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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): January 22, 2025

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 shareBANRThe 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 January 22, 2025, Banner Corporation issued its earnings release for the quarter ended December 31, 2024. 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 January 23, 2025, and from time to time in presentations to investors and other stakeholders.

Item 8.01 Other Events.

On January 22, 2025, Banner Corporation announced its Board of Directors declared a regular quarterly cash dividend on Banner Corporation common stock of $0.48 per share, payable on February 14, 2025 to stockholders of record as of the close of business on February 4, 2025.

Item 9.01 Financial Statements and Exhibits.*

(d)    Exhibits

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: January 22, 2025
By: /s/ Robert G Butterfield
Robert G Butterfield
Executive Vice President, Treasurer and
Chief Financial Officer




Exhibit 99.1

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CONTACT:MARK J. GRESCOVICH,
PRESIDENT & CEO
ROBERT G. BUTTERFIELD, CFO
(509) 527-3636
NEWS RELEASE

Banner Corporation Reports Net Income of $46.4 Million, or $1.34 Per Diluted Share, for Fourth Quarter 2024;
Declares Quarterly Cash Dividend of $0.48 Per Share

Walla Walla, WA - January 22, 2025 - Banner Corporation (NASDAQ GSM: BANR) (“Banner”), the parent company of Banner Bank, today reported net income of $46.4 million, or $1.34 per diluted share, for the fourth quarter of 2024, compared to $45.2 million, or $1.30 per diluted share, for the preceding quarter and $42.6 million, or $1.24 per diluted share, for the fourth quarter of 2023. Net interest income was $140.5 million in the fourth quarter of 2024, compared to $135.7 million in the preceding quarter and $138.4 million in the fourth quarter a year ago. The increase in net interest income compared to the preceding quarter reflects a decrease in funding costs and an increase in interest-earning assets, partially offset by a decrease in yields on interest earning assets. The increase in net interest income compared to the prior year quarter reflects an increase in both the yield and average balance of interest earning assets, partially offset by an increase in funding costs. Fourth quarter 2024 results included a $3.0 million provision for credit losses, up from $1.7 million in the preceding quarter and $2.5 million in the fourth quarter of 2023.
Net income was $168.9 million, or $4.88 per diluted share, for the year ended December 31, 2024, compared to $183.6 million, or $5.33 per diluted share, for the year ended December 31, 2023. Net interest income for the year ended December 31, 2024 decreased to $541.7 million from $576.0 million for the year ended December 31, 2023, primarily due to the rise of deposit costs of $99.3 million, partially offset by a $77.7 million increase in interest income on loans. Results for the year ended December 31, 2024 included a $7.6 million provision for credit losses, a $5.2 million net loss on the sale of securities and a $1.0 million net decrease in the valuation of financial instruments carried at fair value, compared to a $10.8 million provision for credit losses, a $19.2 million net loss on the sale of securities and a $4.2 million net decrease in the valuation of financial instruments carried at fair value during the same period in 2023.

Banner announced that its Board of Directors declared a regular quarterly cash dividend of $0.48 per share payable February 14, 2025, to common shareholders of record on February 4, 2025.
“Banner’s fourth quarter financial performance reflects the continued successful execution of our super community bank strategy, which emphasizes growing new client relationships, maintaining our core funding position, promoting client loyalty and advocacy through our responsive service model, and sustaining a moderate risk profile,” said Mark Grescovich, President and CEO. “Our earnings for the fourth quarter of 2024 benefited from our solid year over year loan growth as well as margin expansion during the fourth quarter as a result of lower funding costs. This benefit was partially offset by the declining interest rate environment and its effect on loan yields. Additionally, Banner’s credit metrics continue to be strong, our reserve for loan losses remained solid, and our capital base continues to be robust. We continue to benefit from a strong core deposit base that has been resilient in a highly competitive environment, with core deposits representing 89% of total deposits at quarter end. Banner has upheld its core values for the past 134 years, which are to do the right thing for our clients, communities, colleagues, company and shareholders; and to provide consistent and reliable strength through all economic cycles and change events.”
At December 31, 2024, Banner, on a consolidated basis, had $16.20 billion in assets, $11.20 billion in net loans and $13.51 billion in deposits. Banner operates 135 full-service branch offices, including branches located in eight of the top 20 largest western Metropolitan Statistical Areas by population.

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 2
Fourth Quarter 2024 Highlights
•Revenue was $160.6 million for the fourth quarter of 2024, compared to $153.7 million in the preceding quarter and $152.5 million in the fourth quarter a year ago.
•Adjusted revenue* (the total of net interest income and total non-interest income adjusted for the net gain or loss on the sale of securities and the net change in valuation of financial instruments) was $160.1 million in the fourth quarter of 2024, compared to $153.7 million in the preceding quarter and $157.1 million in the fourth quarter a year ago.
•Net interest income was $140.5 million in the fourth quarter of 2024, compared to $135.7 million in the preceding quarter and $138.4 million in the fourth quarter a year ago.
•Net interest margin, on a tax equivalent basis, was 3.82%, compared to 3.72% in the preceding quarter and 3.83% in the fourth quarter a year ago.
•Mortgage banking operations revenue was $3.7 million for the fourth quarter of 2024, compared to $3.2 million in the preceding quarter and $5.4 million in the fourth quarter a year ago.
•Return on average assets was 1.15%, compared to 1.13% in the preceding quarter and 1.09% in the fourth quarter a year ago.
•Net loans receivable increased 1% to $11.20 billion at December 31, 2024, compared to $11.07 billion at September 30, 2024, and increased 5% compared to $10.66 billion at December 31, 2023.
•Non-performing assets were $39.6 million, or 0.24% of total assets, at December 31, 2024, compared to $45.2 million, or 0.28% of total assets, at September 30, 2024 and $30.1 million, or 0.19% of total assets, at December 31, 2023.
•The allowance for credit losses - loans was $155.5 million, or 1.37% of total loans receivable, as of December 31, 2024, compared to $154.6 million, or 1.38% of total loans receivable, as of September 30, 2024 and $149.6 million, or 1.38% of total loans receivable, as of December 31, 2023.
•Total deposits were $13.51 billion at December 31, 2024, compared to $13.54 billion at September 30, 2024, and $13.03 billion at December 31, 2023.
•Core deposits represented 89% of total deposits at December 31, 2024.
•Dividends paid to shareholders were $0.48 per share in the quarter ended December 31, 2024.
•Common shareholders’ equity per share decreased 1% to $51.49 at December 31, 2024, compared to $52.06 at the preceding quarter end, and increased 7% from $48.12 at December 31, 2023.
•Tangible common shareholders’ equity per share* decreased 1% to $40.57 at December 31, 2024, compared to $41.12 at the preceding quarter end, and increased 9% from $37.09 at December 31, 2023.

*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.

Income Statement Review
Net interest income was $140.5 million in the fourth quarter of 2024, compared to $135.7 million in the preceding quarter and $138.4 million in the fourth quarter a year ago. Net interest margin on a tax equivalent basis increased ten basis points to 3.82% for the fourth quarter of 2024, compared to 3.72% in the preceding quarter, and decreased compared to 3.83% in the fourth quarter a year ago. Net interest margin for the current quarter, compared to the preceding quarter, benefited from decreased funding costs, partially offset by lower yields on interest earning assets, primarily due to decreases in the targeted federal funds rate in the third and fourth quarters of 2024.
Average yields on interest-earning assets decreased two basis points to 5.31% for the fourth quarter of 2024, compared to 5.33% for the preceding quarter, and increased compared to 5.06% in the fourth quarter a year ago. On September 18, 2024, the Federal Open Market Committee (“FOMC”) of the Federal Reserve System lowered the target range for the federal funds rate 50 basis points, followed by a 25 basis-point decrease on November 7, 2024 and another 25 basis-point decrease on December 18, 2024, resulting in a target range of 4.25% to 4.50% at December 31, 2024. Average loan yields decreased two basis points to 6.02%, compared to 6.04% in the preceding quarter, and increased compared to 5.77% in the fourth quarter a year ago. The decrease in average loan yields during the current quarter primarily reflects the decrease in interest rates, partially offset by the benefits of a balance sheet hedge that matured during the quarter.
Total deposit costs decreased eight basis points to 1.53% in the fourth quarter of 2024, compared to 1.61% in the preceding quarter, and increased compared to 1.18% in the fourth quarter a year ago. The decrease in deposit costs in the current quarter was primarily due to a decrease in interest rates, partially offset by an increase in the average balance of interest-bearing deposits. The average rate paid on borrowings decreased 51 basis points to 4.57% in the fourth quarter of 2024, compared to 5.08% in the preceding quarter, and decreased compared to 4.77% in the fourth quarter a year ago due to lower wholesale borrowings in the current quarter. The total cost of funding liabilities decreased 13 basis points to 1.60% in the fourth quarter of 2024, compared to 1.73% in the preceding quarter, and increased compared to 1.31% in the fourth quarter a year ago.
A $3.0 million provision for credit losses was recorded in the current quarter (comprised of a $3.2 million provision for credit losses - loans, a $203,000 recapture of provision for credit losses - unfunded loan commitments and a $16,000 recapture of provision for credit losses - held-to-maturity debt securities). This compares to a $1.7 million provision for credit losses in the prior quarter (comprised of a $2.0 million provision for credit losses - loans, a $262,000 recapture of provision for credit losses - unfunded loan commitments and a $13,000 recapture of provision for credit losses - held-to-maturity debt securities) and a $2.5 million provision for credit losses in the fourth quarter a year ago (comprised of a $3.8 million provision for credit losses - loans, a $526,000 recapture of provision for credit losses - unfunded loan commitments, a $750,000 recapture of provision for credit losses - available for sale securities and a $23,000 recapture of provision for credit losses - held-to-maturity debt securities). The provision for credit losses for the current quarter primarily reflected risk rating downgrades as well as growth in loan balances.

