Welcome to the Q1 2008 Washington Trust Bancorp, Inc. earnings conference call. (Operator Instructions) Now I would like to turn the conference over to Ms. Elizabeth Eckel.

Welcome to the quarterly earnings conference call for Washington Trust Bancorp, Inc., NASDAQ Global Market symbol (WASH). Today’s conference call is being recorded, is being web-cast live and a web-cast replay of this conference call will be available shortly after the conclusion of the call through the corporation’s website at www.washtrust.com in the Investor Relations section under the sub-head Presentations. However, the information we provide during today’s call is accurate only as of this date and you should not rely on these statements after the conclusion of this call. Hosting this afternoon’s discussion is John C. Warren, Chairman and Chief Executive Officer; and David V. Devault, Executive Vice President, Secretary, Treasurer, and Chief Financial Officer. I’m now pleased to introduce Washington Trust’s Chairman and CEO, John Warren.

This morning we released our earnings for the first quarter ended March 31, 2008. I’m pleased to report that Washington Trust earned 5.8 million for the first quarter. This is consistent with the amount earned for the fourth quarter 2007 but down slightly from the $6 million reported for a year ago. On a per share basis we earned $0.43 per diluted share, which is unchanged from the amount earned in the fourth quarter of 2007 but down from the $0.44 per diluted share earned in the first quarter of 2007. These are very respectable numbers considering we are competing in a slow growth economy with unstable financial markets and decreasing consumer confidence. There are daily stories coming across the wires about problems and issues within the financial markets. We’ve been through difficult times like these before and not only did we survive but we’ve learned from the experience. We’re a solid financial institution with an experienced management team. In previous conference calls I mentioned that we were concerned about what spillover there might be from the sub-prime crisis and what effect it would have on the economy in 2008. These worries and potential problems continue to exist. We have never had a sub-prime or ALT-A mortgage program but the longer the economy stays weak the more concerned we are. Food, gasoline and home heating oil prices just add to this. However, we have had strong loan demand, both commercial and residential which may be the result of borrowers looking for a reputable lender with a solid foundation. Commercial loans were up $46 million or 7% for the quarter and $127 million or 21% over the first quarter of 2007. This is our sixth straight quarter of solid commercial loan growth. We had good production in both the C&I area…

I’ll be reviewing the first quarter operating results and financial position, as described in our press release this morning. Net income for the first quarter of 2008 was $5.8 million or $0.43 per diluted share compared to $6 million or $0.44 per diluted share earned in the first quarter of 2007. The modest reduction in net income and earnings per share was primarily due to a decline in the net interest margin. This condition reflects the impact of Federal Reserve rate cuts in recent months. In addition, our loan loss provision charged to earnings amounted to $450,000 in the quarter, up $150,000 from the provision recorded in the first quarter of 2007. Net interest income in the first quarter of this year was $15.1 million, 1.6% higher than the fourth quarter of 2007 and 1.4% higher than the first quarter a year ago. The net interest margin for the first quarter of 2008 was 2.59%, down 6 basis points from the fourth quarter and down 22 basis points from the first quarter last year. Included in net interest income in the first quarter of 2007 was an interest recovery of $322,000 received on a previously charged off loan. Excluding the 6 basis points attributable to that interest recovery in 2007 the margin was 16 basis points lower than the first quarter last year. The decline in the margin is due to decreases in yields on prime-related commercial and consumer loans, again resulting from actions taken by the Federal Reserve to reduce short term interest rates. Now I’ll comment on some of the major balance sheet changes. Total loan growth amounted to $24.9 million in the quarter. Commercial loan growth continued to be strong with an increase of $46 million in the first three months, and that represents the sixth consecutive…

In closing I’d like to once again say that we’re pleased with our performance in these challenging economic times. We obviously can’t predict what the remainder of 2008 holds. It’s disheartening to pick up the paper and read about layoffs, inflation and mortgage foreclosures. We’re watching for any signs that the Fed actions are taking hold and are hopeful that the consumer will soon begin to regain his confidence. For our part Washington Trust will stay focused on doing those things that are important to our customers and our shareholders while continuing to capitalize on our core competencies and that most importantly includes maintaining our focus on asset quality. At this point thank you for your time this afternoon. And David and I will be happy to answer any questions you might have.

(Operator Instructions) Our first question comes from [Albert Sungar - Sidoti & Co.] [Albert Sungar - Sidoti & Co.]: My first question is on the yield. Do you have the net interest margin for the month of March available?

March was about 2.5%, 250, now when you get into individual months that can be very misleading. I mean February because of the number of days, with fewer than 30 days, but also having a mortgage portfolio that’s on a 30/360 basis pushes the margin up. So the margin has I would say increased slightly from the beginning of the quarter to the end of the quarter, but only slightly. And I wouldn’t draw too many conclusions from that.

I think as we look forward, Albert, what we’re really looking at is a margin that stays somewhat level. And we’ll see if the Fed drops another 25 basis points. But that appears to be the work we’ve done in the forecast. [Albert Sungar - Sidoti & Co.]: On March 18 as you know, we had another 75 basis point cut. So how much of that is reflected in your March net interest margin?

