Customer Guide. Details about your. Whidbey Island Bank account

Customer Guide Details about your Whidbey Island Bank account

Welcome to Heritage Bank Our Family of Banks Important Account information On May 1, 2014 Whidbey Island Bank merged with Heritage Bank, a subsidiary of Heritage Financial Corporation. The system conversion for the two banks is scheduled for October 4, 2014, at which time Whidbey Island Bank accounts will automatically convert to Heritage Bank accounts, most closely matching your current Whidbey Island Bank accounts. Monday, October 6, 2014 you will have access to banking services at any of our 67 locations. This product guide is intended to help you become familiar with Heritage Bank accounts and services. It provides details about your accounts, how to access them and what new services are available. If you would prefer a different account, please contact our Customer Call Center at 888.642.2265 so we can meet your specific needs. The enclosed account Disclosure Statement is effective October 4, 2014. We appreciate your continued loyalty and look forward to providing you with the highest level of personal service. If you have any questions, please call our Customer Call Center at 888.642.2265. Important Note: Whidbey Island Branches The six branches located on Whidbey Island which include: Clinton, Coupeville, Freeland, Langley, Oak Harbor and Oak Harbor-Midway will retain the Whidbey Island Bank name and operate as a division of Heritage Bank. The merger of Whidbey Island Bank and Heritage Bank truly represents an alliance of equals the joining of two well-regarded Washington State community banks similar in size and culture. The combination will allow us to offer you an even broader range of banking services and products in the years ahead.

Table of Contents General Information Important Dates... 2 About our Company... 3 Your Accounts at a Glance... 4 5 Answers to Commonly Asked Questions... 6 11 Our History... inside back cover Locations... back cover Specific Account Information Personal Online Banking... 12 Business Online Banking... 13 Checking Conversion... 14 Personal Checking... 15 16 Personal Savings... 17 Business Checking... 18 19 Business Savings... 20 Individual Retirement Accounts (IRAs)... 20 Certificates of Deposit (CDs)... 21 Business Product Offerings Business and Cash Management Services... 24 Business Lending... 25 Business Checking... 28 Additional Services Wealth Management... 26 Heritage Wealth Strategies Securities, insurance products and advisory services offered through Cetera Investment Services LLC, member FINRA/SIPC. Investments are: Not FDIC/ NCUSIF insured May lose value Not financial institution guaranteed Not a deposit Not insured by any federal government agency. Cetera is not affiliated with Heritage Bank. Heritage Trust Services Investment products are not obligations of, guaranteed by any bank including Heritage Bank or any Heritage Bank affiliate, nor are they insured by the Federal Deposit Insurance Corporation, the Federal Reserve, or any other agency. An investment in such products involves investment risk, including possible loss of principal. Personal Product Offerings Personal Online Banking and Mobile Banking... 22 VISA Debit Cards... 22 Save Up... 22 Personal Loans... 23 Personal Checking... 27 888.642.2265 HeritageBankNW.com 1

Important Dates Thursday, October 2, 2014 Whidbey Island Bank s Bill Pay will be unavailable beginning at 2:30 pm. Please note; all previously scheduled bill payments through Thursday, October 2nd will be processed as scheduled. Those bill payments scheduled on or after October 3rd will be processed by Heritage Bank. Friday, October 3, 2014 Whidbey Island Bank s Online Banking will be unavailable beginning at 5:00 pm Whidbey Island Bank s Telephone Banking will be unavailable beginning at 5:00 pm Beginning Friday and through the weekend, there will be ATM limitations balance inquiries as well as transfers between primary accounts will not be available Final statement date for your Whidbey Island Bank accounts october 2014 Su Mo Tu We Th Fr Sa 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 October 13th Columbus Day, Bank will be closed. Saturday, October 4, 2014 Conversion to Heritage Bank accounts Whidbey Island Bank s Online and Telephone Banking will be unavailable All branches will be closed Sunday, October 5, 2014 Whidbey Island Bank s Online and Telephone Banking will be unavailable Last day to use your Whidbey Island Bank ATM and Check Card you will receive your new Heritage Bank VISA Debit Card the week of September 15th, you may activate and begin using your new Heritage Bank card on Monday, October 6th. Monday, October 6, 2014 All ATMs will operate normally You may begin using Heritage Bank s Online Banking and Bill Pay services at 8:00 am You may activate and begin using your new Heritage Bank VISA Debit Card You will have access to Heritage Bank s Telephone Banking at 8:00 am Bill payments previously scheduled on October 3rd, 4th and 5th will be processed by Heritage Bank 2 HeritageBankNW.com 888.642.2265