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 3
Total non-interest income was $20.0 million in the fourth quarter of 2024, compared to $18.1 million in the preceding quarter and $14.1 million in the fourth quarter a year ago. The increase in non-interest income during the current quarter compared to the preceding quarter was primarily due to a $506,000 increase in mortgage banking operations revenue and a $1.1 million increase in miscellaneous income, primarily due to a gain recognized on the sale of a non-performing loan during the fourth quarter of 2024. The increase in non-interest income during the current quarter compared to the prior year quarter was primarily due to a $5.1 million decrease in the net loss recognized on the sale of securities. Total non-interest income was $66.9 million for the year ended December 31, 2024, compared to $44.4 million a year earlier related mostly to the losses on the sale of investment securities in 2023.
Mortgage banking operations revenue was $3.7 million in the fourth quarter of 2024, compared to $3.2 million in the preceding quarter and $5.4 million in the fourth quarter a year ago. While the volume of one- to four-family loans sold during the current quarter increased compared to both the preceding and prior year quarters, volumes remained low due to reduced refinancing and purchase activity in the current rate environment. The increase from the preceding quarter reflects a $508,000 gain related to the pooled loan sale of $34.8 million of one- to four-family loans during the fourth quarter of 2024. The decrease from the prior year quarter primarily reflects a $3.5 million reversal of the lower of cost or market adjustment on multifamily loans held for sale, recognized during the fourth quarter of 2023, partially offset by higher pricing and volumes of one- to four-family loans sold during the current quarter compared to the fourth quarter of 2023. The reversal was due to the transfer of all remaining multifamily loans held for sale to the held for investment loan portfolio during the same period. Home purchase activity accounted for 79% of one- to four-family mortgage loan originations in the fourth quarter of 2024, 88% in the preceding quarter and 92% in the fourth quarter of 2023.
Total non-interest expense was $99.5 million in the fourth quarter of 2024, compared to $96.3 million in the preceding quarter and $96.6 million in the fourth quarter of 2023. The increase in non-interest expense for the current quarter compared to the prior quarter reflects a $691,000 increase in salary and employee benefits, primarily resulting from increased incentive accruals, partially offset by decreased medical premiums expense, a $923,000 increase in professional and legal expenses, primarily due to increased consultant expenses, and a $550,000 increase in advertising and marketing expenses, primarily due to increases in printed media marketing and community development expenses. The increase in non-interest expense for the current quarter compared to the same quarter a year ago primarily reflects increases in salary and employee benefits and professional and legal expenses. For the year ended December 31, 2024, total non-interest expense was $391.5 million, compared to $382.5 million for the year ended December 31, 2023. Banner’s efficiency ratio was 61.95% for the fourth quarter of 2024, compared to 62.63% in the preceding quarter and 63.37% in the same quarter a year ago. Banner’s adjusted efficiency ratio, a non-GAAP financial measure, was 60.74% for the fourth quarter of 2024, compared to 61.27% in the preceding quarter and 60.04% 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 to $16.20 billion at December 31, 2024, compared to $16.19 billion at September 30, 2024, and $15.67 billion at December 31, 2023. Securities and interest-bearing deposits held at other banks totaled $3.40 billion at December 31, 2024, compared to $3.50 billion at September 30, 2024 and $3.48 billion at December 31, 2023. The decrease compared to the prior quarter was primarily due to a decrease in securities - available for sale. The average effective duration of the securities portfolio was approximately 6.6 years at December 31, 2024, compared to 6.5 years at December 31, 2023.
Total loans receivable increased to $11.35 billion at December 31, 2024, compared to $11.22 billion at September 30, 2024, and $10.81 billion at December 31, 2023. Commercial real estate loans increased 2% to $3.86 billion at December 31, 2024, compared to $3.79 billion at September 30, 2024, and increased 6% compared to $3.64 billion at December 31, 2023. The increase in commercial real estate loans from September 30, 2024 and December 31, 2023 was primarily the result of new loan production and the conversion of commercial construction loans to the commercial real estate portfolio upon the completion of the construction phase. Commercial business loans increased 2% to $2.42 billion at December 31, 2024, compared to $2.37 billion at September 30, 2024 and increased 6% compared to $2.28 billion at December 31, 2023, primarily due to new loan production. One- to four-family residential loans increased 1% to $1.59 billion at December 31, 2024, compared to $1.58 billion at September 30, 2024, and increased 5% compared to $1.52 billion at December 31, 2023. The increase in one- to four-family residential loans was primarily the result of one- to four-family construction loans converting to one- to four-family portfolio loans upon the completion of the construction phase and new loan production. Multifamily real estate loans increased 1% to $894.4 million at December 31, 2024, compared to $889.9 million at September 30, 2024, and increased 10% compared to $811.2 million at December 31, 2023. The increase in multifamily real estate loans from September 30, 2024 and December 31, 2023 was primarily the result of the conversion of multifamily construction loans to the multifamily portfolio upon the completion of the construction phase.
Loans held for sale were $32.0 million at December 31, 2024, compared to $78.8 million at September 30, 2024 and $11.2 million at December 31, 2023. One- to four- family residential mortgage held for sale loans sold in the current quarter totaled $153.2 million, compared to $95.0 million in the preceding quarter and $65.6 million in the fourth quarter a year ago. The decrease in loans held for sale compared to the prior quarter was primarily the result of the pooled loan sale of $34.8 million of one- to four-family residential loans during the current quarter.
Total deposits were $13.51 billion at December 31, 2024, compared to $13.54 billion at September 30, 2024 and $13.03 billion a year ago. Core deposits decreased slightly to $12.01 billion at December 31, 2024, compared to $12.02 billion at September 30, 2024, and increased 4% compared to $11.55 billion at December 31, 2023. The increase in core deposits compared to the prior year quarter primarily reflects increases in interest-bearing transaction and savings accounts. Core deposits were 89% of total deposits at December 31, 2024, September 30, 2024 and December 31, 2023. Certificates of deposit decreased 1% to $1.50 billion at December 31, 2024, compared to $1.52 billion at September 30, 2024, and increased 2% compared to $1.48 billion a year earlier. The decrease in certificates of deposit during the current quarter compared to the preceding quarter was primarily the result of clients moving funds from certificates of deposits to interest-bearing transaction and savings accounts. The increase in certificates of deposit during the current quarter compared to the fourth quarter a year ago was principally due to clients seeking higher yields moving funds from core deposit accounts to higher yielding certificates of deposit, partially offset by a $57.7 million decrease in brokered deposits.

