Form 8-K
8-K — BANNER CORP
Accession: 0000946673-26-000196
Filed: 2026-10-21
Period: 2026-10-21
CIK: 0000946673
SIC: 6022 (STATE COMMERCIAL BANKS)
Item: Results of Operations and Financial Condition
Item: Regulation FD Disclosure
Item: Other Events
Item: Financial Statements and Exhibits
Documents
8-K — banr-20261021.htm (Primary)
EX-99.1 (banr-09302026xex991earning.htm)
EX-99.2 (a2026-q3presentation.htm)
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8-K
8-K (Primary)
Filename: banr-20261021.htm · Sequence: 1
banr-20261021
0000946673false00009466732026-10-212026-10-21
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 21, 2026
Banner Corporation
(Exact name of registrant as specified in its charter)
Washington
000-26584
91-1691604
(State or other jurisdiction of incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
10 S. First Avenue, Walla Walla, Washington 99362
(Address of principal executive offices) (Zip Code)
Registrant's telephone number (including area code) (509) 527-3636
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $.01 per share BANR The NASDAQ Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.*
On October 21, 2026, Banner Corporation issued its earnings release for the quarter ended September 30, 2026. A copy of the earnings release is furnished herewith as Exhibit 99.1, and is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.*
Banner Corporation intends to review the investor presentation attached as Exhibit 99.2 to this Current Report on Form 8-K in conjunction with its earnings release conference call on October 22, 2026, and from time to time in presentations to investors and other stakeholders.
Item 8.01 Other Events.
On October 21, 2026, Banner Corporation announced its Board of Directors declared a regular quarterly cash dividend on Banner Corporation common stock of $0.52 per share, payable on November 13, 2026 to stockholders of record as of the close of business on November 5, 2026.
Item 9.01 Financial Statements and Exhibits.*
(d) Exhibits
99.1 Press Release of Banner Corporation dated October 21, 2026.
99.2 Banner Corporation Investor Materials
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
* The information furnished under Item 2.02, Item 7.01 and Item 9.01 of this Current Report on Form 8-K, including the exhibits, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liabilities under that Section, nor shall it be deemed incorporated by reference in any registration statement or other filings of Banner Corporation under the Securities Act of 1933, as amended, except as shall be set forth by specific reference in such filing.
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 hereunto duly authorized.
BANNER CORPORATION
Date: October 21, 2026
By: /s/ Robert G Butterfield
Robert G Butterfield
Executive Vice President, Treasurer and
Chief Financial Officer
EX-99.1
EX-99.1
Filename: banr-09302026xex991earning.htm · Sequence: 2
Document
Exhibit 99.1
CONTACT: MARK J. GRESCOVICH,
PRESIDENT & CEO
ROBERT G. BUTTERFIELD, CFO
(509) 527-3636
NEWS RELEASE
Banner Corporation Reports Net Income of $47.7 Million, or $1.36 Per Diluted Share, for Third Quarter 2026;
Declares Quarterly Cash Dividend of $0.52 Per Share; Results Strengthened by Completion of Pacific Financial Corporation Acquisition
Walla Walla, WA - October 21, 2026 - Banner Corporation (NASDAQ GSM: BANR) (“Banner”), the parent company of Banner Bank, today reported net income of $47.7 million, or $1.36 per diluted share, for the third quarter of 2026, compared to $48.9 million, or $1.43 per diluted share, for the preceding quarter, and $53.5 million, or $1.54 per diluted share, for the third quarter of 2025. Net interest income was $161.9 million for the third quarter of 2026, compared to $153.7 million in the preceding quarter and $150.0 million for the third quarter a year ago. The increase in net interest income compared to both the prior quarter and the third quarter a year ago was primarily driven by an increase in average interest-earning assets resulting from the acquisition of Pacific Financial Corporation (“Pacific Financial”) on September 1, 2026 and organic loan growth, as well as expansion in Banner’s net interest margin reflecting higher yields on interest-earning assets. Funding costs increased compared to the prior quarter, partially offsetting the increase in interest income, but decreased compared to the third quarter a year ago. Third quarter 2026 results included $5.2 million of merger-and acquisition-related costs, compared to $238,000 in the preceding quarter and none in the third quarter of 2025. Third quarter 2026 results also included a $2.8 million provision for credit losses, compared to $3.8 million in the preceding quarter and $2.7 million in the third quarter of 2025.
Net income was $151.3 million, or $4.39 per diluted share, for the nine months ended September 30, 2026, compared to net income of $144.1 million, or $4.15 per diluted share, for the nine months ended September 30, 2025. Results for the nine months ended September 30, 2026 included a $5.8 million provision for credit losses, a $3.3 million net loss on the sale of securities and a $1.8 million net increase in fair value adjustments on financial instruments carried at fair value, compared to a $10.6 million provision for credit losses, a $374,000 net gain on the sale of securities and a $626,000 net increase in the fair value adjustments on financial instruments carried at fair value during the same period in 2025. The nine months ended September 30, 2026 results included $5.4 million of merger and acquisition related costs, compared to none for the nine months ended September 30, 2025.
Banner announced that its Board of Directors declared a regular quarterly cash dividend of $0.52 per share payable November 13, 2026, to common shareholders of record on November 5, 2026.
“During the third quarter, we completed the merger with Pacific Financial Corporation, the holding company of Bank of the Pacific,” said Mark Grescovich, President and CEO. “Bank of the Pacific was a highly respected, financially strong community bank with exceptional core deposits. This transaction expands our presence and density in attractive Western Washington and Western Oregon markets while offering Bank of the Pacific customers broader product offerings and technology tools, increased commercial lending limits and an expanded branch delivery system.”
“Banner’s results for the third quarter reflect the continued strength of our super community bank model, which prioritizes deepening client relationships, maintaining a strong funding base, and delivering exceptional service while upholding a moderate risk profile,” Grescovich continued. “Our earnings for the third quarter of 2026 benefited from loan growth and the completion of the merger with Pacific Financial. These benefits were partially offset by higher non-interest expense, which primarily reflects merger related expenses. Banner continues to build on a foundation of solid credit quality, backed by a well-funded credit loss reserve and a robust capital position that offers both resilience and flexibility for future growth. At the same time, the strategic investments we have made across the organization are delivering tangible results, further positioning Banner for long-term success. We also continue to capitalize on a strong core deposit base, with core deposits representing 90% of total deposits at quarter-end. For more than 136 years, Banner has upheld its core values by consistently doing the right thing for our clients, communities, colleagues, company and shareholders. Our long-standing commitment has enabled us to earn trust, navigate change with confidence and continue building a strong foundation for the future.”
At September 30, 2026, Banner, on a consolidated basis, had $18.08 billion in assets, $12.82 billion in net loans and $15.39 billion in deposits. Banner operates 153 full-service branch offices, including branches located in eight of the top 20 largest western United States Metropolitan Statistical Areas by population.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 2
Third Quarter 2026 Highlights
•Net interest margin, on a tax equivalent basis, was 4.14% for the current quarter, compared to 4.13% in the preceding quarter and 3.98% in the third quarter a year ago.
•Revenue was $177.3 million for the third quarter of 2026, compared to $172.0 million in the preceding quarter and increased 4% from $170.7 million in the third quarter a year ago.
•Net interest income was $161.9 million in the third quarter of 2026, compared to $153.7 million in the preceding quarter and $150.0 million in the third quarter a year ago.
•Return on average assets was 1.11% for the third quarter of 2026, compared to 1.20% in the preceding quarter and 1.30% in the third quarter a year ago.
•Net loans receivable increased 8% to $12.82 billion at September 30, 2026, compared to $11.83 billion at June 30, 2026, and increased 11% from $11.54 billion at September 30, 2025.
•Loan originations increased to $1.28 billion for the third quarter of 2026, compared to $1.26 billion in the preceding quarter and increased 61% from $794.5 million in the third quarter a year ago.
•Total deposits were $15.39 billion at September 30, 2026, compared to $13.79 billion at June 30, 2026, and $14.02 billion at September 30, 2025.
•Core deposits represented 90% of total deposits at September 30, 2026.
•Non-performing assets were $63.0 million, or 0.35% of total assets, at September 30, 2026, compared to $60.5 million, or 0.36% of total assets, at June 30, 2026, and $45.3 million, or 0.27% of total assets, at September 30, 2025.
•The allowance for credit losses - loans was $171.6 million, or 1.32% of total loans receivable, as of September 30, 2026, compared to $161.8 million, or 1.35% of total loans receivable, as of June 30, 2026, and $159.7 million, or 1.36% of total loans receivable, as of September 30, 2025.
•Dividends paid to shareholders were $0.52 per share in the quarter ended September 30, 2026.
•Common shareholders’ equity per share was $58.56 at September 30, 2026, compared to $58.83 at June 30, 2026, and increased 5% from $55.71 at September 30, 2025.
•Tangible common shareholders’ equity per share* decreased 4% to $45.84 at September 30, 2026, compared to $47.82 at June 30, 2026, and increased 2% from $44.79 at September 30, 2025.
•Repurchased 200,000 shares of Banner common stock during the third quarter of 2026 at an average price of $71.03 per share
*Non-GAAP (Generally Accepted Accounting Principles) financial measure; See, “Additional Financial Information - Non-GAAP Financial Measures” on the final two pages of this press release for a reconciliation of non-GAAP financial measures.
Significant Recent Events
On September 1, 2026, Banner completed the acquisition of Pacific Financial Corporation the holding company for Bank of the Pacific, in an all-stock transaction. At closing, Bank of the Pacific had 18 branch locations, including 15 in Washington and three in Oregon. Shareholders of Pacific Financial received 0.2633 shares of Banner common stock for each share of Pacific Financial common stock they owned, plus cash in lieu of any fractional shares, for total consideration paid of $186.8 million.
The Pacific Financial transaction was accounted for using the acquisition method of accounting. Accordingly, the assets (including identifiable intangible assets) and the liabilities of Pacific Financial were measured at their respective estimated fair values as of the merger date. The excess of the purchase price over the fair value of the net assets acquired was attributed to goodwill. The fair value on the merger date represents management's best estimates based on available information and facts and circumstances in existence on the merger date. The acquisition method of accounting is subject to adjustment within a measurement period of one year from the acquisition date. The acquisition brought $1.29 billion of assets, including $756.9 million of net loans receivable, and $1.14 billion of deposits to Banner.
Income Statement Review
Net interest income was $161.9 million in the third quarter of 2026, compared to $153.7 million in the preceding quarter and $150.0 million in the third quarter a year ago. Net interest margin, on a tax equivalent basis, increased one basis point to 4.14% for the third quarter of 2026, compared to 4.13% in the preceding quarter, and increased 16 basis points from 3.98% in the third quarter a year ago. The net interest margin for the current quarter benefited from a higher average yield on interest-earning assets compared to the preceding quarter, partially offset by higher funding costs. Compared to the third quarter a year ago, the increase in the net interest margin primarily reflected lower funding costs and a higher average yield on interest-earning assets.