About Our Company On behalf of Heritage Bank, we welcome you to our banking family. As a Heritage Bank customer, you ll benefit from more than 85 years of experience in community banking, our commitment to exceptional service and our reputation of strength and stability. We re excited to build a rewarding, long-term relationship with you. Jeff Deuel, President and COO Heritage Bank, a subsidiary of Heritage Financial Corporation, serves the Pacific Northwest with branches from Portland, Oregon to Bellingham, Washington as well as in the Yakima Valley where we operate under the name of Central Valley Bank, a division of Heritage Bank and on Whidbey Island where we will operate under the name of Whidbey Island Bank, a division of Heritage Bank. We offer more than 85 years of community banking history and strong customer relationships. As a full-service community bank, we offer a complete array of business and personal banking tools designed with our customers and their financial goals in mind. As part of Heritage Bank, you will have access to 67 full-service branches and thousands of surcharge free ATM locations offered through the MoneyPass network. We are guided by our commitment to continuously improving our organization. It defines our relationships, sets expectations for our actions and directs our decision-making in four fundamental areas customers, communities, employees and shareholders. We strive for continuous improvement every day, it is what we do. Our commitment begins with our dedication to exceeding the expectations of our customers. Building relationships is essential to our growth as a community bank. So every day, we look for ways to pleasantly surprise customers by meeting their needs in ways they may not expect. We might introduce them to an account which is a better fit, a service that makes life easier or we may simply remember them by name. We do whatever it takes to provide a level of satisfaction our customers may not have known they could get from a bank. We also focus on building strong communities; through leadership and volunteering we are afforded the opportunity to help others in a meaningful way. We understand acting locally not only enriches the quality of life for our employees, but can have a tremendous impact on our customers and communities. With more than 85 years of strength and service, we know the importance of a lasting commitment. Our Vision Our Mission We are an Innovative Team providing We are Committed to Continuously Improving: Financial Services Community Involvement where Your Customer Satisfaction Success is Our Vision Employee Empowerment Shareholder Value Customer Satisfaction Statement Building Successful Relationships by Exceeding Your Expectations 888.642.2265 HeritageBankNW.com 3

Your Accounts at a Glance Personal Checking & Savings Current Account New Account Page Priceless Checking Free Checking 15 Work Perks Checking Free Checking 15 Banclub Checking Free Checking 15 Regular Checking Free Checking 15 Interest Checking Interest Checking 15 Advantage Checking 50+ Interest Checking 15 Investor Checking Premier Checking 15 Ultimate Checking Ultimate 1 Checking 16 Private Banking Checking Private Banking Checking 16 Regular Savings Statement Savings 17 Personal Money Market Money Market Advantage 17 CDARS Personal Money Market Money Market Advantage 17 Ultimate Money Market Ultimate 1 Money Market 17 Health Savings Account Health Savings Account 17 Business Checking & Savings Current Account New Account Page Business Checking Business 1 Checking 18 Business Interest Checking Business Interest 1 Checking 18 Community Checking Small Business Checking 18 Business Analyzed Checking Business Analysis Checking 18 Regular Business Checking Business Checking 19 Cash Sweep Shadow Business Sweep 19 Public Funds Checking Public Analysis Checking 19 Public Small Business Public Analysis Checking 19 Public Funds Interest Checking Public NOW 19 IOLTA / IRETA IOLTA / IRETA 19 Business Savings Business Incentive Savings 20 Business Money Market Business Money Market 20 CDARS Business Money Market Business Money Market 20 CDARS Public Money Market Business Money Market 20 Public Funds Money Market Public Savings 20 Public Fund Savings Public Savings 20 4 HeritageBankNW.com 888.642.2265

Your Accounts at a Glance IRAs & Certificates of Deposit (CDs) Current Account New Account Page 12 60 Month IRA CD IRA CD 20 12 60 Month Roth IRA CD Roth IRA CD 20 12 60 Month Coverdale Education IRA Coverdale Education IRA CD 20 3 9 Month CD Flex Term CD 21 12 Month 5 Year CD Fixed Rate CD 21 1 12 Month Set Maturity CD Flex Term CD 21 13 Month 5 Year Set Maturity CD Fixed Rate CD 21 888.642.2265 HeritageBankNW.com 5

Answers to Commonly Asked Questions Does Heritage Bank have a social media presence? Yes. Come join us! You can currently find Heritage on Facebook and Twitter (@HeritageBankNW). Here you will find financial tips, contests and promotions, community information and other engaging conversations between Heritage and the communities we serve. When will the name change occur? During the weekend of October 4th, we will convert Whidbey Island Bank accounts into Heritage Bank. By year-end, the Whidbey Island Bank branches will begin to operate under the Heritage Bank name with the exception of the branches located on Whidbey Island which will retain the Whidbey Island Bank name and operate as a division of Heritage Bank. Information About My Branch Heritage Bank Who is Heritage Bank and where are Heritage Bank locations? Heritage Bank, a subsidiary of Heritage Financial Corporation, serves the Pacific Northwest with branches from Portland, Oregon to Bellingham, Washington as well as in the Yakima Valley where we operate under the name of Central Valley Bank, a division of Heritage Bank and on Whidbey Island where we will operate under the name Whidbey Island Bank, a division of Heritage Bank. We offer more than 85 years of community banking history and strong customer relationships. As a fullservice community bank, we offer a complete array of business and personal banking tools designed with our customers and their financial goals in mind. As part of Heritage, you will have access to 67 full-service branches and thousands of surcharge free ATM locations offered through the MoneyPass network. Will Heritage Bank be actively involved in the community and support charitable organizations? Yes. Heritage focuses on building strong communities through leadership and volunteering. We understand acting locally not only enriches the quality of life for our employees, but can have a tremendous impact on our customers and communities. Our commitment includes monetary contributions and guidance; energetic and committed volunteers; and leaders to advocate for economic development. Our staff is encouraged to be actively involved in the communities we serve. Heritage also supports the economic development of our areas by seeking deposits from our communities and making loans to customers who have local ties to our markets. Will any branches be closing? We continually review our locations to best serve our markets. At this time we do not anticipate any branch closures. The merger of Heritage Bank and Whidbey Island Bank creates an expansive and convenient branch network throughout Western Washington. In fact, we will have 67 branches to meet the needs of our customers. Will the hours of operation change at my branch? Yes. Some branches will have changes to hours of operation. Changes will be posted in the branch at least 30 days prior to the change. Customer Contact Center and Telephone Banking Will I have access to the Customer Call Center? Yes. You will continue to have access to the Customer Call Center at 888.642.2265. When will my access to Whidbey Island Bank s Telephone Banking discontinue? You will continue to have access to Whidbey s Telephone Banking until Friday, October 3rd at 5:00 pm. Will I have access to Telephone Banking at Heritage Bank? Yes. You can continue to call 888.942.2265 or the Heritage Access Line at 360.705.9150 or 888.505.9150. The first time you access the system you will be prompted to enter the last four digits of your Tax ID/Social Security Number. You will then be prompted to set up a Personal Identification Number (PIN) for future access to your account. 6 HeritageBankNW.com 888.642.2265

