Financial Analysis

Financial Instruments with Off-Balance Sheet Risk - The Company has financial instruments with off-balance-sheet risk generated in the normal course of business to meet the financing needs of its clients. These financial instruments include commitments to extend credit, commitments related to standby letters of credit, commitments to originate loans, commitments to sell loans, and commitments to buy or sell securities. These instruments involve, to varying degrees, elements of credit and interest rate risk similar to the risk involved in on-balance sheet items. Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument from commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. We use the same credit policies in making commitments and conditional obligations as on-balance sheet instruments. Outstanding commitments consisted of the following at the dates indicated (in thousands): Contract or Notional Amount December 31, 2025 December 31, 2024 Commitments to extend credit $ 3,978,474 $ 3,857,782 Standby letters of credit and financial guarantees 26,406 28,287 Risk participation agreements 41,191 43,913 Derivatives also included in Note 19: Commitments to originate loans held for sale 39,895 35,512 Commitments to sell loans secured by one- to four-family residential properties 43,264 17,963 Commitments to sell securities related to mortgage banking activitie …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Repurchase Agreements: At December 31, 2025, retail repurchase agreements were $107.7 million and had interest rates ranging from 0.05% to 3.44%. These repurchase agreements are secured by the pledge of certain mortgage-backed and agency securities with a carrying value of $202.9 million. The Bank has the right to pledge or sell these securities, but it must replace them with substantially the same securities. The Bank had no borrowings under wholesale repurchase agreements at December 31, 2025 and 2024. Federal Reserve Bank of San Francisco and fed fund lines: The Bank periodically borrows funds on an overnight basis from the Federal Reserve Bank through the Borrower-In-Custody program. These borrowings are secured by a pledge of eligible loans. At December 31, 2025, based upon available unencumbered collateral, the Bank was eligible to borrow $1.55 billion from the Federal Reserve Bank. However, as of that date, as well as December 31, 2024, the Bank had no funds borrowed under this arrangement. At December 31, 2025, the Bank had uncommitted federal funds lines of credit agreements with other financial institutions totaling $125.0 million. No balances were outstanding under these agreements as of December 31, 2025 and 2024. Availability of lines is subject to federal funds balances available for loan and continued borrower eligibility. These lines are intended to support short-term liquidity needs and the agreements may restrict consecutive day usage. A summary of all other …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Disaggregation of Revenue: Deposit fees and other service charges for the years ended December 31, 2025, 2024 and 2023, are summarized as follows (in thousands): Years Ended December 31 2025 2024 2023 Deposit service charges $ 25,433 $ 24,708 $ 22,497 Debit and credit card interchange fees 23,525 23,766 24,021 Debit and credit card expense (13,099) (12,632) (12,386) Merchant services income 13,506 13,431 14,466 Merchant services expense (11,320) (11,246) (11,687) Other service charges 5,195 5,344 4,727 Total deposit fees and other service charges $ 43,240 $ 43,371 $ 41,638

DisaggregationOfRevenueTableTextBlock

The Company operates the following stock-based compensation plans as approved by its shareholders: 2014 Omnibus Incentive Plan (the 2014 Plan). 2018 Omnibus Incentive Plan (the 2018 Plan). 2023 Omnibus Incentive Plan (the 2023 Plan). The purpose of these plans is to promote the success and enhance the value of the Company by providing a means for attracting and retaining highly skilled employees, officers and directors of Banner and its affiliates and linking their personal interests with those of the Companys shareholders. Under these plans, the Company currently has outstanding restricted stock share grants and restricted stock unit grants. 2014 Omnibus Incentive Plan: The 2014 Plan was approved by shareholders on April 22, 2014. The 2014 Plan provides for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, other stock-based awards and other cash awards, and provides for vesting requirements which may include time-based or performance-based conditions. The Company reserved 900,000 shares of its common stock for issuance under the 2014 Plan in connection with the exercise of awards. As of December 31, 2025, 583,200 restricted stock units have been granted under the 2014 Plan, of which 92,956 were unvested. 2018 Omnibus Incentive Plan: The 2018 Plan was approved by shareholders on April 24, 2018. The 2018 Plan provides for the grant of incentive stock opt …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

