<PAGE>
 
                                 UNITED STATES

                      SECURITIES AND EXCHANGE COMMISSION

                            Washington, D.C.  20549

                                  FORM 10 - Q

              QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) of the

                        SECURITIES EXCHANGE ACT OF 1934


                        For Quarter Ended June 30, 1997

                        Commission file number 0-12506


                            Heritage Bancorp, Inc.

                           Pennsylvania  23-2228542

                 120 South Centre Street, Pottsville, PA 17901

                                (717) 622-2320


          Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such report(s), and (2) has been subject to such
filing requirements for the past 90 days.  Yes   X     No  
                                               ------      ------

          Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.


                    Common stock, par value $5.00 per share

               4,773,927 shares outstanding as of June 30, 1997
<PAGE>

                            Heritage Bancorp, Inc.
                        and its wholly owned subsidiary
                        -------------------------------
<TABLE> 
<CAPTION> 
Consolidated Balance Sheets (Unaudited)
-----------------------------------------------------------------
(Dollars in thousands)                                             June 30,    December 31,
                                                                     1997          1996
                                                                 ------------  ------------
ASSETS                                                      
------                                                      
<S>                                                              <C>           <C>                     
Cash and due from banks                                           $    9,339    $    9,463
                                                            
Securities:                                                 
   Held to maturity (fair value 1997 - $17,588;             
      fair value 1996 - $19,717)                                      17,395        19,460
   Available for sale                                                 95,047        95,222
                                                                 ------------  ------------
                                                                     112,442       114,682
                                                            
Loans receivable:                                           
   Commercial, financial, and agricultural                           101,495        95,135
   Real estate - mortgage and construction                            70,939        68,102
   Consumer                                                           48,544        45,830
                                                                 ------------  ------------
                                                                     220,978       209,067
Less: Unearned income                                                   (232)         (354)
      Allowance for loan losses                                       (3,106)       (3,071)
                                                                 ------------  ------------
   Net loans                                                         217,640       205,642
                                                            
Premises and equipment, net of accumulated                  
   depreciation                                                        5,133         5,331
Accrued income receivable and other                                    7,037         6,836
                                                                 ------------  ------------
                                                                  $  351,591    $  341,954
                                                                 ============  ============

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

Deposits:
   Noninterest bearing                                            $   32,608    $   31,458
   Interest bearing                                                  224,975       222,786
                                                                 ------------  ------------
      Total deposits                                                 257,583       254,244
                                                             
Short term borrowings and securities sold under          
   agreements to repurchase                                           15,942        15,952
Term funds borrowed                                                   34,450        29,450
Other liabilities                                                      2,233         2,227
                                                                 ------------  ------------
      Total liabilities                                              310,208       301,873
                                                             
Stockholders' Equity:                                        
   Preferred stock, $25 par value; 10,000,000 shares         
      authorized and unissued                                              0             0
   Common stock, $5 par value; authorized 10,000,000         
      shares issued 1997 - 5,002,104; 1996 - 2,501,052       
      shares                                                          25,011        12,505
   Surplus                                                               728           668
   Retained earnings                                                  17,506        28,474
   Treasury stock, at cost (1997 - 228,177 shares;           
      1996 - 100,791 shares)                                          (2,342)       (1,961)
   Net unrealized appreciation on securities                 
      available for sale, net of tax                                     480           395
                                                                 ------------  ------------
      Total stockholders' equity                                      41,383        40,081
                                                                 ------------  ------------
                                                                  $  351,591    $  341,954
                                                                 ============  ============
</TABLE> 
                                                       
                                                       
                                                       

                                       2
<PAGE>

                            Heritage Bancorp, Inc.
                        and its wholly owned subsidiary
                        -------------------------------

Consolidated Statements of Income (Unaudited)
--------------------------------------------------------------------------------
(Dollars in thousands)
<TABLE> 
<CAPTION> 
                                                                             Three Months Ended              Six Months Ended
                                                                                  June 30,                        June 30,
                                                                           1997            1996            1997            1996
                                                                       ------------    ------------    ------------    ------------
<S>                                                                    <C>             <C>             <C>             <C> 
Interest income:
  Loans, including fees                                                 $     4,907     $     4,146     $     9,609     $     8,173 
  Investment and mortgage-backed securities:                                                                                        
    Taxable                                                                   1,507           1,501           3,023           3,008 
    Tax-exempt                                                                  256             196             495             364 
  Other                                                                           1               6               1               9 
                                                                       ------------    ------------    ------------    ------------ 
     Total interest income                                                    6,671           5,849          13,128          11,554 
                                                                                                                                    