Answers to Commonly Asked Questions Deposit Account Information Will there be changes to my account? There may be some changes to the terms and conditions of your account. Whidbey Island Bank accounts were carefully reviewed and matched to the Heritage Bank accounts they most closely resembled. In addition, we have some new products to offer you. Your banker is available to review your accounts with you to ensure you are in the best Heritage accounts to meet your needs. Please read the product section in this guide to learn more about the products that have changed. Will I need to replace my current checks? No. You may continue to use your Whidbey Island Bank checks and deposit slips as you do today (unless you are notified otherwise). If you would like to order new Heritage Bank checks, you can order online at HeritageBankNW.com or visit any of our locations to do so on or after October 6th. How will transactions post to my checking and savings accounts? Checks presented for payment are paid in serial number sequence order, or as they are paid electronically throughout the day. Transactions are posted in date and time order and ATM transactions are posted in chronological order. Please refer to your Disclosure Statement Booklet for more details. Can I continue to use my current savings deposit and withdrawal tickets? Yes. You can continue to use your current savings deposit and withdrawal tickets. Will my deposit account numbers remain the same? The vast majority of Whidbey customer account numbers will not change. However, a few customers were issued new account numbers. All affected customers were notified separately regarding account number changes. Will I continue to receive my checking account statement at approximately the same time each month? Yes. Your statement from Heritage will arrive at approximately the same time each month. Will I continue to receive estatements? Yes. If you currently receive estatements you will continue to do so. Will I continue to receive check images? Yes. If you currently receive check images in your statements that service will continue. Will my direct deposit and automatic payments continue? Yes. Direct deposits and automatic payments will continue without interruption. Will my current overdraft protection still be available at Heritage Bank? If you currently use an automated transfer from a deposit account to cover your overdrafts, that service will continue at Heritage. If you use an overdraft line of credit to cover your overdrafts, your current credit limit will transfer to Heritage and that service will continue. If you participate in Whidbey s Overdraft program, Heritage may cover overdrafts based on your current opt-in status at its sole discretion and charge the normal $32 overdraft fee. If I am in the Work Perks banking program, will my program benefits continue? Yes. Those benefits will continue to be offered after the conversion. safe Deposit box Will there be changes to my Safe Deposit Box? No. Your billing cycle and method of payment will remain the same. On your anniversary date, the current Safe Deposit Box fee schedule will apply. Certificate of Deposit and Individual Retirement Accounts How do I renew my Certificate of Deposit (CD) or Individual Retirement Account (IRA)? If your Whidbey CD or IRA is set to renew automatically, it will continue to do so in most cases and will roll over at maturity to a Heritage Bank CD or IRA with a similar term. You will continue to receive a notice prior to maturity. However, some CDs and IRAs will not automatically renew. In these instances, you will receive a maturity notice and you will need to visit your local branch to discuss your options prior to the maturity date. 888.642.2265 HeritageBankNW.com 7