Interest income was $214.6 million in the third quarter of 2026, compared to $202.7 million in the preceding quarter and $205.8 million in the third quarter of 2025. Average yields on interest-earning assets increased five basis points to 5.46% for the third quarter of 2026, compared to 5.41% for the preceding quarter, primarily reflecting a higher proportion of loans within the interest-earning asset mix and an increase in loan yields. Compared to the third quarter a year ago, average yields on interest-earning assets increased by three basis points from 5.43%. Average loan yields increased by three basis points to 6.12% in the third quarter of 2026, compared to 6.09% in the preceding quarter, and decreased from 6.17% in the third quarter a year ago.
Interest expense was $52.7 million in the third quarter of 2026, compared to $48.9 million in the preceding quarter and $55.9 million in the third quarter a year ago. Total deposit costs increased by five basis points to 1.38% in the third quarter of 2026, compared to 1.33% in the preceding quarter, and decreased by 12 basis points compared to 1.50% in the third quarter a year ago. The increase in deposit costs compared to the preceding quarter was primarily due to higher average rates paid across all deposit categories and a shift in deposit mix toward interest-bearing deposits, partially offset by growth in non-interest-bearing deposits. The decrease in deposit costs in the current quarter compared to the same quarter a year ago primarily reflected lower average rates paid across all deposit categories.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 3
The average rate paid on borrowings increased 11 basis points to 3.99% in the third quarter of 2026 from 3.88% in the preceding quarter, primarily reflecting higher average rates paid on borrowings and lower FHLB advances in the current quarter. The average rate paid on borrowings decreased by 19 basis points from 4.18% in the third quarter a year ago, primarily due to lower average rates paid on FHLB advances and junior subordinated debentures and subordinated notes, partially offset by a higher average rate paid on other borrowings. The total cost of funding liabilities increased four basis points to 1.43% in the third quarter of 2026, compared to 1.39% in the preceding quarter, and decreased 14 basis points from 1.57% in the third quarter a year ago.
A $2.8 million provision for credit losses was recorded in the current quarter (comprised of a $1.8 million provision for credit losses - loans and a $1.0 million provision for credit losses - unfunded loan commitments). This compares to a $3.8 million provision for credit losses in the prior quarter (comprised of a $1.6 million provision for credit losses - loans and a $2.2 million provision for credit losses - unfunded loan commitments) and a $2.7 million provision for credit losses in the third quarter a year ago (comprised of a $1.4 million provision for credit losses - loans and a $1.3 million provision for credit losses - unfunded loan commitments). The provision for credit losses recorded in the third quarter of 2026 primarily reflected loan growth, partially offset by improvements in credit quality.
Total non-interest income was $15.4 million in the third quarter of 2026, compared to $18.2 million in the preceding quarter and $20.7 million in the third quarter of 2025. The decrease from the preceding quarter was driven primarily by a net loss on the sale of securities of $2.1 million, resulting from the sale of the investment portfolio acquired from Pacific Financial, as well as a $630,000 decrease in miscellaneous income, reflecting lower gains on SBA loan sales and fluctuations in other miscellaneous income items. These decreases were partially offset by a $470,000 favorable change in fair value adjustments on financial instruments. Compared to the prior year quarter, non-interest income decreased primarily due to lower miscellaneous income, as well as lower mortgage banking revenue. These declines were partially offset by higher deposit fees and other service charges. Total non-interest income was $52.8 million for the nine months ended September 30, 2026, compared to $57.6 million for the same period in 2025.
Total non-interest expense was $115.7 million in the third quarter of 2026, compared to $108.0 million in the preceding quarter and $102.0 million in the third quarter of 2025. Merger-related expenses were $5.2 million in the third quarter of 2026, compared to $238,000 in the preceding quarter and none in the third quarter of 2025. Excluding merger-related expenses, the increase from the preceding quarter reflected increases in expenses in several categories related to the acquired Pacific Financial operations, including an increase in salary and employee benefits. In addition, real estate operations expense increased by $1.1 million, reflecting write-downs of foreclosed real estate. The increase compared to the same quarter a year ago primarily reflects increases in salary and employee benefits, information and computer data services expenses, professional and legal expenses, and real estate operations expenses, partially offset by a decrease in occupancy and equipment expense. For the nine months ended September 30, 2026, total non-interest expense was $326.3 million, compared to $304.6 million for the nine months ended September 30, 2025.
Banner’s efficiency ratio was 65.25% for the third quarter of 2026, compared to 62.80% in the preceding quarter and 59.76% in the same quarter a year ago. Banner’s adjusted efficiency ratio, a non-GAAP financial measure, was 59.53% for the third quarter of 2026, compared to 61.30% in the preceding quarter and 58.54% in the year-ago quarter. See, “Additional Financial Information - Non-GAAP Financial Measures” on the final two pages of this press release for a discussion and reconciliation of non-GAAP financial measures.
Balance Sheet Review
Total assets increased 9% to $18.08 billion at September 30, 2026, compared to $16.59 billion at June 30, 2026, and increased 9% compared to $16.56 billion at September 30, 2025. The increase for both periods was primarily due to the $1.29 billion of assets acquired in the Pacific Financial acquisition. In addition, both periods benefited from organic loan growth. Securities and interest-bearing deposits held at other banks totaled $3.43 billion at September 30, 2026, compared to $3.17 billion at June 30, 2026 and $3.47 billion at September 30, 2025. The average effective duration of the securities portfolio was approximately 6.0 years and 6.4 years at September 30, 2026 and September 30, 2025, respectively.
Total loans receivable increased 8% to $13.00 billion at September 30, 2026, compared to $11.99 billion at June 30, 2026, and increased 11% from $11.70 billion at September 30, 2025. The increase in total loans compared to both periods included $765.5 million of portfolio loans acquired from Pacific Financial.
Commercial real estate loans totaled $4.61 billion at September 30, 2026, an increase of 11% from $4.14 billion at June 30, 2026, and 15% from $4.00 billion at September 30, 2025. Commercial business loans totaled $2.73 billion at September 30, 2026, an increase of 6% compared to $2.58 billion at June 30, 2026, and an increase of 12% from $2.43 billion at September 30, 2025. Growth in both categories reflected the Pacific Financial acquisition and new loan production, partially offset by payoffs and paydowns.
Multifamily real estate loans totaled $913.3 million at September 30, 2026, an increase of 7% from $855.9 million at June 30, 2026, and 6% from $860.7 million at September 30, 2025. Construction, land and land development loans totaled $1.80 billion at September 30, 2026, an increase of 6% from $1.69 billion at June 30, 2026, and 4% from $1.74 billion at September 30, 2025. Growth in these categories reflected the acquisition of Pacific Financial, as well as new loan production and advances, partially offset by transfers to the permanent loan portfolios upon completion of the construction phase.
Agricultural business loans totaled $389.2 million at September 30, 2026, an increase of 15% from $337.5 million at June 30, 2026, and 10% from $354.9 million at September 30, 2025, primarily reflecting the acquisition, partially offset by payoffs and paydowns. Consumer loans totaled $929.8 million at September 30, 2026, an increase of 12% from $827.0 million at June 30, 2026, and 26% from $740.3 million at September 30, 2025. The growth primarily reflected the acquisition of Pacific Financial, as well as new loan production and advances, particularly on home equity revolving lines of credit.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 4
Loans held for sale were $32.7 million at September 30, 2026, compared to $27.2 million at June 30, 2026, and $20.3 million at September 30, 2025. One- to four- family residential mortgage held for sale loans sold in the current quarter totaled $103.3 million, compared to $134.6 million in the preceding quarter, and $136.9 million in the third quarter a year ago. The increase in loans held for sale at September 30, 2026, compared to both the preceding quarter and the prior year quarter, was attributable to one- to four-family residential mortgage held for sale loan originations outpacing loan sales during the current quarter.
Total deposits were $15.39 billion at September 30, 2026, compared to $13.79 billion at June 30, 2026, and $14.02 billion at September 30, 2025. Core deposits increased to $13.78 billion at September 30, 2026, compared to $12.32 billion at June 30, 2026, and $12.48 billion at September 30, 2025. The increase in deposits reflected $1.14 billion in deposits from Pacific Financial during the third quarter of 2026. Excluding acquired deposits, the increase from both the prior quarter and prior year quarter reflected increases in both noninterest-bearing and interest-bearing transaction and savings accounts. Core deposits remained stable at 90% of total deposits at September 30, 2026, and at 89% at both June 30, 2026 and September 30, 2025. Certificates of deposit increased 10% to $1.62 billion at September 30, 2026, compared to $1.47 billion at June 30, 2026, and increased 5%, compared to $1.54 billion at September 30, 2025, due to the Pacific Financial acquisition.
There were no outstanding FHLB advances at September 30, 2026, compared to $320.0 million outstanding FHLB advances at June 30, 2026, and $100.0 million at September 30, 2025. The decrease in FHLB advances during the quarter reflected repayment of all outstanding advances, as deposits served as the primary source of funding. At September 30, 2026, off-balance sheet liquidity included additional borrowing capacity of $3.82 billion at the FHLB and $1.56 billion at the Federal Reserve, as well as federal funds line of credit agreements with other financial institutions of $125.0 million.
At September 30, 2026, total common shareholders’ equity was $2.13 billion, or 11.80% of total assets, compared to $2.00 billion, or 12.05% of total assets at June 30, 2026, and $1.91 billion, or 11.55% of total assets, at September 30, 2025. The increase in total common shareholders’ equity from June 30, 2026, was primarily due to a $174.6 million increase in common stock, primarily attributable to the acquisition of Pacific Financial during the third quarter. In addition, retained earnings increased by $29.8 million, resulting from $47.7 million in net income, partially offset by the accrual of $17.9 million in cash dividends and a $69.7 million increase in accumulated other comprehensive loss. The Company repurchased 200,000 shares of its common stock in the third quarter of 2026 at an average price of $71.03 per share. At September 30, 2026, tangible common shareholders’ equity, a non-GAAP financial measure, was $1.67 billion, or 9.48% of tangible assets, compared to $1.63 billion, or 10.02% of tangible assets, at June 30, 2026, and $1.54 billion, or 9.50% of tangible assets, at September 30, 2025. See “Additional Financial Information - Non-GAAP Financial Measures” on the final two pages of this press release for a reconciliation of non-GAAP financial measures.
Banner and Banner Bank continue to maintain capital levels in excess of the requirements to be categorized as “well-capitalized.” At September 30, 2026, Banner’s estimated common equity Tier 1 capital ratio was 12.57%, its estimated Tier 1 leverage capital to average assets ratio was 11.59%, and its estimated total capital to risk-weighted assets ratio was 14.42%. These regulatory capital ratios are estimates, pending completion and filing of Banner’s regulatory reports.