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 4
FHLB advances were $290.0 million at December 31, 2024, compared to $230.0 million at September 30, 2024 and $323.0 million a year ago. At December 31, 2024, off-balance sheet liquidity included additional borrowing capacity of $2.95 billion at the FHLB and $1.52 billion at the Federal Reserve as well as federal funds line of credit agreements with other financial institutions of $125.0 million.
At December 31, 2024, total common shareholders’ equity was $1.77 billion or 10.95% of total assets, compared to $1.79 billion or 11.08% of total assets at September 30, 2024, and $1.65 billion or 10.55% of total assets at December 31, 2023. The decrease in total common shareholders’ equity at December 31, 2024 compared to September 30, 2024 was due to an increase in accumulated other comprehensive loss of $51.7 million as the result of a decrease in the fair value of the security portfolio, partially offset by a $29.6 million increase in retained earnings as a result of $46.4 million in net income, partially offset by the accrual of $16.8 million of cash dividends during the fourth quarter of 2024. At December 31, 2024, tangible common shareholders’ equity, a non-GAAP financial measure, was $1.40 billion, or 8.84% of tangible assets, compared to $1.42 billion, or 8.96% of tangible assets, at September 30, 2024, and $1.27 billion, or 8.33% of tangible assets, a year ago. 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 December 31, 2024, Banner’s estimated common equity Tier 1 capital ratio was 12.44%, its estimated Tier 1 leverage capital to average assets ratio was 11.05%, and its estimated total capital to risk-weighted assets ratio was 15.04%. These regulatory capital ratios are estimates, pending completion and filing of Banner’s regulatory reports.
Credit Quality
The allowance for credit losses - loans was $155.5 million, or 1.37% of total loans receivable and 421% of non-performing loans, at December 31, 2024, compared to $154.6 million, or 1.38% of total loans receivable and 359% of non-performing loans, at September 30, 2024, and $149.6 million, or 1.38% of total loans receivable and 506% of non-performing loans, at December 31, 2023. In addition to the allowance for credit losses - loans, Banner maintains an allowance for credit losses - unfunded loan commitments, which was $13.6 million at December 31, 2024, compared to $13.8 million at September 30, 2024, and $14.5 million at December 31, 2023. Net loan charge-offs totaled $2.3 million in the fourth quarter of 2024, compared to $230,000 in the preceding quarter and $1.1 million in the fourth quarter a year ago. Non-performing loans were $37.0 million at December 31, 2024, compared to $43.0 million at September 30, 2024, and $29.6 million a year ago.
An increase in adversely classified loans, offset in part by payoffs and paydowns, resulted in total substandard loans of $192.5 million as of December 31, 2024. This compares to $150.1 million as of September 30, 2024 and $125.4 million a year ago.
Total non-performing assets were $39.6 million, or 0.24% of total assets, at December 31, 2024, compared to $45.2 million, or 0.28% of total assets, at September 30, 2024, and $30.1 million, or 0.19% of total assets, a year ago.
Conference Call
Banner will host a conference call on Thursday January 23, 2025, at 8:00 a.m. PST, to discuss its fourth quarter results. Interested investors may listen to the call live at www.bannerbank.com. Investment professionals are invited to dial (833) 470-1428 using access code 347551 to participate in the call. A replay of the call will be available at www.bannerbank.com.
About the Company
Banner Corporation is a $16.20 billion bank holding company operating a commercial bank in four Western states 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 - Fourth Quarter 2024 Results
January 22, 2025
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. These statements may relate to future financial performance, strategic plans or objectives, revenues or earnings projections, or other financial information. By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements and could negatively affect Banner’s operating and stock price performance.
Factors that could cause Banner’s actual results to differ materially from those described in the forward-looking statements, include but are not limited to, the following: (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 employment levels, labor shortages and the effects of inflation, a recession or slowed economic growth, or increased political instability due to acts of war; (2) changes in the interest rate environment, including increases or decreases in the Board of Governors of the Federal Reserve System (the “Federal Reserve”) benchmark rate and duration at which such interest rate levels are maintained, which could affect our revenues and expenses, the value of assets and obligations, and the availability and cost of capital and liquidity; (3) the impact of inflation and the current and future monetary policies of the Federal Reserve in response thereto; (4) the effects of any federal government shutdown; (5) the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; (6) expectations regarding key growth initiatives and strategic priorities; (7) the credit risks of 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; (8) results of examinations by regulatory authorities, including the possibility that any such regulatory authority may, among other things, require increases in the allowance for credit losses or writing down of assets or impose restrictions or penalties with respect to Banner’s activities; (9) competitive pressures among depository institutions, including repricing and competitors’ pricing initiatives, and their impact on Banner's market position, loan, and deposit products; (10) the effect of inflation on interest rate movements and their impact on client behavior and net interest margin; (11) fluctuations in real estate values; (12) the ability to adapt successfully to technological changes to meet clients’ needs and developments in the market place; (13) the ability to access cost-effective funding; (14) disruptions, security breaches or other adverse events, failures or interruptions in, or attacks on, information technology systems or on the third-party vendors who perform critical processing functions; (15) changes in financial markets; (16) changes in economic conditions in general and in Washington, Idaho, Oregon and California in particular; (17) the costs, effects and outcomes of litigation; (18) legislation or regulatory changes, including but not limited to changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules, other governmental initiatives affecting the financial services industry and changes in federal and/or state tax laws or interpretations thereof by taxing authorities; (19) the potential imposition of new tariffs or changes to existing trade policies that could affect economic activity or specific industry sectors including, but not limited to, our agriculture based lending; (20) changes in accounting principles, policies or guidelines; (21) future acquisitions by Banner of other depository institutions or lines of business, and associated risks of goodwill impairment due to changes in Banner’s business or market conditions; (22) 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; (23) environmental, social and governance goals and targets; (24) other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services; and (25) 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 Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K.

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 6
RESULTS OF OPERATIONSQuarters EndedYear Ended
(in thousands except shares and per share data)Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
INTEREST INCOME:    
Loans receivable$169,586 $168,338 $154,532 $655,590 $577,891 
Mortgage-backed securities16,086 16,357 17,398 66,085 72,352 
Securities and cash equivalents10,764 11,146 11,808 44,428 51,329 
Total interest income196,436 195,841 183,738 766,103 701,572 
INTEREST EXPENSE:    
Deposits52,217 53,785 39,342 199,465 100,126 
Federal Home Loan Bank (FHLB) advances85 2,263 1,870 8,941 10,524 
Other borrowings817 1,147 1,125 4,299 3,376 
Subordinated debt
2,781 2,971 2,992 11,682 11,541 
Total interest expense55,900 60,166 45,329 224,387 125,567 
Net interest income140,536 135,675 138,409 541,716 576,005 
PROVISION FOR CREDIT LOSSES3,000 1,692 2,522 7,581 10,789 
Net interest income after provision for credit losses137,536 133,983 135,887 534,135 565,216 
NON-INTEREST INCOME:    
Deposit fees and other service charges11,018 10,741 9,560 43,371 41,638 
Mortgage banking operations3,686 3,180 5,391 12,207 11,817 
Bank-owned life insurance2,144 2,445 2,609 9,193 9,245 
Miscellaneous2,751 1,658 1,159 8,289 5,169 
 19,599 18,024 18,719 73,060 67,869 
Net gain (loss) on sale of securities275 — (4,806)(5,190)(19,242)
Net change in valuation of financial instruments carried at fair value161 39 139 (982)(4,218)
Total non-interest income20,035 18,063 14,052 66,888 44,409 
NON-INTEREST EXPENSE:    
Salary and employee benefits62,523 61,832 60,111 250,555 244,563 
Less capitalized loan origination costs(4,188)(4,354)(3,871)(16,857)(16,257)
Occupancy and equipment12,141 12,040 12,200 48,771 47,886 
Information and computer data services7,471 7,134 7,098 29,165 28,445 
Payment and card processing services5,771 5,346 6,088 22,518 20,547 
Professional and legal expenses3,025 2,102 2,267 7,858 9,830 
Advertising and marketing1,711 1,161 1,686 5,149 4,794 
Deposit insurance2,857 2,874 2,926 11,398 10,529 
State and municipal business and use taxes1,518 1,432 1,372 5,648 5,260 
Real estate operations, net113 103 47 293 (538)
Amortization of core deposit intangibles589 590 858 2,626 3,756 
Miscellaneous5,947 6,031 5,839 24,414 23,723 
Total non-interest expense99,478 96,291 96,621 391,538 382,538 
Income before provision for income taxes58,093 55,755 53,318 209,485 227,087 
PROVISION FOR INCOME TAXES11,702 10,602 10,694 40,587 43,463 
NET INCOME$46,391 $45,153 $42,624 $168,898 $183,624 
Earnings per common share:    
Basic$1.34 $1.31 $1.24 $4.90 $5.35 
Diluted$1.34 $1.30 $1.24 $4.88 $5.33 
Cumulative dividends declared per common share$0.48 $0.48 $0.48 $1.92 $1.92 
Weighted average number of common shares outstanding:    
Basic34,501,016 34,498,830 34,381,780 34,470,057 34,344,142 
Diluted34,743,024 34,650,322 34,472,155 34,628,710 34,450,412 
Increase in common shares outstanding3,144 936 2,420 111,463 154,351 