Answers to Commonly Asked Questions How often will I receive statements for my CD and IRA accounts? You will receive your Heritage CD statements each quarter and annually on IRA statements for the prior year. If you have a checking account with Heritage, you may request a combined monthly statement, which will include summary information on your CD or IRA accounts. Will I continue to receive separate required minimum distribution notices for my IRA accounts? Yes. You will continue to receive separate required minimum distribution notices. Home Equity and Loan Information Will loan payments post the same date as received? Yes. Loan payments will be credited on the same date as received unless payment is received on a weekend or holiday. Those payments will post on the next business day. Will I need to mail my loan payment to a different address? Yes. All loan payments should be mailed to: Heritage Bank, Attn: Loan Servicing, P.O. Box 9564, Tacoma, WA 98490-0564. Will I receive my deposit and Home Equity Line of Credit (HELOC) statements at the same time every month? We have made every effort to keep your statement cycle dates consistent, however you may notice some slight changes. If there are any changes to your existing loans you will receive a separate mailing with detailed information. Will I continue to receive combined statements for my loans? Yes. You will continue to receive combined statements. Will my loan/heloc account number and/or payment method change? The majority of customers will continue to use their current loan/heloc account number, loan payment coupons and HELOC checks. Customers who require new loan account numbers, loan payment coupons and HELOC checks will be contacted. If you have any automatic payments related to your loans, you do not need to take any action. Your ACH originator will be automatically notified of the change. If there are any changes to your existing loan you will receive a separate mailing with detailed information. 8 HeritageBankNW.com 888.642.2265 Will my Ready Reserve line of credit continue as overdraft protection for my checking account? Your Ready Reserve line of credit will convert to Heritage s Classic Reserve line of credit and continue as overdraft protection for your checking account. The following is notification of the change in terms to your Agreement: Advance Fees: Advance Fee charges for your account will no longer be applied to any advances from your Classic Reserve account. Payment Application: Your payments will be applied in the following order: (1) interest, (2) principal balance and (3) late charges and other charges. Minimum Payment Amount: The Current Amount Due will include the following as applicable to your Account during each billing cycle: the greater of $50.00 or five percent (5%) of the outstanding balance, late charges and any amounts in excess of your established credit limit. You will be considered to have agreed to changes unless you cancel your account and pay your account balance in full before the new terms take effect Will I continue to receive paperless loan statements, past due notices or loan related bills electronically through email? At this time, Heritage does not offer paperless billing. Any statements, notices or loan-related bills generated after October 6th will be mailed. Credit, Debit and atm cards Will I continue to have access to surcharge free ATMs through the MoneyPass network? Yes. You will continue to have access to the MoneyPass ATM network. This means you can use your Heritage Bank ATM or Debit Card at all non-heritage locations which display the MoneyPass logo and you won t be charged a surcharge fee by that bank. In addition, Heritage will also waive ATM transaction fees whenever a MoneyPass ATM is used. You can find the nearest MoneyPass ATM location at www.moneypass.com or by downloading the MoneyPass app. Can I continue to use my Whidbey Island Bank Credit Card? Yes. You may continue to use your Whidbey Island Bank Credit Card. Will I receive a new Heritage Bank VISA Debit Card to replace my Whidbey Island Bank Check Card? Yes. You will receive your new VISA Debit Card the week of September 15th. The Heritage Bank VISA Debit Card operates in the same way as the Whidbey Check Card. You will receive

Answers to Commonly Asked Questions What should I do if my Heritage Bank VISA Debit Card is lost or stolen? You can report a card lost or stolen by visiting your local branch, by calling the Customer Call Center at 888.642.2265, or by calling the automated 24-hour Debit Card Security Services hotline at 800.472.3272. Will the daily purchase and withdrawal limits change on my consumer debit card? Your VISA debit card daily purchase limit will be $1,500 and your cash withdrawal limit will be $500. instructions regarding the activation of your new card in the card mailer. You may activate and begin using your new Heritage Bank card on or after Monday, October 6th. If you have not received your new card and Personal Identification Number (PIN) by September 26th, please call our Customer Call Center at 888.642.2265. (Note: Heritage Bank does not offer personalized debit cards. The Heritage Bank VISA Debit Card will replace your personalized card.) When will my Whidbey Island Bank VISA Check Card service discontinue? You can continue to use your Whidbey Island VISA Check Card through Sunday, October 5th. Will my Health Savings Account (HSA) continue to be linked to my Heritage Bank VISA Debit Card? You will receive a new Heritage Bank HSA Debit Card. Your Heritage Bank HSA Debit Card is exclusive to your HSA and used to pay for qualified medical expenses. How do I activate my new Heritage Bank VISA Debit Card? You can activate your Heritage Debit Card Monday, October 6th by calling 800.757.9848 or with any PIN-based transaction. Continue to use your existing Whidbey Island Bank Check Card through Sunday, October 5th. Will my debit card PIN change? Yes. You will receive a new PIN in the mail approximately four days after your new Heritage Bank ATM or VISA Debit Card arrives. Can I change the PIN mailed to me for my Heritage Bank VISA Debit Card? Yes. You can change your PIN any time after you receive your card by visiting a local branch. Will the daily purchase and withdrawal limits change on my business debit card? Your VISA debit card daily purchase limit and your ATM withdrawal limit will remain the same. I have automatic drafts from my Whidbey Island Bank Check Card. What do I need to do to ensure automatic payments appear on my new Heritage VISA Debit Card? You will need to contact your merchant or service provider to update your card information once you activate your new card. Will my Whidbey Rewards points transfer to Heritage Bank and continue after conversion? Yes, your Rewards points will transfer to Heritage Bank and you will continue to earn points for using your Heritage Bank Debit Card. Consumer Online Banking and Bill Pay I am currently an Online Banking customer. Will I need to sign up again after conversion? No. However, the first time you log in to Heritage Bank s Online Banking on or after Monday, October 6th, you will be guided through Heritage s Enhanced Multi-Factor Authentication process which replaces the security picture and 3-question process at Whidbey. Login instructions will be sent in a separate letter, mailed a couple of weeks prior to conversion. We encourage you to visit HeritageBankNW.com for additional information related to the online banking conversion. When I log in on October 6th, will I see my recent transaction history? No. Your online transaction history will restart on Monday, October 6th. Transaction history prior to October 3rd will not be available. During the October 4th conversion weekend we will mail statements to customers who currently receive paper statements as well as send estatements to online statement customers. We recommend you either print or download any additional history you may need. 888.642.2265 HeritageBankNW.com 9

