UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1994
----------------------------------------------------
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ____________________ to __________________

Commission file Number 0-13091
------------------------------------------------------

WASHINGTON TRUST BANCORP, INC.
----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

RHODE ISLAND 05-0404671
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

23 BROAD STREET, WESTERLY, RHODE ISLAND 02891
-----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (401) 348-1200
------------------
Securities registered pursuant to Section 12 (b) of the Act:
Name of each exchange on
Title of each class which registered
NONE NONE
---------------------- ----------------------
Securities registered pursuant to Section 12 (g) of the Act:

COMMON STOCK, $.0625 PAR VALUE
------------------------------------------------------------------------------
(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. [ X ] Yes [ ] No

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]

The aggregate market value of voting stock held by non-affiliates of the
registrant was $61,445,077 at March 14, 1995 which includes $5,701,523 held
by The Washington Trust Company under trust agreements and other instruments.

The number of shares of common stock of the registrant outstanding as of
March 14, 1995 was 2,825,061.

Page 1 of 141
Exhibit Index page 22

DOCUMENTS INCORPORATED BY REFERENCE

1. Portions of the Registrant's 1994 Annual Report to Shareholders. (Parts I,
II and IV)

2. Portions of the Registrant's Proxy Statement dated March 20, 1995 for the
1995 Annual Meeting of Shareholders. (Part III).

===============================================================================

FORM 10-K
WASHINGTON TRUST BANCORP, INC.
For the Year Ended December 31, 1994

TABLE OF CONTENTS
-----------------

Description Page Number
--------------- -----------

Part I
------
Item 1 - Business 3
Item 2 - Properties 16
Item 3 - Legal Proceedings 16
Item 4 - Submission of Matters to a Vote of Security Holders 16
Executive Officers of the Registrant 17

Part II
-------
Item 5 - Market for the Registrant's Common Stock
and Related Stockholder Matters 18
Item 6 - Selected Financial Data 19
Item 7 - Management's Discussion and Analysis of Financial
Condition and Results of Operations 19
Item 8 - Financial Statements and Supplementary Data 19
Item 9 - Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure 19

Part III
--------
Item 10 - Directors and Executive Officers of the Registrant 20
Item 11 - Executive Compensation 20
Item 12 - Security Ownership of Certain Beneficial Owners and
Management 20
Item 13 - Certain Relationships and Related Transactions 20

Part IV
-------
Item 14 - Exhibits, Financial Statement Schedules and Reports
on Form 8-K 21

Signatures 22
----------

-2-
PART I
------

ITEM 1. BUSINESS
----------------
Washington Trust Bancorp, Inc.
------------------------------
Washington Trust Bancorp, Inc. (the "Corporation") is a publicly-owned,
registered bank holding company, organized in 1984 under the laws of the state
of Rhode Island, whose subsidiaries are permitted to engage in banking and other
financial services and businesses. The Corporation conducts its business
through its wholly-owned subsidiary, The Washington Trust Company (the "Bank"),
a Rhode Island chartered commercial bank. The deposits of the Bank are insured
by the Federal Deposit Insurance Corporation ("FDIC").

The Corporation was formed in 1984 under a plan of reorganization in which
outstanding common shares of The Washington Trust Company were exchanged for
common shares of Washington Trust Bancorp, Inc. At December 31, 1994 the
Corporation had total consolidated assets of $516 million, deposits of $441
million and equity capital of $46 million.

The Washington Trust Company
----------------------------
The Washington Trust Company was originally chartered in 1800 as the Washington
Bank and is the oldest banking institution headquartered in its market area.
Its current corporate charter dates to 1902. See "Market Area and Competition"
below for further information.

A broad range of financial services are provided by the Bank, including:

- Residential mortgages - Commercial and consumer demand deposits
- Commercial loans - Savings, NOW and money market deposits
- Construction loans - Certificates of deposit
- Installment loans - Retirement accounts
- Home equity lines of credit - Electronic funds transfer
- VISA and Mastercard accounts - Safe deposit boxes
- Merchant credit card services - Trust and investment services

The Bank's primary source of income is net interest income, the difference
between interest earned on interest-earning assets and interest paid on
interest-bearing deposits and other borrowed funds. Sources of noninterest
income include fees for management of customer investment portfolios, trusts and
estates, service charges on deposit accounts, merchant processing fees and other
banking-related fees. Noninterest expenses include the provision for loan
losses, salaries and employee benefits, occupancy, equipment, office supplies
deposit taxes and assessments, foreclosed property costs and other
administrative expenses.

Automated teller machines (ATM's) are located at each of the Bank's six banking
offices. The Bank is a member of the NYCE, Yankee 24, Plus, and Cashstream
ATM networks.

-3-
Data processing for most of the Bank's deposit and loan accounts and other
applications is conducted internally using owned equipment. Application
software is primarily obtained through purchase or licensing agreements.

The Bank's Trust and Investment Department provides fiduciary services as
trustee under wills and trust agreements; as executor or administrator of
estates; as a provider of agency and custodial investment services to
individuals and institutions; and as a trustee for employee benefit plans. The
market value of total trust assets amounted to $389 million as of December 31,
1994.