Credit Quality
The allowance for credit losses - loans was $171.6 million, or 1.32% of total loans receivable and 290% of non-performing loans, at September 30, 2026, compared to $161.8 million, or 1.35% of total loans receivable and 295% of non-performing loans, at June 30, 2026, and $159.7 million, or 1.36% of total loans receivable and 399% of non-performing loans, at September 30, 2025. The allowance ratio decreased compared to both prior periods, primarily reflecting the acquisition of Pacific Financial, which had favorable credit quality and a moderately lower risk profile. Coverage of non-performing loans remained strong at 290% at September 30, 2026, compared to 295% at June 30, 2026. The year-over-year decline from 399% at September 30, 2025 reflects a moderate increase in non-performing loans over the past year, while the allowance level has remained stable and commensurate with the portfolio’s risk profile. In addition to the allowance for credit losses - loans, the allowance for credit losses - unfunded loan commitments was $16.2 million at September 30, 2026, compared to $15.1 million at June 30, 2026, and $14.0 million at September 30, 2025. Net loan charge-offs were $704,000 in the third quarter of 2026, compared to net loan charge-offs of $101,000 and $2.2 million in the preceding quarter and third quarter of 2025, respectively. Non-performing loans were $59.1 million at September 30, 2026, compared to $54.8 million at June 30, 2026, and $40.0 million at September 30, 2025. Despite the increase in non-performing loans, substandard loans declined to $209.7 million at September 30, 2026, from $218.4 million at June 30, 2026. Total non-performing assets were $63.0 million, or 0.35% of total assets, at September 30, 2026, compared to $60.5 million, or 0.36% of total assets, at June 30, 2026, and $45.3 million, or 0.27% of total assets, at September 30, 2025.
Conference Call
Banner will host a conference call on Thursday, October 22, 2026, at 8:00 a.m. PDT, to discuss its third quarter results. Interested investors may listen to the call live at www.bannerbank.com. Investment professionals are invited to dial (833) 461-5787 using access code 349483357 to participate in the call. A replay of the call will be available at www.bannerbank.com.
About the Company
Banner Corporation is an $18.08 billion bank holding company operating a commercial bank primarily in Washington, Oregon, California and Idaho through a network of branches offering a full range of deposit services and business, commercial real estate, construction, residential, agricultural and consumer loans. Visit Banner Bank on the Web at www.bannerbank.com.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 5
Forward-Looking Statements
When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “may,” “believe,” “will,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” “potential,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date such statements are made and based only on information then actually known to Banner. Banner does not undertake and specifically disclaims any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.
Forward-looking statements may relate to, among other things, future financial performance, strategic plans or objectives, revenues or earnings projections, and other financial or operational information. These statements are inherently subject to numerous risks and uncertainties, including ongoing market volatility and evolving global conditions, which may cause actual results to differ materially from those expressed or implied. These factors include, but are not limited to: (1) adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, including, without limitation, as a result of labor shortages, elevated inflation, recessionary pressures, or slowing economic growth; (2) changes in interest rate levels, volatility, and the timing and pace of such changes, including actions by the Federal Reserve, which could materially affect our net interest margin, funding costs, asset values, access to capital and liquidity; (3) the impact of inflation and monetary and fiscal policy responses thereto, and their impact on consumer and business behavior; (4) geopolitical developments and international conflicts, including but not limited to tensions or instability in Eastern Europe, South America, the Middle East, and Asia, or the imposition of new or increased tariffs and trade restrictions, which may disrupt financial markets, global supply chains, commodity prices, or economic activity in specific industry sectors, including, but not limited to, agriculture-based lending; (5) the effects of a federal government shutdown, debt ceiling standoff, or other fiscal policy uncertainty; (6) the impact of bank failures or adverse developments at other banks and related negative publicity about the banking industry in general on investor and depositor sentiment; (7) expectations regarding key growth initiatives and strategic priorities; (8) credit risks from lending activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses, which could necessitate additional provisions for credit losses, resulting both from loans originated and loans acquired from other financial institutions; (9) results of examinations by regulatory authorities, which could result in the imposition of penalties, required changes to our business practices, or additional reserves; (10) competitive pressures among depository and non-depository institutions that adversely affect pricing, market share, deposit flows or product offerings; (11) fluctuations in real estate values; (12) the ability to adapt to rapid technological changes, including advancements in artificial intelligence, digital banking platforms, and cybersecurity; (13) vulnerabilities in information systems or third-party service providers, including disruptions, breaches, or attacks; (14) market volatility or deterioration in capital markets affecting liquidity, valuations, or investor confidence; (15) the costs, effects and outcomes of litigation or other legal proceedings involving the Company; (16) legislation or regulatory changes, including but not limited to shifts in capital requirements, banking regulation, tax laws, or consumer protection laws; (17) climate-related risks and natural disasters, which may affect loan collateral, operations, or compliance obligations; (18) changes in accounting principles, policies or guidelines; (19) the impact of completed and future acquisitions or business combinations, including related goodwill impairment risks and integration challenges; (20) effects of critical accounting policies and judgments, including the use of estimates in determining fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; (21) other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services; and (22) other risks detailed from time to time in Banner’s other reports filed with and furnished to the Securities and Exchange Commission including Banner’s Annual Report on Form 10-K for the year ended December 31, 2025 and subsequent Quarterly Reports on Form 10-Q.
Further, statements about the effects of Banner’s acquisition of Pacific Financial, completed on September 1, 2026, on Banner’s business, financial results, and condition may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in the forward-looking statements due to factors and future developments which are uncertain, unpredictable and in many cases beyond Banner’s control, including, but are not limited to the risk that: (1) the business of Pacific Financial may not be integrated with Banner’s business successfully, including the planned systems conversions, or such integration may be more difficult, time-consuming or costly than expected; (2) the anticipated benefits of the merger, including anticipated cost savings and earnings accretion, may not be realized or may not be realized within the expected time period; (3) customer and employee relationships and business operations may be disrupted by the merger, and Banner may be challenged in retaining key customers and employees following its completion; (4) merger-related and integration expenses may be greater than expected; (5) preliminary estimates of the fair value of acquired assets and assumed liabilities may change during the measurement period, and acquired loans may experience higher credit losses than anticipated; (6) management’s attention may be diverted from ongoing business operations and opportunities due to integration activities; and (7) other factors detailed in Banner’s filings with the SEC.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 6
RESULTS OF OPERATIONS Quarters Ended Nine Months Ended
(in thousands except shares and per share data) Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
INTEREST INCOME:
Loans receivable $ 188,586 $ 178,389 $ 179,065 $ 540,678 $ 523,115
Mortgage-backed securities 14,996 14,053 15,090 43,365 46,250
Securities and cash equivalents 10,998 10,244 11,693 31,041 30,610
Total interest income 214,580 202,686 205,848 615,084 599,975
INTEREST EXPENSE:
Deposits 50,022 45,554 52,251 141,254 150,304
Federal Home Loan Bank (FHLB) advances 653 1,426 1,527 2,119 5,757
Other borrowings 695 732 694 2,124 2,063
Subordinated debt
1,317 1,234 1,387 3,785 6,380
Total interest expense 52,687 48,946 55,859 149,282 164,504
Net interest income 161,893 153,740 149,989 465,802 435,471
PROVISION FOR CREDIT LOSSES 2,824 3,818 2,670 5,846 10,604
Net interest income after provision for credit losses 159,069 149,922 147,319 459,956 424,867
NON-INTEREST INCOME:
Deposit fees and other service charges 11,496 11,728 10,955 34,615 32,559
Mortgage banking operations 2,575 2,792 3,298 8,579 9,627
Bank-owned life insurance 2,354 2,471 2,702 7,137 7,661
Miscellaneous 750 1,380 3,175 3,956 6,742
17,175 18,371 20,130 54,287 56,589
Net (loss) gain on sale of securities (2,102) 8 377 (3,336) 374
Net change in valuation of financial instruments carried at fair value 313 (157) 223 1,818 626
Total non-interest income 15,386 18,222 20,730 52,769 57,589
NON-INTEREST EXPENSE:
Salary and employee benefits 71,410 69,388 64,935 208,530 195,278
Less capitalized loan origination costs (4,917) (5,283) (4,802) (14,086) (13,056)
Occupancy and equipment 10,965 10,936 12,518 32,598 36,871
Information and computer data services 8,882 10,321 8,199 27,516 24,026
Payment and card processing services 6,821 6,218 6,060 19,080 17,709
Professional and legal expenses 2,225 2,519 2,190 6,357 6,891
Advertising and marketing 1,766 1,980 1,395 4,419 3,072
Deposit insurance 2,615 2,819 2,867 8,151 8,464
State and municipal business and use taxes 1,919 1,773 1,655 5,512 4,525
Real estate operations, net 1,261 165 203 1,535 534
Amortization of core deposit intangibles 663 256 341 1,175 1,252
Miscellaneous 6,889 6,660 6,461 20,072 19,063
110,499 107,752 102,022 320,859 304,629
Merger and acquisition-related expenses 5,177 238 — 5,415 —
Total non-interest expense 115,676 107,990 102,022 326,274 304,629
Income before provision for income taxes 58,779 60,154 66,027 186,451 177,827
PROVISION FOR INCOME TAXES 11,070 11,268 12,525 35,140 33,694
NET INCOME $ 47,709 $ 48,886 $ 53,502 $ 151,311 $ 144,133
Earnings per common share:
Basic $ 1.37 $ 1.44 $ 1.55 $ 4.41 $ 4.17
Diluted $ 1.36 $ 1.43 $ 1.54 $ 4.39 $ 4.15
Cumulative dividends declared per common share $ 0.52 $ 0.52 $ 0.48 $ 1.54 $ 1.44
Weighted average number of common shares outstanding:
Basic 34,856,074 34,012,611 34,494,824 34,305,632 34,543,969
Diluted 35,026,771 34,129,173 34,659,346 34,479,283 34,730,103
BANR - Third Quarter 2026 Results
October 21, 2026
Page 7
FINANCIAL CONDITION Percentage Change
(in thousands except shares and per share data) Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025 Prior Qtr Prior Yr Qtr
ASSETS
Cash and due from banks $ 234,056 $ 215,508 $ 182,772 $ 193,453 9 % 21 %
Interest-bearing deposits 324,049 219,944 239,868 479,410 47 % (32) %
Total cash and cash equivalents
558,105 435,452 422,640 672,863 28 % (17) %
Securities - available for sale, amortized cost $2,538,271, $2,273,608, $2,271,471 and $2,292,835, respectively
2,184,309 2,015,891 2,016,261 2,018,525 8 % 8 %
Securities - held to maturity, fair value $709,449, $787,987, $814,668 and $815,434, respectively
918,914 929,309 961,196 971,603 (1) % (5) %
Total securities
3,103,223 2,945,200 2,977,457 2,990,128 5 % 4 %
FHLB stock 10,000 24,209 16,476 14,226 (59) % (30) %
Loans held for sale 32,698 27,160 42,902 20,334 20 % 61 %
Loans receivable 12,995,341 11,994,410 11,721,687 11,702,538 8 % 11 %
Allowance for credit losses – loans (171,563) (161,849) (160,276) (159,707) 6 % 7 %
Net loans receivable
12,823,778 11,832,561 11,561,411 11,542,831 8 % 11 %
Accrued interest receivable 72,660 65,016 60,525 64,914 12 % 12 %
Property and equipment, net 129,175 108,247 111,522 113,848 19 % 13 %
Goodwill 434,283 373,121 373,121 373,121 16 % 16 %
Other intangibles, net 28,948 979 1,491 1,806 2,857 % 1,503 %
Bank-owned life insurance 355,332 324,164 319,347 317,469 10 % 12 %
Operating lease right-of-use assets 31,454 29,534 32,736 35,494 7 % (11) %
Other assets 503,781 427,904 434,860 416,047 18 % 21 %
Total assets
$ 18,083,437 $ 16,593,547 $ 16,354,488 $ 16,563,081 9 % 9 %
LIABILITIES
Deposits:
Non-interest-bearing $ 4,970,392 $ 4,542,942 $ 4,489,839 $ 4,572,338 9 % 9 %
Interest-bearing transaction and savings accounts 8,807,919 7,773,630 7,721,003 7,903,215 13 % 11 %
Interest-bearing certificates 1,615,158 1,473,021 1,532,304 1,540,382 10 % 5 %
Total deposits 15,393,469 13,789,593 13,743,146 14,015,935 12 % 10 %
Advances from FHLB — 320,000 150,000 100,000 (100) % (100) %
Other borrowings 105,248 114,497 107,715 120,536 (8) % (13) %
Junior subordinated debentures at fair value 87,122 79,652 79,151 76,251 9 % 14 %
Operating lease liabilities 34,022 32,108 35,755 38,826 6 % (12) %
Accrued expenses and other liabilities 279,603 210,134 245,266 251,464 33 % 11 %
Deferred compensation 50,070 48,300 47,158 47,177 4 % 6 %
Total liabilities 15,949,534 14,594,284 14,408,191 14,650,189 9 % 9 %
SHAREHOLDERS’ EQUITY
Common stock 1,443,098 1,268,527 1,282,505 1,295,821 14 % 11 %
Retained earnings 970,008 940,210 871,803 837,826 3 % 16 %
Accumulated other comprehensive loss (279,203) (209,474) (208,011) (220,755) 33 % 26 %
Total shareholders’ equity 2,133,903 1,999,263 1,946,297 1,912,892 7 % 12 %
Total liabilities and shareholders’ equity $ 18,083,437 $ 16,593,547 $ 16,354,488 $ 16,563,081 9 % 9 %
Common Shares Issued:
Shares outstanding at end of period 36,442,062 33,984,909 34,097,856 34,335,297
Common shareholders’ equity per share (1)
$ 58.56 $ 58.83 $ 57.08 $ 55.71
Common shareholders’ tangible equity per share (1) (2)
$ 45.84 $ 47.82 $ 46.09 $ 44.79
Common shareholders’ equity to total assets 11.80 % 12.05 % 11.90 % 11.55 %
Common shareholders’ tangible equity to tangible assets (2)
9.48 % 10.02 % 9.84 % 9.50 %
Consolidated Tier 1 leverage capital ratio 11.59 % 11.79 % 11.41 % 11.33 %
(1) Calculation is based on number of common shares outstanding at the end of the period rather than weighted average shares outstanding.