Answers to Commonly Asked Questions When is the last day I can log in to Whidbey s Online Banking and Bill Pay before the conversion? You may continue to access online banking until 5:00 pm on Friday, October 3rd. Bill Pay will no longer be available after 2:30 pm on Thursday, October 2nd. Please note, this will be the last day you can log in to Bill Pay and initiate or schedule a payment until Monday, October 6th. Any bill payments scheduled to take place between October 3rd and October 5th will be paid on Monday, October 6th. Additional information regarding online banking and Bill Pay will be mailed in a separate letter a couple weeks prior to conversion. I currently use online Bill Pay. Will my payees transfer to Heritage? Yes. All of your payees will transfer over during conversion weekend. Information about recurring bill payments and online transfers will be provided in a separate letter, which will be mailed a couple of weeks prior to conversion. How will my online bill payments be processed during system conversion weekend? Online bill payments scheduled through Thursday, October 2nd will be processed as scheduled. Bill payments scheduled on October 3rd through October 5th will be processed by Heritage Bank on Monday, October 6th. I currently use estatements. Will my prior statements be available? Yes. You will be able to access your estatements on October 6th. For your convenience, we will transfer up to 12 months of estatement history from the date you enrolled. If you wish to retain any additional statements, we recommend you print or download them prior to 5:00 pm on October 3rd. If I use Quicken or QuickBooks will my current information still be available after the conversion? In order to retain your current information, you will need to download it prior to October 3rd. Download instructions for the various versions of Quicken or QuickBooks are available on both Heritage s and Whidbey s websites. What is Heritage Bank s FinanceWorks? FinanceWorks is an easy online tool to help you simplify and manage your finances. It provides a complete picture of accounts you have with Heritage Bank, as well as with any of more than 19,000 other financial institutions all in one place. Best of all, it is free when you bank online. More information is available online at HeritageBankNW.com. When will I receive more information regarding the conversion of online banking? A letter will be sent to you providing more details about online banking a couple of weeks prior to the conversion. Additionally, we will email customers leading up to the conversion with important information and tips. Please make sure Whidbey has your current email address. Finally, details about the online banking conversion will be available on both Heritage s and Whidbey s websites. Mobile Banking I currently use Whidbey s text message banking. Will I need to sign up again? Yes. You will need to register your phone for text message banking within Heritage s Online Banking on or after October 6th. Instructions are available at HeritageBankNW.com. I currently use Whidbey s mobile app. Will I need to download Heritage s app after the conversion? Yes. You will need to download Heritage s Mobile Banking apps from either Google Play (Android devices) or the Apple App Store. There is also a Kindle Fire app available through Amazon. Additionally, you will need to first log in to online banking from a personal computer on or after Monday, October 6th. Business Online Banking Can ACH origination files, federal tax payments or state tax payments have an effective entry date after October 3rd? No. Heritage is unable to accept any business online banking files with an effective date after October 3rd. Any Whidbey initiated files with an effective date after October 3rd will not be processed by Heritage. Beginning October 6th files can be initiated/entered up to one month in advance of the effective date. Files must be submitted by the daily ACH cut off time (2:00 pm) at least two business days prior to the effective date. 10 HeritageBankNW.com 888.642.2265

Answers to Commonly Asked Questions Can I set an online banking wire request value date after October 3rd? No. Heritage is unable to accept any business online banking wire requests value dated after end of business on October 3rd. Any Whidbey initiated wire transfer request dated after October 3rd will not be processed by Heritage. Beginning October 6th wires can be initiated/entered up to one month in advance of the effective date. Wires must be submitted by the daily wire cut off time (2:00 pm) to be completed the same day. If I have questions regarding my Business Online Banking account, who should I contact? Please contact our Customer Call Center at 888.642.2265 or Support@HeritageBankNW.com for Business Online Banking account questions. If I currently use Business Remote Deposit, who do I contact for questions and technical support? If you are currently utilizing Business Remote Deposit, your service will not change. Continue to call 888.642.2265 or Support@HeritageBankNW.com for questions and technical support. Will there be any change to FDIC insurance coverage on deposits I make on or after the merger date? If you are both a Heritage and Whidbey Island Bank customer, deposits made on or after October 6th by Heritage customers will be combined with all other deposits made with Whidbey Island prior to October 6th for purposes of calculating applicable FDIC insurance coverage. Similarly, deposits made on or after October 6th by Whidbey customers will be combined with all other deposits made with Heritage prior to the merger date for purposes of calculating applicable FDIC insurance coverage. Where can I get more information about FDIC insurance coverage? The FDIC has developed a tool called EDIE the Estimator to calculate whether you are within the FDIC coverage limits at any FDIC-insured bank. This calculator is easy to use and is available at the FDIC website. Before you begin, identify all the deposit accounts that you have at Whidbey and Heritage Bank. Then just follow the simple steps on EDIE the Estimator to calculate your coverage. For additional information regarding FDIC insurance coverage, we encourage you to visit the FDIC website at www.fdic.gov or call 877.ASK.FDIC (877.275.3342). FDIC Insurance Information Will my deposits continue to be insured by the FDIC? Yes. Your deposit accounts will continue to be FDIC insured up to the applicable limits allowed by law. The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category. FDIC insurance covers all deposit accounts, including checking and savings accounts, money market deposit accounts and certificates of deposit. FDIC insurance does not cover other financial products and services that banks may offer, such as stocks, bonds, mutual fund shares, life insurance policies, annuities or securities. What happens to my coverage if I have deposits at both Heritage and Whidbey Island Bank? When two or more insured banks merge, deposits from the assumed bank are separately insured from deposits at the assuming bank for at least six months after the merger. This grace period gives a depositor the opportunity to restructure his or her accounts, if necessary. CDs from Whidbey Island Bank are separately insured until the earliest maturity date after the end of the six-month grace period. CDs that mature during the six-month period and are renewed for the same term and in the same dollar amount (either with or without accrued interest) continue to be separately insured until the first maturity date after the six-month period. If a CD matures during the six-month grace period and is renewed on any other basis, it would be separately insured only until the end of the six-month grace period. 888.642.2265 HeritageBankNW.com 11