The following is a summary of the relative amounts of income producing functions
as a percentage of gross operating income during the past five years:

1994 1993 1992 1991 1990
---- ---- ---- ---- ----

Interest and fees on:
Residential real estate loans 31% 33% 37% 37% 35%
Commercial and other loans 32 30 31 33 40
Installment and consumer loans 9 8 9 10 10
---- ---- ---- ---- ----
Total loan income 72 71 77 80 85

Interest and dividends on securities 13 13 9 7 6
Trust income 7 7 6 5 5
Other noninterest income 8 9 8 8 4
---- ---- ---- ---- ----
Gross operating income 100% 100% 100% 100% 100%
==== ==== ==== ==== ====

The percentage of gross income derived from interest and fees on loans was 72%
and 71% in 1994 and 1993, respectively, down from a five-year high of 85% in
1990, primarily as a result of the low interest rate environment that existed in
1993 and 1994.

Market Area and Competition
---------------------------
The Bank's market area includes most of southern Rhode Island (Washington
County) and a portion of New London County in southeastern Connecticut. The
Bank's six banking offices are located in the following Rhode Island
communities:

- Westerly (2) - Charlestown - New Shoreham (Block Island)
- Richmond - Narragansett

The Bank's offices in Charlestown and on Block Island are the only bank
facilities in those communities. The Block Island office was acquired from
another Rhode Island bank in 1984. The Charlestown office was opened in 1988
and the Narragansett office was opened in 1989.

The Bank faces strong competition from branches of major Rhode Island and
regional commercial banks, local branches of certain Connecticut banks, as well
as various credit unions, savings institutions and, to some extent, finance

-4-
companies. The principal methods of competition are through interest rates,
financing terms and other customer conveniences. The Washington Trust Company
had 36% of total deposits reported by financial institutions for banking offices
within its market area as of June 30, 1994. The two closest competitors held
16% each, and the third closest competitor held 6% of total deposits in the
market area. The Corporation believes that being the largest commercial banking
institution headquartered within the market area provides a competitive
advantage over other financial institutions. The Bank has a marketing
department which is responsible for the review of existing products and services
and the development of new products and services.

Employees
---------
As of December 31, 1994 the Corporation employed approximately 241 full-time and
53 part-time employees. Management believes that its employee relations are
good.

Supervision and Regulation
--------------------------
General - The business in which the Corporation and the Bank are engaged is
subject to extensive supervision, regulation, and examination by various bank
regulatory authorities and other agencies of federal and state government. The
supervisory and regulatory activities of these parties are often intended
primarily for the protection of customers or are aimed at carrying out broad
public policy goals that may not be directly related to the financial services
provided by the Corporation and the Bank, nor intended for the protection of the
Corporation's shareholders. Proposals to change regulations and laws which
affect the banking industry are frequently raised at the federal and state
level. The potential impact on the Corporation of any future revisions to the
supervisory or regulatory structure cannot be determined.

The Corporation and the Bank are required by various authorities to file
extensive periodic reports of financial and other information and such other
reports as the regulatory and supervisory authorities may require. The
Corporation is also subject to the reporting and other requirements of the
Securities Exchange Act of 1934.

The Corporation is a bank holding company registered under the Bank Holding
Company Act of 1956, as amended (the "BHC Act"). As a bank holding company, the
activities of the Corporation are regulated by the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"). The BHC Act requires that
the Corporation obtain prior approval of the Federal Reserve Board to acquire
control over a bank or certain nonbank entities and restricts the activities of
the Corporation to those closely related to banking. Federal law also regulates
transactions between the Corporation and the Bank, including loans or extensions
of credit.

The Bank is subject to the supervision of, and examination by, the FDIC. As
a state chartered institution, The Washington Trust Company is also subject
to various Rhode Island business and banking regulations.

Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) - FDICIA
was enacted in December 1991 and has resulted in extensive changes to the
federal banking laws. Among other things, FDICIA requires the federal banking
regulators to take prompt corrective action with respect to depository
-5-

institutions that do not meet minimum capital requirements.

FDICIA established five capital tiers, ranging from "well-capitalized" to
"critically undercapitalized." A depository institution is well-capitalized
if it significantly exceeds the minimum level required by regulation for each
relevant capital measure. Under FDICIA, an institution that is not well-
capitalized is generally prohibited from accepting brokered deposits and
offering interest rates on deposits higher than the prevailing rate in its
market. In addition, "pass through" deposit insurance coverage may not be
available for certain employee benefit accounts. At December 31, 1994, the
Bank's capital ratios placed it in the well-capitalized category.

Another primary purpose of FDICIA was to recapitalize the Bank Insurance Fund
(BIF). The FDIC adopted a risk-related premium system for the assessment
period beginning January 1, 1993. Under this new system, each institution's
assessment rate is based on its capital ratios in combination with a
supervisory evaluation of the risk the institution poses to the BIF. Banks
deemed to be well-capitalized and who pose the lowest risk to the BIF will
pay the lowest assessment rates, while undercapitalized banks, who present
the highest risk, will pay the highest rates.

FDICIA contains other significant provisions that require the federal banking
regulators to establish standards for safety and soundness for depository
institutions and their holding companies in three areas: (i) operational and
managerial; (ii) asset quality, earnings and stock valuation; and (iii)
management compensation. The legislation also requires that risk-based capital
requirements contain provisions for interest rate risk, credit risk and risks of
nontraditional activities. FDICIA also imposes expanded accounting and audit
reporting requirements for depository institutions. In addition, FDICIA imposes
numerous restrictions on state-chartered banks, including those which generally
limit investments and activities to those permitted to national banks, and
contains several consumer banking law provisions.

The provisions of FDICIA are being phased in over several years. While final
rules have been issued on most provisions, others have yet to be issued.

Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 - On
September 30, 1994, the Riegle-Neal Interstate Banking and Branching Efficiency
Act of 1994 was signed into law. Effective one year after enactment, adequately
capitalized bank holding companies will be permitted to acquire banks in any
state subject to certain concentration limits and other conditions. Also, on a
phased-in basis over three years from the date of its enactment, other
limitations on interstate bank mergers, consolidations and branching will be
eased, subject to a state's ability to "opt out" of certain provisions of the
law by passage of state law. No legislation has been introduced in Rhode Island
for the 1995 legislative session that would constitute an "opt out" election by
the State.

Dividend Restrictions -The Corporation's revenues consist of cash dividends paid
to it by the Bank. Such payments are restricted pursuant to various state and
federal regulatory limitations. Reference is made to Note 16 to the
Corporation's Consolidated Financial Statements included in its 1994 Annual
Report to Shareholders incorporated herein by reference for additional
discussion of the Corporation's ability to pay dividends.
-6-

Capital Guidelines - Regulatory guidelines have been established that require
bank holding companies and banks to maintain minimum ratios of capital to risk-
adjusted assets. Banks are required to have minimum core capital (Tier 1) of 4%
and total risk-adjusted capital (Tier 1 and Tier 2) of 8%. For the Corporation,
Tier 1 capital is essentially equal to shareholders' equity excluding the net
unrealized gain on securities available for sale. Tier 2 capital consists of a
portion of the reserve for possible loan losses (limited to 1.25% of total risk-
weighted assets). As of December 31, 1994, net risk-weighted assets amounted to
$342.5 million, the Tier 1 capital ratio was 12.55% and the total risk-based
capital ratio was approximately 13.82%.

The Tier 1 leverage ratio is defined as Tier 1 capital (as defined under the
risk-based capital guidelines) divided by average assets (net of intangible
assets and excluding the effects of accounting for securities available for sale
under SFAS No. 115). The minimum leverage ratio is 3% for banking organizations
that do not anticipate significant growth and that have well-diversified risk
(including no undue interest rate risk), excellent asset quality, high
liquidity and strong earnings. Other banking organizations are expected to have
ratios of at least 4 - 5%, depending on their particular condition and growth
plans. Higher capital ratios could be required if warranted by the particular
circumstances or risk profile of a given banking organization. The
Corporation's Tier 1 leverage ratio was 8.45% as of December 31, 1994. The
Federal Reserve has not advised the Corporation of any specific minimum Tier 1
leverage capital ratio applicable to it.

GUIDE 3 STATISTICAL DISCLOSURES
-------------------------------
The following tables contain additional consolidated statistical data about the
Corporation and its subsidiary.

I. Distribution of Assets, Liabilities and Shareholders' Equity;
Interest Rates and Interest Differential
-------------------------------------------------------------
A. Average balance sheets are presented on page 28 of the Corporation's 1994
Annual Report to Shareholders under the caption "Average Balances/Net
Interest Margin (Fully Taxable Equivalent Basis)", and are incorporated
herein by reference. Nonaccrual loans are included in average loan
balances. Average balances are based upon daily averages.

B. An analysis of net interest earnings, including interest earned and paid,
average yields and costs, and net yield on interest-earning assets is
presented on page 28 of the Corporation's 1994 Annual Report to
Shareholders under the caption "Average Balances/Net Interest Margin (Fully
Taxable Equivalent Basis)", and is incorporated herein by reference.

Interest income is reported on the fully taxable-equivalent basis. Tax
exempt income is converted to a fully taxable equivalent basis by assuming
a 34% marginal federal income tax rate adjusted for applicable state income
taxes net of the related federal tax benefit. For dividends on corporate
stocks, the 70% federal dividends received deduction is also used in the
calculation of tax equivalency. Interest on nonaccrual loans is included
in the analysis of net interest earnings to the extent that such interest
income has been recognized in the Consolidated Statements of Income. See
Guide 3 Item III.C.1.

-7-
C. An analysis of rate/volume changes in interest income and interest expense
is presented on page 29 of the Corporation's 1994 Annual Report to
Shareholders under the caption "Volume/Rate Analysis - Interest Income and
Expense (Fully Taxable Equivalent Basis)", and is incorporated herein by
reference. The net change attributable to both volume and rate has been
allocated proportionately.

II. INVESTMENT SECURITIES AND SECURITIES AVAILABLE FOR SALE
-------------------------------------------------------
A. The carrying amounts of investment securities as of the dates indicated are
presented in the following table:

December 31, 1994 1993 1992
-------------------------------------------------------------------------

U.S. Treasury obligations and
obligations of U.S. government
agencies $20,413,017 $19,419,860 $ 8,998,075
Mortgage-backed securities 21,696,508 25,401,432 24,202,972
States and political subdivisions 10,387,091 7,676,540 5,905,595
---------- ---------- ----------
$52,496,616 $52,497,832 $39,106,642
========== ========== ===========

The December 31, 1992 balance of mortgage-backed securities includes
$19,209,775 of securitized mortgages originated by the Bank which were
previously classified as loans in the Corporation's 1992 consolidated
financial statements.

The carrying amounts of securities available for sale as of the dates
indicated are summarized in the table below. Effective January 1, 1994, the
Corporation adopted Statement of Financial Accounting Standards No. 115,
"Accounting for Certain Investments in Debt and Equity Securities" (SFAS No.
115). The Statement requires that securities available for sale be reported
at fair value, with any unrealized gains and losses excluded from earnings
and reported as a separate component of shareholders' equity, net of tax,
until realized. Therefore, the carrying value of securities available for
sale at December 31, 1994 presented below is equal to market value. Prior
to the adoption of SFAS No. 115, securities available for sale were carried
at the lower of aggregate cost, adjusted for amortization of premium or
accretion of discount in the case of debt securities, or market value.

