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Banner Corporation Reports Net Income Of $5.1 Million In Fourth Quarter; 2011 Net Income Highlighted By Improved Credit Quality And Strong Revenue Generation

Stocks in this article: BANR

Banner Corporation (NASDAQ:BANR), the parent company of Banner Bank and Islanders Bank, today reported net income of $5.1 million in the fourth quarter of 2011, compared to net income of $6.0 million in the immediately preceding quarter and a net loss of $12.7 million in the fourth quarter a year ago. For the full year ended December 31, 2011, Banner reported net income of $5.5 million compared to a net loss of $61.9 million in 2010.

“Banner’s 2011 performance provided consistent evidence that we are successfully executing on our strategies and priorities to strengthen our franchise and deliver sustainable profitability to Banner,” said Mark J. Grescovich, President and Chief Executive Officer. “Our return to profitability for the last three quarters, and now for the year, reflects significant progress on the key objectives of those strategies: reducing the adverse effect of non-performing assets, increasing client relationships and reducing our cost of funds. This progress and our 2011 operating results clearly demonstrate that our strategic turnaround plan is effective and is building shareholder value.

“Banner’s credit quality metrics further improved during the fourth quarter, with non-performing loans, real estate owned and total non-performing asset levels all decreasing at year end, leading to reduced credit costs for the current quarter and for the full year. Also notable during the quarter was an increase in net loans and continued growth in non-interest-bearing deposits, as we experienced further success in acquiring new client relationships and account balances.”

In the fourth quarter of 2011, Banner paid a $1.6 million dividend on the $124 million of senior preferred stock it issued to the U.S. Treasury under the Capital Purchase Program. In addition, Banner accrued $425,000 for related discount accretion. Including the preferred stock dividend and related accretion, net income available to common shareholders was $0.18 per share for the fourth quarter of 2011, compared to net income available to common shareholders of $0.24 per share in the third quarter of 2011 and a net loss to common shareholders of $0.91 per share for the fourth quarter a year ago. For the year ended December 31, 2011, the net loss to common shareholders, including the preferred stock dividend and related accretion, was $0.15 per share, compared to a net loss of $7.21 per share for the year ended December 31, 2010.

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