Specific account information Personal Online Banking and Bill Pay Heritage would like to welcome our newest online banking customers and introduce our website HeritageBankNW.com. If you currently utilize online banking with Whidbey, you will automatically transfer to Heritage Bank s Online Banking service during conversion. If you currently use Bill Pay all of your established payees will remain available. You may see a minor change to the payee name when they transfer over. Below is a guide to help you with your initial login as well as important information which may affect you. Timeline In order to properly transfer your records, Heritage will temporarily disable access to various online banking services leading up to the conversion. Thursday, October 2nd at 2:30 pm Bill Pay will be disabled at Whidbey Island Bank. Please note, all previously scheduled bill payments through Thursday, October 2nd will be processed as scheduled. Bill payments previously scheduled October 3rd October 5th will be processed by Heritage Bank on Monday, October 6th. Friday, October 3rd at 5:00 pm online banking and mobile banking will be disabled at Whidbey Island Bank. Monday, October 6th at 8:00 am online banking, mobile banking and Bill Pay will be restored at HeritageBankNW.com. Initial Login You will receive your login information in a separate letter a couple weeks prior to conversion. When you log in to Heritage Bank s Online Banking for the first time, you will be prompted to accept Heritage s terms and conditions, change your password for security reasons, update your User ID if it does not comply with Heritage s standards and verify your email address. Other Important User Information If you are an online Bill Pay user, all of your established payees will remain available, you will need to re-establish e-bills for all applicable payees. Scheduled and recurring transfers, notifications, alerts and account nicknames will not transfer. Print this information for your records prior to October 3rd (after the conversion, you will need to re-enter this information). On Monday, October 6th, you will have access to your existing online statement from the date you enrolled, up to 12 months of history. Heritage will retain 12 months of online statements moving forward. If you are a Mobile App customer, you will need to log in to online banking from a personal computer before downloading and logging into Heritage s Mobile App. If you are a Text Message Banking customer, you will need to register your phone for Text Message Banking within Heritage s Online Banking after conversion on October 6th. Quicken, QuickBooks, and Microsoft Money users: Prior to October 3rd, please visit HeritageBankNW.com for instructions on how to export your account information. Heritage and Whidbey Island Bank are working closely to meet your needs and ensure a smooth transition. If you need assistance during this conversion, please contact: Customer Call Center, 888.642.2265 Support@HeritageBankNW.com Visit the online banking conversion webpage at HeritageBankNW.com Heritage Bank uses a method of security called Enhanced Multi-Factor Authentication, so you will no longer see your security image during login. The first time you log in, you will be guided through the process to receive a one-time passcode via email, telephone message, or SMS text message. Inputting this one-time passcode successfully at login will register your account and computer with this enhanced security. We encourage you to preview this process, and learn about other important online banking changes by visiting: HeritageBankNW.com. 12 HeritageBankNW.com 888.642.2265