Interest expense:                                                                                                                   
  Deposits                                                                    1,888           1,885           3,748           3,840 
  Borrowings:                                                                                                                       
    Short-term                                                                  279             164             531             221 
    Long-term                                                                   470              63             851             125 
                                                                       ------------    ------------    ------------    ------------ 
     Total interest expense                                                   2,637           2,112           5,130           4,186 
                                                                       ------------    ------------    ------------    ------------ 
     Net interest income                                                      4,034           3,737           7,998           7,368 
Provision for loan losses                                                        45              45              90              90 
                                                                       ------------    ------------    ------------    ------------ 
     Net interest income after provision for loan losses                      3,989           3,692           7,908           7,278 
Other income:                                                                                                                       
  Trust department                                                              184             194             477             421 
  Service charges                                                               178             158             349             318 
  Other income                                                                  151             105             259             205 
  Security gains                                                                  8               0             141               0 
                                                                       ------------    ------------    ------------    ------------ 
     Total other income                                                         521             457           1,226             944 
                                                                       ------------    ------------    ------------    ------------ 
Other expenses:                                                                                                                     
  Salaries and employee benefits                                              1,334           1,237           2,642           2,451 
  Occupancy, net                                                                194             200             422             446 
  Equipment                                                                     199             194             403             380 
  Communications and supplies                                                   172             154             356             321 
  Professional fees and outside services                                        263             257             624             456 
  Marketing and advertising                                                      99              76             177             154 
  Taxes other than income                                                        91              90             182             189 
  FDIC insurance premiums                                                         9               0              16               1 
  Other                                                                         224             207             510             427 
                                                                       ------------    ------------    ------------    ------------ 
     Total other expenses                                                     2,585           2,415           5,332           4,825 
                                                                       ------------    ------------    ------------    ------------ 
                                                                                                                                    
     Income before income taxes                                               1,925           1,734           3,802           3,397 
Federal income taxes                                                            574             503           1,119             985 
                                                                       ------------    ------------    ------------    ------------ 
     Net income                                                         $     1,351     $     1,231     $     2,683     $     2,412 
                                                                       ============    ============    ============    ============ 
Net income per common share                                             $      0.28     $      0.26     $      0.56     $      0.50
                                                                       ============    ============    ============    ============
</TABLE> 

                                       3
<PAGE>

                            Heritage Bancorp, Inc.
                        and its wholly owned subsidiary
                        -------------------------------

Consolidated Statements of Cash Flows (Unaudited)
--------------------------------------------------------------------------------
(Dollars in thousands)
<TABLE> 
<CAPTION> 
                                                                         Six Months Ended June 30,
                                                                            1997           1996
                                                                       ------------    ------------
<S>                                                                    <C>             <C> 
Operating Activities
--------------------
 Net income                                                             $     2,683     $     2,412
 Adjustments to reconcile net cash provided by  
  operating activities:                       
  Provision for loan losses                                                      90              90
  Depreciation                                                                  358             324
  (Gains)/losses on sales of equipment                                            6              (6)
  Amortization of securities' premiums and    
   accretion of discounts, net                                                   24              55
  Realized gains on sales of securities                                        (141)              0
  Increase in accrued income receivable     
   and other assets                                                            (255)           (674)
  Increase (decrease) in interest payable and other liabilities                   6            (232)
                                                                       ------------    ------------

    Net cash provided by operating activities                                 2,771           1,969
                                                                       ------------    ------------

Investing Activities 
--------------------
  Securities held to maturity:
    Proceeds from called/matured securities                                   2,055           4,015
    Purchases                                                                     0          (1,998)
  Securities available for sale: 
    Proceeds from called/matured securities and  
      principal repayments                                                    5,640           6,027
    Proceeds from sales                                                       2,966               8
    Purchases                                                                (8,165)        (14,927)
  Net increase in loans receivable                                          (12,088)        (13,125)
  Proceeds from sales of equipment                                               30               8
  Purchases of equipment                                                       (196)           (416)
                                                                       ------------    ------------

    Net cash used in investing activities                                    (9,758)        (20,408)
                                                                       ------------    ------------

