WESTERLY – Washington Trust Bancorp Inc. (Nasdaq: WASH), parent of The Washington Trust Co., today posted a second-quarter profit of $6.1 million, an increase of $613,000, or 11.2 percent, compared with the year-ago period’s $5.48 million.

Earnings per diluted share increased to 45 cents, 5 cents more than in the 2007 second quarter.

The bank recorded $46.19 million in revenue for the second quarter, up 2.6 percent from $45 million in the same quarter last year.

The bank’s net interest margin widened to 2.71 percent in the second quarter, up 12 basis points from the first quarter but down 5 basis points from the 2007 second quarter.

Washington Trust’s second-quarter loan-loss provision – funds set aside for anticipated bad loans – was $1.4 million, up considerably from $300,000 a year ago. That increase was due “largely to growth in the loan portfolio as well as an ongoing evaluation of credit quality and general economic conditions,” the bank said.

Nonperforming assets increased to $6.18 million, or 0.23 percent of total assets, in the quarter, compared with $5.7 million, or 0.22 percent of total assets, in the first quarter. Net charge-offs for the second quarter were $161,000.

“Washington Trust’s second-quarter results were particularly noteworthy considering the deterioration of economic conditions and declines in the financial markets,” said John C. Warren, bank chairman and CEO. “In the face of these strong headwinds we have achieved solid earnings through active management and believe our disciplined credit culture is serving us well.”

The bank noted that commercial loans continued to grow, rising $68.7 million in the second quarter – the seventh consecutive period of quarter-to-quarter growth – to $795.01 million. Compared with the year-ago period, commercial loans increased $172.03 million, or 27.6 percent.

The bank said its revenue from wealth-management services increased to $7.65 million, up 2.1 percent from the year-ago period’s $7.49 million. Assets under management rose 1.1 percent from the previous quarter to $3.92 billion.

The bank’s returns on average equity and average assets for the second quarter were 12.88 percent and 0.92 percent, respectively, compared with 12.57 percent and 0.92 percent, respectively, for the same period in 2007.

A conference call featuring Chairman and CEO John C. Warren and David V. Devault, the bank’s executive vice president, secretary, treasurer and chief financial officer, is slated for tomorrow at 8:30 a.m. A live Webcast is planned at www.WashTrust.com, where the conference call also will be available for later replay.

Last month, the Washington Trust board of directors declared a second-quarter dividend of 21 cents per share, or 1 cent more than the preceding quarter’s. (READ MORE) The bank has boosted dividends in each of the past 16 years.

Washington Trust Bancorp Inc. (Nasdaq: WASH), based in Westerly, is the parent of The Washington Trust Co., a Rhode Island-chartered bank founded in 1800 that has offices in Rhode Island, Massachusetts and southeastern Connecticut. Additional information is available at www.WashTrust.com.