(2) Common shareholders’ tangible equity and tangible assets exclude goodwill and other intangible assets. These ratios represent non-GAAP financial measures. See, “Additional Financial Information - Non-GAAP Financial Measures” on the final two pages of this press release for a reconciliation of non-GAAP financial measures.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 8
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
LOANS Percentage Change
Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025 Prior Qtr Prior Yr Qtr
Commercial real estate (CRE):
Owner-occupied $ 1,330,460 $ 1,229,993 $ 1,138,298 $ 1,134,559 8 % 17 %
Investment properties 1,804,740 1,744,127 1,701,413 1,652,141 3 % 9 %
Small balance CRE 1,471,499 1,166,516 1,212,357 1,210,357 26 % 22 %
Multifamily real estate 913,324 855,862 850,789 860,650 7 % 6 %
Construction, land and land development:
Commercial construction 220,048 181,843 156,021 144,125 21 % 53 %
Multifamily construction 520,521 503,058 514,330 586,104 3 % (11) %
One- to four-family construction 645,694 631,183 607,447 578,128 2 % 12 %
Land and land development 416,397 378,172 433,678 427,348 10 % (3) %
Commercial business:
Commercial business 1,358,990 1,286,818 1,225,108 1,254,460 6 % 8 %
Small business scored 1,374,527 1,295,861 1,187,360 1,176,889 6 % 17 %
Agricultural business, including secured by farmland:
Agricultural business, including secured by farmland 389,220 337,487 353,152 354,884 15 % 10 %
One- to four-family residential 1,620,111 1,556,493 1,573,191 1,582,605 4 % 2 %
Consumer:
Consumer—home equity revolving lines of credit 802,440 744,546 679,489 649,188 8 % 24 %
Consumer—other 127,370 82,451 89,054 91,100 54 % 40 %
Total loans receivable $ 12,995,341 $ 11,994,410 $ 11,721,687 $ 11,702,538 8 % 11 %
Loans 30 - 89 days past due and on accrual $ 24,287 $ 17,686 $ 26,767 $ 14,674
Total delinquent loans (including loans on non-accrual), net $ 73,285 $ 61,333 $ 63,093 $ 45,529
Total delinquent loans / Total loans receivable 0.56 % 0.51 % 0.54 % 0.39 %
LOANS BY GEOGRAPHIC LOCATION Percentage Change
Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025 Prior Qtr Prior Yr Qtr
Amount Percentage Amount Amount Amount
Washington $ 5,947,312 46 % $ 5,359,130 $ 5,371,200 $ 5,407,327 11 % 10 %
California 3,422,524 26 % 3,275,124 3,105,405 3,064,993 5 % 12 %
Oregon 2,495,998 19 % 2,210,617 2,159,404 2,137,422 13 % 17 %
Idaho 736,557 6 % 732,830 667,343 668,949 1 % 10 %
Utah 88,784 1 % 78,216 82,594 79,697 14 % 11 %
Other 304,166 2 % 338,493 335,741 344,150 (10) % (12) %
Total loans receivable $ 12,995,341 100 % $ 11,994,410 $ 11,721,687 $ 11,702,538 8 % 11 %
BANR - Third Quarter 2026 Results
October 21, 2026
Page 9
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
LOAN ORIGINATIONS Quarters Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025
Commercial real estate $ 203,374 $ 163,031 $ 118,354
Multifamily real estate 28,351 215 2,500
Construction and land 594,168 561,290 369,363
Commercial business 251,592 312,028 167,627
Agricultural business 4,890 9,032 7,681
One-to four-family residential 35,337 37,998 6,817
Consumer 165,021 172,152 122,193
Total loan originations (excluding loans held for sale) $ 1,282,733 $ 1,255,746 $ 794,535
BANR - Third Quarter 2026 Results
October 21, 2026
Page 10
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES – LOANS
Quarters Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025
Balance, beginning of period $ 161,849 $ 160,352 $ 160,501
Initial allowance for credit loss at acquisition 8,624 — —
Provision for credit losses – loans 1,794 1,598 1,384
Recoveries of loans previously charged off:
Commercial real estate 10 12 36
Construction and land — 5 725
One- to four-family real estate 12 12 13
Commercial business 433 171 99
Agricultural business, including secured by farmland 5 213 99
Consumer 68 63 78
528 476 1,050
Loans charged off:
Construction and land — — (218)
One- to four-family real estate (207) — —
Commercial business (500) (293) (518)
Agricultural business, including secured by farmland — (4) (2,054)
Consumer (525) (280) (438)
(1,232) (577) (3,228)
Net charge-offs (704) (101) (2,178)
Balance, end of period $ 171,563 $ 161,849 $ 159,707
Net charge-offs / average loans receivable (0.006) % (0.001) % (0.019) %
ALLOCATION OF ALLOWANCE FOR CREDIT LOSSES – LOANS Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Commercial real estate $ 46,114 $ 42,167 $ 41,599 $ 41,191
Multifamily real estate 10,543 9,859 9,805 9,901
Construction and land 33,231 32,124 35,508 35,144
One- to four-family real estate 19,361 19,478 19,552 20,485
Commercial business 42,702 41,114 37,785 37,646
Agricultural business, including secured by farmland 6,523 5,859 5,567 5,268
Consumer 13,089 11,248 10,460 10,072
Total allowance for credit losses – loans $ 171,563 $ 161,849 $ 160,276 $ 159,707
Allowance for credit losses - loans / Total loans receivable 1.32 % 1.35 % 1.37 % 1.36 %
Allowance for credit losses - loans / Non-performing loans 290 % 295 % 351 % 399 %
CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - UNFUNDED LOAN COMMITMENTS
Quarters Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025
Balance, beginning of period $ 15,125 $ 12,903 $ 12,750
Provision for credit losses - unfunded loan commitments 1,029 2,222 1,290
Balance, end of period $ 16,154 $ 15,125 $ 14,040
BANR - Third Quarter 2026 Results
October 21, 2026
Page 11
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
NON-PERFORMING ASSETS Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Loans on non-accrual status:
Secured by real estate:
Commercial $ 5,376 $ 2,132 $ 525 $ 460
Multifamily 167 — — —
Construction and land 12,200 12,648 5,175 4,240
One- to four-family 25,624 23,398 19,855 16,576
Commercial business 5,229 6,968 6,751 6,824
Agricultural business, including secured by farmland 3,021 2,967 4,609 5,765
Consumer 4,790 4,784 4,610 4,877
56,407 52,897 41,525 38,742
Loans more than 90 days delinquent, still on accrual:
Secured by real estate:
Commercial — 234 — 274
Construction and land — — 1,268 —
One- to four-family 2,491 1,427 2,698 834
Commercial business — — — 166
Consumer 199 265 148 —
2,690 1,926 4,114 1,274
Total non-performing loans 59,097 54,823 45,639 40,016
REO 3,860 5,720 5,578 5,272
Other repossessed assets — — 18 —
Total non-performing assets $ 62,957 $ 60,543 $ 51,235 $ 45,288
Total non-performing assets to total assets 0.35 % 0.36 % 0.31 % 0.27 %
LOANS BY CREDIT RISK RATING Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Pass $ 12,751,020 $ 11,754,475 $ 11,446,550 $ 11,491,485
Special Mention 34,665 21,509 82,060 37,013
Substandard 209,656 218,426 193,077 174,040
Total $ 12,995,341 $ 11,994,410 $ 11,721,687 $ 11,702,538
BANR - Third Quarter 2026 Results
October 21, 2026
Page 12
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
DEPOSIT COMPOSITION Percentage Change
Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025 Prior Qtr Prior Yr Qtr
Non-interest-bearing $ 4,970,392 $ 4,542,942 $ 4,489,839 $ 4,572,338 9 % 9 %
Interest-bearing checking 3,088,085 2,623,149 2,609,080 2,734,822 18 % 13 %
Regular savings accounts 4,099,252 3,853,612 3,723,922 3,705,823 6 % 11 %
Money market accounts 1,620,582 1,296,869 1,388,001 1,462,570 25 % 11 %
Total interest-bearing transaction and savings accounts 8,807,919 7,773,630 7,721,003 7,903,215 13 % 11 %
Total core deposits 13,778,311 12,316,572 12,210,842 12,475,553 12 % 10 %
Interest-bearing certificates 1,615,158 1,473,021 1,532,304 1,540,382 10 % 5 %
Total deposits $ 15,393,469 $ 13,789,593 $ 13,743,146 $ 14,015,935 12 % 10 %
GEOGRAPHIC CONCENTRATION OF DEPOSITS Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025 Percentage Change
Amount Percentage Amount Amount Amount Prior Qtr Prior Yr Qtr
Washington $ 8,562,173 56 % $ 7,268,041 $ 7,500,215 $ 7,648,527 18 % 12 %
Oregon 3,275,006 21 % 3,142,625 3,035,104 3,081,329 4 % 6 %
California 2,783,673 18 % 2,631,688 2,483,948 2,542,903 6 % 9 %
Idaho 772,617 5 % 747,239 723,879 743,176 3 % 4 %