Financing Activities
--------------------
  Net increase in demand deposits, N.O.W                                        787           1,483
   accounts, and savings accounts  
  Net increase in time deposits                                               2,552             277
  Net increase (decrease) in short-term borrowings                              (10)         18,619
  Term borrowings                                                             5,000               0
  Purchase of treasury stock                                                   (571)           (839)
  Issuance of treasury stock                                                    250             131
  Cash dividends                                                             (1,145)           (967)
                                                                       ------------    ------------

    Net cash provided by financing activities                                 6,863          18,704
                                                                       ------------    ------------
                                                         
    Increase (decrease) in cash and cash equivalents                           (124)            265
                                                         
    Cash and cash equivalents at the beginning of the year                    9,463          11,356
                                                                       ------------    ------------

    Cash and cash equivalents at June 30                                $     9,339     $    11,621
                                                                       ============    ============
</TABLE> 

                                       4
<PAGE>
 
                            Heritage Bancorp, Inc.
                        and its wholly-owned subsidiary

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  (Unaudited)


June 30, 1997

Note A - BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X.  Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements.  In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included.  Operating results for the three and six month periods ended 
June 30, 1997 are not necessarily indicative of the results that may be expected
for the year ended December 31, 1997.

Note B - SIGNIFICANT ACCOUNTING POLICIES

Earnings per share:

Earnings per share is based on the weighted average shares outstanding as
follows:

<TABLE>
<CAPTION>
                                         1997              1996
                                         ----              ----

         <S>                          <C>               <C>
         Second quarter*              4,770,399         4,786,642
         Year-to-date*                4,776,453         4,808,206
</TABLE>

*Weighted average shares outstanding have been restated to give effect to a 2-
 for-1 stock split in the form of  a 100% stock dividend declared April 8, 1997,
 paid May 23, 1997.

Note C - STOCK OPTION PLANS

Effective April 15, 1997, under the terms of the 1995 Stock Option Plan for Non-
employee Directors, the Corporation awarded certain directors a total of 7,000
stock options at an exercise price of $13.25, per share which was the closing
market price on that day, after being adjusted for the stock split.

                                       5
<PAGE>
 
                      Management's Discussion and Analysis


FINANCIAL CONDITION
 
The Corporation functions as a financial intermediary, therefore trends in its
sources and uses of funds should be examined when reviewing financial condition.
The primary reason for the increased profitability is the additional income
generated from the significant loan growth that occurred in the second half of
1996 and the early part of 1997.  It is important to note that credit quality
standards were not compromised to achieve this growth, which is evidenced by a
16.3% decrease in non-performing loans since June 30, 1996.

LOANS RECEIVABLE

Net loans increased $11,998,000 or 5.83% first the first half of 1997 to
$217,640,000.  The increase in loans was directly attributable to increased
marketing efforts, favorable economic conditions in our market area, and
competitive pricing.  Management expects this trend to continue throughout the
second half of 1997 providing that the economic environment remains relatively
stable.

ALLOWANCE FOR LOAN LOSSES

Changes in the allowance for loan losses for the six months ended June 30, 1997
and 1996 were as follows (in 000's):

<TABLE>
<CAPTION>
                                                         1997           1996
                                                      ----------    -----------
         <S>                                          <C>           <C> 
         Balance at beginning of year                  $   3,071      $   3,209
         Recoveries of loans                                  16            211
         Provision charged to operations                      90             90
         Loans charged off                                   (71)          (274)
                                                      ----------    -----------
         Balance at end of period                      $   3,106      $   3,236
                                                      ==========    ===========
</TABLE>

The following table summarizes the Corporation's nonaccrual, past due, and
restructured loans at June 30, 1997 and December 31, 1996 (in 000's).

<TABLE>
<CAPTION>
                                                         1997           1996
                                                      ----------    -----------
         <S>                                          <C>           <C> 
         Loans on nonaccrual status                    $     954     $      893
         Accruing loans past due 90+ days                  1,190            273
         Restructured loans                                  -              -
                                                      ----------    -----------
           Total                                       $   2,144     $    1,166
                                                      ==========    ===========
</TABLE>

Included in accruing loans past due 90 plus days as of June 30, 1997 is a loan
with an outstanding balance of $572,325 that was brought current during the
first week of July.

As of June 30, 1997 and 1996, management has identified $391,000 and $403,000,
respectively, in loans that are considered  potential problem loans.  A
potential problem loan is any loan specifically identified in management's
reserve analysis that is not included in the above table.