Specific account information Business Online Banking and Bill Pay While the look and feel of your online banking will change; most, if not all, of the functionality you use will continue to be available to you. If you currently utilize online banking with Whidbey, you will automatically transfer to Heritage Bank s Online Banking service Business Cash Manager Online (BCMO) during conversion. If you currently use Bill Pay all of your established payees will remain available. You may see a minor change to the payee name when they transfer over. Below is a guide to help you with your initial login and important information which may affect you. Timeline In order to properly transfer your records, Heritage will need to temporarily disable access to various Business Online Banking services leading up to the conversion. Thursday, October 2nd at 2:30 pm Bill Pay will be disabled at Whidbey Island Bank. Please note all previously scheduled payments through Thursday, October 2nd will be processed as scheduled. Bill payments previously scheduled on October 3rd 5th will be processed by Heritage Bank on Monday, October 6th. Friday, October 3rd at 5:00 pm Business Online Banking at Whidbey will be disabled. Monday, October 6th at 8:00 am BCMO and Bill Pay will be restored at HeritageBankNW.com. Initial Login You will receive your login information in a separate letter a couple weeks prior to conversion. On the login page, which is accessed from the website homepage at HeritageBankNW.com, you will be asked for the following: Company ID, User ID and User Password Heritage Bank uses a method of security called Multi-Factor Authentication, so you will no longer use Tokens to log in. The first time you log in, you will be guided through this process. Other Important User Information One primary administrator will be designated per company based on Whidbey s Online Banking documentation. Payees, single and recurring bill payments will convert directly into BCMO at Heritage. You will need to re-establish e-bills for all applicable payees. Scheduled and recurring transfers, notifications and alerts will not be converted. To ensure you do not miss a transfer, notification, or alert, we suggest you print this information for your records prior to October 3rd (after the conversion, you will need to re-enter this information). On Monday, October 6th you will have access to existing online statements from the date you enrolled up to 12 months of history. Heritage Bank will retain 12 months of online statements. Mobile banking for business customers is not currently offered, Heritage Bank plans to offer this service in the future. IMPORTANT: Please visit HeritageBankNW.com prior to Friday, October 3rd for instructions on how to properly export your account information into Quicken, QuickBooks, or Microsoft Money. ATTENTION ACH and WIRE CUSTOMERS: Your existing tokens will be registered to access these services. Please be on the lookout in September for additional information regarding these online services. Heritage and Whidbey are working closely to meet your needs and ensure a smooth transition. If you need assistance during this conversion, please contact: Customer Call Center, 888.642.2265 Support@HeritageBankNW.com Visit the online banking conversion webpage at HeritageBankNW.com We encourage you to preview this process and learn about other important online banking changes by visiting: HeritageBankNW.com. 888.642.2265 HeritageBankNW.com 13

Specific account information Checking Conversion Information For detailed information about your checking account at Heritage Bank, please see charts on pages 15, 16, 18 & 19 and the enclosed Disclosure Statement. Continue to use your current Whidbey Island Bank checks. You should continue to use your current supply of checks, deposit and withdrawal slips until they run out. There is no need to order new checks at this time. When you reorder, your new checks will have the Heritage logo and your current account number. You will receive a new debit card. If you now use a debit card to access your Whidbey Island Bank accounts, you will be mailed a new Heritage Bank VISA Debit Card the week of September 15, 2014. You will receive a new Personal Identification Number (PIN) approximately 4 days after your new card. Your new card will access your same accounts. You may activate and begin using your new card on Monday, October 6th. Heritage has a cash withdrawal limit of $500 per day and a point of sale transaction limit of $1,500 per day. VISA debit card limits are subject to available account balances. Direct Deposit of payroll and other income will continue without interruption. Automatic payments will continue to be withdrawn from your accounts as they were originally created. Current interest rates can be found in the enclosed Disclosure Statement or online at HeritageBankNW.com. Check images provide you with an easy way to reconcile, research and store your canceled checks. If you currently receive the images of your canceled checks with your statement, you will receive the images of your canceled checks with your Heritage statement. As of October 6, 2014, any new direct deposits, ACH transactions or other electronic transactions you establish should reflect Heritage Bank s routing (ABA) number of 325170835 along with your account number. Money Pass surcharge free atm network You will continue to have access to the MoneyPass ATM network. You can find the nearest MoneyPass ATM location at www.moneypass.com or by downloading the free MoneyPass app. 14 HeritageBankNW.com 888.642.2265

Specific account information Personal Checking & Savings Priceless Checking Work Perks Checking Banclub Checking Regular Checking Free Checking Interest Checking Interest Checking Advantage Checking 50+ Interest Checking Investor Checking Premier Checking No minimum balance required No monthly fee Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images VISA debit card with ATM access ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 $300 minimum balance required to avoid monthly fee $6 monthly fee if the balance falls below minimum Interest earned on balances of $300 or more Interest compounded daily and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images VISA debit card with ATM access ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 No minimum balance required No monthly fee Interest earned on balances of $500 or more Interest compounded daily and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images Free checks (2 boxes per year) Free bank checks VISA debit card with ATM access Free ATM transactions $50,000 minimum balance* required to avoid monthly fee $25 monthly fee if the balance falls below minimum Interest earned on balances of $300 or more Interest compounded daily and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images Free Premier Checks Free bank checks Free TravelMoney Cards Free Overdraft Protection transfers Free 3x5 Safe Deposit Box** VISA debit card with ATM access Free ATM transactions and reimbursement of ATM surcharge fees *Premier Checking requires combined balances of $50,000 or more in all personal accounts to avoid monthly fee of $25 **Free 3x5 Safe Deposit Box applies to converted Investor Checking accounts 888.642.2265 HeritageBankNW.com 15