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 7
FINANCIAL CONDITION  Percentage Change
(in thousands except shares and per share data)Dec 31, 2024Sep 30, 2024Dec 31, 2023Prior QtrPrior Yr Qtr
ASSETS  
Cash and due from banks$203,402 $226,568 $209,634 (10)%(3)%
Interest-bearing deposits298,456 252,227 44,830 18 %566 %
Total cash and cash equivalents
501,858 478,795 254,464 5 %97 %
Securities - available for sale, amortized cost $2,460,262, $2,523,968, and $2,729,980, respectively
2,104,511 2,237,939 2,373,783 (6)%(11)%
Securities - held to maturity, fair value $825,528, $879,278, and $907,514, respectively
1,001,564 1,013,903 1,059,055 (1)%(5)%
Total securities
3,106,075 3,251,842 3,432,838 (4)%(10)%
FHLB stock22,451 19,751 24,028 14 %(7)%
Loans held for sale32,021 78,841 11,170 (59)%187 %
Loans receivable11,354,656 11,224,606 10,810,455 1 %5 %
Allowance for credit losses – loans(155,521)(154,585)(149,643)1 %4 %
Net loans receivable
11,199,135 11,070,021 10,660,812 1 %5 %
Accrued interest receivable60,885 66,981 63,100 (9)%(4)%
Property and equipment, net124,589 125,256 132,231 (1)%(6)%
Goodwill373,121 373,121 373,121 — %— %
Other intangibles, net3,058 3,647 5,684 (16)%(46)%
Bank-owned life insurance312,549 310,400 304,366 1 %3 %
Operating lease right-of-use assets39,998 38,192 43,731 5 %(9)%
Other assets424,297 371,829 364,846 14 %16 %
Total assets
$16,200,037 $16,188,676 $15,670,391 — %3 %
LIABILITIES  
Deposits:  
Non-interest-bearing$4,591,543 $4,688,244 $4,792,369 (2)%(4)%
Interest-bearing transaction and savings accounts7,423,183 7,328,051 6,759,661 1 %10 %
Interest-bearing certificates1,499,672 1,521,853 1,477,467 (1)%2 %
Total deposits13,514,398 13,538,148 13,029,497 — %4 %
Advances from FHLB290,000 230,000 323,000 26 %(10)%
Other borrowings125,257 154,533 182,877 (19)%(32)%
Subordinated notes, net80,278 80,170 92,851 — %(14)%
Junior subordinated debentures at fair value67,477 66,257 66,413 2 %2 %
Operating lease liabilities43,472 42,318 48,659 3 %(11)%
Accrued expenses and other liabilities258,070 237,128 228,428 9 %13 %
Deferred compensation46,759 46,401 45,975 1 %2 %
Total liabilities14,425,711 14,394,955 14,017,700 — %3 %
SHAREHOLDERS’ EQUITY  
Common stock1,307,509 1,304,792 1,299,651 — %1 %
Retained earnings744,091 714,472 642,175 4 %16 %
Accumulated other comprehensive loss
(277,274)(225,543)(289,135)23 %(4)%
Total shareholders’ equity1,774,326 1,793,721 1,652,691 (1)%7 %
Total liabilities and shareholders’ equity$16,200,037 $16,188,676 $15,670,391 — %3 %
Common Shares Issued:  
Shares outstanding at end of period34,459,832 34,456,688 34,348,369 
Common shareholders’ equity per share (1)
$51.49 $52.06 $48.12 
Common shareholders’ tangible equity per share (1) (2)
$40.57 $41.12 $37.09 
Common shareholders’ equity to total assets10.95 %11.08 %10.55 %
Common shareholders’ tangible equity to tangible assets (2)
8.84 %8.96 %8.33 %
Consolidated Tier 1 leverage capital ratio11.05 %10.91 %10.56 %
(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 - Fourth Quarter 2024 Results
January 22, 2025
Page 8
ADDITIONAL FINANCIAL INFORMATION  
(dollars in thousands)  
LOANSPercentage Change
Dec 31, 2024Sep 30, 2024Dec 31, 2023Prior QtrPrior Yr Qtr
Commercial real estate (CRE):  
Owner-occupied$1,027,426 $990,516 $915,897 4 %12 %
Investment properties1,623,672 1,583,863 1,541,344 3 %5 %
Small balance CRE1,213,792 1,218,822 1,178,500 — %3 %
Multifamily real estate894,425 889,866 811,232 1 %10 %
Construction, land and land development:
Commercial construction122,362 124,051 170,011 (1)%(28)%
Multifamily construction513,706 524,108 503,993 (2)%2 %
One- to four-family construction514,220 507,350 526,432 1 %(2)%
Land and land development369,663 370,690 336,639 — %10 %
Commercial business:
Commercial business1,318,333 1,281,615 1,255,734 3 %5 %
Small business scored1,104,117 1,087,714 1,022,154 2 %8 %
Agricultural business, including secured by farmland:
Agricultural business, including secured by farmland340,280 346,686 331,089 (2)%3 %
One- to four-family residential1,591,260 1,575,164 1,518,046 1 %5 %
Consumer:
Consumer—home equity revolving lines of credit625,680 622,615 588,703 — %6 %
Consumer—other95,720 101,546 110,681 (6)%(14)%
Total loans receivable$11,354,656 $11,224,606 $10,810,455 1 %5 %
Loans 30 - 89 days past due and on accrual$26,824 $13,030 $19,744 
Total delinquent loans (including loans on non-accrual), net$55,432 $44,656 $43,164 
Total delinquent loans / Total loans receivable0.49 %0.40 %0.40 %

LOANS BY GEOGRAPHIC LOCATIONPercentage Change
Dec 31, 2024Sep 30, 2024Dec 31, 2023Prior QtrPrior Yr Qtr
AmountPercentageAmountAmount
Washington$5,245,886 46 %$5,203,637 $5,095,602 1 %3 %
California2,861,435 25 %2,796,965 2,670,923 2 %7 %
Oregon2,113,229 19 %2,108,229 1,974,001 — %7 %
Idaho665,158 6 %652,148 610,064 2 %9 %
Utah82,459 1 %85,316 68,931 (3)%20 %
Other386,489 3 %378,311 390,934 2 %(1)%
Total loans receivable$11,354,656 100 %$11,224,606 $10,810,455 1 %5 %

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 9
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)

LOAN ORIGINATIONSQuarters EndedYear Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Commercial real estate$124,554 $114,372 $76,277 $408,546 $309,022 
Multifamily real estate3,120 314 5,360 6,593 57,046 
Construction and land303,345 472,506 382,905 1,759,799 1,541,383 
Commercial business250,515 179,871 166,984 752,269 585,047 
Agricultural business17,177 5,877 15,058 79,715 84,072 
One-to four-family residential 29,531 24,488 37,446 106,085 167,951 
Consumer73,791 96,137 57,427 356,543 300,913 
Total loan originations (excluding loans held for sale)$802,033 $893,565 $741,457 $3,469,550 $3,045,434 



BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 10
ADDITIONAL FINANCIAL INFORMATION     
(dollars in thousands)     
CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES – LOANS
  Quarters Ended
Year Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Balance, beginning of period$154,585 $152,848 $146,960 $149,643 $141,465 
Provision for credit losses – loans3,219 1,967 3,821 8,563 11,097 
Recoveries of loans previously charged off:
Commercial real estate1,215 65 129 2,767 557 
Construction and land— — — — 29 
One- to four-family real estate124 14 18 171 230 
Commercial business245 613 237 1,963 1,283 
Agricultural business, including secured by farmland2 1 16 304 146 
Consumer164 41 131 476 543 
 1,750 734 531 5,681 2,788 
Loans charged off:
Commercial real estate(4)— — (351)— 
Construction and land(5)(145)(933)(150)(1,089)
One- to four-family real estate— — (8)— (42)
Commercial business(3,595)(414)(310)(5,955)(2,650)
Agricultural business, including secured by farmland— — — — (564)
Consumer(429)(405)(418)(1,910)(1,362)
 (4,033)(964)(1,669)(8,366)(5,707)
Net charge-offs(2,283)(230)(1,138)(2,685)(2,919)
Balance, end of period$155,521 $154,585 $149,643 $155,521 $149,643 
Net charge-offs / Average loans receivable(0.020)%(0.002)%(0.011)%(0.024)%(0.028)%