                                       6
<PAGE>
 
Information with respect to impaired loans through June 30, 1997 and 1996 
(in 000's):

<TABLE>
<CAPTION>
                                                                                         1997           1996
                                                                                     -----------    -----------
   <S>                                                                               <C>            <C> 
   Impaired loans for which there is a related allowance for loan losses              $      487     $      564    
   Impaired loans for which there is no related allowance for loan losses                    467            371
                                                                                     -----------    -----------
    Total impaired loans                                                              $      954            935
                                                                                     ===========    ===========
   Related allowance for loan losses                                                  $      165     $      195
                                                                                     ===========    ===========
   Average recorded balance of these impaired loans                                   $      992     $    1,101
                                                                                     ===========    ===========
   Interest income recognized on these impaired loans                                 $       36     $       36
                                                                                     ===========    ===========
</TABLE>

The provision for loan losses was $90,000 for the six months ended June 30, 1997
and 1996.  Management monitors the credit quality of its portfolio on an ongoing
basis to determine sufficient levels of reserve.  The process includes an
evaluation of the Bank's past loan loss experience, known and inherent risks in
the portfolio, adverse situations that may affect the borrower's ability to
repay, the estimated value of any underlying collateral, composition of the loan
portfolio, current economic conditions, and other relevant factors. As of June
30, 1997, management believes the current level of the allowance is adequate,
and anticipates future provisions for loan losses will be consistent with 1996
levels.  The allowance for loan losses was 1.43% and 1.75% of net loans
outstanding at June 30, 1997 and 1996.  The allowance for loan losses to
nonperforming loans was 144.85% and 126.34% at June 30, 1997 and 1996,
respectively.

SECURITIES

The securities portfolio decreased $2,240,000 or 1.95% compared to the 
December 31, 1996 ending balance of $114,682,000. The proceeds from the
maturities and principal repayments has primarily been used to fund loan growth.

DEPOSITS

The Corporation was able the maintain stable deposit levels throughout the first
half of 1997.  Total deposits increased $3,339,000 or 1.31% to $257,583,000 as
of June 30, 1997 compared to December 31, 1996.  During the same period last
year deposits increased $1,760,000 or .70%.

BORROWINGS

Federal Home Loan Bank term funds borrowed increased $5,000,000 or 16.98%
compared to December 31, 1996 of $29,450,000.  This increase was primarily due
to fund increased loan demand as deposit growth and security repayments were not
sufficient to cover the increase in loan volume.  Borrowings from the FHLB have
provided an alternative source of funds at a lower cost then paying premium
rates to attract deposits that would be deemed volatile in nature.

LIQUIDITY

The Corporation maintains liquidity through its available for sale securities
portfolio, which management considers extremely liquid.  The liquidity of this
portfolio, the Bank's core deposits, credit facilities which have been arranged
through the Federal Home Loan Bank and potential repurchase agreements with a
major investment firm provide the Corporation with funds necessary to meet loan
demand or deposit run-off.

                                       7
<PAGE>
 
CAPITAL

The Corporation is required to maintain minimum amounts of capital to total
"risk-weighted" assets, as defined by the banking regulators.  At June 30, 1997,
the Corporation is required to have minimum Tier 1 and total capital ratios of
4.00% and 8.00%, respectively.  The Corporation's actual ratios at that date
were  18.41% and 19.67%, respectively, which significantly exceed the
requirements.  The Corporation's leverage ratio at June 30, 1997 was 11.72%.

RESULTS OF OPERATIONS

Net income for the second quarter of 1997 was $1,351,000 ($.28 per share)
compared to $1,231,000 ($.26 per share) in 1996, a 9.75% increase.  Earnings for
the six month period ended June 30, 1997 were $2,683,000 ($.56 per share), a
11.24 % increase over 1996 results of $2,412,000 ($.50 per share).  The primary
reason for the increased profitability is the additional income generated from
the significant loan growth throughout 1996 and during the first half of 1997.
Increases in overhead expenses were for outside consulting engagements designed
to increase the profitability levels of all income producing departments within
the Corporation.  These costs were offset by increases in trust fees, other
income and security gains.