December 31, 1994 1993 1992
-------------------------------------------------------------------------

U.S. Treasury obligations $24,533,220 $25,120,650 $23,165,503
Corporate debt securities -- 1,000,000 1,000,000
Corporate stocks 9,076,095 8,143,093 9,577,786
Federal Home Loan Bank stock 2,906,800 1,972,800 1,942,000
---------- ---------- ----------
$36,516,115 $36,236,543 $35,685,289
========== ========== ===========

-8-
B. Maturities of debt securities as of December 31, 1994 are presented in the
following tables. Mortgage-backed securities are included based on their
weighted average maturities, adjusted for anticipated future prepayments.
Yields on tax exempt obligations were not computed on a tax equivalent
basis.

U.S. Treasury
obligations &
obligations of Mortgage- States and
U.S. Government backed Political Total Debt
Investment Securities Agencies Securities Subdivisions Securities
--------------------------- --------------- ----------- ------------ -----------

Due in 1 year or less: Amount $ 2,998,917 $ 1,491,000 $ 3,539,599 $ 8,029,516
Yield 4.04% 7.00% 4.68% 4.87%

After 1 but within 5 years: Amount 16,414,100 6,393,819 5,889,928 28,697,847
Yield 5.15% 6.97% 4.34% 5.39%

After 5 but within 10 years: Amount 1,000,000 5,575,938 658,309 7,234,247
Yield 8.00% 7.23% 4.88% 7.13%

After 10 years: Amount -- 8,235,751 299,255 8,535,006
Yield -- 7.49% 3.43% 7.35%
---------- ---------- ---------- ----------
Totals: Amount $20,413,017 $21,696,508 $10,387,091 $52,496,616
Yield 5.13% 7.24% 4.46% 5.87%
========== ========== ========== ==========

U.S. Treasury U.S. Treasury Weighted
obligations at obligations at average
Securities Available for Sale amortized cost market value yield
----------------------------- -------------- -------------- --------

Due in 1 year or less: Amount $ 6,001,105 $ 5,980,350 5.54%

After 1 but within 5 years: Amount 18,568,315 17,881,150 6.11%

After 5 but within 10 years: Amount -- -- --

After 10 years: Amount 490,060 671,720 13.14%
---------- ---------- -----
Totals: Amount $25,059,480 $24,533,220 6.11%
========== ========== =====

C. Not applicable.

-9-
III. LOAN PORTFOLIO
--------------
A. Types of Loans

December 31, 1994 1993 1992 1991 1990
--------------------------------------------------------------------------------------------------------

Residential real estate:
Mortgages $169,715,217 $152,758,727 $140,438,839 $168,173,712 $156,007,304
Homeowner construction 6,933,793 6,120,171 5,124,603 4,482,367 9,070,011
----------- ----------- ----------- ----------- -----------
Total residential real estate 176,649,010 158,878,898 145,563,442 172,656,079 165,077,315
----------- ----------- ----------- ----------- -----------
Commercial:
Mortgages 54,735,825 48,011,836 38,921,833 36,734,260 36,070,358
Construction and development 11,909,730 10,051,008 10,947,411 18,644,654 28,124,400
Other 101,796,053 101,636,280 97,344,028 96,392,707 105,605,074
----------- ----------- ----------- ----------- -----------
Total commercial 168,441,608 159,699,124 147,213,272 151,771,621 169,799,832
----------- ----------- ----------- ----------- -----------
Installment 45,042,854 33,932,673 32,461,572 36,583,783 38,893,929
----------- ----------- ----------- ----------- -----------
$390,133,472 $352,510,695 $325,238,286 $361,011,483 $373,771,076
=========== =========== =========== =========== ===========

B. An analysis of the maturity and interest rate sensitivity of real estate
construction and commercial and other loans as of December 31, 1994
follows:

Maturity analysis:

One Year One to five After five
or Less Years Years Total
---------- ---------- ---------- -----------

Construction and development (*) $ 4,580,438 4,463,857 9,799,228 $ 18,843,523
Commercial - other 36,609,542 43,458,125 21,728,386 101,796,053
---------- ---------- ---------- -----------
$41,189,980 47,921,982 31,527,614 $120,639,576
========== ========== ========== ===========
<FN>
(*) Includes homeowner construction and commercial construction and development.
Maturities of homeowner construction loans are included based on their contractual
conventional mortgage repayment terms following the completion of construction.

Sensitivity to changes in interest rates for all such loans due after one
year is as follows:

Floating or
Predetermined Adjustable
Rates Rates Totals
------------- ---------- ----------

Principal due after one year $12,200,919 $67,248,677 $79,449,596
========== ========== ==========

-10-
C. Risk Elements
Reference is made to the caption "Asset Quality" included in Management's
Analysis of Financial Statements on pages 25-27 of the Corporation's 1994
Annual Report to Shareholders incorporated herein by reference. Included
therein is a discussion of the Corporation's credit review and collection
practices. Also included therein is information concerning property
acquired through foreclosure and in-substance foreclosures held at December
31, 1994 and the Corporation's ongoing efforts to dispose of such
properties.