ALLOCATION OF ALLOWANCE FOR CREDIT LOSSES – LOANSDec 31, 2024Sep 30, 2024Dec 31, 2023
Commercial real estate$40,830 $40,040 $44,384 
Multifamily real estate10,308 10,233 9,326 
Construction and land29,038 28,322 28,095 
One- to four-family real estate20,807 20,463 19,271 
Commercial business38,611 39,779 35,464 
Agricultural business, including secured by farmland5,727 5,340 3,865 
Consumer10,200 10,408 9,238 
Total allowance for credit losses – loans$155,521 $154,585 $149,643 
Allowance for credit losses - loans / Total loans receivable1.37 %1.38 %1.38 %
Allowance for credit losses - loans / Non-performing loans421 %359 %506 %

CHANGE IN THE ALLOWANCE FOR CREDIT LOSSES - UNFUNDED LOAN COMMITMENTS
  Quarters Ended
Year Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Balance, beginning of period$13,765 $14,027 $15,010 $14,484 $14,721 
Recapture of provision for credit losses - unfunded loan commitments(203)(262)(526)(922)(237)
Balance, end of period$13,562 $13,765 $14,484 $13,562 $14,484 


BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 11
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
NON-PERFORMING ASSETSDec 31, 2024Sep 30, 2024Dec 31, 2023
Loans on non-accrual status:  
Secured by real estate:  
Commercial$2,186 $2,127 $2,677 
Construction and land3,963 4,286 3,105 
One- to four-family10,016 9,592 5,702 
Commercial business7,067 10,705 9,002 
Agricultural business, including secured by farmland8,485 7,703 3,167 
Consumer4,835 4,636 3,204 
 36,552 39,049 26,857 
Loans more than 90 days delinquent, still on accrual:  
Secured by real estate:  
Commercial— 2,258 — 
Construction and land— 380 1,138 
One- to four-family369 961 1,205 
Commercial business— — 1 
Consumer35 359 401 
 404 3,958 2,745 
Total non-performing loans36,956 43,007 29,602 
REO2,367 2,221 526 
Other repossessed assets300 — — 
Total non-performing assets$39,623 $45,228 $30,128 
Total non-performing assets to total assets0.24 %0.28 %0.19 %

LOANS BY CREDIT RISK RATINGDec 31, 2024Sep 30, 2024Dec 31, 2023
Pass$11,118,744 $11,022,014 $10,671,281 
Special Mention43,451 52,497 13,732 
Substandard192,461 150,095 125,442 
Total$11,354,656 $11,224,606 $10,810,455 


BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 12

ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands) 
DEPOSIT COMPOSITIONPercentage Change
Dec 31, 2024Sep 30, 2024Dec 31, 2023Prior QtrPrior Yr Qtr
Non-interest-bearing$4,591,543 $4,688,244 $4,792,369 (2)%(4)%
Interest-bearing checking2,393,864 2,344,561 2,098,526 2 %14 %
Regular savings accounts3,478,423 3,339,859 2,980,530 4 %17 %
Money market accounts1,550,896 1,643,631 1,680,605 (6)%(8)%
Total interest-bearing transaction and savings accounts7,423,183 7,328,051 6,759,661 1 %10 %
Total core deposits12,014,726 12,016,295 11,552,030 — %4 %
Interest-bearing certificates1,499,672 1,521,853 1,477,467 (1)%2 %
Total deposits$13,514,398 $13,538,148 $13,029,497 — %4 %

GEOGRAPHIC CONCENTRATION OF DEPOSITSDec 31, 2024Sep 30, 2024Dec 31, 2023Percentage Change
AmountPercentageAmountAmountPrior QtrPrior Yr Qtr
Washington$7,441,413 55 %$7,413,414 $7,247,392 — %3 %
Oregon2,981,327 22 %2,997,843 2,852,677 (1)%5 %
California2,392,573 18 %2,423,295 2,269,557 (1)%5 %
Idaho699,085 5 %703,596 659,871 (1)%6 %
Total deposits$13,514,398 100 %$13,538,148 $13,029,497 — %4 %

INCLUDED IN TOTAL DEPOSITSDec 31, 2024Sep 30, 2024Dec 31, 2023
Public non-interest-bearing accounts$165,667 $141,541 $146,916 
Public interest-bearing transaction & savings accounts248,746 246,332 209,699 
Public interest-bearing certificates25,423 28,144 52,048 
Total public deposits$439,836 $416,017 $408,663 
Collateralized public deposits$336,376 $317,960 $305,306 
Total brokered deposits$50,346 $50,333 $108,058 
AVERAGE ACCOUNT BALANCE PER DEPOSIT ACCOUNTDec 31, 2024Sep 30, 2024Dec 31, 2023
Number of deposit accounts460,004 459,127 463,750 
Average account balance per account$30 $30 $29 




BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 13
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
ESTIMATED REGULATORY CAPITAL RATIOS AS OF DECEMBER 31, 2024ActualMinimum to be categorized as "Adequately Capitalized"Minimum to be
categorized as
"Well Capitalized"
AmountRatioAmountRatioAmountRatio
Banner Corporation-consolidated:    
      Total capital to risk-weighted assets$2,024,046 15.04 %$1,076,652 8.00 %$1,345,814 10.00 %
      Tier 1 capital to risk-weighted assets1,760,065 13.08 %807,489 6.00 %807,489 6.00 %
      Tier 1 leverage capital to average assets1,760,065 11.05 %636,913 4.00 % n/a  n/a
      Common equity tier 1 capital to risk-weighted assets1,673,565 12.44 %605,616 4.50 % n/a  n/a
Banner Bank:    
      Total capital to risk-weighted assets1,890,438 14.03 %1,077,725 8.00 %1,347,157 10.00 %
      Tier 1 capital to risk-weighted assets1,726,457 12.82 %808,294 6.00 %1,077,725 8.00 %
      Tier 1 leverage capital to average assets1,726,457 10.83 %637,392 4.00 %796,740 5.00 %
      Common equity tier 1 capital to risk-weighted assets1,726,457 12.82 %606,221 4.50 %875,652 6.50 %

These regulatory capital ratios are estimates, pending completion and filing of Banner’s regulatory reports.

BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 14
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
(rates / ratios annualized)
ANALYSIS OF NET INTEREST SPREADQuarters Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023
Average BalanceInterest and Dividends
Yield / Cost (3)
Average BalanceInterest and Dividends
Yield / Cost (3)
Average BalanceInterest and Dividends
Yield / Cost (3)
Interest-earning assets:
Held for sale loans
$61,585 $1,049 6.78 %$26,954 $453 6.69 %$31,148 $447 5.69 %
Mortgage loans
9,267,076 136,831 5.87 %9,207,468 135,497 5.85 %8,770,029 123,382 5.58 %
Commercial/agricultural loans
1,900,337 31,873 6.67 %1,879,215 32,547 6.89 %1,822,069 30,447 6.63 %
Consumer and other loans
124,726 2,078 6.63 %128,548 2,154 6.67 %138,049 2,237 6.43 %
Total loans (1)
11,353,724 171,831 6.02 %11,242,185 170,651 6.04 %10,761,295 156,513 5.77 %
Mortgage-backed securities
2,576,908 16,228 2.51 %2,623,399 16,498 2.50 %2,798,647 17,541 2.49 %
Other securities
919,742 10,281 4.45 %943,310 11,120 4.69 %1,035,842 11,993 4.59 %
Interest-bearing deposits with banks
107,404 1,043 3.86 %51,604 493 3.80 %45,286 506 4.43 %
FHLB stock
9,887 316 12.71 %16,664 412 9.84 %15,326 215 5.57 %
Total investment securities3,613,941 27,868 3.07 %3,634,977 28,523 3.12 %3,895,101 30,255 3.08 %
Total interest-earning assets
14,967,665 199,699 5.31 %14,877,162 199,174 5.33 %14,656,396 186,768 5.06 %
Non-interest-earning assets1,016,366   981,290 875,719   
Total assets
$15,984,031   $15,858,452 $15,532,115   
Deposits:      
Interest-bearing checking accounts
$2,377,179 9,279 1.55 %$2,295,723 9,497 1.65 %$2,060,226 5,907 1.14 %
Savings accounts
3,441,196 19,447 2.25 %3,268,647 19,299 2.35 %2,885,167 12,560 1.73 %
Money market accounts
1,584,092 8,510 2.14 %1,611,543 9,184 2.27 %1,723,426 7,644 1.76 %
Certificates of deposit
1,513,966 14,981 3.94 %1,540,637 15,805 4.08 %1,477,474 13,231 3.55 %
Total interest-bearing deposits
8,916,433 52,217 2.33 %8,716,550 53,785 2.45 %8,146,293 39,342 1.92 %
Non-interest-bearing deposits
4,640,557 — — %4,601,755 — — %5,036,523 — — %
Total deposits
13,556,990 52,217 1.53 %13,318,305 53,785 1.61 %13,182,816 39,342 1.18 %
Other interest-bearing liabilities:       
FHLB advances
7,522 85 4.50 %161,413 2,263 5.58 %129,630 1,870 5.72 %
Other borrowings
143,097 817 2.27 %159,439 1,147 2.86 %185,518 1,125 2.41 %
Junior subordinated debentures and subordinated notes
169,678 2,781 6.52 %179,075 2,971 6.60 %182,678 2,992 6.50 %
Total borrowings
320,297 3,683 4.57 %499,927 6,381 5.08 %497,826 5,987 4.77 %
Total funding liabilities
13,877,287 55,900 1.60 %13,818,232 60,166 1.73 %13,680,642 45,329 1.31 %
Other non-interest-bearing liabilities (2)
324,447   311,803 311,539   
Total liabilities
14,201,734   14,130,035 13,992,181   
Shareholders’ equity1,782,297   1,728,417 1,539,934   
Total liabilities and shareholders’ equity$15,984,031   $15,858,452 $15,532,115   
Net interest income/rate spread (tax equivalent)$143,799 3.71 %$139,008 3.60 %$141,439 3.75 %
Net interest margin (tax equivalent)3.82 %3.72 %3.83 %
Reconciliation to reported net interest income:
Adjustments for taxable equivalent basis(3,263)(3,333)(3,030)
Net interest income and margin, as reported$140,536 3.74 %$135,675 3.63 %$138,409 3.75 %
Additional Key Financial Ratios:
Return on average assets1.15 %1.13 %1.09 %
Adjusted return on average assets (4)
1.15 %1.13 %1.18 %
Return on average equity10.35 %10.39 %10.98 %
Adjusted return on average equity (4)
10.28 %10.39 %11.89 %
Average equity/average assets11.15 %10.90 %9.91 %
Average interest-earning assets/average interest-bearing liabilities162.05 %161.42 %169.55 %
Average interest-earning assets/average funding liabilities107.86 %107.66 %107.13 %
Non-interest income/average assets0.50 %0.45 %0.36 %
Non-interest expense/average assets2.48 %2.42 %2.47 %
Efficiency ratio61.95 %62.63 %63.37 %
Adjusted efficiency ratio (4)
60.74 %61.27 %60.04 %