NET INTEREST INCOME

Net interest income was $4,034,000 and $7,998,000 for the three and six months
ended June 30, 1997, an increase of $297,000 or 7.95% and $630,000 or 8.55%,
over the same period in 1996.  The increase in interest income was primarily due
an average increase in net loan volume of $33,976,000 or 19.2%.  This increase
resulted in $1,436,000 in additional interest income.  Average investments also
increased $3,882,000 in addition to a 14 basis point increase in the yield,
resulting in $138,000 in additional interest income for the six months ended
June 30, 1997.  Average borrowings, used to fund loan demand, increased
$39,192,000 which resulted in an increase in interest expense of $1,080,000.
The Corporation was able to benefit from a decrease in rate on these borrowed
funds by 16 basis points resulting in a $44,000 decrease in expense.  Average
deposits decreased $4,631,000 resulting in a decrease in interest expense of
$92,000 for the six months ended June 30, 1997.

OTHER INCOME

Other income increased $64,000 or 14.00%, for the three months ended June 30,
1997 and $282,000 or 29.87% for the six months ended June 30, 1997 compared to
the respective periods in 1996.  Trust department income increased $56,000 or
13.30%, for the six months ended June 30, 1997.  The majority of the increase is
the result of an increase in trust assets under management this year versus the
same period last year.

The "other" category increased $46,000 or 43.81% and $54,000 or 26.34% for the
three and six months ended June 30, 1997.  The majority of the increase relates
to an increase in gains from the sale of loans to Freddie Mac in addition to
increased commissions on the sale of insurance on mortgage and installment
loans.  Also contributing to the increase is fee income from our debit card
program which was introduced during the fourth quarter of 1996.

Security gains increased $8,000 and $141,000 or 100% for the three and six
months ended June 30, 1997.  The majority of the gains was the result of a sale
of stock of another financial Corporation that was purchased by a foreign
company.

                                       8
<PAGE>
 
OTHER EXPENSES

Other expenses were $2,585,000 and $5,332,000 for the three and six months ended
June 30, 1997, an increase of  $170,000 or 7.04%  and $507,000 or 10.51%, over
the respective period in 1996.

Salaries and employee benefits increased $97,000 or 7.84% and $191,000 or 7.79%
for the three and six months ended June 30, 1997,  compared to the respective
periods in 1996.  This is due to normal annual salary increases and an increase
in the accrual for employee performance compensation of $87,000 which is based
on projected increase in earnings this year compared to last year.

Professional fees and other outside services increased $6,000 or 2.33% and
$168,000 or 36.84%, for the three and six months ended June 30, 1997 compared to
1996.  For the three months ended June 30, 1997 expenses are comparable to the
respective period in 1996.  The year-to-date increase over 1996 relates to the
utilization of outside consultants for the reorganization of various
departments.  This is in an effort to increase the operating efficiencies and
overall profitability in these areas.

The "other" category increased $17,000 or 8.21% and $83,000 or 19.44%  for the
three and six months ended June 30, 1997 compared to the same period in 1996.
The majority of the increase for the three and six months ended June 30, 1997
relates to loan and collection expense.  Year-to-date this category increased
$42,000 primarily due to the write-down of ORE assets.  Also, directors fees
increased $31,000 due to implementation of a retainer fee during the first
quarter of 1997.

FEDERAL INCOME TAXES

The provision for federal income taxes was $574,000 and $1,119,000 for the three
and six months ended June 30, 1997 which represents an increase of $71,000 or
14.12% and $134,000 or 13.60% over the June 30, 1996 respective periods.  This
variance is due to increased earnings in 1997.  Effective tax rates were 29.43%
and 29.00% for the six months ended June 30, 1997 and 1996.

                                       9
<PAGE>
 
PART II     OTHER INFORMATION



Item 1.     Legal Proceedings - Not Applicable

Item 2.     Changes in Securities - Not Applicable

Item 3.     Defaults Upon Senior Securities - Not Applicable

Item 4.     Submission of Matters to a Vote of Security Holders - Not Applicable

Item 5.     Other Information - Not Applicable

Item 6.     Exhibits and Reports on Form 8-K - Not Applicable

                                       10
<PAGE>
 
SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned there unto duly authorized.


                                                HERITAGE BANCORP, INC.
                                                     (Registrant)

    August 13, 1997                     /s/ Allen E. Kiefer
------------------------              ------------------------------------------
        (Date)                          Allen E. Kiefer,
                                        President & Chief Executive Officer


    August 13, 1997                     /s/ David L. Scott
------------------------              ------------------------------------------
        (Date)                          David L. Scott, CPA
                                        Vice President & Chief Financial Officer

                                       11