Banner Corporation Earns $45.2 million, or $1.89 per diluted share, in 2015; Includes $6.9 Million, or $0.20 Per Diluted Share, in the Fourth Quarter of 2015; Fourth Quarter Highlighted By Completed Acquisition of AmericanWest Bank


WALLA WALLA, Wash., Jan. 27, 2016 (GLOBE NEWSWIRE) -- Banner Corporation (NASDAQ GSM:BANR), the parent company of Banner Bank and Islanders Bank, today reported net income in the fourth quarter of 2015 of $6.9 million, or $0.20 per diluted share, compared to $12.9 million, or $0.62 per diluted share, in the preceding quarter and $11.7 million, or $0.60 per diluted share, in the fourth quarter a year ago.  The current quarter results were impacted by $18.4 million of acquisition-related expenses which, net of tax benefit, reduced net income by $0.37 per diluted share, and the preceding quarter results were impacted by $2.2 million of acquisition-related expenses which, net of tax benefit, reduced net income by $0.09 per diluted share.

For the year, net income was $45.2 million, or $1.89 per diluted share, compared to $54.1 million, or $2.79 per diluted share, in 2014.  Results for 2014 included a $9.1 million bargain purchase gain related to the acquisition of six branches in southwest Oregon, which net of taxes contributed $0.30 to diluted net income per share.  Acquisition-related expenses were $26.1 million, or $0.76 per diluted share net of tax benefit, in 2015 compared to $4.3 million, or $0.17 per diluted share net of tax benefit, in 2014.

“For Banner Corporation 2015 was a truly transformational year,” stated Mark J. Grescovich, President and Chief Executive Officer.  “While our operating results for the most recent quarter and full year continued to reflect the success of our proven client acquisition strategies, which produced strong organic growth of loans and deposits, as well as core revenues, we also benefited meaningfully from the successful acquisition and integration of Siuslaw Bank in March 2015 and the six branches in southwest Oregon that we acquired in June 2014.  In addition, the recently completed acquisition of AmericanWest Bank had a dramatic impact on our operating results for the fourth quarter of 2015, substantially increasing the scale and reach of the Company and providing tremendous opportunity for future revenue growth.  With this strategic combination, we will deploy our super community bank model throughout a strengthened presence in Washington, Oregon and Idaho, and enter attractive growth markets in California and Utah.  Although there remains significant additional work to be done to complete the full integration of the two companies and realize the expected operating synergies, we are exceptionally pleased with the progress we have made through the dedicated efforts of our employees and expect that, similar to the prior acquisitions, this acquisition of AmericanWest Bank will result in significant benefits to our expanding group of clients, communities, employees and shareholders.”

With the completion of the AmericanWest Bank acquisition, at December 31, 2015 Banner Corporation had $9.8 billion in assets, $7.2 billion in net loans and $8.1 billion in deposits.  As Banner Bank deploys its super community bank business model across five western states, the combined bank, with 202 branch offices located in nine of the top 20 largest western Metropolitan Statistical Areas by population, is benefiting from its diversified geographic footprint with significant growth opportunities.

Fourth Quarter 2015 Highlights

  • Completed acquisition of AmericanWest Bank on October 1, 2015, including $4.5 billion of assets, $3.0 billion of net loans and $3.6 billion in deposits.
  • Net income was $6.9 million, or $0.20 per diluted share.
  • Acquisition-related expenses were $18.4 million which, net of tax benefit, reduced net income by $0.37 per diluted share for the quarter ended December 31, 2015.
  • Revenues from core operations* increased 90% to $112.0 million, compared to $59.1 million in the fourth quarter a year ago.
  • Net interest margin was 4.05% for the current quarter, compared to 4.14% in the third quarter of 2015 and 4.08% a year ago.
  • Deposit fees and other service charges were $13.2 million, an increase of 35% compared to the preceding quarter and 58% year-over-year.
  • Revenues from mortgage banking operations were $4.5 million, compared to $4.4 million in the preceding quarter and $3.0 million a year ago.
  • Net loans increased by $2.94 billion, or 69%, during the quarter, and increased 93% year-over-year.
  • Total deposits increased 107% to $8.06 billion compared to a year ago.
  • Core deposits increased by $3.03 billion, or 83%, during the quarter, and increased 114% year-over-year.
  • Core deposits represented 83% of total deposits at December 31, 2015.
  • Common stockholders' tangible equity per share* decreased to $29.66 at December 31, 2015, compared to $30.75 at the preceding quarter end but increased from $29.64 a year ago.
  • The ratio of tangible common stockholders' equity to tangible assets* remained strong at 10.68% at December 31, 2015.

