Banner Corporation (NASDAQ: BANR), the parent company of Banner Bank and Islanders Bank, today reported net income of $15.6 million in the third quarter of 2012, compared to $25.4 million in the preceding quarter and $6.0 million in the third quarter a year ago. For the first nine months of 2012, Banner reported net income of $50.2 million, compared to $387,000 in the same period a year ago. In the preceding quarter ended June 30, 2012, Banner’s results included a $31.8 million tax benefit as a result of the reversal of most of its deferred tax asset valuation allowance, which was partially offset by a net loss of $19.1 million for fair value adjustments.
“Banner’s highlights for the third quarter included our continued improvement in asset quality, additional customer account growth and record revenues from core operations,” said Mark J. Grescovich, President and Chief Executive Officer. “Similar to the second quarter, Banner’s third quarter revenues from core operations* (net interest income before the provision for loan losses plus total other operating income excluding fair value and other-than-temporary impairment (OTTI) adjustments) increased 8% when compared to the third quarter a year ago. This marks the twelfth consecutive quarter that we have realized a year-over-year increase in revenues from core operations.* Our net interest margin expanded 12 basis points to 4.22% in the third quarter compared to 4.10% in the third quarter a year ago. Also, our deposit fees and other service charge income remained strong, increasing by 10% compared to the third quarter a year ago, and our revenues from mortgage banking operations again increased and were more than two times higher than in the third quarter of 2011. This progress, which is consistent with our results for the first half of the year, further demonstrates our strategic plan and initiatives are effective and are building shareholder value.”
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