What Happened?

A number of stocks jumped in the afternoon session after the broader financial sector rallied sharply, lifting regional bank names alongside their larger peers. 

The Russell 2000 climbed 1.4%, outperforming both the S&P 500 and the Nasdaq, a pattern that typically benefits smaller domestically focused regional banks more than their larger counterparts. 

Regional banks have been one of the quieter 2026 stories. The KRE ETF has risen approximately 9% as Q1 earnings confirmed that net interest margins are finally widening, driven by deposit costs rolling over while loan yields stay elevated. With the Fed holding rates at 3.75% and recent prints confirming the labor market remains resilient, expectations for near-term rate cuts weakened. A higher-for-longer rate environment sustained over more quarters directly extends the NIM expansion thesis for the sector.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Regional Banks company Washington Trust Bancorp (NASDAQ: WASH) jumped 5.6%. Is now the time to buy Washington Trust Bancorp? Access our full analysis report here, it’s free.
• Regional Banks company Butterfield Bank (NYSE: NTB) jumped 3.9%. Is now the time to buy Butterfield Bank? Access our full analysis report here, it’s free.

Zooming In On Washington Trust Bancorp (WASH)

Washington Trust Bancorp’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was about 1 month ago when the stock dropped 16.4% on the news that the company reported first-quarter 2026 results that fell short of Wall Street's expectations. 

The company announced adjusted earnings of $0.66 per share and revenue of $57.83 million. Both key figures missed analysts' consensus estimates, overshadowing the year-on-year growth in both metrics. While revenue increased by 10.6% and earnings per share rose from $0.61 in the same quarter last year, investors focused on the miss against projections, signaling a weaker-than-anticipated performance for the Rhode Island-based bank.

Washington Trust Bancorp is up 15.7% since the beginning of the year, but at $33.36 per share, it is still trading 9.2% below its 52-week high of $36.75 from February 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Washington Trust Bancorp’s shares 5 years ago would now be looking at only $603.20.

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