*Revenues from core operations and other operating income from core operations (both of which exclude fair value adjustments, gains and losses on the sale of securities and the acquisition bargain purchase gain), acquisition accounting impact on net interest margin, other operating expense from core operations (which excludes acquisition-related costs) and references to tangible common stockholders' equity per share and the ratio of tangible common equity to tangible assets (both of which exclude goodwill and other intangible assets) represent non-GAAP (Generally Accepted Accounting Principles) financial measures. Management has presented these non-GAAP financial measures in this earnings release because it believes that they provide useful and comparative information to assess trends in Banner's core operations reflected in the current quarter's results and facilitate the comparison of our performance with the performance of our peers.  Where applicable, comparable earnings information using GAAP financial measures is also presented.  See also Non-GAAP Financial Measures reconciliation tables on the last two pages of this press release.

Acquisition of AmericanWest Bank

Effective October 1, 2015, Banner completed the acquisition of Starbuck Bancshares, Inc. ("Starbuck") and its wholly owned subsidiary AmericanWest Bank.  The merger was accounted for using the acquisition method of accounting.  Accordingly, the purchase price was allocated to the assets (including identifiable intangible assets) and the liabilities of Starbuck at their respective estimated fair values as of the merger date.  The excess of the purchase price over the fair value of the net assets acquired was allocated to goodwill.  The fair value on the merger date represents management's best estimates based on available information and facts and circumstances in existence on the merger date.  The allocation of the purchase price is subject to adjustment within the measurement period.

In addition to the acquisition of AmericanWest Bank, the acquisition of Siuslaw Financial Group and its wholly-owned subsidiary Siuslaw Bank ("Siuslaw") in March 2015 and acquisition of six branches in southwest Oregon acquired in June 2014 (the (the "Branch purchase") had a significant impact on the current and historical operating results of Banner.  For additional details regarding these acquisitions and merger related expenses, see the tables under Business Combinations on pages 12 and 13 of this press release.

Income Statement Review

Banner’s fourth quarter net interest income, before the provision for loan losses, increased 76% to $92.1 million, compared to $52.2 million in the preceding quarter and increased 97% compared to $46.7 million in the fourth quarter a year ago, largely reflecting the acquisitions of AmericanWest Bank and Siuslaw and continued client acquisition.  In 2015, Banner’s net interest income increased 35% to $242.3 million compared to $179.9 million in 2014, which in addition to the acquisitions reflected the Branch purchase and significant organic loan and deposit growth.

“Although lower as expected following the acquisition of AmericanWest Bank, we maintained a solid net interest margin in the fourth quarter reflecting a strong loan to deposit ratio and well disciplined pricing decisions,” said Grescovich.  Net interest margin is enhanced by the amortization of acquisition accounting discounts on purchased loans received in Banner's acquisitions, which is accreted into loan interest income, as well as by net premiums on non-market-rate certificate of deposit liabilities assumed which are amortized as a reduction to deposit interest expense.  The preceding quarter was impacted by the accretion of acquisition accounting loan discounts from the Siuslaw acquisition and immaterial amount of deposit premium amortization which together contributed approximately three basis points to the margin in that period.  Banner's net interest margin was 4.05% for the fourth quarter of 2015, which included 11 basis points as a result of accretion from acquisition accounting loan discounts from both the AmericanWest Bank and Siuslaw acquisitions and three basis points from the amortization of deposit premiums, compared to 4.14% in the preceding quarter and 4.08% in the fourth quarter a year ago.  For the year, Banner’s net interest margin was 4.10%, which included seven basis  points from acquisition accounting adjustments, compared to 4.07% in 2014, which included just one basis point from acquisition accounting adjustments.

Average interest-earning asset yields decreased ten basis points compared to the preceding quarter and decreased seven basis points from the fourth quarter a year ago.  Despite the positive impact from the accretion of discounts on the loans acquired through the acquisitions, which added 14 basis points to reported yields for the quarter, loan yields decreased four basis points compared to the preceding quarter and decreased eight basis points from the fourth quarter a year ago.  The decrease in the average loan yield was primarily attributable to changes in the portfolio mix as a result of the acquisitions, as well as payoffs of loans which had a higher yield than the average yield of newly originated loans.  Deposit costs decreased one basis point compared to the preceding quarter and decreased three basis points compared to the fourth quarter a year ago.  Amortization of acquisition accounting net premiums on certificates of deposit reduced the cost of deposits by three basis points in the fourth quarter 2015 and by one basis point for the full year.  The total cost of funds declined two basis points in the fourth quarter compared to the preceding quarter and declined five basis points compared to the fourth quarter a year ago.