1. Nonaccrual, Past Due and Restructured Loans.
(a). Nonaccrual loans as of the dates indicated were as follows:

December 31, 1994 1993 1992 1991 1990
--------------------------------------------------------------------------

$7,119,271 $11,370,726 $12,563,329 $17,856,390 $16,329,966
========= ========== ========== ========== ==========

For years 1994, 1993 and 1992, loans, with the exception of credit card
loans, were placed on nonaccrual status and interest recognition was
suspended when such loans were 90 days or more overdue with respect to
principal and/or interest. Interest previously accrued, but not
collected on such loans was reversed against current period income.
Cash receipts on nonaccrual loans were recorded as interest income, or
as a reduction of principal if full collection of the loan was doubtful
or if impairment of the collateral was identified. Loans were removed
from nonaccrual status when they had been current as to principal and
interest for a period of time, the borrower had demonstrated an ability
to comply with repayment terms, and when, in management's opinion, the
loans were considered to be fully collectible.

In years prior to 1992, commercial loans were placed on nonaccrual status
and interest recognition was suspended when they were 90 days or more
overdue. Residential mortgages and consumer loans were placed on
nonaccrual status when, in management's judgment, the probability of
collection was deemed insufficient to warrant further income recognition.

For the year ended December 31, 1994, the gross interest income that would
have been recognized if loans on nonaccrual status had been current in
accordance with their original terms was approximately $628,000. Interest
recognized on these loans amounted to approximately $287,000.

There were no significant commitments to lend additional funds to borrowers
whose loans were on nonaccrual status at December 31, 1994.

(b). Loans contractually past due 90 days or more and still accruing for
the dates indicated were as follows:

December 31, 1994 1993 1992 1991 1990
--------------------------------------------------------------------

$24,124 $22,455 $42,648 $6,064,648 $4,039,105
====== ====== ====== ========= =========

-11-

(c). Restructured accruing loans for the dates indicated were as follows:

December 31, 1994 1993 1992 1991 1990
-----------------------------------------------------------------------

$364,824 $ --- $1,476,000 $1,522,282 $ --
======= ========= ========= ========= =========

Restructured accruing loans include those for which concessions, such as
reduction of interest rates other than normal market rate adjustments or
deferral of principal or interest payments, have been granted due to a
borrower's financial condition. Interest on restructured loans is accrued
at the reduced rate. Loans restructured during 1994 amounted to $525,809,
of which $160,985 is included in nonaccrual loans reported in Section
III.C.1.(a) above.

2. Potential Problem Loans.
Potential problem loans consist of certain accruing commercial loans that
were less than 90 days past due at December 31, 1994, including certain
loans classified as either substandard, doubtful or loss by the Bank's
primary regulator during their most recent examination conducted during the
fourth quarter of 1994 and loans identified by management of the Bank as
potential problem loans. Such loans are characterized by weaknesses in
the financial condition of borrowers or collateral deficiencies. Based on
historical experience, the credit quality of some of these loans may
improve as a result of collection efforts, while the credit quality of
other loans may deteriorate, resulting in some amount of losses. These
loans are not included in the analysis of nonaccrual, past due and
restructured loans in III.C.1 above.

At December 31, 1994, potential problem loans which were contractually
current amounted to $4.9 million. In addition, potential problem loans
that were 30-89 days past due amounted to approximately $2.3 million at
December 31, 1994. The Corporation's loan policy provides guidelines for
the review of such loans in order to facilitate collection.

Depending on future events, the potential problem loans referred to above,
and others not currently identified, could be classified as nonperforming
in the future.

3. Foreign Outstandings. None

4. Loan Concentrations. The Corporation has no concentration of loans which
exceed 10% of its total loans except as disclosed by types of loan in
Section III.A.

D. Other Interest-Bearing Assets: None

-12-

IV. SUMMARY OF LOAN LOSS EXPERIENCE
-------------------------------
A. The reserve for possible loan losses is available for future credit losses
inherent in the loan portfolio. The level of the reserve is based on
management's ongoing review of the growth and composition of the loan
portfolio, net charge-off experience, current and expected economic
conditions, and other pertinent factors. Loans (or portions thereof)
deemed to be uncollectible are charged against the reserve and recoveries
of amounts previously charged off are added to the reserve. Loss
provisions charged to earnings are added to the reserve to bring it to
the desired level. Loss experience on loans is presented in the
following table for the years indicated.

Analysis of the Reserve for Possible Loan Losses
------------------------------------------------

December 31, 1994 1993 1992 1991 1990
--------------------------------------------------------------------------------------------

Balance at beginning of year $8,657,263 $7,342,276 $6,474,272 $8,487,196 $3,229,112
Charge-offs (domestic):
Residential:
Mortgages 158,526 203,472 260,848 331,130 41,699
Homeowner construction -- -- -- -- --
Commercial:
Mortgages 329,233 596,250 24,154 2,097,532 100,000
Construction and development -- -- 114,315 1,312,452 980,143
Other 375,609 333,924 2,522,916 2,928,730 1,867,843
Installment 250,840 378,575 494,756 771,705 269,260
--------- --------- --------- --------- ---------
Total charge-offs 1,114,208 1,512,221 3,416,989 7,441,549 3,258,945
--------- --------- --------- --------- ---------
Recoveries (domestic):
Residential:
Mortgages 1,110 2,278 -- 272 --
Homeowner construction -- -- -- -- --
Commercial:
Mortgages 21,830 84,351 200 -- --
Construction and development 6,504 20,756 29,424 100,997 --
Other 188,722 174,976 192,845 23,981 11,018
Installment 74,686 44,847 62,524 103,375 6,011
--------- --------- --------- --------- ---------
Total recoveries 292,852 327,208 284,993 228,625 17,029
--------- --------- --------- --------- ---------
Net charge-offs 821,356 1,185,013 3,131,996 7,212,924 3,241,916
Additions charged to earnings 1,000,000 2,500,000 4,000,000 5,200,000 8,500,000
--------- --------- --------- --------- ---------
Balance at end of period $8,835,907 $8,657,263 $7,342,276 $6,474,272 $8,487,196
========= ========= ========= ========= =========
Net charge-offs to average loans .22% .35% .89% 1.95% .89%
========= ========= ========= ========= =========