(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. The tax equivalent yield adjustment to interest earned on loans was $2.2 million, $2.3 million and $2.0 million for the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $1.0 million for each of the quarters ended December 31, 2024, September 30, 2024 and December 31, 2023.
(4)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 - Fourth Quarter 2024 Results
January 22, 2025
Page 15
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
(rates / ratios annualized)
ANALYSIS OF NET INTEREST SPREADYear Ended
Dec 31, 2024Dec 31, 2023
Average BalanceInterest and Dividends
Yield/Cost (3)
Average BalanceInterest and Dividends
Yield/Cost (3)
Interest-earning assets:
Held for sale loans
$27,627 $1,875 6.79 %$49,106 $2,621 5.34 %
Mortgage loans
9,094,276 526,842 5.79 %8,513,487 460,664 5.41 %
Commercial/agricultural loans
1,871,024 127,028 6.79 %1,782,141 113,250 6.35 %
Consumer and other loans
129,929 8,584 6.61 %138,196 8,715 6.31 %
Total loans (1)
11,122,856 664,329 5.97 %10,482,930 585,250 5.58 %
Mortgage-backed securities
2,650,010 66,652 2.52 %2,927,650 72,927 2.49 %
Other securities
951,515 44,083 4.63 %1,173,637 52,148 4.44 %
Interest-bearing deposits with banks
65,650 2,573 3.92 %46,815 2,200 4.70 %
FHLB stock
16,658 1,302 7.82 %17,903 847 4.73 %
Total investment securities3,683,833 114,610 3.11 %4,166,005 128,122 3.08 %
Total interest-earning assets
14,806,689 778,939 5.26 %14,648,935 713,372 4.87 %
Non-interest-earning assets967,122  917,018 
Total assets
$15,773,811  $15,565,953 
Deposits:  
Interest-bearing checking accounts
$2,233,902 33,113 1.48 %$1,921,326 13,334 0.69 %
Savings accounts
3,231,631 71,225 2.20 %2,674,936 27,739 1.04 %
Money market accounts
1,632,092 35,206 2.16 %1,908,983 24,089 1.26 %
Certificates of deposit
1,514,726 59,921 3.96 %1,209,261 34,964 2.89 %
Total interest-bearing deposits
8,612,351 199,465 2.32 %7,714,506 100,126 1.30 %
Non-interest-bearing deposits
4,647,100 — — %5,436,953 — — %
Total deposits
13,259,451 199,465 1.50 %13,151,459 100,126 0.76 %
Other interest-bearing liabilities:      
FHLB advances
159,954 8,941 5.59 %196,819 10,524 5.35 %
Other borrowings
164,613 4,299 2.61 %199,291 3,376 1.69 %
Junior subordinated debentures and subordinated notes
177,361 11,682 6.59 %185,883 11,541 6.21 %
Total borrowings
501,928 24,922 4.97 %581,993 25,441 4.37 %
Total funding liabilities
13,761,379 224,387 1.63 %13,733,452 125,567 0.91 %
Other non-interest-bearing liabilities (2)
308,667  295,098 
Total liabilities
14,070,046  14,028,550 
Shareholders’ equity1,703,765  1,537,403 
Total liabilities and shareholders’ equity$15,773,811  $15,565,953 
Net interest income/rate spread (tax equivalent)$554,552 3.63 %$587,805 3.96 %
Net interest margin (tax equivalent)3.75 %4.01 %
Reconciliation to reported net interest income:
Adjustments for taxable equivalent basis(12,836)(11,800)
Net interest income and margin, as reported$541,716 3.66 %$576,005 3.93 %
Additional Key Financial Ratios:
Return on average assets1.07 %1.18 %
Adjusted return on average assets (4)
1.10 %1.30 %
Return on average equity9.91 %11.94 %
Adjusted return on average equity (4)
10.19 %13.17 %
Average equity/average assets10.80 %9.88 %
Average interest-earning assets/average interest-bearing liabilities162.46 %176.57 %
Average interest-earning assets/average funding liabilities107.60 %106.67 %
Non-interest income/average assets0.42 %0.29 %
Non-interest expense/average assets2.48 %2.46 %
Efficiency ratio64.33 %61.66 %
Adjusted efficiency ratio (4)
62.29 %57.89 %

(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 $8.7 million and $7.4 million for the years ended December 31, 2024 and 2023, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $4.1 million and $4.4 million for the years ended December 31, 2024 and 2023, respectively.
(4)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 - Fourth Quarter 2024 Results
January 22, 2025
Page 16
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 and the ratio of tangible common equity to tangible assets, 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 REVENUEQuarters EndedYear Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Net interest income (GAAP)$140,536 $135,675 $138,409 $541,716 $576,005 
Non-interest income (GAAP)20,035 18,063 14,052 66,888 44,409 
Total revenue (GAAP)160,571 153,738 152,461 608,604 620,414 
Exclude: Net (gain) loss on sale of securities(275)— 4,806 5,190 19,242 
Net change in valuation of financial instruments carried at fair value(161)(39)(139)982 4,218 
Adjusted revenue (non-GAAP)$160,135 $153,699 $157,128 $614,776 $643,874 

ADJUSTED EARNINGSQuarters EndedYear Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Net income (GAAP)$46,391 $45,153 $42,624 $168,898 $183,624 
Exclude: Net (gain) loss on sale of securities(275)— 4,806 5,190 19,242 
Net change in valuation of financial instruments carried at fair value(161)(39)(139)982 4,218 
Banner Forward expenses (1)
— — — — 1,334 
Related net tax expense (benefit)105 9 (1,121)(1,481)(5,951)
Total adjusted earnings (non-GAAP)$46,060 $45,123 $46,170 $173,589 $202,467 
Diluted earnings per share (GAAP)$1.34 $1.30 $1.24 $4.88 $5.33 
Diluted adjusted earnings per share (non-GAAP)$1.33 $1.30 $1.34 $5.01 $5.88 
Return on average assets1.15 %1.13 %1.09 %1.07 %1.18 %
Adjusted return on average assets (2)
1.15 %1.13 %1.18 %1.10 %1.30 %
Return on average equity10.35 %10.39 %10.98 %9.91 %11.94 %
Adjusted return on average equity (3)
10.28 %10.39 %11.89 %10.19 %13.17 %

(1)Included in miscellaneous expenses in results of operations.
(2)Adjusted earnings (non-GAAP) divided by average assets.
(3)Adjusted earnings (non-GAAP) divided by average equity.


