Heritage Bank merger awaits SEC nod after filing

Joining with Washington Banking Co. would mean branches across state on I-5 corridor

rboone@theolympian.comMarch 1, 2014 

The parent company to Olympia’s Heritage Bank is a step closer to completing its merger with Washington Banking Co. after filing its final registration statement with federal regulators about the pending deal.

Once the Securities and Exchange Commission approves Thursday’s filing, Heritage will set a date for shareholders to vote on the merger.

The deal is expected to be finalized during early second quarter, Brian Vance, Heritage Financial’s president and chief executive, said.

The merger would result in a company — operating under the Heritage name — with $3.3 billion in assets, about 800 employees and nearly 70 branches from Bellingham to Portland.

The merger, when it was announced in October, was valued at $265 million.

Oak Harbor-based Washington Banking Co. is the parent company to Whidbey Island Bank, which has most of its branches between Seattle and Bellingham.

Combine Heritage’s branches between Portland and Seattle and you have a community bank that can serve the Interstate 5 corridor, Vance said.

“We’re more attractive to those businesses that have operations up and down the corridor,” he said.

The combined company is expected to grow its earnings faster than as separate banks. The combined company expects to grow its earnings by 24 percent in 2015, the first full year of the merger, Vance said.

Heritage has been an active participant in mergers and acquisitions the past several years.

Last year, Heritage acquired Northwest Commercial Bank in Lakewood, merged with its subsidiary Central Valley Bank, acquired the parent company to Valley Bank in Puyallup, and announced its pending merger with Washington Banking Co.

Prior to these deals, Heritage also acquired Pierce Commercial Bank in Tacoma and Cowlitz Bank in Longview, both of which failed and were sold by the FDIC. In the past 52 weeks, Heritage’s stock, which trades under the symbol HFWA, has ranged from $13.25 to $18.64 a share. After Friday’s trading, the stock was down a cent to $17.73.

Rolf Boone: 360-754-5403 rboone@theolympian.com

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