-13-

B. The following table presents the allocation of the allowance for loan losses.

December 31, 1994 1993 1992 1991 1990
--------------------------------------------------------------------------------------------

Residential:
Mortgages $1,088,974 1,064,022 1,053,778 1,225,000 1,020,000
% of these loans to all loans 43.5% 43.3% 43.2% 46.6% 41.7%

Homeowner construction 44,047 33,661 35,222 -- --
% of these loans to all loans 1.8% 1.7% 1.6% 1.2% 2.4%

Commercial:
Mortgages 1,114,797 1,090,454 1,017,490 1,305,509 1,493,453
% of these loans to all loans 14.0% 13.6% 12.0% 10.2% 9.7%

Construction and development 270,684 110,645 179,395 494,694 1,373,735
% of these loans to all loans 3.0% 2.9% 3.4% 5.2% 7.5%

Other 2,686,977 2,726,961 2,753,695 2,453,753 1,887,083
% of these loans to all loans 26.1% 28.9% 29.8% 26.7% 28.3%

Installment 854,688 559,889 692,913 726,000 669,615
% of these loans to all loans 11.6% 9.6% 10.0% 10.1% 10.4%

Unallocated (1) 2,775,740 3,071,631 1,609,783 269,316 2,043,310
--------- --------- --------- --------- ---------
$8,835,907 8,657,263 7,342,276 6,474,272 8,487,196
100.0% 100.0% 100.0% 100.0% 100.0%
========= ========= ========= ========= =========

<FN>
(1) Beginning with 1991, the Corporation's practice for allocating loss exposure was refined,
resulting in a broader allocation of the overall reserve. Accordingly, portions of the
unallocated reserve have been redistributed to specific loan categories.

-14-
V. DEPOSITS
--------
A. Average deposit balances outstanding and the average rates paid thereon
are presented in the following table:

1994 1993 1992
--------------------- -------------------- --------------------
Average Average Average Average Average Average
Amount Rate Paid Amount Rate Paid Amount Rate Paid
----------- --------- ---------- --------- ---------- ---------

Demand deposits $ 49,369,000 -- 40,097,000 -- 32,872,000 --
Savings deposits:
Regular 98,851,000 2.70% 79,567,000 2.83% 63,163,000 3.33%
NOW accounts 57,834,000 1.36% 58,930,000 1.84% 55,178,000 2.73%
Money market accounts 40,101,000 2.17% 59,473,000 2.74% 63,969,000 3.45%
----------- ----------- -----------
Total savings 196,786,000 2.20% 197,970,000 2.51% 182,310,000 3.19%

Time deposits 183,950,000 4.30% 176,148,000 4.60% 183,443,000 5.60%
----------- ----------- -----------
Total deposits $430,105,000 414,215,000 398,625,000
=========== =========== ===========

B. Not Applicable

C. Not Applicable

D. The maturity schedule of time deposits in amounts of $100,000 or more at
December 31, 1994 was as follows:

Over 3 Over 6
3 months through through Over 12
or less 6 months 12 months months Total
---------- --------- --------- --------- ----------

Time remaining
until maturity: $11,381,827 2,224,163 4,643,474 6,313,153 24,562,617
========== ========= ========= ========= ==========

E. Not applicable

VI. RETURN ON EQUITY AND ASSETS
---------------------------

1994 1993 1992
---- ---- ----

Return on average assets 1.25% 1.01% 0.70%
Return on average shareholders' equity 14.11% 12.92% 9.15%
Dividend payout ratio 33.02% 34.30% 46.85%
Average equity to average total assets 8.84% 7.81% 7.68%

VII. SHORT-TERM BORROWINGS
---------------------
The average balance of short-term borrowings during the reported periods
was less than 30% of shareholders' equity at the end of each reported
period.
-15-
ITEM 2. PROPERTIES
------------------
As of December 31, 1994 the Corporation was operating six facilities including
its main office located in Westerly, Rhode Island and five branch banking
facilities located in Westerly, Charlestown, Narragansett, Richmond and Block
Island, Rhode Island. All sites are owned, except for the Block Island branch
facility, which is leased. The main office premises, containing the corporate
offices and a banking facility, consists of a five story building and an
adjacent two story building. The buildings, which are connected, contain
approximately 50,000 square feet of space, 42,000 square feet of which is
occupied by the Corporation. The remaining space is leased to merchant and
professional tenants under short-term lease arrangements and could be used for
expansion of the Corporation's offices. The main office location also contains
a three level retail parking garage with 80,000 square feet of space.

The Corporation has made a substantial investment in its branch office
facilities. The Charlestown banking office opened in 1988 in a newly
constructed facility. The Narragansett banking office began operations in June
1989 in a building which had been acquired in 1988 and was completely renovated.
A major renovation and expansion of the Richmond banking office was completed in
January of 1990. The Richmond site also contains a separate building operated
as a restaurant by a restaurant chain under a long-term lease.

ITEM 3. LEGAL PROCEEDINGS
-------------------------
Neither the Corporation nor its subsidiary is a party to any material pending
legal proceedings, other than routine litigation incidental to their business
activities.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
-----------------------------------------------------------
No matters were submitted to a vote of security holders during the fourth
quarter of the year ended December 31, 1994.