BANR - Fourth Quarter 2024 Results
January 22, 2025
Page 17
ADDITIONAL FINANCIAL INFORMATION
(dollars in thousands)
ADJUSTED EFFICIENCY RATIOQuarters EndedYear Ended
Dec 31, 2024Sep 30, 2024Dec 31, 2023Dec 31, 2024Dec 31, 2023
Non-interest expense (GAAP)$99,478 $96,291 $96,621 $391,538 $382,538 
Exclude: Banner Forward expenses (1)
— — — — (1,334)
CDI amortization(589)(590)(858)(2,626)(3,756)
State/municipal tax expense(1,518)(1,432)(1,372)(5,648)(5,260)
REO operations(113)(103)(47)(293)538 
Adjusted non-interest expense (non-GAAP)$97,258 $94,166 $94,344 $382,971 $372,726 
Net interest income (GAAP)$140,536 $135,675 $138,409 $541,716 $576,005 
Non-interest income (GAAP)20,035 18,063 14,052 66,888 44,409 
Total revenue (GAAP)160,571 153,738 152,461 608,604 620,414 
Exclude: Net (gain) loss on sale of securities(275)— 4,806 5,190 19,242 
Net change in valuation of financial instruments carried at fair value(161)(39)(139)982 4,218 
Adjusted revenue (non-GAAP)$160,135 $153,699 $157,128 $614,776 $643,874 
Efficiency ratio (GAAP)61.95 %62.63 %63.37 %64.33 %61.66 %
Adjusted efficiency ratio (non-GAAP) (2)
60.74 %61.27 %60.04 %62.29 %57.89 %

(1)Included in miscellaneous expenses in results of operations.
(2)Adjusted non-interest expense (non-GAAP) divided by adjusted revenue.

TANGIBLE COMMON SHAREHOLDERS’ EQUITY TO TANGIBLE ASSETS
Dec 31, 2024Sep 30, 2024Dec 31, 2023
Shareholders’ equity (GAAP)$1,774,326 $1,793,721 $1,652,691 
Exclude goodwill and other intangible assets, net376,179 376,768 378,805 
Tangible common shareholders’ equity (non-GAAP)$1,398,147 $1,416,953 $1,273,886 
Total assets (GAAP)$16,200,037 $16,188,676 $15,670,391 
Exclude goodwill and other intangible assets, net376,179 376,768 378,805 
Total tangible assets (non-GAAP)$15,823,858 $15,811,908 $15,291,586 
Common shareholders’ equity to total assets (GAAP)10.95 %11.08 %10.55 %
Tangible common shareholders’ equity to tangible assets (non-GAAP)8.84 %8.96 %8.33 %
TANGIBLE COMMON SHAREHOLDERS’ EQUITY PER SHARE
Shareholders’ equity (GAAP)$1,774,326 $1,793,721 $1,652,691 
Tangible common shareholders’ equity (non-GAAP)$1,398,147 $1,416,953 $1,273,886 
Common shares outstanding at end of period34,459,832 34,456,688 34,348,369 
Common shareholders’ equity (book value) per share (GAAP)$51.49 $52.06 $48.12 
Tangible common shareholders’ equity (tangible book value) per share (non-GAAP)$40.57 $41.12 $37.09 

Photo by Salvador Saldana Photo by Yvonne McDonald Photo by Maria DeVecchio Photo by Siti Alimah Fourth Quarter 2024

 
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 January 22, 2025 as well as the Form 10-K for the year ended December 31, 2023 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.

 
Fourth quarter 2024 highlights 2 • Net income of $46.4 million, compared to $45.2 million for the prior quarter • HFI Loan growth of $130 million (5% annualized) • Total loan originations (excluding HFS) were $802 million • Total funding costs decreased 13 basis points; deposit costs decreased 8 basis points • Net interest margin (tax equivalent) increased 10 basis points to 3.82% • Efficiency ratio (GAAP) decreased 68 basis points to 61.95%; adjusted, non- GAAP efficiency ratio decreased 53 basis points to 60.74% • Return on average assets of 1.15%, and return on average equity of 10.35%, compared to 1.13% and 10.39%, respectively, for the prior quarter • $3.0 million provision for credit losses driven by risk rating downgrades and growth in loans; Allowance for credit losses – loans was 1.37% of total loans • Non-performing assets remained low at 0.24% of total assets, down 4 basis points from last quarter • Announced dividend of $0.48 per share to be paid in February 2025

 
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 $16.2B Deposits $13.5B Loans $11.4B Offices 135 Employees 1,956 3 Acquisition History 2019 Q4 2018 Q4 2015 Q4 2015 Q1 2014 Q2 AltaPacific Bank Skagit Bank AmericanWest Bank Siuslaw Bank SW Oregon Branches Assets $0.4B $0.9B $4.5B $0.4B $0.2B Deposits $0.3B $0.8B $3.6B $0.3B $0.2B Loans $0.3B $0.6B $3.0B $0.2B $0.1B Offices 6 11 98 10 6

 
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 4

 
Growing revenue … in a good place since 1890 5 Source: U.S. Census Bureau Moody’s Analytics Forecasted (June 2023) Population Estimate (millions) 2020 2030 Growth Washington 7.7 8.4 9%* Oregon 4.2 4.5 5% Idaho 1.8 2.2 20%* California 39.5 39.5 0% Region 53.3 54.6 2% United States 331.4 344.6 4% * 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 6th largest economy 6

 
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 7

 
Growing revenue Guard and improve reputation Outstanding CRA Rating FDIC 2021, most recent 3-year examination cycle Most Trustworthy Companies in America Newsweek 2023 & 2024 World’s Most Trustworthy Companies Newsweek 2023 & 2024 (Highest ranked U.S. based bank in 2024) America’s Best Regional Banks Newsweek 2024 & 2025 Excellence Award for Bank of the Year Q2 Holdings 2023 5-Star rating™ (highest category) BauerFinancial; 10+ years America’s 100 Best Banks Forbes, 8 consecutive years (2017-2024) Top 50 U.S. Public Banks (assets of $10B+) S&P Global Market Intelligence 2021, 2022 & 2023 8

 
$ 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 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 0 25 50 75 100 125 150 175 200 Growing revenue Deposit Fees as % of Core Revenue 1 Other Fees Mortgage Banking Deposit Fees 9 1. Excludes net gain/loss on sale of securities and change in valuation of financial instruments carried at fair value. Core revenue1 Quarter Ending Quarter Last 12 Months Amount Amount 12/31/24 $160M $615M 12/31/09 $45M $177M Noninterest income1 Quarter Ending Quarter Last 12 Months Amount Amount 12/31/24 $19.6M $73.1M 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 10

 
Protecting net interest margin $ Millions Avg Bal Cost (in bps) Non-Interest 4,641 0 Interest Bearing 7,402 200 CDs 1,514 394 Subtotal Deposits 13,557 153 FHLB & Other 320 457 Total 13,877 160 11 34% 53% 11% 2% 76% 24% 35% 29% 36% Non-Interest Bearing Certificates of Deposit Interest Bearing and Savings Securities & Int-bearing Deposits Loans Fixed: 4.74% Yield Floating: 7.74% Yield Low Cost Funding Mix 12/31/2024 Adjustable: 5.19% Yield Earning Asset Mix 12/31/2024 Loan Repricing Structure 12/31/2024 $ Millions Avg Bal Yield (in bps) Loans 11,354 602 Securities & Int- bearing Deposits 3,614 307 Total 14,968 531 65% of the loan portfolio is floating/adjustable 70% of the floating/adjustable loans have floors 26% of the loans that have floors are at the floor 27% of the loans that have floors are within 100 basis points of the floor FHLB, Sub Debt & 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 —% 1% 2% 3% 4% 5% 6% 7% $ B 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 0 2 4 6 8 10 12 14 16 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Protecting net interest margin Noncore Deposits Core Deposits Manage deposit costs Quarter Ending Quarter Last 12 Months Amount Rate Amount Rate 12/31/24 $52.2M 1.53% $199.5M 1.50% 12/31/09 $17.7M 1.83% $83.2M 2.21% 12 Focus on core deposits Quarter Ending Balance % of Total Deposits 12/31/24 $12,015M 89% 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% -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 Noncore Funding Dependence Peer Top Quartile 13 $ 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% 40% 60% 80% 100% 0 2 4 6 8 10 12 14 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 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 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 Amount Rate 12/31/24 $141M 3.74% $542M 3.66% 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 14 Peer Top Quartile Peer Median Net Interest Margin Banner Net Interest Margin Earning Asset Yield Funding Cost

