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WALLA WALLA, Wash. and NAMPA, Idaho, Sept. 24, 2013 (GLOBE NEWSWIRE) -- Banner Corporation ("Banner") (Nasdaq:BANR), the holding company for Banner Bank and Islanders Bank, and Home Federal Bancorp, Inc. ("Home") (Nasdaq:HOME), the holding company for Home Federal Bank, today announced the signing of a definitive merger agreement pursuant to which Banner will acquire Home. The combined company will have approximately $5.2 billion in assets and will be the fourth largest Pacific Northwest headquartered bank as ranked by assets. It also will have a top 10 deposit market share position in Washington, Idaho and Oregon with an established platform for growth and continued operational improvement throughout the Pacific Northwest.
"We are excited to have Home Federal Bank join the Banner Bank team," stated Mark Grescovich, Banner's President and Chief Executive Officer. "This combination will help us toward our goal of becoming the community bank of choice in the Pacific Northwest. It significantly improves our market share in the Boise market, which is the 3
rd largest metropolitan market in the Pacific Northwest, while also expanding our presence in several key Oregon markets, including Bend/Central Oregon, Eugene, Medford and Grants Pass. The combination of our two organizations provides the opportunity to create tremendous synergies while offering Home Federal customers a broader product offering, increased lending limits and an expanded branch delivery system that stretches throughout the Pacific Northwest."
Len Williams, President and CEO of Home, commented, "This combination brings together two community banks that are focused on providing great customer service, a strong commitment to the communities where they operate and an excellent environment for employees to perform and advance. We look forward to working with the management team at Banner Bank to create a leading super community bank in the Pacific Northwest."
The boards of Banner and Home unanimously approved the transaction, which is subject to regulatory approval, approval by the stockholders of Home, and other customary conditions of closing. The transaction provides for the payment to Home stockholders and option holders of $87.6 million in cash (subject to adjustment based on closing capital and other adjustments fully described in the definitive merger agreement) and to Home stockholders 2,904,000 shares of Banner common stock, subject to price collars. Based on the closing price of $37.66 for Banner shares on September 24, 2013, the transaction would have an aggregate value of $197.0 million. As of June 30, 2013, Home Federal Bancorp, Inc. had tangible common equity of $168.1 million. Banner expects the transaction to be immediately accretive to earnings per share, excluding one-time transaction expenses. Upon closing of the transaction, which is anticipated to take place in the first quarter of 2014, Home will be merged into Banner and Home Federal Bank will be merged into Banner Bank.