-16-
EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------

Following is a list of all executive officers of the Corporation and the
Bank with their titles, ages, and length of service with the Corporation as of
December 31, 1994. (Service prior to 1984 for all executive officers of the
Corporation was with the Bank.)
Years
Officers of the Corporation Age of service
--------------------------- --- ----------
Joseph J. Kirby President 63 32

Joseph H. Potter Executive Vice President 61 36

David V. Devault, CPA Vice President and
Chief Financial Officer 40 8

Louis J. Luzzi Vice President and Treasurer 53 34

Harvey C. Perry, II Vice President and Secretary 44 20

Joseph H. Potter and Louis J. Luzzi are first cousins.

Joseph J. Kirby joined the Bank in 1963 as an Investment Officer. He was
elected Vice President and Investment Officer in 1965 and Executive Vice
President in 1972. He was elected president in 1982.

Joseph H. Potter joined the Bank in 1958 and was elected Secretary in 1967. He
was elected Vice President and Secretary in 1973 and Executive Vice President in
1982.

David V. Devault joined the Bank in 1986 as Controller. He was elected Vice
President and Chief Financial Officer of the Corporation and the Bank in 1987.
He was elected Senior Vice President and Chief Financial Officer of the Bank in
1990. Prior to joining the Bank he was a Senior Manager with the firm of KPMG
Peat Marwick.

Louis J. Luzzi joined the Bank in 1960 and was elected Assistant Vice President
in 1969. He was elected Vice President in 1979 and Vice President and Treasurer
in 1983.

Harvey C. Perry, II joined the Bank in 1974 and was elected Assistant Trust
Officer in 1977, Trust Officer in 1981 and Secretary and Trust Officer in 1982.
He was elected Vice President and Secretary of the Corporation and the Bank in
1984, and Senior Vice President and Secretary of the Bank in 1990.

Years
Officers of the Bank Age of service
-------------------- --- ----------
Vernon F. Bliven Senior Vice President - 45 22
Human Resources

Robert G. Cocks, Jr. Senior Vice President - Lending 50 2

-17-
Louis W. Gingerella, Jr. Senior Vice President - 42 4
Credit Administration

B. Michael Rauh, Jr. Senior Vice President - 35 3
Retail Banking

Vernon F. Bliven joined the Bank in 1972 and was elected Assistant Vice
President in 1980, Vice President in 1986 and Senior Vice President - Human
Resources in 1993.

Robert G. Cocks, Jr. joined the Bank in 1992 as Senior Vice President - Lending.
Prior to joining the Bank he served as Executive Vice President at Bay Bank
South from 1987 to 1991. From 1991 to 1992 he worked as an independent
consultant.

Louis W. Gingerella, Jr. joined the Bank in 1990 as Vice President - Credit
Administration. He was elected Senior Vice President - Credit Administration in
1992. Prior to joining the Bank he held the position of Senior Vice President
with Bank of New England since 1988.

B. Michael Rauh, Jr. joined the Bank in 1991 as Vice President - Marketing and
was promoted in 1993 to Senior Vice President - Retail Banking. Prior to
joining the Bank he was Executive Vice President with the advertising agency of
Chaffee & Partners since 1989.

-18-

PART II
-------

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS
-------------------------------------------------------------
The Corporation's common stock has traded on the NASDAQ Small-Cap Market since
June 19, 1992. Previously, the Corporation's common stock had been listed on
the NASDAQ Over-The-Counter Market system since June 1987.

The quarterly common stock price ranges and dividends paid per share for the
years ended December 31, 1994 and 1993 are presented in the following table.
The stock prices are based on the high and low sales prices during the
respective quarter. Stock price and dividend amounts have been restated to
reflect a 3-for-2 stock split paid in the form of a stock dividend on August 31,
1994.

1994 Quarters 1 2 3 4
--------------------------------------------------------------------

Stock prices:
high 19.17 22.50 24.00 24.00
low 16.67 17.67 21.33 19.75

Cash dividend declared .16 .17 .20 .20

1993 Quarters 1 2 3 4
--------------------------------------------------------------------
Stock prices:
high 13.00 15.33 16.83 18.00
low 10.67 11.67 13.67 15.33

Cash dividend declared .15 .15 .15 .14

The Corporation will continue to review future common stock dividends based on
profitability, financial resources and economic conditions. The Corporation has
recorded consecutive quarterly dividends for over one hundred years. On March
16, 1995, the Corporation's Board of Directors declared a cash dividend of $.22
per share, an increase of 10% over the previous dividend amount. The dividend
is payable April 17, 1995 to shareholders of record as of April 3, 1995.

The Corporation's primary source of funds for dividends paid to shareholders is
the receipt of dividends from the Bank. A discussion of the restrictions on the
advance of funds or payment of dividends to the Corporation is included in Note
16 to the Consolidated Financial Statements included in the 1994 Annual Report
to Shareholders which is incorporated herein by reference.

At December 31, 1994 there were 1,216 holders of record of the Corporation's
common stock.

-19-
ITEM 6. SELECTED FINANCIAL DATA
-------------------------------
Selected consolidated financial data for the five years ended December 31, 1994
appears under the caption "Five Year Summary of Selected Consolidated Financial
Data" on page 22 of the Corporation's 1994 Annual Report to Shareholders which
is incorporated herein by reference.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
-------------------------------------------------------------------------------
The information required by this Item appears under the caption "Management's
Analysis of Financial Statements" on pages 23-34 of the Corporation's 1994
Annual Report to Shareholders which is incorporated herein by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
---------------------------------------------------
The financial statements and supplementary data are contained in the
Corporation's 1994 Annual Report to Shareholders, filed as Exhibit 13, on the
pages indicated in the following table, and are incorporated herein by
reference.