Specific account information Personal Checking & Savings (continued) Ultimate Checking Ultimate 1 Checking $10,000 minimum balance* required to avoid monthly fee $10 monthly fee if the balance falls below minimum Interest earned on all balances Interest compounded monthly and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images Free basic checks Free bank checks Free TravelMoney Cards Free 3x5 Safe Deposit Box VISA debit card with ATM access ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 *Ultimate Checking requires combined balances of $10,000 or more in Ultimate Checking and Ultimate Money Market to avoid monthly fee of $10 Private Banking Checking Private Banking Checking $50,000 minimum balance* required to avoid monthly fee $15 monthly fee if the balance falls below minimum Interest earned on all balances Interest compounded monthly and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images VISA debit card with ATM access Free Private Banking Checks Free bank checks Free TravelMoney Cards Free 3x5 Safe Deposit Box CD Rate Bonus Free Overdraft Protection transfers Extensive loan benefits; fee and rate reductions** Additional benefits exclusive to Private Banking Customers** ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 *Private Banking Checking requires combined balances of $50,000 or more in personal Checking, Savings and Money Market to avoid monthly fee of $15 ** See Banker for details. Private Banking customers pay an annual fee of $100 16 HeritageBankNW.com 888.642.2265

Specific account information Personal Checking & Savings (continued) Regular Savings Statement Savings $300 minimum balance required to avoid monthly fee* $3 monthly fee if the balance falls below minimum* Interest earned on all balances Interest compounded daily and paid monthly Quarterly statement ATM card available ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 *Monthly fee and minimum balance waived for minors and converted Combined Savings Personal Money Market CDARS Personal Money Market Money Market Advantage Ultimate Money Market Ultimate 1 Money Market $1,000 minimum balance required to avoid monthly fee* $10 monthly fee if the balance falls below minimum* Interest earned on all balances Interest compounded daily and paid monthly Up to 6 preauthorized withdrawals allowed per statement cycle, including checks Unlimited in-branch and ATM withdrawals ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 *Monthly fee and minimum balance waived for CDARS Money Market No minimum balance required* No monthly fee* Interest earned on all balances Interest compounded daily and paid monthly Up to 6 preauthorized withdrawals allowed per statement cycle, including checks Unlimited in-branch and ATM withdrawals ATM charges: no fee at Heritage Bank or MoneyPass ATMs, all others $2 *Ultimate 1 Checking required for Ultimate 1 Money Market Health Savings Account Health Savings Account No minimum balance required No monthly fee Interest earned on all balances Interest compounded daily and paid monthly Free online banking, Bill Pay, FinanceWorks, Mobile & Text Banking Free online statements with check images HSA VISA debit card available 888.642.2265 HeritageBankNW.com 17

Specific account information Business Checking & Savings Business Checking Business 1 Checking Business Interest Checking Business Interest 1 Checking Community Checking Small Business Checking $1,500 minimum balance required $8 monthly fee if the balance falls below minimum First 200 transactions free; $0.15 per transaction over 200; point of sale debits are excluded $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Monthly statement with check images Online banking with basic Business Cash Manager Online available $2,500 minimum balance required $8 monthly fee if the balance falls below minimum Interest earned on all balances Interest compounded monthly and paid monthly First 200 transactions free; $0.15 per transaction over 200; point of sale debits are excluded $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Monthly statement with check images Online banking with basic Business Cash Manager Online available No minimum balance required No monthly fee Checks paid first 100 free; $0.25 each over 100* Deposit fee first 20 free; $0.15 each over 20* Deposited item fee first 100 items free; $0.15 each over 100* $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Monthly statement with check images Online banking with basic Business Cash Manager Online available *Excess transaction fees waived for converted Community Checking accounts Business Analyzed Checking Business Analysis Checking No minimum balance required $9 monthly fee $0.12 per check paid / $0.20 per deposit / $0.06 per deposited item $0.06 per ACH item cleared $0.70 / $1,000 currency deposited fee $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Earnings credit based on average collected balance Uncollected funds usage rate: Prime plus 3%, adjusted monthly Monthly statement with check images Online Banking with Business Cash Manager Online available Full suite of Cash Management services available 18 HeritageBankNW.com 888.642.2265

Specific account information Business Checking & Savings (continued) Regular Business Checking Business Checking Cash Sweep Shadow Business Sweep $2,500 minimum balance required $8 monthly fee if the balance falls below minimum $0.12 per check paid / $0.20 per deposit / $0.06 per deposited item $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Earnings credit based on average collected balance Monthly statement with check images Online banking with basic Business Cash Manager Online available No minimum balance required* $30 monthly fee Interest earned on average collected balance Interest compounded daily and paid monthly Monthly statement *Business Analysis Checking required for Business Sweep Public Funds Checking Public Small Business Public Analysis Checking Public Funds Interest Checking Public NOW IOLTA / IRETA IOLTA / IRETA No minimum balance required $9 monthly fee $0.12 per check paid / $0.20 per deposit / $0.06 per deposited item $0.06 per ACH item cleared $0.70 / $1,000 currency deposited fee $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Earnings credit based on average collected balance Uncollected funds usage rate: Prime plus 3%, adjusted monthly Monthly statement with check images Online banking with Business Cash Manager Online available Full suite of Cash Management services available No minimum balance required No monthly fee Interest earned on average collected balance Interest compounded daily and paid monthly $0.12 per check paid / $0.20 per deposit / $0.06 per deposited item $0.05 per rolled coin purchase / $0.05 per $100 currency purchase Monthly statement with check images Online banking with basic Business Cash Manager Online available No minimum balance required No monthly fee Interest earned on all balances Interest compounded daily and paid monthly Monthly statement with check images Online banking with Business Cash Manager Online available 888.642.2265 HeritageBankNW.com 19