Heritage Financial Corporation (Parent Only)

12 Months Ended

Dec. 31, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Heritage Financial Corporation (Parent Only)

Heritage Financial Corporation (Parent Company Only)

Following is the condensed financial statements of the Parent Company.

HERITAGE FINANCIAL CORPORATION

(PARENT COMPANY ONLY)

Condensed Statements of Financial Condition

	December 31, 2014		December 31, 2013
	(In thousands)
ASSETS
Cash and interest earning deposits	$	8,835	$	2,645
Investment in subsidiary bank	465,442		212,354
Other assets	863		1,041
	$	475,140	$	216,040
LIABILITIES AND STOCKHOLDERS’ EQUITY
Junior subordinated debentures	$	19,082	$	—
Other liabilities	1,552		278
Total stockholders’ equity	454,506		215,762
	$	475,140	$	216,040

HERITAGE FINANCIAL CORPORATION

(PARENT COMPANY ONLY)

Condensed Statements of Income

	Years Ended December 31,
	2014			2013			2012
	(In thousands)
Interest income:
Interest earning deposits and other assets	$	17		$	22		$	44
ESOP loan	—			—			8
Total interest income	17			22			52
Interest expense:
Junior subordinated debentures	458			—			—
Total interest expense	458			—			—
Net interest (expense) income	(441		)	22			52
Noninterest income:
Dividends from subsidiary banks	66,300			26,000			14,100
Equity in (excess distributed) undistributed income of subsidiary banks	(40,737		)	(13,001		)	962
Other income	3			—			—
Total noninterest income	25,566			12,999			15,062
Noninterest expense:
Professional services	2,943			1,718			—
Other expense	3,109			2,905			2,766
Total noninterest expense	6,052			4,623			2,766
Income before income taxes	19,073			8,398			12,348
Income tax benefit	(1,941		)	(1,177		)	(913		)
Net income	$	21,014		$	9,575		$	13,261

HERITAGE FINANCIAL CORPORATION

(PARENT COMPANY ONLY)

Condensed Statements of Cash Flows

	Years Ended December 31,
	2014			2013			2012
	(In thousands)
Cash flows from operating activities:
Net income	$	21,014		$	9,575		$	13,261
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in excess distributed (undistributed) income of subsidiary bank	40,737			13,001			(962		)
Tax (benefit) provision realized from stock options exercised, share-based payment and dividends on unallocated ESOP shares	(112		)	13			93
Recognition of compensation related to ESOP shares and share based payment	1,395			1,223			1,185
Stock option compensation expense	20			71			106
Net change in other assets and liabilities	811			(489		)	7
Net cash provided by operating activities	63,865			23,394			13,690
Cash flows from investing activities:
ESOP loan principal repayments	—			—			161
Investment in subsidiary	(43,215		)	(21,666		)	—
Net cash (used in) provided by investing activities	(43,215		)	(21,666		)	161
Cash flows from financing activities:
Common stock cash dividends paid	(12,892		)	(6,672		)	(12,155		)
Proceeds from exercise of stock options	921			176			129
Tax benefit (provision) realized from stock options exercised, share-based payment and dividends on unallocated ESOP shares	112			(13		)	(93		)
Repurchase of common stock	(2,601		)	(8,825		)	(6,023		)
Net cash used in financing activities	(14,460		)	(15,334		)	(18,142		)
Net increase (decrease) in cash and cash equivalents	6,190			(13,606		)	(4,291		)
Cash and cash equivalents at beginning of year	2,645			16,251			20,542
Cash and cash equivalents at end of year	$	8,835		$	2,645		$	16,251