Page of 1994
Annual Report
-------------
Consolidated Balance Sheets 35
Consolidated Statements of Income 36
Consolidated Statements of Changes in Shareholders' Equity 38
Consolidated Statements of Cash Flows 37
Notes to Consolidated Financial Statements 39
Parent Company Financial Statements 55
Independent Auditor's Report 57
Summary of Unaudited Quarterly Financial Information 58

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
----------------------------------------------------------
None.

-20-
PART III
--------

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
-----------------------------------------------------------
Required information regarding directors is presented under the caption
"Nominee and Director Information" in the Corporation's Proxy Statement dated
March 20, 1995 prepared for the 1995 Annual Meeting of Shareholders and
incorporated herein by reference.

Required information regarding executive officers of the Corporation is included
in Part I under the caption "Executive Officers of the Registrant".

Information required with respect to compliance with Section 16(a) of the
Exchange Act appears under the caption "Compliance with Section 16(a) of the
Exchange Act" in the Corporation's Proxy Statement dated March 20, 1995
prepared for the 1995 Annual Meeting of Shareholders which is incorporated
herein by reference.

ITEM 11. EXECUTIVE COMPENSATION
-------------------------------
The information required by this Item appears under the caption "Compensation of
Directors and Executive Officers - Executive Compensation" in the Corporation's
Proxy Statement dated March 20, 1995 prepared for the 1995 Annual Meeting of
Shareholders which is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
-------------------------------------------------
The information required by this Item appears under the caption "Nominee and
Director Information" in the Corporation's Proxy Statement dated March 20, 1995
prepared for the 1995 Annual Meeting of Shareholders which is incorporated
herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
-------------------------------------------------------
The information required by this Item is incorporated herein by reference to
the caption "Indebtedness and Other Transactions" of the Corporation's Proxy
Statement dated March 20, 1995 prepared for the 1995 Annual Meeting of
Shareholders.

-21-
PART IV
-------

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
------------------------------------------------------------------------
(a) 1. The financial statements of Washington Trust Bancorp, Inc. required in
response to this Item are listed in response to Item 8 of this Report and
are incorporated herein by reference.

2. Financial Statement Schedules. All schedules normally required by
Article 9 of Regulation S-K and all other schedules to the consolidated
financial statements of the Corporation have been omitted because the
required information is either not required, not applicable, or is
included in the consolidated financial statements or notes thereto.

(b) No reports on Form 8-K have been filed during the fourth quarter of the
year ended December 31, 1994.

Exhibit Number
--------------
3.(i) Restated articles of incorporation
3.(ii) By-laws of the Corporation **

* 10.1 Supplemental Pension Benefit and Profit Sharing
Plan
* 10.2 Outside Director's Retainer Continuation Plan
* 10.3 Plan for Deferral of Director's Fees
* 10.4 Amended and Restated 1988 Stock Option Plan
* 10.5 Short Term Incentive Plan ***

11 Computation of Earnings per share

13 1994 Annual Report to Shareholders

21 Subsidiaries of the Registrant

23 Consent of Independent Auditors

27 Financial Data Schedule

* Management contract or compensatory plan or arrangement.

** Incorporated herein by reference to Exhibit 3 of the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1990, previously filed
with the Commission.

*** Incorporated herein by reference to Exhibit 10 of the Registrant's Annual
Report on Form 10-K for the year ended December 31, 1993, previously filed
with the Commission.

(d) Financial Statement Schedules.

None.

-22-

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

WASHINGTON TRUST BANCORP, INC.
------------------------------
(Registrant)

March 16, 1995 Joseph J. Kirby
Date ________________ By ______________________________________
Joseph J. Kirby, President, Principal
Executive Officer and Director

March 16, 1995 David V. Devault
Date ________________ By ______________________________________
David V. Devault, Vice President,
Chief Financial Officer and Principal
Accounting Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

March 16, 1995 Joseph H. Potter
Date ________________ ______________________________________
Joseph H. Potter, Executive Vice
President and Director

March 16, 1995 Gary P. Bennett
Date ________________ ______________________________________
Gary P. Bennett, Director

Date ________________ ______________________________________
Steven J. Crandall, Director

March 16, 1995 Richard A. Grills
Date ________________ ______________________________________
Richard A. Grills, Director

March 16, 1995 Larry J. Hirsch
Date ________________ ______________________________________
Larry J. Hirsch, Director

-23-

March 16, 1995 Katherine W. Hoxsie
Date ________________ ______________________________________
Katherine W. Hoxsie, Director

March 16, 1995 Mary E. Kennard
Date ________________ ______________________________________
Mary E. Kennard, Director

March 16, 1995 James W. McCormick, Jr.
Date ________________ ______________________________________
James W. McCormick, Jr., Director

March 16, 1995 Thomas F. Moore
Date ________________ ______________________________________
Thomas F. Moore, Director

March 16, 1995 Brendan P. O'Donnell
Date ________________ ______________________________________
Brendan P. O'Donnell, Director

March 16, 1995 Victor J. Orsinger, II
Date ________________ ______________________________________
Victor J. Orsinger, II, Director

March 16, 1995 Anthony J. Rose, Jr.
Date ________________ ______________________________________
Anthony J. Rose, Jr., Director

March 16, 1995 James P. Sullivan
Date ________________ ______________________________________
James P. Sullivan, Director

March 16, 1995 Neil H. Thorp
Date ________________ ______________________________________
Neil H. Thorp, Director

-24-