Total deposits $ 15,393,469 100 % $ 13,789,593 $ 13,743,146 $ 14,015,935 12 % 10 %
INCLUDED IN TOTAL DEPOSITS Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Public non-interest-bearing accounts $ 164,992 $ 171,112 $ 138,860 $ 139,999
Public interest-bearing transaction & savings accounts 378,147 242,061 234,669 230,192
Public interest-bearing certificates 48,995 34,794 34,431 35,660
Total public deposits $ 592,134 $ 447,967 $ 407,960 $ 405,851
Collateralized public deposits $ 488,656 $ 348,318 $ 312,310 $ 312,142
Total brokered deposits $ — $ — $ 50,002 $ 49,989
AVERAGE ACCOUNT BALANCE PER DEPOSIT ACCOUNT Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Number of deposit accounts 474,642 441,808 445,989 449,087
Average account balance per account $ 33 $ 32 $ 31 $ 31
BANR - Third Quarter 2026 Results
October 21, 2026
Page 13
ADDITIONAL FINANCIAL INFORMATION
(in thousands)
ACQUISITION OF PACIFIC FINANCIAL CORPORATION
The following table* provides the estimated fair value of the assets acquired and liabilities assumed in the Pacific Financial Corporation acquisition at September 1, 2026 (in thousands):
Pacific Financial Corporation
September 1, 2026
Cash paid $ 982
Fair value of common shares issued 185,864
Total consideration
186,846
Fair value of assets acquired:
Cash and cash equivalents
120,605
Securities
322,928
Federal Home Loan Bank stock
768
Net loans receivable 756,921
Property and equipment
20,306
Core deposit intangible
28,632
Bank-owned life insurance
28,795
Deferred tax asset
534
Operating lease right-of-use assets 3,126
Other assets
9,537
Total assets acquired
1,292,152
Fair value of liabilities assumed:
Deposits
1,140,283
Junior subordinated debentures
11,400
Deferred compensation
2,547
Operating lease liabilities 3,206
Other liabilities
9,032
Total liabilities assumed
1,166,468
Net assets acquired
125,684
Goodwill
$ 61,162
* Amounts recorded in this table are preliminary estimates of fair value. Additional adjustments to the acquisition accounting may be required with a measurement period of one year from the acquisition date.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 14
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
KEY FINANCIAL RATIOS Quarters Ended Nine Months Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
Return on average assets 1.11 % 1.20 % 1.30 % 1.22 % 1.19 %
Adjusted return on average assets (1)
1.24 % 1.21 % 1.28 % 1.27 % 1.20 %
Return on average equity 9.19 % 9.91 % 11.33 % 10.11 % 10.49 %
Adjusted return on average equity (1)
10.22 % 9.98 % 11.18 % 10.47 % 10.51 %
Return on average tangible common equity (1)
11.58 % 12.27 % 14.24 % 12.59 % 13.27 %
Average equity/average assets 12.10 % 12.09 % 11.49 % 12.10 % 11.40 %
Average interest-earning assets/average interest-bearing liabilities 158.87 % 159.69 % 159.82 % 159.34 % 159.75 %
Average interest-earning assets/average funding liabilities 108.34 % 108.42 % 108.11 % 108.40 % 108.06 %
Non-interest income/average assets 0.36 % 0.45 % 0.50 % 0.43 % 0.48 %
Non-interest expense/average assets 2.70 % 2.65 % 2.48 % 2.64 % 2.53 %
Efficiency ratio 65.25 % 62.80 % 59.76 % 62.92 % 61.78 %
Adjusted efficiency ratio (1)
59.53 % 61.30 % 58.54 % 60.09 % 60.30 %
(1)Represent non-GAAP financial measures. See, “Additional Financial Information - Non-GAAP Financial Measures” on the final two pages of this press release for a reconciliation of non-GAAP financial measures.
ESTIMATED REGULATORY CAPITAL RATIOS AS OF SEPTEMBER 30, 2026 Actual Minimum to be categorized as "Adequately Capitalized" Minimum to be
categorized as
"Well Capitalized"
Amount Ratio Amount Ratio Amount Ratio
Banner Corporation-consolidated:
Total capital to risk-weighted assets $ 2,238,012 14.42 % $ 1,241,499 8.00 % $ 1,551,873 10.00 %
Tier 1 capital to risk-weighted assets 1,950,818 12.57 % 931,124 6.00 % 931,124 6.00 %
Tier 1 leverage capital to average assets 1,950,818 11.59 % 673,198 4.00 % n/a n/a
Common equity tier 1 capital to risk-weighted assets 1,950,818 12.57 % 698,343 4.50 % n/a n/a
Banner Bank:
Total capital to risk-weighted assets 2,139,006 13.79 % 1,241,112 8.00 % 1,551,390 10.00 %
Tier 1 capital to risk-weighted assets 1,951,312 12.58 % 930,834 6.00 % 1,241,112 8.00 %
Tier 1 leverage capital to average assets 1,951,312 11.60 % 672,922 4.00 % 841,153 5.00 %
Common equity tier 1 capital to risk-weighted assets 1,951,312 12.58 % 698,126 4.50 % 1,008,404 6.50 %
These regulatory capital ratios are estimates, pending completion and filing of Banner’s regulatory reports.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 15
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
(rates / ratios annualized)
ANALYSIS OF NET INTEREST SPREAD Quarters Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025
Average Balance Interest and Dividends
Yield / Cost (3)
Average Balance Interest and Dividends
Yield / Cost (3)
Average Balance Interest and Dividends
Yield / Cost (3)
Interest-earning assets:
Held for sale loans
$ 28,484 $ 435 6.06 % $ 33,242 $ 509 6.14 % $ 32,109 $ 531 6.56 %
Real estate secured loans 10,336,321 157,949 6.06 % 9,875,493 148,303 6.02 % 9,651,895 147,682 6.07 %
Commercial/agricultural loans
1,892,754 30,243 6.34 % 1,881,938 29,866 6.37 % 1,869,782 31,124 6.60 %
Consumer and other loans
128,400 2,332 7.21 % 117,727 2,015 6.87 % 119,593 2,114 7.01 %
Total loans (1)
12,385,959 190,959 6.12 % 11,908,400 180,693 6.09 % 11,673,379 181,451 6.17 %
Mortgage-backed securities
2,358,520 15,220 2.56 % 2,275,561 14,269 2.52 % 2,445,497 15,269 2.48 %
Other securities
964,707 10,346 4.25 % 938,205 9,915 4.24 % 854,725 9,065 4.21 %
Interest-bearing deposits with banks
135,744 1,256 3.67 % 139,672 1,102 3.16 % 291,147 3,053 4.16 %
FHLB stock
12,815 329 10.19 % 16,342 150 3.68 % 15,729 463 11.68 %
Total investment securities 3,471,786 27,151 3.10 % 3,369,780 25,436 3.03 % 3,607,098 27,850 3.06 %
Total interest-earning assets
15,857,745 218,110 5.46 % 15,278,180 206,129 5.41 % 15,280,477 209,301 5.43 %
Non-interest-earning assets 1,155,000 1,082,054 1,022,905
Total assets
$ 17,012,745 $ 16,360,234 $ 16,303,382
Deposits:
Interest-bearing checking accounts
$ 2,819,736 11,215 1.58 % $ 2,606,252 9,433 1.45 % $ 2,618,924 10,834 1.64 %
Savings accounts
3,963,030 20,276 2.03 % 3,830,346 19,009 1.99 % 3,616,728 20,170 2.21 %
Money market accounts
1,414,605 6,485 1.82 % 1,314,496 5,790 1.77 % 1,471,938 7,799 2.10 %
Certificates of deposit
1,519,253 12,046 3.15 % 1,465,885 11,322 3.10 % 1,510,966 13,448 3.53 %
Total interest-bearing deposits
9,716,624 50,022 2.04 % 9,216,979 45,554 1.98 % 9,218,556 52,251 2.25 %
Non-interest-bearing deposits
4,655,219 — — % 4,523,594 — — % 4,573,009 — — %
Total deposits
14,371,843 50,022 1.38 % 13,740,573 45,554 1.33 % 13,791,565 52,251 1.50 %
Other interest-bearing liabilities:
FHLB advances
65,141 653 3.98 % 145,176 1,426 3.94 % 133,380 1,527 4.54 %
Other borrowings
108,036 695 2.55 % 116,146 732 2.53 % 119,727 694 2.30 %
Junior subordinated debentures and subordinated notes
91,491 1,317 5.71 % 89,178 1,234 5.55 % 89,178 1,387 6.17 %
Total borrowings
264,668 2,665 3.99 % 350,500 3,392 3.88 % 342,285 3,608 4.18 %
Total funding liabilities
14,636,511 52,687 1.43 % 14,091,073 48,946 1.39 % 14,133,850 55,859 1.57 %
Other non-interest-bearing liabilities (2)
317,543 290,601 296,036
Total liabilities
14,954,054 14,381,674 14,429,886
Shareholders’ equity 2,058,691 1,978,560 1,873,496
Total liabilities and shareholders’ equity $ 17,012,745 $ 16,360,234 $ 16,303,382
Net interest income/rate spread (tax equivalent) 165,423 4.03 % 157,183 4.02 % 153,442 3.86 %
Net interest margin (tax equivalent) 4.14 % 4.13 % 3.98 %
Reconciliation to reported net interest income:
Adjustments for taxable equivalent basis (3,530) (3,443) (3,453)
Net interest income and margin, as reported $ 161,893 4.05 % $ 153,740 4.04 % $ 149,989 3.89 %
(1)Average balances include loans accounted for on a nonaccrual basis and accruing loans 90 days or more past due. Amortization of net deferred loan fees/costs is included with interest on loans.
