Banner Corporation Announces Fourth Quarter And Year End Results

WALLA WALLA, Wash., Jan. 26, 2011 (GLOBE NEWSWIRE) -- Banner Corporation (Nasdaq:BANR), the parent company of Banner Bank and Islanders Bank, today reported that it had a net loss of $12.7 million in the quarter ended December 31, 2010, compared to a net loss of $42.7 million in the immediately preceding quarter and a net loss of $3.5 million in the fourth quarter a year ago.

"Further margin expansion and increased net interest income supported strong revenue generation during the fourth quarter, despite a decline in income from mortgage banking operations. Throughout the year ended December 31, 2010, we have improved our core business by continuing to change the composition of our deposit portfolio, growing non-interest-bearing and other core deposit balances and adding customer relationships, while strengthening our on-balance-sheet liquidity and capital base, realigning and refocusing our delivery platforms and effectively managing controllable operating expenses," said Mark J. Grescovich, President and Chief Executive Officer. "The result has been meaningful improvement in our core operations and growth in recurring revenues compared to similar periods a year earlier. While we are pleased that we continued to make progress in these areas in the fourth quarter, our still too high level of non-performing assets and related credit costs again adversely affected our operating results.  Although we made modest progress during the quarter in reducing non-performing loans and selling acquired real estate, significantly improving our asset quality through aggressive management of our problem assets remains the primary focus for Banner that will allow us to return to profitability."

In the fourth quarter, Banner paid a $1.6 million dividend on the $124 million of senior preferred stock it issued to the U.S. Treasury in the fourth quarter of 2008 in connection with its participation in the Treasury's Capital Purchase Program. In addition, Banner accrued $398,000 for related discount accretion. Including the preferred stock dividend and related accretion, the net loss to common shareholders was $0.13 per share for the quarter ended December 31, 2010, compared to a net loss to common shareholders of $0.40 per share in the third quarter of 2010 and $0.27 per share for the fourth quarter a year ago.