Heritage Financial (HFWA) in Olympia, Wash., has agreed to buy Washington Banking (WBCO) in Oak Harbor. Heritage will pay about $265 million in cash and stock for Washington Banking, the companies said Wednesday.

The $5.2 billion-asset company reported a profit of $9.4 million in the third quarter, down 18% from the same period a year earlier, it announced Wednesday.

JPMorgan Chase's acquisitions of Bear Stearns and Washington Mutual during the meltdown were once seen as bargains and more recently second-guessed in light of the bank's $13 billion mortgage settlement. The pain will pay off in the long run, experts say.

Hayward Bancshares in Eau Claire, Wis., is merging its two bank charters in a bid to cut regulatory costs.

First Midwest Bancorp (FMBI) offset insurance costs and the impact of shrinking margins with the sale of its stake in a software firm.

Bank of America Corp.'s Countrywide unit fraudulent sold thousands of loans known to be defective to Fannie Mae and Freddie Mac, according to Assistant U.S. Attorney Jaimie Nawaday in closing arguments in a lawsuit against the lender.

Grupo BTG Pactual, the Brazilian investment bank founded by billionaire Andre Esteves, is working on a bid for JPMorgan Chase & Co.'s physical commodities business, said a person with direct knowledge of the matter.

PacWest Bancorp (PACW) in Los Angeles doubled its profits in the third quarter thanks to its purchase of First California Financial Group (FCAL).

City Holding Co. (CHCO) in Charleston, W.Va., reported a 32% increase in quarterly profit as acquisitions helped boost its interest income.

Prosperity Bancshares (PB) in Houston reported a 20% boost in profit after announcing two deals in the third quarter.

Poage Bankshares (PBSK), in Ashland, Ky., has agreed to acquire its crosstown rival, Town Square Financial, for $14.7 million.

Bankers are devoting more attention than ever to regulatory compliance and cost-cutting, but they need to be careful not to let service suffer in the process, a panel of CEOs said Tuesday.

FirstMerit Corp. (FMER) in Akron, Ohio, earned $40.7 million in the third quarter, up 16% from the same period a year ago, due largely to its recent acquisition of Citizens Republic Bancorp in Flint, Mich.

Northrim BanCorp (NRIM) in Anchorage, Alaska, has agreed to buy Alaska Pacific Bancshares (AKPB) in Juneau.

Heritage Oaks Bancorp (HEOP) in Paso Robles, Calif., has agreed to buy Mission Community Bancorp (MISN) in San Luis Obispo, Calif.

Pacific National Bank in Miami has found a buyer.

The National Association of Retail Collection Attorneys named a Philadelphia attorney as its 11th president.

Multiples are stronger in historical terms than many bankers assume, buyers' stock prices are going up and banks need to get to $25 billion of assets to thrive, says David Olson of River Branch Holdings.

F.N.B. Corp. (FNB) in Hermitage, Pa., beat earnings estimates on strong net interest income.

The New York firm has historically avoided investing in acquisition-minded banks, preferring low-key institutions with good leaders and plans for making solid loans.