The following table presents estimated fair values of the Companys financial instruments as of December 31, 2025 and 2024, whether or not recognized or recorded in the Consolidated Statements of Financial Condition (in thousands): December 31, 2025 December 31, 2024 Level Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Assets: Cash and cash equivalents 1 $ 422,640 $ 422,640 $ 501,858 $ 501,858 Securitiesavailable-for-sale 2 1,985,990 1,985,990 2,078,826 2,078,826 Securitiesavailable-for-sale 3 30,271 30,271 25,685 25,685 Securitiesheld-to-maturity 2 955,459 808,965 995,237 819,230 Securitiesheld-to-maturity 3 5,737 5,703 6,327 6,298 Loans held for sale 2 42,902 43,062 32,021 32,215 Loans receivable, net 3 11,561,411 11,497,137 11,199,135 10,894,024 Equity securities 1 406 406 481 481 FHLB stock 3 16,476 16,476 22,451 22,451 Bank-owned life insurance 1 319,347 319,347 312,549 312,549 Mortgage servicing rights 3 11,498 34,862 12,618 37,926 SBA servicing rights 3 1,104 1,104 869 869 Investments in limited partnerships 3 15,566 15,566 13,955 13,955 Derivatives: Interest rate swaps 2 9,978 9,978 14,507 14,507 Interest rate lock and forward sales commitments 2,3 333 333 331 331 Liabilities: Demand, interest checking and money market accounts 2 8,486,920 8,486,920 8,536,303 8,536,303 Regular savings 2 3,723,922 3,723,922 3,478,423 3,478,423 Certificates of deposit 2 1,532,304 1,527,803 1,499,672 1,492,829 FHLB advances 2 150,000 150,000 290,000 290,000 Other …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

The following table presents the components of the provision for income taxes included in the Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023 (in thousands): Years Ended December 31 2025 2024 2023 Current Federal $ 24,772 $ 22,648 $ 28,805 State 5,790 7,843 6,296 Total Current 30,562 30,491 35,101 Deferred Federal 13,323 10,567 7,698 State (353) (471) 664 Total Deferred 12,970 10,096 8,362 Provision for income taxes $ 43,532 $ 40,587 $ 43,463 The following table presents the reconciliation of the provision for income taxes based on the federal statutory rate to the actual effective rate by amount and percent for the years ended December 31, 2025 and 2024 (amounts in thousands): Year Ended December 31 2025 2024 Amount Percent Amount Percent Federal income tax statutory rate $ 50,172 21.0 % $ 43,992 21.0 % State income taxes, net of federal tax offset (1) 3,628 1.5 6,174 3.0 State audits and amended returns 4 Tax credits (14,211) (5.9) (9,597) (4.6) Low income housing tax credit partnerships, net of amortization 10,653 4.5 6,791 3.2 Nontaxable and nondeductible items: Tax-exempt interest (7,395) (3.1) (6,914) (3.3) Investment in life insurance (2,132) (0.9) (1,930) (0.9) Other 2,817 1.1 2,067 1.0 Provision for income taxes and effective income tax rate $ 43,532 18.2 % $ 40,587 19.4 % (1) State taxes in California and Oregon made up the majority (greater than 50 percent) of the tax effect in this category. The following table presents t …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

The Company leases 83 buildings and offices under non-cancelable operating leases. The leases contain various provisions for increases in rental rates, based either on changes in the published Consumer Price Index or a predetermined escalation schedule. Substantially all of the leases provide the Company with the option to extend the lease term one or more times following expiration of the initial term. The table below presents the lease ROU assets and lease liabilities recorded on the balance sheet at December 31, 2025 and 2024 (dollars in thousands): December 31, 2025 December 31, 2024 Assets Operating lease ROU assets $ 32,736 $ 39,998 Liabilities Operating lease liabilities $ 35,755 $ 43,472 Weighted average remaining lease term - operating leases 4.3 years 4.4 years Weighted average discount rate - operating leases 4.0 % 4.0 % The table below presents certain information related to the lease costs for operating leases for the years ended December 31, 2025, 2024 and 2023 (in thousands): Year Ended December 31, 2025 2024 2023 Operating lease cost (1) $ 15,456 $ 13,863 $ 13,848 Short-term lease cost 22 9 132 Variable lease cost 2,431 2,454 2,231 Less sublease income (1,375) (1,547) (1,447) Total lease cost (2) $ 16,534 $ 14,779 $ 14,764 (1) Total operating lease cost includes early lease termination fees of $1.6 million for the year ended December 31, 2025. There were no lease termination fees recognized for the years ended December 31, 2024 or 2023. (2) Lease expenses and …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Employee Retirement Plans: Substantially all Company and Bank employees are eligible to participate in its 401(k)/Profit Sharing Plan, a defined contribution and profit sharing plan sponsored by the Company. Employees may elect to have a portion of their salary contributed to the plan in conformity with Section 401(k) of the Internal Revenue Code. At the discretion of the Companys Board of Directors, the Company may elect to make matching and/or profit-sharing contributions for the employees benefit. During 2025, the Board of Directors elected to make a matching contribution of 4% of eligible compensation. For the years ended December 31, 2025, 2024 and 2023, $7.3 million, $7.1 million and $6.7 million, respectively, was expensed for the Companys 401(k) contributions. Supplemental Retirement and Salary Continuation Plans: Through the Bank, the Company is obligated under various non-qualified deferred compensation plans to help supplement the retirement income of certain executives, including certain retired executives, selected by resolution of the Banks Boards of Directors or in certain cases by the former directors of acquired banks. These plans are unfunded, include both defined benefit and defined contribution plans, and provide for payments after the executives retirement. In the event of a participant employees death prior to or during retirement, the Company may be obligated to pay to the designated beneficiary the benefits set forth under the plan. For the years ended …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

