led to a $3.0 million charge-off. After these actions, commercial nonaccrual loans are expected to drop to $1.0 million as of September 30, 2025, from $14.0 million as of June 30, 2025. More detail will come with the company’s third quarter 2025 earnings release.

Positive

• None.

Negative

• $11.3 million in loan charge-offs and a $7.0 million credit loss provision will significantly pressure Washington Trust Bancorp’s third quarter 2025 earnings.

Insights

Bank credit risk analyst

Large charge-offs hurt near-term earnings but clean up problem loans.

Washington Trust Bancorp is signaling a meaningful third quarter 2025 earnings hit from $11.3 million of charge-offs tied to two troubled commercial credits, along with a $7.0 million provision for credit losses on loans. For a regional bank, that level of credit cost can materially compress quarterly profitability, even though core operating trends are not discussed here.

The telecom infrastructure construction participation produced an $8.3 million charge-off after a Chapter 11 filing, while the sale of a nonaccrual Class B office loan drove a further $3.0 million charge-off. These actions sharply reduce reported commercial nonaccrual loans to $1.0 million as of September 30, 2025, versus $14.0 million at June 30, 2025, which may improve headline asset quality metrics after the quarter in which the losses are recognized.

The ultimate impact on capital ratios and future credit costs will be clearer when full third quarter 2025 results and risk disclosures are released in the upcoming earnings materials referenced here.

8-K Event Classification

2 items: 8.01, 9.01

2 items

Item 8.01 Other Events Other

Voluntary disclosure of events the company deems important to shareholders but not covered by other items.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Understanding 8-K Material Events →

0000737468FALSE00007374682025-10-082025-10-08

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 8, 2025

WASHINGTON TRUST BANCORP, INC.

(Exact Name of Registrant as Specified in Charter)

Rhode Island

001-32991

05-0404671

(State or other jurisdiction of incorporation)

(Commission File Number)

(IRS Employer Identification No.)

23 Broad Street
Westerly,			Rhode Island			02891
(Address of principal executive offices)						(Zip Code)

(401)			348-1200
(Registrant's telephone number, including area code)

N/A

(Former name or address, if changed from last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class			Trading Symbol(s)			Name of each exchange on which registered
COMMON STOCK, $.0625 PAR VALUE PER SHARE			WASH			The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
Exchange Act.			☐

Item 8.01    Other Events.

Washington Trust Bancorp, Inc.’s (the “Company”) third quarter 2025 financial performance will be adversely affected by $11.3 million in charge-offs on two commercial loan relationships. The Company expects to recognize a provision for credit losses on loans of $7.0 million for the third quarter, primarily as a result of these charge-offs.

The first loan relationship is a participation in a shared national credit to a telecom infrastructure construction contractor. The contractor filed for Chapter 11 bankruptcy in the second quarter of 2025 and, at that time, the Company placed the loan relationship on nonaccrual status. As of June 30, 2025, this relationship had a carrying value of $9.3 million and a specific reserve of $2.3 million. Based on ensuing developments in the bankruptcy proceedings in the third quarter, the Company recognized a charge-off of $8.3 million on this relationship. The remaining carrying value of $1.0 million as of September 30, 2025 is expected to be collected in the fourth quarter of 2025.

The second loan is a nonaccrual commercial real estate loan secured by a Class B office property. Late in the third quarter of 2025, the Company decided to sell this loan, which had a carrying value of $4.3 million on June 30, 2025. The sale was completed at the end of September and a charge-off of $3.0 million was recognized.

Following these actions, the Company expects to report commercial nonaccrual loans of $1.0 million as of September 30, 2025, compared to $14.0 million as of June 30, 2025. Additional information will be provided with the Company’s third quarter 2025 earnings release.

Forward-Looking Statements

This Current Report on Form 8-K contains statements that are “forward-looking statements.” We may also make forward-looking statements in other documents we file with the U.S. Securities and Exchange Commission (“SEC”), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors, or employees. You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters. You should not rely on forward-looking statements, because they involve known and unknown risks, uncertainties, and other factors, some of which are beyond our control. These risks, uncertainties, and other factors may cause our actual results, performance, or achievements to be materially different from the anticipated future results, performance, or achievements expressed or implied by the forward-looking statements.

Some of the factors that might cause these differences include the following:

•changes in general business and economic conditions (including the impact of actual or threatened tariffs imposed by the U.S. and foreign governments, inflation and concerns about liquidity) on a national basis and in the local markets in which we operate;

•interest rate changes or volatility, as well as changes in the balance and mix of loans and deposits;

•changes in customer behavior due to political, business and economic conditions;

•changes in loan demand and collectability;

•the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments;

•ongoing volatility in national and international financial markets;

•reductions in the market value or outflows of wealth management assets under administration;

•decreases in the value of securities and other assets;

•increases in defaults and charge-off rates;

•changes in the size and nature of our competition;

•changes in, and evolving interpretations of, existing and future laws, rules and regulations;

•changes in accounting principles, policies and guidelines;

•operational risks including, but not limited to, changes in information technology, cybersecurity incidents, fraud, natural disasters, war, terrorism, civil unrest and future pandemics;

•regulatory, litigation and reputational risks; 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, 2024, as updated by our Quarterly Reports on Form 10-Q and other filings submitted to the SEC, may result in these differences. You should carefully review all of these factors, and you should be aware that there may be other factors that could cause these differences. These forward-looking statements were based on information, plans, and estimates at the date of this report, and we assume no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

Item 9.01 Financial Statements and Exhibits.

(d)

Exhibits.

Exhibit No.

Exhibit

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

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

WASHINGTON TRUST BANCORP, INC.

Date:

October 8, 2025

By:

/s/ Ronald S. Ohsberg

Ronald S. Ohsberg

Senior Executive Vice President, Chief Financial Officer and Treasurer

FAQ

How will Washington Trust Bancorp (WASH) be affected in Q3 2025?

The company expects third quarter 2025 financial performance to be adversely affected by $11.3 million in charge-offs on two commercial loan relationships and a related $7.0 million provision for credit losses on loans.

What caused the $8.3 million charge-off at Washington Trust Bancorp (WASH)?

The $8.3 million charge-off relates to a participation in a shared national credit to a telecom infrastructure construction contractor that filed for Chapter 11 bankruptcy in the second quarter of 2025 after being placed on nonaccrual status.

What happened to Washington Trust Bancorp’s nonaccrual commercial real estate loan?

The second problem loan was a nonaccrual commercial real estate loan secured by a Class B office property, with a $4.3 million carrying value on June 30, 2025; it was sold at the end of September, resulting in a $3.0 million charge-off.

How did Washington Trust Bancorp’s nonaccrual commercial loans change after these actions?

Following the charge-offs and loan sale, Washington Trust Bancorp expects to report commercial nonaccrual loans of $1.0 million as of September 30, 2025, down from $14.0 million as of June 30, 2025.

Will Washington Trust Bancorp (WASH) provide more detail on these credit losses?

The company states that additional information about these charge-offs and their impact will be provided with its third quarter 2025 earnings release.

What were the key amounts reserved on the telecom loan before the charge-off?

The company notes risks including economic conditions, interest rate changes, loan demand and collectability, market volatility, operational risks, and other factors described under “Risk Factors” in its Form 10-K and subsequent SEC filings.