Well, certainly some of it was the loans that are tied to prime and immediately re-price would have been affected by that. Other loans, primarily home equity lines, would re-price on April 1 being tied to the Wall Street Journal prime index. At the same time we’re repricing deposits downward. There’d be a lagging effect of those changes as well. [Albert Sungar - Sidoti & Co.]: Switching to wealth management, do you have a target assets under administration by the end of 2008?

Are you going to forecast where the stock market’s going to be? [Albert Sungar - Sidoti & Co.]: In terms of the rewards that you’re trying to set basically the bar for the wealth management division.

Within the numbers that you see there in the decline we actually had pretty good net growth from new customers coming in. So that if the stock market begins to come around and hopefully we’ll be truly the leading indicator for the economy. Hopefully we easily surpass the $4 billion by the time we get to the end of the year, as we would have been forecasting as you can expect to the beginning of the year. [Albert Sungar - Sidoti & Co.]: But you are open to a few ideas of acquiring something like Western Financial. Would you be interested on that?

Yes, I think we’ve been very open both in talking to each of you who would be on the phone today and various investment bankers. They know that a well-matched wealth management firm would be a great add for us and we would be very open to that. [Albert Sungar - Sidoti & Co.]: And there were no buybacks in the first quarter of 2008. Do you expect to complete the buyback program by the end of 2008?

It’s still open but I think realistically with all the turmoil that’s going on in the marketplace that I think we’d just as soon keep a tight fist around our capital and take advantage of the opportunities for growth that are here rather than chasing a buyback. [Albert Sungar - Sidoti & Co.]: Talking about growth, commercial loan growth has been very strong. I guess an overall picture, if you could give a bit color on the sustainability of that growth in light of the budget shortfalls projected for the state of Rhode Island.

What we’re actually seeing on the growth is a blend of both commercial, the C&I, as well as the commercial real estate. And the activity is coming not just from our current customers but with the turmoil at all the larger banks in Rhode Island are experiencing we’re seeing a lot more customer activity and non-customer activity, I mean customers of the large institutions coming to us and we’re cautiously optimistic we will continue to see loan growth throughout the rest of the year.

The next question comes from Frank Schiraldi - Sandler O’Neill. Frank Schiraldi - Sandler O’Neill: First on the margin, John did I hear you correctly you expect or are optimistic that it could stabilize here or do you think there might be actually some expansion in the short term?

I think in the near term, stable would be the most likely outcome. Frank Schiraldi - Sandler O’Neill: On charge offs is there any way you could share with us a breakdown? Were there recoveries in the quarter as well or was that just a real small charge-off, that $3000, or were there recoveries against some charge-offs in the quarter?

There were some recoveries certainly.

It was all small dollars, Frank. There were a couple of small charge offs and a couple of small recoveries that net into the $3,000. Frank Schiraldi - Sandler O’Neill: On the commercial relationship that you mentioned in the release as being 30 days plus delinquent, is there any update on that? Is that still delinquent as of today? And is there any maybe a little bit more you can give us as far as what sort of credit those are, what they’re secured by? And just your thoughts on potential losses down the road on that relationship.

It’s a hotel. It is a customer that is experiencing I would say seasonal cash flow issues. On a loan to value ratio basis, we believe we are very well secured on that and it’s just a matter of working through these issues with this customer. Frank Schiraldi - Sandler O’Neill: About the deposit service charges line, it usually tends to be weaker in the first quarter on a linked quarter basis. It was sort of flat from the fourth quarter this time around. Is there something different in there, maybe some new overdraft program, something like that or is there any reason for that?

No. The answer is no. The behavior of depositors with respect to overdrafts is it moves around. That’s the best thing I can tell you and I don’t think there’s anything seasonal going on there right now. Frank Schiraldi - Sandler O’Neill: On the pipeline, John you said commercial growth you’re optimistic that you can continue to grow here. There was obviously a pretty strong commercial growth in this quarter. Are you seeing the pipeline accelerate here? Is it starting to slow?

Yes, I’d say the pipeline is holding its own which is good. We had just excellent growth in the first quarter. I don’t think we will see growth at that level. But the pipeline is very good. It’s coming from multiple locations, multiple customers and we’re seeing great opportunities that really are indicative of the problems that a lot of other large institutions are having. And the customers are looking for somebody that actually is paying attention to business. Frank Schiraldi - Sandler O’Neill: On the reverse mortgages, that’s a fee income business. Is there any consideration on whether you actually hold those or no?

No we don’t hold those. That’s a business proposition that we wouldn’t do.

Our next question comes from Damon DelMonte - KBW.

On the wealth management line items, would you characterize this quarter’s performance as being driven by market valuations or would you just say there’s some seasonality in the first quarter?

The change in the wealth management assets is largely driven by the markets. There was a positive net customer cash flow in the quarter and it was larger than the first quarter a year ago but when the S&P 500 drops 10% in the quarter it’s pretty hard to avoid the impact of that. The most seasonal thing we have is tax preparation fees and that generally is a second quarter item that is recognized. So that’s not in the first quarter.

And then on that $3.4 million commercial lending relationship, did you already establish reserve against this?

Again, based on the loan to value ratio we don’t believe there’s loss exposure identified on that.

We show no further questions at this time.

Thank you very much. We appreciate you all taking the time this afternoon and thank you very much. We look forward to chatting with each of you individually going forward. Have a good afternoon now.