Disaggregation of Revenue: Deposit fees and other service charges for the years ended December 31, 2025, 2024 and 2023, are summarized as follows (in thousands): Years Ended December 31 2025 2024 2023 Deposit service charges $ 25,433 $ 24,708 $ 22,497 Debit and credit card interchange fees 23,525 23,766 24,021 Debit and credit card expense (13,099) (12,632) (12,386) Merchant services income 13,506 13,431 14,466 Merchant services expense (11,320) (11,246) (11,687) Other service charges 5,195 5,344 4,727 Total deposit fees and other service charges $ 43,240 $ 43,371 $ 41,638 Deposit fees and other service charges Deposit fees and other service charges include both transaction-based and non-transaction-based deposit fees. Transaction based fees on deposit accounts are charged to deposit clients for specific services provided, such as wire transfers, official checks, and overdraft processing. These fees are contract-specific to each individual transaction, do not extend beyond the transaction, and are recognized when the specific service is performed. Non-transaction-based deposit fees primarily consist of monthly account maintenance fees. These fees are generally subject to day-to-day contracts that may be canceled by either party without notice. The performance obligation is satisfied, and the fees are recognized, on a monthly basis after the service period is completed. Debit and credit card interchange income and expenses Debit and credit card interchange income represent fee …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

The Company is managed by legal entity, rather than by lines of business, and its activities are considered a single operating segment for financial reporting purposes. The Bank is engaged in the single line of business of community banking, which involves gathering deposits and originating loans in its primary market areas. The Bank manages its operations, allocates resources, and monitors and reports its financials as a single operating segment. Banners Chief Executive Officer is considered the Chief Operating Decision Maker (CODM). The CODM assesses performance based on net income that is reported on our Consolidated Statements of Operations. The measure of segment assets is reported on our Consolidated Statement of Financial Condition as total assets. The CODM uses consolidated net income as the primary measure to evaluate resource allocations. The CODM is regularly provided with our consolidated financial statements, specifically the statement of operations and the statement of cash flows, as well as expense and budget data. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Financial Instruments with Off-Balance Sheet Risk - The Company has financial instruments with off-balance-sheet risk generated in the normal course of business to meet the financing needs of its clients. These financial instruments include commitments to extend credit, commitments related to standby letters of credit, commitments to originate loans, commitments to sell loans, and commitments to buy or sell securities. These instruments involve, to varying degrees, elements of credit and interest rate risk similar to the risk involved in on-balance sheet items. Our exposure to credit loss in the event of nonperformance by the other party to the financial instrument from commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. We apply the same credit policies to these commitments and conditional obligations as we do to our on-balance sheet financial instruments. Outstanding commitments consisted of the following at the dates indicated (in thousands): Contract or Notional Amount September 30, 2025 December 31, 2024 Commitments to extend credit $ 3,838,654 $ 3,857,782 Standby letters of credit and financial guarantees 19,705 28,287 Risk participation agreements 41,719 43,913 Commitments to originate loans held for sale 50,041 35,512 Commitments to sell loans secured by one- to four-family residential properties 28,000 17,963 Commitments to sell securities related to mortgage banking activities 33,000 37,5 …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents estimated fair values of the Companys financial instruments as of September 30, 2025 and December 31, 2024, whether or not recognized or recorded in the Consolidated Statements of Financial Condition (dollars in thousands): September 30, 2025 December 31, 2024 Level Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Assets: Cash and cash equivalents 1 $ 672,863 $ 672,863 $ 501,858 $ 501,858 Securitiesavailable-for-sale 2 1,989,454 1,989,454 2,078,826 2,078,826 Securitiesavailable-for-sale 3 29,071 29,071 25,685 25,685 Securitiesheld-to-maturity 2 965,401 809,271 995,237 819,230 Securitiesheld-to-maturity 3 6,202 6,163 6,327 6,298 Loans held for sale 2 20,334 20,599 32,021 32,215 Loans receivable, net 3 11,542,831 11,445,723 11,199,135 10,894,024 Equity securities 1 510 510 481 481 FHLB stock 3 14,226 14,226 22,451 22,451 Bank-owned life insurance 1 317,469 317,469 312,549 312,549 Mortgage servicing rights 3 11,962 35,526 12,618 37,926 SBA servicing rights 3 1,122 1,122 869 869 Investments in limited partnerships 3 16,929 16,929 13,955 13,955 Derivatives: Interest rate swaps 2 10,292 10,292 14,507 14,507 Interest rate lock and forward sales commitments 2,3 319 319 331 331 Liabilities: Demand, interest checking and money market accounts 2 8,769,730 8,769,730 8,536,303 8,536,303 Regular savings 2 3,705,823 3,705,823 3,478,423 3,478,423 Certificates of deposit 2 1,540,382 1,535,106 1,499,672 1,492,829 FHLB advances 2 100,000 100,0 …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Other Intangible Assets: At September 30, 2025, intangible assets are comprised of goodwill and core deposit intangibles (CDI) acquired in business combinations. Goodwill represents the excess of the purchase consideration paid over the fair value of the assets acquired, net of the fair values of liabilities assumed in a business combination, and is not amortized but is reviewed at least annually for impairment. The Company has identified one reporting unit for the purpose of evaluating goodwill for impairment. The Company completed an assessment of qualitative factors as of December 31, 2024 and concluded that no further analysis was required as it was more likely than not that the fair value of the reporting unit exceeded the carrying value. CDI represents the value of transaction-related deposits and the value of the client relationships associated with the deposits. The Company amortizes CDI assets over their estimated useful lives and reviews them at least annually for events or circumstances that could impair their value. The following table summarizes the changes in the Companys goodwill and other intangibles for the year ended December 31, 2024 and the nine months ended September 30, 2025 (in thousands): Goodwill CDI Total Balance, December 31, 2023 $ 373,121 $ 5,684 $ 378,805 Amortization (2,626) (2,626) Balance, December 31, 2024 373,121 3,058 376,179 Amortization (1,252) (1,252) Balance, September 30, 2025 $ 373,121 $ 1,806 $ 374,927 The following tabl …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