(2)Average other non-interest-bearing liabilities include fair value adjustments related to junior subordinated debentures.
(3)Tax-exempt income is calculated on a tax equivalent basis, which Banner believes provides comparability of net interest income and net interest margin arising from both taxable and tax-exempt sources and is consistent with industry practice. The tax equivalent yield adjustment to interest earned on loans was $2.4 million, $2.3 million and $2.4 million for the quarters ended September 30, 2026, June 30, 2026 and September 30, 2025, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.2 million for the quarter ended September 30, 2026, and $1.1 million for both the quarters ended June 30, 2026, and September 30, 2025.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 16
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
(rates / ratios annualized)
ANALYSIS OF NET INTEREST SPREAD Nine Months Ended
Sep 30, 2026 Sep 30, 2025
Average Balance Interest and Dividends
Yield/Cost (3)
Average Balance Interest and Dividends
Yield/Cost (3)
Interest-earning assets:
Held for sale loans
$ 29,268 $ 1,325 6.05 % $ 28,203 $ 1,391 6.59 %
Real estate secured loans 9,990,880 450,621 6.03 % 9,528,868 429,315 6.02 %
Commercial/agricultural loans
1,876,124 89,262 6.36 % 1,900,225 93,072 6.55 %
Consumer and other loans
120,803 6,387 7.07 % 120,735 6,293 6.97 %
Total loans (1)
12,017,075 547,595 6.09 % 11,578,031 530,071 6.12 %
Mortgage-backed securities
2,320,187 43,998 2.54 % 2,494,794 46,740 2.50 %
Other securities
927,502 29,301 4.22 % 883,330 28,313 4.29 %
Interest-bearing deposits with banks
153,029 3,876 3.39 % 144,974 4,114 3.79 %
FHLB stock
13,034 627 6.43 % 17,214 834 6.48 %
Total investment securities 3,413,752 77,802 3.05 % 3,540,312 80,001 3.02 %
Total interest-earning assets
15,430,827 625,397 5.42 % 15,118,343 610,072 5.40 %
Non-interest-earning assets 1,114,707 1,007,862
Total assets
$ 16,545,534 $ 16,126,205
Deposits:
Interest-bearing checking accounts
$ 2,686,656 29,921 1.49 % $ 2,489,219 28,833 1.55 %
Savings accounts
3,862,559 57,673 2.00 % 3,521,141 57,110 2.17 %
Money market accounts
1,372,422 18,426 1.80 % 1,506,171 23,388 2.08 %
Certificates of deposit
1,488,968 35,234 3.16 % 1,510,594 40,973 3.63 %
Total interest-bearing deposits
9,410,605 141,254 2.01 % 9,027,125 150,304 2.23 %
Non-interest-bearing deposits
4,550,490 — — % 4,526,898 — — %
Total deposits
13,961,095 141,254 1.35 % 13,554,023 150,304 1.48 %
Other interest-bearing liabilities:
FHLB advances
71,692 2,119 3.95 % 168,663 5,757 4.56 %
Other borrowings
111,904 2,124 2.54 % 125,517 2,063 2.20 %
Junior subordinated debentures and subordinated notes
89,958 3,785 5.63 % 142,255 6,380 6.00 %
Total borrowings
273,554 8,028 3.92 % 436,435 14,200 4.35 %
Total funding liabilities
14,234,649 149,282 1.40 % 13,990,458 164,504 1.57 %
Other non-interest-bearing liabilities (2)
309,638 298,056
Total liabilities
14,544,287 14,288,514
Shareholders’ equity 2,001,247 1,837,691
Total liabilities and shareholders’ equity $ 16,545,534 $ 16,126,205
Net interest income/rate spread (tax equivalent) 476,115 4.02 % 445,568 3.83 %
Net interest margin (tax equivalent) 4.13 % 3.94 %
Reconciliation to reported net interest income:
Adjustments for taxable equivalent basis (10,313) (10,097)
Net interest income and margin, as reported $ 465,802 4.04 % $ 435,471 3.85 %
(1)Average balances include loans accounted for on a nonaccrual basis and loans 90 days or more past due. Amortization of net deferred loan fees/costs is included with interest on loans.
(2)Average other non-interest-bearing liabilities include fair value adjustments related to junior subordinated debentures.
(3)Tax-exempt income is calculated on a tax equivalent basis. The tax equivalent yield adjustment to interest earned on loans was $6.9 million and $7.0 million for the nine months ended September 30, 2026 and 2025, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $3.4 million and $3.1 million for the nine months ended September 30, 2026 and 2025, respectively.
BANR - Third Quarter 2026 Results
October 21, 2026
Page 17
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
* Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this earnings release contains certain non-GAAP financial measures. Tangible common shareholders’ equity per share, the ratio of tangible common equity to tangible assets, the return on average tangible common equity, and references to adjusted revenue, adjusted earnings, the adjusted return on average assets, the adjusted return on average equity and the adjusted efficiency ratio represent non-GAAP financial measures. Management has presented these non-GAAP financial measures in this earnings release because it believes that they provide useful and comparative information to assess trends in Banner’s core operations reflected in the current quarter’s results and facilitate the comparison of our performance with the performance of our peers. However, these non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP. Where applicable, comparable earnings information using GAAP financial measures is also presented. Because not all companies use the same calculations, our presentation may not be comparable to other similarly titled measures as calculated by other companies. For a reconciliation of these non-GAAP financial measures, see the tables below:
ADJUSTED REVENUE Quarters Ended Nine Months Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
Net interest income (GAAP) $ 161,893 $ 153,740 $ 149,989 $ 465,802 $ 435,471
Non-interest income (GAAP) 15,386 18,222 20,730 52,769 57,589
Total revenue (GAAP) 177,279 171,962 170,719 518,571 493,060
Exclude: Net loss (gain) on sale of securities 2,102 (8) (377) 3,336 (374)
Net change in valuation of financial instruments carried at fair value (313) 157 (223) (1,818) (626)
Losses incurred on building and lease exits — — (1,373) — (454)
Adjusted revenue (non-GAAP) $ 179,068 $ 172,111 $ 168,746 $ 520,089 $ 491,606
ADJUSTED EARNINGS Quarters Ended Nine Months Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
Net income (GAAP) $ 47,709 $ 48,886 $ 53,502 $ 151,311 $ 144,133
Exclude: Net loss (gain) on sale of securities 2,102 (8) (377) 3,336 (374)
Net change in valuation of financial instruments carried at fair value (313) 157 (223) (1,818) (626)
Merger and acquisition-related expenses 5,177 238 — 5,415 —
Building and lease exit costs 63 47 (331) 119 1,422
Related net tax (benefit) expense (1,688) (104) 224 (1,693) (101)
Total adjusted earnings (non-GAAP) $ 53,050 $ 49,216 $ 52,795 $ 156,670 $ 144,454
Diluted earnings per share (GAAP) $ 1.36 $ 1.43 $ 1.54 $ 4.39 $ 4.15
Diluted adjusted earnings per share (non-GAAP) $ 1.51 $ 1.44 $ 1.52 $ 4.54 $ 4.16
Return on average assets 1.11 % 1.20 % 1.30 % 1.22 % 1.19 %
Adjusted return on average assets (1)
1.24 % 1.21 % 1.28 % 1.27 % 1.20 %
Return on average equity 9.19 % 9.91 % 11.33 % 10.11 % 10.49 %
Adjusted return on average equity (2)
10.22 % 9.98 % 11.18 % 10.47 % 10.51 %
AVERAGE TANGIBLE COMMON EQUITY Quarters Ended Nine Months Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
Net Income (GAAP) $ 47,709 $ 48,886 $ 53,502 $ 151,311 $ 144,133
Exclude: Amortization of intangibles, net of tax $ 524 $ 202 $ 269 $ 928 $ 989
Tangible net income available to common shareholders (non-GAAP) $ 48,233 $ 49,088 $ 53,771 $ 152,239 $ 145,122
Average common shareholder’s equity $ 2,058,691 $ 1,978,560 $ 1,873,496 $ 2,001,247 $ 1,837,691
Exclude: Average goodwill and other intangible assets, net 405,947 374,225 375,093 384,999 375,504
Average tangible common equity $ 1,652,744 $ 1,604,335 $ 1,498,403 $ 1,616,248 $ 1,462,187
Return on average tangible common equity (3)
11.58 % 12.27 % 14.24 % 12.59 % 13.27 %
(1)Adjusted earnings (non-GAAP) divided by average assets.
(2)Adjusted earnings (non-GAAP) divided by average equity.
(3)Tangible net income (non-GAAP) divided by average tangible common equity (non-GAAP).
BANR - Third Quarter 2026 Results
October 21, 2026
Page 18
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
ADJUSTED EFFICIENCY RATIO Quarters Ended Nine Months Ended
Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Sep 30, 2026 Sep 30, 2025
Non-interest expense (GAAP) $ 115,676 $ 107,990 $ 102,022 $ 326,274 $ 304,629
Exclude: CDI amortization (663) (256) (341) (1,175) (1,252)
State/municipal tax expense (1,919) (1,773) (1,655) (5,512) (4,525)
REO operations (1,261) (165) (203) (1,535) (534)
Merger and acquisition-related expenses (5,177) (238) — (5,415) —
Building and lease exit costs (63) (47) (1,042) (119) (1,876)
Adjusted non-interest expense (non-GAAP) $ 106,593 $ 105,511 $ 98,781 $ 312,518 $ 296,442
Net interest income (GAAP) $ 161,893 $ 153,740 $ 149,989 $ 465,802 $ 435,471
Non-interest income (GAAP) 15,386 18,222 20,730 52,769 57,589
Total revenue (GAAP) 177,279 171,962 170,719 518,571 493,060
Exclude: Net loss (gain) on sale of securities 2,102 (8) (377) 3,336 (374)
Net change in valuation of financial instruments carried at fair value (313) 157 (223) (1,818) (626)
Losses incurred on building and lease exits — — (1,373) — (454)
Adjusted revenue (non-GAAP) $ 179,068 $ 172,111 $ 168,746 $ 520,089 $ 491,606
Efficiency ratio (GAAP) 65.25 % 62.80 % 59.76 % 62.92 % 61.78 %
Adjusted efficiency ratio (non-GAAP) (1)
59.53 % 61.30 % 58.54 % 60.09 % 60.30 %
(1)Adjusted non-interest expense (non-GAAP) divided by adjusted revenue (non-GAAP).
