Heritage Financial Corp. (HFWA, Financial) filed Quarterly Report for the period ended 2012-06-30.
Heritage Financial Corporation has a market cap of $225.5 million; its shares were traded at around $13.54 with a P/E ratio of 19.7 and P/S ratio of 2.7. The dividend yield of Heritage Financial Corporation stocks is 2.2%.
Total interest income decreased $2.5 million, or 12.4%, to $17.4 million for the three months ended June 30, 2012, from $19.9 million for the three months ended June 30, 2011. Total interest income decreased $2.0 million, or 5.3%, to $35.4 million for the six months ended June 30, 2012, from $37.4 million for the six months ended June 30, 2011. The decrease in interest income for both the three and six months ended June 30, 2012 was primarily due to lower yields on interest earning assets.
The balance of average interest earning assets (including nonaccrual loans) increased $15.1 million, or 1.2%, to $1.24 billion for the three months ended June 30, 2012, from $1.23 billion for the three months ended June 30, 2011. The balance of average interest earning assets (including nonaccrual loans) increased $12.0 million, or 1.0%, to $1.25 billion for the six months ended June 30, 2012, from $1.24 billion for the six months ended June 30, 2011. The increase in average interest earning assets for both the three and six months ended June 30, 2012 was primarily due to increases in originated loans.
The yield on total interest earning assets decreased 86 basis points from 6.49% for the three months ended June 30, 2011 to 5.63% for the three months ended June 30, 2012. The yield on total interest earning assets decreased 39 basis points from 6.09% for the six months ended June 30, 2011 to 5.70% for the six months ended June 30, 2012. The effect of discount accretion on loan yields for the three months ended June 30, 2012 and June 30, 2011 was approximately 69 basis points and 132 basis points, respectively. The effect of discount accretion on loan yields for the six months ended June 30, 2012 and June 30, 2011 was approximately 65 basis points and 86 basis points, respectively. For the three months ended June 30, 2012 and June 30, 2011, originated nonaccruing loans reduced the yield earned on loans by approximately 10 basis points and 16 basis points, respectively. For the six months ended June 30, 2012 and June 30, 2011, originated nonaccruing loans reduced the yield earned on loans by approximately 10 basis points and 30 basis points, respectively. Originated nonaccrual loans totaled $16.7 million at June 30, 2012 as compared to $23.3 million at June 30, 2011.
Total assets decreased by $30.8 million, or 2.3%, to $1.34 billion as of June 30, 2012 from $1.37 billion as of December 31, 2011 due primarily to a decrease in interest earning deposits, which was partially offset by an increase in originated loans receivable. For the same period, net loans, which excludes loans held for sale, but are net of the allowance for loan losses, remained unchanged at $1.00 billion, reflecting a decrease of $2.1 million, or 0.2% due substantially to decreases in purchased loans. Deposits decreased by $22.7 million, or 2.0%, to $1.11 billion as of June 30, 2012 compared to $1.14 billion as of December 31, 2011. Securities sold under agreement to repurchase decreased $9.4 million, or 40.9%, to $13.7 million as of June 30, 2012 from $23.1 million as of December 31, 2011 primarily due to decreases in customer balances.
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Heritage Financial Corporation has a market cap of $225.5 million; its shares were traded at around $13.54 with a P/E ratio of 19.7 and P/S ratio of 2.7. The dividend yield of Heritage Financial Corporation stocks is 2.2%.
Highlight of Business Operations:
Net interest income decreased $1.9 million, or 10.7%, to $16.2 million for the three months ended June 30, 2012, compared with $18.2 million in the same period in 2011. Net interest income decreased $848,000, or 2.5%, to $32.9 million for the six months ended June 30, 2012, compared with $33.8 million in the same period in 2011. The decrease in net interest income for both the three and six months ended June 30, 2012 was primarily a result of a decrease in the net interest margin. Net interest income as a percentage of average earning assets (net interest margin) for the three months ended June 30, 2012, decreased 68 basis points to 5.25% from 5.93% for the same period in 2011. The net interest margin for the six months ended June 30, 2012, decreased 20 basis points to 5.30% from 5.50% for the same period in 2011. The decrease in net interest margin for the both the three and six months ended June 30, 2012 was primarily due to decreased loan yields partially offset by decreased cost of interest bearing deposits. The net interest spread for the three months ended June 30, 2012 decreased to 5.10% from 5.75% for the same period in 2011. The net interest spread for the six months ended June 30, 2012 decreased to 5.15% from 5.31% for the same period in 2011.Total interest income decreased $2.5 million, or 12.4%, to $17.4 million for the three months ended June 30, 2012, from $19.9 million for the three months ended June 30, 2011. Total interest income decreased $2.0 million, or 5.3%, to $35.4 million for the six months ended June 30, 2012, from $37.4 million for the six months ended June 30, 2011. The decrease in interest income for both the three and six months ended June 30, 2012 was primarily due to lower yields on interest earning assets.
The balance of average interest earning assets (including nonaccrual loans) increased $15.1 million, or 1.2%, to $1.24 billion for the three months ended June 30, 2012, from $1.23 billion for the three months ended June 30, 2011. The balance of average interest earning assets (including nonaccrual loans) increased $12.0 million, or 1.0%, to $1.25 billion for the six months ended June 30, 2012, from $1.24 billion for the six months ended June 30, 2011. The increase in average interest earning assets for both the three and six months ended June 30, 2012 was primarily due to increases in originated loans.
The yield on total interest earning assets decreased 86 basis points from 6.49% for the three months ended June 30, 2011 to 5.63% for the three months ended June 30, 2012. The yield on total interest earning assets decreased 39 basis points from 6.09% for the six months ended June 30, 2011 to 5.70% for the six months ended June 30, 2012. The effect of discount accretion on loan yields for the three months ended June 30, 2012 and June 30, 2011 was approximately 69 basis points and 132 basis points, respectively. The effect of discount accretion on loan yields for the six months ended June 30, 2012 and June 30, 2011 was approximately 65 basis points and 86 basis points, respectively. For the three months ended June 30, 2012 and June 30, 2011, originated nonaccruing loans reduced the yield earned on loans by approximately 10 basis points and 16 basis points, respectively. For the six months ended June 30, 2012 and June 30, 2011, originated nonaccruing loans reduced the yield earned on loans by approximately 10 basis points and 30 basis points, respectively. Originated nonaccrual loans totaled $16.7 million at June 30, 2012 as compared to $23.3 million at June 30, 2011.
Total assets decreased by $30.8 million, or 2.3%, to $1.34 billion as of June 30, 2012 from $1.37 billion as of December 31, 2011 due primarily to a decrease in interest earning deposits, which was partially offset by an increase in originated loans receivable. For the same period, net loans, which excludes loans held for sale, but are net of the allowance for loan losses, remained unchanged at $1.00 billion, reflecting a decrease of $2.1 million, or 0.2% due substantially to decreases in purchased loans. Deposits decreased by $22.7 million, or 2.0%, to $1.11 billion as of June 30, 2012 compared to $1.14 billion as of December 31, 2011. Securities sold under agreement to repurchase decreased $9.4 million, or 40.9%, to $13.7 million as of June 30, 2012 from $23.1 million as of December 31, 2011 primarily due to decreases in customer balances.
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