BANR earnings analysis
What we found in BANR's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Banner delivered revenue growth and modest sequential net-interest-margin expansion in Q2 2026, with GAAP revenue of $171.962 million and tax-equivalent NIM of 4.13%. However, basic EPS declined to $1.44 from $1.61 in Q1 as the provision returned to $3.818 million and expenses increased, while nonperforming assets rose to $60.543 million. The balance sheet remains well capitalized and operating cash generation was strong, but loan growth was partly funded by higher FHLB advances and the pending Pacific Financial acquisition adds execution risk.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue and net interest income grew
- Q2 GAAP revenue increased $2.632 million sequentially to $171.962 million from $169.330 million, and rose $9.812 million year over year from $162.150 million. Net interest income increased to $153.740 million from $150.169 million sequentially and $144.399 million a year ago.
- Net interest margin expanded
- Tax-equivalent net interest margin expanded to 4.13% from 4.11% in Q1 and 3.92% in Q2 2025. Management attributed the sequential improvement to loan growth, slightly higher loan yields and lower deposit costs, partly offset by greater FHLB usage.
- Loan growth outpaced deposit growth
- Net loans rose $272.7 million from year-end to $11.994 billion, led by commercial business loans up $170.2 million and consumer loans up $58.5 million. Total deposits increased $46.4 million to $13.790 billion, with core deposits up $105.7 million and representing 89% of deposits.
- Strong operating cash generation
- Six-month operating cash flow was $148.870 million, up from $112.089 million in the prior-year period. After $3.960 million of property-and-equipment purchases, calculated six-month free cash flow was $144.910 million, implying low 2.7% capex intensity versus operating cash flow.
- Capital ratios improved
- Capital strengthened: shareholders' equity increased $53.0 million from year-end to $1.999 billion, while tangible common equity/tangible assets improved to 10.02% from 9.84%. Banner's total capital ratio was 14.68%, above the 10.00% well-capitalized threshold.
- Acquisition and capital-return actions
- Pacific Financial merger is expected to close in Q3 2026, subject to approvals and other conditions; Pacific Financial holders would receive 0.2633 Banner shares per share. Banner also authorized a new repurchase program for 1,700,000 shares on August 3, 2026.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Sequential EPS and profitability declined
- Quarterly earnings weakened sequentially: net income fell to $48.886 million from $54.716 million and diluted EPS declined to $1.43 from $1.60. The drivers included a $3.818 million total credit-loss provision versus a $796,000 recapture in Q1 and a $5.382 million sequential increase in non-interest expense.
- Nonperforming and substandard loans rose
- Asset-quality pressure increased: non-performing assets rose to $60.543 million, or 0.36% of assets, from $51.235 million, or 0.31%, at year-end. Nonaccrual loans increased to $52.897 million from $41.525 million, while substandard loans rose to $218.426 million from $193.077 million.
- Loan growth increased wholesale funding use
- FHLB advances more than doubled from $150.0 million at year-end to $320.0 million, which management said temporarily funded second-quarter loan growth. Total deposits were only $46.4 million higher year to date, while loans increased $272.7 million.
- Rate exposure has asymmetric balance-sheet effects
- Interest-rate sensitivity remains material: a modeled instantaneous 300-basis-point rate decline would reduce next-12-month net interest income by $35.677 million, or 5.6%. Conversely, a 300-basis-point rate increase would lower modeled economic value of equity by $474.277 million, or 14.2%.
- Pacific Financial transaction risk updated
- The only stated material risk-factor update concerns the Pacific Financial acquisition. The filing says the Q3 2026 expected close is not assured; failure to close, integration difficulties, disruption of customer or employee relationships, or dilution from Banner share issuance could adversely affect results.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $1.44
- Segment
- Single community-banking operating segment; Q2 2026 GAAP revenue was $171.962 million.
What they said about what is next.
No quantitative revenue or EPS outlook was provided in the 10-Q. Management expects the Pacific Financial acquisition to close in Q3 2026, subject to shareholder, regulatory and other closing conditions.
The filing reads about the same as the one before it.
What came before.
- 10-Q · May 5, 2026
- Banner Corporation reported a strong Q1 2026 with revenue of $169.3 million, increasing slightly from Q4 2025's $167.7 million. Net income rose to $54.7 million, reflecting an improvement in EPS to $1.60, supported by a…
- 10-K · February 25, 2026
- Banner Corporation’s 2025 10‑K shows modest top‑line growth and stronger per‑share earnings driven by loan growth and stable margins. The bank reports total assets of $16.35 billion, a net loan portfolio of $11.72…
- 10-Q · August 6, 2024
- Banner reported quarter-to-date net revenue (net interest income + non-interest income) of $149,745,000 and net income of $39,795,000 for the three months ended June 30, 2024. Revenue was essentially flat versus the…
- 10-Q · November 2, 2023
- Banner reported Q3 2023 revenue of $154.424M and diluted EPS of $1.33. Results show year-over-year pressure (revenue and EPS down vs. Q3 2022) but a sequential pickup in quarterly net income. Balance sheet shows loan…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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