TANGIBLE COMMON SHAREHOLDERS’ EQUITY TO TANGIBLE ASSETS
Sep 30, 2026 Jun 30, 2026 Dec 31, 2025 Sep 30, 2025
Shareholders’ equity (GAAP) $ 2,133,903 $ 1,999,263 $ 1,946,297 $ 1,912,892
Exclude goodwill and other intangible assets, net 463,231 374,100 374,612 374,927
Tangible common shareholders’ equity (non-GAAP) $ 1,670,672 $ 1,625,163 $ 1,571,685 $ 1,537,965
Total assets (GAAP) $ 18,083,437 $ 16,593,547 $ 16,354,488 $ 16,563,081
Exclude goodwill and other intangible assets, net 463,231 374,100 374,612 374,927
Total tangible assets (non-GAAP) $ 17,620,206 $ 16,219,447 $ 15,979,876 $ 16,188,154
Common shareholders’ equity to total assets (GAAP) 11.80 % 12.05 % 11.90 % 11.55 %
Tangible common shareholders’ equity to tangible assets (non-GAAP) 9.48 % 10.02 % 9.84 % 9.50 %
TANGIBLE COMMON SHAREHOLDERS’ EQUITY PER SHARE
Shareholders’ equity (GAAP) $ 2,133,903 $ 1,999,263 $ 1,946,297 $ 1,912,892
Tangible common shareholders’ equity (non-GAAP) $ 1,670,672 $ 1,625,163 $ 1,571,685 $ 1,537,965
Common shares outstanding at end of period 36,442,062 33,984,909 34,097,856 34,335,297
Common shareholders’ equity (book value) per share (GAAP) $ 58.56 $ 58.83 $ 57.08 $ 55.71
Tangible common shareholders’ equity (tangible book value) per share (non-GAAP) $ 45.84 $ 47.82 $ 46.09 $ 44.79
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a2026-q3presentation
T h i r d Q u a r t e r 2 0 2 6 Since 1890
Disclosure Statement 1 This presentation includes forward-looking statements. These statements include descriptions of management’s plans, objectives or goals for future operations, products or services, forecast of financial or other performance measures and statements about Banner’s general outlook for economic and other conditions. Additional forward-looking statements may be made in the question-and-answer period following the presentation. These forward-looking statements are subject to several risks and uncertainties and actual results may differ materially from those discussed today. Information on the risk factors that could cause actual results to differ are available from the earnings press release that was released October 21, 2026 as well as the Form 10-K for the year ended December 31, 2025 and Forms 10-Q filed quarterly thereafter. Forward-looking statements are effective only as of the date they are made, and Banner assumes no obligation to update information concerning its expectations.
Third quarter 2026 highlights 2 • Net income of $47.7 million, compared to $48.9 million for the prior quarter • Completed the acquisition of Pacific Financial Corporation, the holding company of Bank of the Pacific, adding $766 million in total loans and $1.14 billion in deposits • Organic loan growth of $235 million quarter-over-quarter (8% annualized) • Total loan originations (excluding HFS) were $1.28 billion • Organic deposit growth of $463 million quarter-over-quarter (13% annualized) • Net interest margin (tax equivalent) increased by 1 basis points to 4.14% • Efficiency ratio (GAAP) was 65.25%, compared to 62.80% in the prior quarter; adjusted, non- GAAP efficiency ratio was 59.53% compared to 61.30% in the prior quarter • Return on average assets of 1.11%, and return on average tangible common equity of 11.58%, compared to 1.20% and 12.27%, respectively, for the prior quarter • $1.8 million provision for credit losses - loans and $1.0 million provision for credit losses - unfunded commitments; Allowance for credit losses – loans was 1.32% of total loans • Non-performing assets remained low at 0.35% of total assets, down 1 basis point from last quarter • Repurchased 200,000 shares of Banner common stock at an average price of $71.03 per share • Announced cash dividend to $0.52 per share to be paid in November 2026
Building value at Banner Building value for stakeholders … by focusing on core banking competency … that is sustainable through change events … and scalable with acquisition growth Banner Corporation Assets $18.1B Deposits $15.4B Loans $13.0B Offices 153 Employees 2,084 3 Acquisition History Assets Deposits Loans Offices Bank of the Pacific 2026 Q3 $1.3B $1.1B $0.8B 18 AltaPacific Bank 2019 Q4 $0.4B $0.3B $0.3B 6 Skagit Bank 2018 Q4 $0.9B $0.8B $0.6B 11 AmericanWest Bank 2015 Q4 $4.5B $3.6B $3.0B 98 Siuslaw Bank 2015 Q1 $0.4B $0.3B $0.2B 10 SW Oregon Branches 2014 Q2 $0.2B $0.2B $0.1B 6
Building value at Banner Growing with … Scale in attractive markets Low-cost deposit franchise Commercially focused loan portfolio Conservative balance sheet Financially appealing opportunity Pacific Financial Corp Assets $ 1.3B Deposits $ 1.1B Loans $ 0.8B Offices 18 4 Transaction closed September 1, 2026. Core conversion and systems integration planned for November.
Building value at Banner Core banking competency Growing revenue Protecting net interest margin Spending carefully Maintaining a moderate risk profile Employing capital wisely Growing revenue Take advantage of ideal geography Offer super community bank value proposition Guard and improve reputation Grow market share 5
Growing revenue … in a good place since 1890 6 Source: U.S. Census Bureau Moody’s Analytics Forecasted (October 2025) Population Estimate (millions) 2020 2030 Growth Washington 7.7 8.2 7%* Oregon 4.2 4.4 3% Idaho 1.8 2.2 19%* California 39.5 39.4 0% Region 53.3 54.2 2% United States 331.6 347 5% * Among the fastest growing in the country
Growing revenue … in an ideal geography Powerful and diverse economic drivers From Banner’s Pacific Northwest base to … Technology Manufacturing Consumer Logistics Natural Resources Agriculture Traditional, specialty crops, orchards, wineries, … California From Apple to from Silicon Valley to the Central Valley … the world’s 5th largest economy* 7 * Source: International Monetary Fund and U.S. Bureau of Economic Analysis, October 2025
Growing revenue Our super community bank value proposition Broad product offerings serving middle market, small business and consumer client base Decision-making as close to client as possible Delivery channels aligned to maximize tactical execution of strategic plan Community investment 8
Growing revenue Guard and protect our reputation America’s Best Regional Banks Newsweek 2024, 2025 and 2026 Most Trustworthy Companies in America Newsweek 2023 - 2026 5-Star rating™ (highest category) BauerFinancial; 13+ years Outstanding CRA Rating FDIC 2021 and 2025 (two consecutive examination cycles) 100 Best Banks in America Forbes, 9 consecutive years (2017-2026) Top 50 U.S. Public Banks (assets of $10B+) S&P Global Market Intelligence 2021-2025 Great Place to Work certification May 2025 & 2026 9
$ M ill io n s 20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0 5 10 15 20 25 30 0% 4% 8% 12% 16% 20% 24% 28% $ M ill io n s 20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0 25 50 75 100 125 150 175 200 Growing revenue Deposit Fees as % of Core Revenue 1 Other Fees Mortgage Banking Deposit Fees 10 1. Excludes net gain/loss on sale of securities, change in valuation of financial instruments carried at fair value and gains/losses incurred on building and leases exits. Core revenue 1 Quarter Ending Quarter Last 12 Months Amount Amount 09/30/26 $179M $690M 12/31/09 $45M $177M Non-interest income 1 Quarter Ending Quarter Last 12 Months Amount Amount 09/30/26 $17.2M $71.7M 12/31/09 $6.6M $31.1M Other Income Net Interest Income
Building value at Banner Core banking competency Growing revenue Protecting net interest margin Spending carefully Maintaining a moderate risk profile Employing capital wisely Protecting net interest margin Improve earning asset mix Improve funding mix Reduce deposit costs Maintain loan-to-deposit ratio 11
Protecting net interest margin $ Millions Avg Bal Cost (in bps) Non-interest 4,655 0 Interest Bearing 8,198 184 CDs 1,519 315 Subtotal Deposits 14,372 138 FHLB & Other 265 399 Total 14,637 143 12 32% 56% 10% 2% 78% 22% 32% 30% 38% Non-interest Bearing Certificates of Deposit Interest Bearing and Savings Securities & Int-bearing Deposits Loans Fixed: 5.04% Yield Floating: 6.96% Yield Low-Cost Funding Mix 9/30/2026 Adjustable: 5.78% Yield Earning Asset Mix 9/30/2026 Loan Repricing Structure 9/30/2026 $ Millions Avg Bal Yield (in bps) Loans 12,386 612 Securities & Int- bearing Deposits 3,472 310 Total 15,858 546 68% of the loan portfolio is floating/adjustable 75% of the floating/adjustable loans have floors 17% of the loans that have floors are at the floor 32% of the loans that have floors are within 100 basis points of the floor (excludes loans at the floor) FHLB & Other
20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 —% 1% 2% 3% 4% 5% 6% 7% $ B ill io n s 20 07- Q 4 20 08-Q 4 20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0 2 4 6 8 10 12 14 16 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Protecting net interest margin Non-core Deposits Core Deposits Manage deposit costs Quarter Ending Quarter Last 12 Months Amount Rate Amount Rate 09/30/26 $50.0M 1.38% $191.7M 1.37% 12/31/09 $17.7M 1.83% $83.2M 2.21% 13 Focus on core deposits Quarter Ending Balance % of Total Deposits 09/30/26 $13,778M 90% 12/31/09 $1,924M 50% Loan Yield Deposit Cost Core Deposits % Loan–Deposit Spread
20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 -20% -10% 0% 10% 20% 30% 40% 50% Protecting net interest margin Peer Median Peer source: Group 1 ($10B and over), Bank Holding Company Performance Report (BHCPR), National Information Center, Federal Reserve System, Division of Banking Supervision and Regulation Net Non-core Funding Dependence Peer Top Quartile 14 $ B illio n s 20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 —% 20% 40% 60% 80% 100% 0 2 4 6 8 10 12 14 16 Banner Loan-to-Deposit Ratio Deposits Loans
20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0% 1% 2% 3% 4% 5% 6% 20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% Protecting net interest margin Maintain top quartile net interest margin Quarter Ending Quarter Last 12 Months Amount Rate 1 Amount Rate 1 09/30/26 $162M 4.14% $618M 4.10% 12/31/09 $39M 3.53% $146M 3.36% Peer source: Group 1 ($10B and over), Bank Holding Company Performance Report (BHCPR), National Information Center, Federal Reserve System, Division of Banking Supervision and Regulation 15 Peer Top Quartile Peer Median Net Interest Margin 1 Banner Net Interest Margin 1 Earning Asset Yield Funding Cost 1. On a tax equivalent basis