 
Conservative investment portfolio 15 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 12/31/24 CMO, $1,061, 34.2% MBS, $811, 26.1% CMBS, $468, 15.1% Municipal, $459, 14.8% ABS, $171, 5.5% Corp, $125, 4.0% Agency, $8, 0.3% Other, $3, 0.1% Y e ar s 3.41 2.15 0.19 -0.42 6.57 6.49 6.33 6.56 Total Portfolio Effective Duration Duration on New Purchases Q1 2024 Q2 2024 Q3 2024 Q4 2024 -2.00 0.00 2.00 4.00 6.00 8.00 5.66% 6.58% 6.26% 6.46% 3.09% 3.12% 3.08% 2.99% New Purchases Tax Effective Yield Total Portfolio Tax Effective Yield Q1 2024 Q2 2024 Q3 2024 Q4 2024 0% 2% 4% 6% 8% 12 Month Net Interest Income Sensitivity ($MM), % Change Quarterly New Purchases: Average Duration Investment Portfolio Composition ($3.11 billion) 79% of investments are Agency MBS/CMO or AAA rated 8.9% 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 200 596,609 0.6% 598,751 0.9% Up 100 597,129 0.7% 601,126 1.3% Base 593,279 0.0% 593,279 0.0% Down 100 584,549 (1.5)% 572,509 (3.5)% Down 200 576,682 (2.8)% 553,531 (6.7)%

 
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 16

 
$ 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 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 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 17 Control core operating expense Quarter Ending Quarter Last 12 Months Amount Amount 12/31/24 $97M $383M 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 nonperforming 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 18

 
Commercial RE 34% Multifamily 8% Construction 14% Commercial 21% Agricultural 3% 1-4 Family 14% Consumer 6% Diversified loan portfolio 19 Loan Composition 12/31/2024 CRE Breakout $MM % Owner Ooccuped CRE 1,027 9 % Investment Properties 1,624 14 % Small Balance CRE 1,214 11 % Total Comm CRE 3,865 34 % Construction Breakout $MM % Commercial 122 1 % Multifamily 514 5 % 1-4 Family 514 5 % Land 370 3 % Total Construction 1,520 14 % Loan Originations (commitments, $MM) A ve rag e Y ie ld 7.41% 7.69% 8.27% 8.59%8.47%8.47% 8.23% 7.56% Commercial RE Multifamily Construction Commercial Agricultural 1-4 Fam Consumer Avg Yield on New Loan Originations Q1 '23 Q2 '23 Q3 '23 Q4 '23 Q1 '24 Q2 '24 Q3 '24 Q4 '24 0 200 400 600 800 1,000 1,200 1,400 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10%

 
20 Characteristics of highlighted loan segments Office 1 Balances ($MM) $622.2 Percent of Total Loans 5.5% Total Investor Office $278.0 Total Owner Occupied $344.1 Average Loan Size $0.8 Largest Loan Size $18.7 30 + days Past Due $0.5 Adversely Classified $6.4 Retail 2 Balances ($MM) $1,403.6 Percent of Total Loans 12.4% Balance of Retail Loans Secured by CRE * $1,304.0 Average Loan Size $0.6 Average CRE Secured Loan Size $0.8 Largest Loan Size $23.8 30 + days Past Due $4.3 Adversely Classified $14.3 * No mall exposure Healthcare 3 Balances ($MM) $409.3 Percent of Total Loans 3.6% Balance Secured by Medical Office * $163.1 Medical Office as a % of Total Loans 1.4% Average Loan Size $0.5 Average Medical Office Size $0.7 Largest Loan Size $16.1 30 + days Past Due $0.4 Adversely Classified $10.9 * No hospital exposure 1 By collateral code 2 Retail business loans, both commercial and commercial real estate secured loans 3 All healthcare and social services, including both commercial and commercial real estate secured loans Multifamily Balances ($MM) $894.4 Percent of Total Loans 7.9% Total Affordable Housing $382.9 Total Market Rent/ Middle Income $511.5 Average Loan Size $1.8 Largest Loan Size $30.0 30 + days Past Due $0.0 Adversely Classified $2.1 CA 35% ID 6% OR 15% Other 3% WA 41% CA 28% ID 6%OR 15% Other 8% WA 43% CA 18% ID 4% OR 17% Other 4% WA 57% CA 29% ID 0% OR 26% Other 4% WA 41%

 
21 Origination Year Portfolio Segment Balance % Owner Occupied 2024 2023 2022 2021 and earlier Office $622.2 55% $28.5 $40.0 $77.5 $476.2 Retail (CRE Secured) $1,304.0 53% $214.8 $149.5 $189.1 $750.6 Medical Office $163.1 51% $15.1 $8.1 $24.2 $115.7 Multifamily $894.4 0% $34.2 $64.5 $208.9 $586.8 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 $622.2 $68.9 $96.9 $87.4 $166.7 $139.0 Retail (CRE Secured) $1,304.0 $112.2 $157.7 $159.0 $437.3 $192.3 Medical Office $163.1 $10.8 $29.2 $20.9 $41.4 $31.5 Multifamily $894.4 $114.5 $107.9 $130.7 $73.0 $389.9 Characteristics of highlighted loan segments

 
Allowance for credit losses 22 $ M ill io n s ACL Provision/Release 6.7 6.8 2.0 2.5 0.5 2.4 1.7 3.0 -0.5 20 22 -Q 4 20 23 -Q 1 20 23 -Q 2 20 23 -Q 3 20 23 -Q 4 20 24 -Q 1 20 24 -Q 2 20 24 -Q 3 20 24 -Q 4 $ M ill io n s $108.4 $167.3 $132.1 $141.5$149.6 $151.1 $152.8$154.6$155.5 1.16% 1.90% 1.48% 1.39% 1.38% 1.39% 1.37% 1.38% 1.37% 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 20 24 -Q 1 20 24 -Q 2 20 24 -Q 3 20 24 -Q 4 $168.7 $169.4 2024-Q 3 Portfolio Econom y N et C /O Provision 2024-Q 4 Net charge-offs Portfolio Economic factors Provision Change assessment: Changes to allowance: $ Millions ACL - Loans 154.6 1.8 (0.9) (2.3) 3.2 155.5 ACL - Unfunded Commitments 13.8 (0.1) (0.1) — (0.2) 13.6 ACL - HTM Securities 0.3 — — — — 0.3 Total ACL 168.7 1.7 (1.0) (2.3) 3.0 169.4 Allocation of Allowance for Credit Losses-Loans Allowance ($000) % Coverage Non Performing ($000) % Coverage NPLs Commercial RE 40,830 1.06% 2,186 1,868% Multifamily 10,308 1.15% 0 0% Construction 29,038 1.91% 3,963 733% 1-4 Family 20,807 1.31% 10,385 200% Commercial 38,611 1.59% 7,067 546% Agricultural 5,727 1.68% 8,485 67% Consumer 10,200 1.41% 4,870 209% Total 155,521 1.37% 36,956 421%

 
$ 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 0 50 100 150 200 250 300 350Minimize nonperforming assets Quarter Ending NPAs REO Amount % of TA Amount % of TA 12/31/24 $40M 0.24% $2M 0.01% 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 Nonperforming 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 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% Peer Top Quartile Peer Median Banner ACLL to Total Loans 23

 
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 24

 
Reconciliation of non-GAAP measures 25 $ Thousands Quarters Ended Year Ended PRE-TAX PRE-PROVISION EARNINGS Dec 31, 2024 Sep 30, 2024 Dec 31, 2023 Dec 31, 2024 Dec 31, 2023 Income before provision for income taxes (GAAP) $ 58,093 $ 55,755 $ 53,318 $ 209,485 $ 227,087 Provision for credit losses 3,000 1,692 2,522 7,581 10,789 Pretax pre provision earnings (non-GAAP) 61,093 57,447 55,840 217,066 237,876 Exclude net loss/(gain) on sale of securities (275) — 4,806 5,190 19,242 Exclude net change in valuation of financial instruments carried at fair value (161) (39) (139) 982 4,218 Exclude Banner Forward expenses — — — — 1,334 Adjusted pretax pre provision earnings (non-GAAP) $ 60,657 $ 57,408 $ 60,507 $ 223,238 $ 262,670

 
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 26

 
v3.24.4
Cover
Jan. 22, 2025
Document Information [Line Items]  
Document Type 8-K
Document Period End Date Jan. 22, 2025
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
Entity Address, State or Province WA
Entity Address, Postal Zip Code 99362
City Area Code 509
Local Phone Number 527-3636
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $.01 per share
Trading Symbol BANR
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000946673
Amendment Flag false
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