As of September 30, 2025, the Company had a net deferred tax asset of $130.4 million. In addition, the Company has estimated $2.0 million of unrecognized tax benefits related to uncertain tax positions. The Company recorded income tax expense of $33.7 million and $28.9 million for the nine months ended September 30, 2025 and 2024, respectively, representing effective tax rates of 18.9% and 19.1%, respectively. The effective tax rates differed from the statutory rate principally due to the effects of tax-exempt income, certain tax credits, and tax benefits related to restricted stock vesting. Tax credit investments: The Company invests in low income housing tax credit funds that are designed to generate a return primarily through the realization of federal tax credits. The Company accounts for these investments by amortizing the cost of tax credit investments over the life of the investment using a proportional amortization method and this tax credit investment amortization expense is a component of the provision for income taxes. The current balance of these tax credit investments is included in other assets, while the unfunded commitments are included in accrued expenses and other liabilities on the Consolidated Statements of Financial Condition. The following table presents the balances of the Companys tax credit investments and related unfunded commitments at September 30, 2025 and December 31, 2024 (in thousands): September 30, 2025 December 31, 2024 Tax Credit Investment …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

The Company is managed by legal entity, rather than by lines of business, and its activities are considered a single operating segment for financial reporting purposes. The Bank is engaged in the single line of business of community banking, which involves gathering deposits and originating loans in its primary market areas. The Bank manages its operations, allocates resources, and monitors and reports its financials as a single operating segment. The Companys performance is assessed based on net income that is reported on our Consolidated Statements of Operations with consolidated net income being the primary measure to evaluate resource allocations. In addition to our consolidated financial statements, the operating and financial condition data below is used to monitor budget versus actual results and assess performance: OPERATING DATA: Quarters Ended Nine Months Ended (In thousands) Sep 30, 2025 Jun 30, 2025 Sep 30, 2024 Sep 30, 2025 Sep 30, 2024 Interest income $ 205,848 $ 200,259 $ 195,841 $ 599,975 $ 569,667 Interest expense 55,859 55,860 60,166 164,504 168,487 Net interest income 149,989 144,399 135,675 435,471 401,180 Provision for credit losses 2,670 4,795 1,692 10,604 4,581 Non-interest income 20,730 17,751 18,063 57,589 46,853 Non-interest expense 102,022 101,348 96,291 304,629 292,060 Net income $ 53,502 $ 45,496 $ 45,153 $ 144,133 $ 122,507 FINANCIAL CONDITION DATA: Quarters Ended (In thousands) Sep 30, 2025 Jun 30, 2025 Dec 31, 2024 Sep 30, 2024 Cash and securit …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing