Banner : Acquisition of Pacific Financial Corporation
BANR
Published on 04/30/2026 at 08:06 pm EDT
A c quisition of Pac i f i c F inanc i a l C orporation
A p r i l 3 0 , 2 0 2 6
Since 1890
Important Information
Additional Information and Where to Find It
Banner will file a registration statement on Form S-4 with the SEC in connection with the proposed transaction. The registration statement will include a proxy statement of Pacific Financial that also constitutes a prospectus of Banner. After the registration statement is declared effective by the SEC, Pacific Financial will mail a definitive proxy statement/prospectus to its shareholders.
Before making any voting decision, the shareholders of Pacific Financial are advised to read the proxy statement/prospectus when it becomes available because it will contain important information about Banner, Pacific Financial, the merger agreement and the merger. When filed, this document and other documents relating to the merger filed by Banner can be obtained free of charge from the SEC's website at https://www.sec.gov. These documents also can be obtained free of charge through Banner's investor relations website at https://investor.bannerbank.com by clicking on "SEC Filings" under the "Financials" tab. Alternatively, these documents, when available, can be obtained free of charge from Banner upon written request to Banner Corporation, Attn: Investor Relations, 10 South First Avenue, Walla Walla, Washington 99362 or by calling (509) 527-3636. The contents of the websites referenced above are not deemed to be incorporated by reference into the registration statement or the proxy statement/prospectus.
Participants in the Solicitation
This communication does not constitute a solicitation of proxy, an offer to sell or a solicitation of an offer to sell any securities. Banner, Pacific Financial, and certain of their directors, executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Pacific Financial in connection with the proposed merger under SEC rules. Information about the directors and executive officers of Banner and Pacific Financial will be included in the proxy statement/prospectus for the proposed transaction filed with the SEC. These documents (when available) may be obtained free of charge in the manner described above under "Additional Information and Where to Find It."
Information about such directors and executive officers of Banner and their direct or indirect interests, by security holdings or otherwise, can be found in Banner's proxy statement in connection with its 2026 annual meeting of shareholders, as filed with the SEC on April 6, 2026, and other documents subsequently filed by Banner with the SEC. To the extent holdings of common stock by its directors or executive
officers have changed since the amounts set forth in Banner's proxy statement for its 2026 annual meeting of shareholders, such changes have been or will be reflected in filings with the SEC on Forms 3, 4, and 5. These documents can be obtained free of charge in the manner described above under "Additional Information and Where to Find It."
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In-Market Transaction of Attractive Deposit
Franchise with Low Execution Risk
Attractive Deposit Franchise
Positive Financial Impact
Adds ~$1.1bn deposits in core Washington / Oregon markets
Granular deposit franchise with 38% non-interest bearing and a 1.03% cost of deposits (0.70% excl. time)
Strong liquidity position - 68% loans / deposits - provides additional upside to drive growth
In-market transaction with identified cost savings opportunities
Successful history of operating in Washington & Oregon with 21 client service locations (15 full-service branches and 6 commercial banking centers)
Conservative balance sheet with commercially focused loan portfolio
Operates in diverse industry lines similar to Banner's super community banking model
Plan for retention of selected leadership post-close supports continuity and integration
Disciplined pricing
~3.2% EPS accretion with fully phased-in cost savings
Limited TBV dilution with <3 year earnback
Attractive use of capital with >25% IRR; neutral to CET1 capital ratio
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Pacific Financial Corporation Overview
Pacific Financial Corporation ("PFLC") was formed in 1997 as the holding company for
Bank of the Pacific, founded in 1971 and headquartered in Aberdeen, Washington
#1 community bank by deposit share in Pacific and Wahkiakum counties within its core
Washington footprint(1)
Low-cost, relationship-driven funding base, with 38% non-interest-bearing deposits and a 1.03% cost of deposits(2)
CEO Denise Portmann, who brings over two decades of leadership experience at Pacific, is expected to continue as part of the Banner team
Key Franchise / Financial Highlights
Franchise & Market Data
CEO Denise J. Portmann
HQ Aberdeen, WA
Branches 15
Profitability (Q1'26) (2)
ROAA 0.97%
Loan Composition (2)
3/31/2026
Deposit Composition (2)
NIM 4.04%
3/31/2026
Commercial and
C&D
Farmland
Time Deposits
Efficiency Ratio 73.9%
Agricultural
4%
Multi-
Non-Interest-
Balance Sheet, Capital and Asset Quality (Q1'26) (2)
Resi 1-4 family
14%
6%
14%
4%
11%
24%
family
Savings
Account
10%
13%
38%
Bearing
(dollars in millions)
Assets $1,291
Gross Loans $771
Consumer
23%
CRE
Owner Occupied
Money
28%
11%
Deposits $1,139
CRE Non-Owner Occupied
Market
Interest-Bearing
CET1
(3
16.2%
NPA / Assets
0.05%
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Demand )
Loan Yield: 5.89%
Cost of Deposits: 1.03%
Source: S&P Capital IQ Pro. Community banks defined as banks with total assets <$65bn. Deposit market share data as of 6/30/2025.
Deposit, loan and financial data from PFLC as of 3/31/2026.
Bank level.
Attractive Deposit Franchise That Adds
Complementary Washington Coast Density
BANR
PFLC
1.03%
(1)
Cost of Deposits Incl. Time
0.70%
(1)
Cost of Deposits Excl. Time
38.0%
(1)
Non-Interest Bearing Deposits
13%
(2)
Upcycle Beta
$2.8k(1)
Median Account Balance
No Borrowings or
Wholesale Deposits
BANR PFLC
Presence in Attractive Markets Granular, Low-Cost & In-Market Deposit Franchise
8.0%
NIB Deposit Growth in 2025
$36.6k(1)
Average Account Balance
(3)
Review of Last Hike Cycle; Valuable Low Beta Deposits
5.50%
0.25%
0.08%
0.75%
Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23
Fed-Funds Rate (Top End) PFLC Cost of Deposits
Financial Data as of 3/31/2026 from PFLC.
Upcycle beta calculated over the time period from 9/30/2021 to 12/31/2023 per
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PFLC earnings releases and Federal Reserve Bank of St. Louis (FRED).
Federal Funds Rate data per the Federal Reserve Bank of St. Louis (FRED).
Key Transaction Assumptions
Consideration & Deal Value
Cost Savings & Earnings Adjustments
Key Merger Assumptions
Excluding cash-out of PFLC options outstanding at closing. 7
Based upon BANR closing price of $66.25 on 4/29/2026 and 10,144,298 PFLC fully diluted shares outstanding.
Attractive Financial Impact
Disciplined Pricing Resulting in…
1.54x
6.0%
6.3x
…Attractive Financial Impact
3.2%
~(2.0%)
2.8 Yrs
>25%
7%
Attractive Proforma Franchise
Proforma Loan Mix (1)
Resi 1-4
Family
Consumer
7%
13%
Agricultural
Commercial
37% RE
3%
Total Loans: $12.5bn
20%
Commercial
6%
14%
C&D
Multi-
family
Proforma Deposit Mix (1)
Non-
interest bearing 33%
Interest-bearing
18%
demand
Total Deposits: $15.0bn
11%
Money
market
11%
Time
Deposits
(CDs)
27%
Savings
1. Financial Data as of 3/31/2026. 8
Key Takeaways
Strengthens Banner's franchise in attractive Washington and Oregon markets, adding
strong local relationships and a well-established community banking presence
Compelling financial profile with near-term earnings uplift, driven by Pacific Financial's
low funding costs, strong core deposit mix, and cost synergies
High strategic and cultural alignment enabling a straightforward integration with low
execution risk, retaining Banner's optionality to explore additional attractive opportunities
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Disclaimer
Banner Corporation published this content on April 30, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 30, 2026 at 23:46 UTC.