Conservative investment portfolio 16 Assumes flat forward balance sheet, parallel and sustained shift in market rates ratably over a 12-month period (ramp) or immediate (shock); Base as of 9/30/26 CMO, $1,017, 32.8% MBS, $881, 28.4% CMBS, $394, 12.7% Municipal, $464, 15.0% ABS, $200, 6.4% Corp, $137, 4.4% Agency, $8, 0.3% Other, $2, 0.1% Y e ar s 1.36 2.43 2.14 3.32 6.23 6.06 6.03 6.10 Total Portfolio Effective Duration Duration on New Purchases Q4 2025 Q1 2026 Q2 2026 Q3 2026 0.00 2.00 4.00 6.00 8.00 5.44% 4.62% 5.29% 5.45% 2.94% 2.94% 2.99% 3.09% New Purchases Tax Effective Yield Total Portfolio Tax Effective Yield Q4 2025 Q1 2026 Q2 2026 Q3 2026 0% 2% 4% 6% 12 Month Net Interest Income Sensitivity ($MM), % Change Quarterly New Purchases: Average Duration Investment Portfolio Composition ($3.10 billion) 76% of investments are Agency MBS/CMO or AAA rated 2.5% non-rated investments, principally CRA investments Portfolio is a diversified mix of asset types and blend of fixed and floating rate instruments. It remains moderately asset sensitive. Quarterly New Purchases: Average Yield $ MillionsRamp $MM Ramp % Change Shock $MM Shock % Change Up 200 725,591 0.7% 736,242 2.2% Up 100 725,298 0.7% 734,569 2.0% Base 720,288 0.0% 720,288 0.0% Down 100 713,312 (1.0)% 702,154 (2.5)% Down 200 706,695 (1.9)% 686,181 (4.7)%
Building value at Banner Core banking competency Growing revenue Protecting net interest margin Spending carefully Maintaining a moderate risk profile Employing capital wisely Spending carefully Benefit from scale Control core operating expense 17
$ M ill io n s 20 09- Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0 20 40 60 80 100 20% 30% 40% 50% 60% 70% 80% 90% 100% 20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 50% 60% 70% 80% 90% 100% Spending carefully Peer source: Group 1 ($10B and over), Bank Holding Company Performance Report (BHCPR), National Information Center, Federal Reserve System, Division of Banking Supervision and Regulation 18 Control core operating expense Quarter Ending Quarter Last 12 Months Amount Amount 09/30/26 $107M $414M 12/31/09 $31M $132M Peer Top Quartile Peer Median Banner Efficiency Ratio Occupancy Compensation Information Services Other Efficiency Ratio
Maintaining a moderate risk profile Embrace effective enterprise risk management Minimize non-performing assets Maintain appropriate loan loss reserve Maintain appropriate risk capital Building value at Banner Core banking competency Growing revenue Protecting net interest margin Spending carefully Maintaining a moderate risk profile Employing capital wisely 19
Commercial RE 35% Multifamily 7% Construction 14% Commercial 21% Agricultural 3% 1-4 Family 13% Consumer 7% Diversified loan portfolio 20 Loan Composition 9/30/2026 CRE Breakout $MM % Owner Ooccuped CRE 1,330 10 % Investment Properties 1,805 14 % Small Balance CRE 1,471 11 % Total Comm CRE 4,607 35 % Construction Breakout $MM % Commercial 220 2 % Multifamily 521 4 % 1-4 Family 646 5 % Land 416 3 % Total Construction 1,803 14 % Loan Originations (commitments, $MM) A ve rag e Y ie ld 8.23% 7.56% 8.01% 7.27% 7.35% 6.88%6.69% 6.53% 6.55% Commercial RE Multifamily Construction Commercial Agricultural 1-4 Fam Consumer Avg Yield on New Loan Originations Q3 '24 Q4 '24 Q1 '25 Q2 '25 Q3 '25 Q4' 25 Q1 '26 Q2 '26 Q3 '26 0 200 400 600 800 1,000 1,200 1,400 0% 1% 2% 3% 4% 5% 6% 7% 8% 9%
21 Characteristics of highlighted loan segments (as of 9/30/26) Office 1 Balances ($MM) $709.2 Percent of Total Loans 5.5% Total Investor Office $361.5 Total Owner Occupied $347.7 Average Loan Size $0.8 Largest Loan Size $18.0 30 + days Past Due $0.6 Adversely Classified $1.7 Retail 2 Balances ($MM) $1,653.2 Percent of Total Loans 12.8% Balance of Retail Loans Secured by CRE * $1,519.1 Average Loan Size $0.7 Average CRE Secured Loan Size $0.9 Largest Loan Size $47.1 30 + days Past Due $5.6 Adversely Classified $19.4 * No mall exposure Healthcare 3 Balances ($MM) $555.1 Percent of Total Loans 4.3% Balance Secured by Medical Office * $237.7 Medical Office as a % of Total Loans 1.8% Average Loan Size $0.6 Average Medical Office Size $0.9 Largest Loan Size $24.4 30 + days Past Due $0.2 Adversely Classified $13.1 * No hospital exposure 1 By collateral code 2 Retail business loans, both commercial and commercial real estate secured loans 3 All healthcare and social services, including both commercial and commercial real estate secured loans Multifamily Balances ($MM) $913.3 Percent of Total Loans 7.1% Total Affordable Housing $519.1 Total Market Rent/ Middle Income $394.2 Average Loan Size $1.4 Largest Loan Size $23.9 30 + days Past Due $0.2 Adversely Classified $2.1 CA 37% ID 5% OR 19%Other 2% WA 37% CA 29% ID 7% OR 19% Other 5% WA 40% CA 25% ID 3% OR 18% Other 5% WA 49% CA 33% ID 2% OR 24% Other 2% WA 39%
22 As of 9/30/26 Origination Year Portfolio Segment Balance % Owner Occupied 2026 2025 2024 2023 and earlier Office $709.2 49% $96.3 $72.5 $20.7 $519.8 Retail (CRE Secured) $1,519.1 57% $236.0 $196.2 $201.2 $885.8 Medical Office $237.7 45% $45.5 $45.6 $14.9 $131.7 Multifamily $913.3 0% $31.1 $26.7 $31.5 $824.0 As of 9/30/26 Scheduled Maturity or Next Reprice Date (excludes variable rate loans) Portfolio Segment Balance < 12 months 1 - 2 years 2 - 3 years 3 - 5 years > 5 years Office $709.2 $96.1 $72.6 $92.9 $251.0 $95.0 Retail (CRE Secured) $1,519.1 $156.0 $139.2 $210.7 $602.1 $171.5 Medical Office $237.7 $22.7 $23.3 $24.9 $102.3 $25.4 Multifamily $913.3 $133.6 $40.4 $62.9 $86.2 $474.0 Characteristics of highlighted loan segments $ in Millions
Allowance for credit losses 23 $ M ill io n s ACL Provision 2.4 1.7 3.0 3.1 4.8 2.7 2.4 3.8 2.8 -0.8 20 24 -Q 2 20 24 -Q 3 20 24 -Q 4 20 25 -Q 1 20 25 -Q 2 20 25 -Q 3 20 25 -Q 4 20 26 -Q 1 20 26 -Q 2 20 26 -Q 3 $ M ill io n s $108 $167 $132 $142 $150 $156 $160 $160 $162 $172 1.16% 1.90% 1.48% 1.39% 1.38% 1.37% 1.37% 1.37% 1.35% 1.32% ACL - Loans ACL - Loans as % of Loans, excluding PPP C EC L D ay 1 12 /3 1/ 20 20 12 /3 1/ 20 21 12 /3 1/ 20 22 12 /3 1/ 20 23 12 /3 1/ 20 24 12 /3 1/ 20 25 20 26 -Q 1 20 26 -Q 2 20 26 -Q 3 Allocation of Allowance for Credit Losses-Loans as of 9/30/26 Allowance ($000) % Coverage Non-performing ($000) % Coverage NPLs Commercial RE 46,114 1.00% 5,376 858% Multifamily 10,543 1.15% 167 NM* Construction 33,231 1.84% 12,200 272% 1-4 Family 19,361 1.20% 28,115 69% Commercial 42,702 1.56% 5,229 817% Agricultural 6,523 1.68% 3,021 216% Consumer 13,089 1.41% 4,989 262% Total 171,563 1.32% 59,097 290% *not meaningful
20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% $ M ill io n s 20 09 -Q 4 20 10 -Q 4 20 11 -Q 4 20 12 -Q 4 20 13 -Q 4 20 14 -Q 4 20 15 -Q 4 20 16 -Q 4 20 17 -Q 4 20 18 -Q 4 20 19 -Q 4 20 20 -Q 4 20 21 -Q 4 20 22 -Q 4 20 23 -Q 4 20 24 -Q 4 20 25 -Q 4 0 50 100 150 200 250 300 350Minimize non-performing assets Quarter Ending NPAs REO Amount % of TA Amount % of TA 09/30/26 $63M 0.35% $4M 0.02% 12/31/09 $292M 6.11% $78M 2.01% Peer source: Group 1 ($10B and over), Bank Holding Company Performance Report (BHCPR), National Information Center, Federal Reserve System, Division of Banking Supervision and Regulation Maintaining a moderate risk profile ACLL Real Estate Owned Non-performing Loans Peer Top Quartile Peer Median Banner ACLL to Total Loans 24
Building value at Banner Core banking competency Growing revenue Protecting net interest margin Spending carefully Maintaining a moderate risk profile Employing capital wisely Employing capital wisely Maintain premium to tangible book value Pay appropriate dividends Prepare for future opportunities 25
Reconciliation of non-GAAP measures 26 $ Thousands Quarters Ended PRE-TAX PRE-PROVISION EARNINGS Sep 30, 2026 Jun 30, 2026 Sep 30, 2025 Income before provision for income taxes (GAAP) $ 58,779 $ 60,154 $ 66,027 Provision for credit losses 2,824 3,818 2,670 Pre-tax pre-provision earnings (non-GAAP) 61,603 63,972 68,697 Exclude net (gain)/loss on sale of securities 2,102 (8) (377) Exclude net change in valuation of financial instruments carried at fair value (313) 157 (223) Exclude merger and acquisition-related expenses 5,177 238 — Exclude net building and lease exit costs 63 47 (331) Adjusted pre-tax pre-provision earnings (non-GAAP) $ 68,632 $ 64,406 $ 67,766
Building value at Banner Building value for … Shareholders by delivering top quartile financial performance Clients by delivering super community bank service and products Employees by offering opportunity and reward Communities by providing capital and staying involved 27
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Cover
Oct. 21, 2026
Document Information [Line Items]
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Document Period End Date
Oct. 21, 2026
Entity Registrant Name
Banner Corporation
Entity Incorporation, State or Country Code
WA
Entity File Number
000-26584
Entity Tax Identification Number
91-1691604
Entity Address, Address Line One
10 S. First Avenue,
Entity Address, City or Town
Walla Walla
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WA
Entity Address, Postal Zip Code
99362
City Area Code
509
Local Phone Number
527-3636
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- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Exchange Act
-Number 240
-Section 14a
-Subsection 12
+ Details
Name:
dei_SolicitingMaterial
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Trading symbol of an instrument as listed on an exchange.
+ References
No definition available.
+ Details
Name:
dei_TradingSymbol
Namespace Prefix:
dei_
Data Type:
dei:tradingSymbolItemType
Balance Type:
na
Period Type:
duration
X
- Definition
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
+ References
Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Securities Act
-Number 230
-Section 425
+ Details
Name:
dei_WrittenCommunications
Namespace Prefix:
dei_
Data Type:
xbrli:booleanItemType
Balance Type:
na
Period Type:
duration