“Home purchase activity remains robust in our markets, and revenues from mortgage banking remained strong, reflecting Banner’s increased market presence and our investment in this business line,” said Grescovich.  Mortgage banking operations contributed $4.5 million to fourth quarter revenues compared to $4.4 million in the preceding quarter and $3.0 million in the fourth quarter of 2014.  In 2015, mortgage banking operations produced $17.7 million of revenues compared to $10.2 million in 2014.  Home purchase activity accounted for 61% of fourth quarter mortgage banking originations and 63% of mortgage originations in 2015.

Deposit fees and other service charges increased 35% to $13.2 million in the fourth quarter of 2015, compared to $9.7 million in the preceding quarter and increased 58% compared to $8.3 million in the fourth quarter a year ago.  In 2015, deposit fees and other service charges increased 33% to $40.6 million compared to $30.6 million in 2014.  The year-over-year increase reflects strong organic growth, as well as the AmericanWest Bank and Siuslaw acquisitions and the Branch purchase, together resulting in significant growth in the number of deposit accounts and increased transaction activity.

Revenues from core operations* (revenues excluding gains and losses on the sale of securities, net change in valuation of financial instruments and the bargain purchase gain) increased 66% to $112.0 million in the fourth quarter ended December 31, 2015, compared to $67.4 million in the preceding quarter and increased 90% compared to $59.1 million in the fourth quarter of 2014.  In 2015, revenues from core operations* increased 36% to $305.9 million, compared to $224.4 million in 2014.  Total revenues were $110.5 million for the quarter ended December 31, 2015, compared to $66.3 million in the preceding quarter and $58.8 million in the fourth quarter a year ago.  In 2015, total revenues were $304.6 million, compared to $234.9 million in 2014.

Banner’s fourth quarter 2015 results included a $1.5 million net loss for fair value adjustments as a result of changes in the valuation of financial instruments carried at fair value, as well as a $3,000 net loss on the sale of securities.  In the preceding quarter, results included a $1.1 million net loss for fair value adjustments and in the fourth quarter a year ago results included a $287,000 net loss for fair value adjustments, as well as a $1,000 gain on the sale of securities.

Banner’s total other operating income, which includes the changes in the valuation of financial instruments and gains and losses on the sale of securities, was $18.4 million in the fourth quarter of 2015, compared to $14.1 million in the third quarter of 2015 and $12.1 million in the fourth quarter a year ago.  For the full year, total other operating income was $62.3 million compared to $55.0 million in 2014 which also included the $9.1 million bargain purchase gain from the Branch purchase.  Other operating income from core operations,* which excludes gains and losses on sale of securities and net changes in the valuation of financial instruments, was $19.9 million for the fourth quarter of 2015, compared to $15.2 million for the preceding quarter and $12.4 million for the fourth quarter a year ago.  For the year, other operating income from core operations* increased 43% to $63.6 million, compared to $44.5 million in 2014.

Total other operating expenses (non-interest expenses) were $100.3 million in the fourth quarter of 2015, compared to $46.7 million in the preceding quarter and $41.2 million in the fourth quarter of 2014.  The year-over-year increase in operating expenses was largely attributable to acquisition-related expenses and incremental costs associated with operating the 98 branches acquired in the AmericanWest Bank acquisition on October 1, 2015 and the ten Siuslaw branches acquired in March 2015, as well as generally increased compensation, occupancy and payment and card processing services reflecting increased transaction volume.  There were $18.4 million in acquisition-related expenses in the current quarter compared to $2.2 million in the preceding quarter and $2.8 million in the fourth quarter a year ago.  For the year, total other operating expenses were $236.6 million, compared to $153.7 million in 2014, with acquisition-related expenses of $26.1 million, compared to $4.3 million in 2014.  Acquisition-related expenses in the year ended December 31, 2015 included $24.1 million related to the acquisition of AmericanWest Bank and $2.0 million related to the acquisition of Siuslaw.  In addition to the AmericanWest Bank and Siuslaw branches, the increase in total operating expenses for the full year reflects costs associated with operating the six southwestern Oregon branches acquired in June 2014.

For the fourth quarter of 2015, Banner recorded $3.3 million in state and federal income tax expense for an effective tax rate of 32.4%, which reflects normal marginal tax rates increased by the effect of certain non-deductible merger expenses and reduced by the effect of tax-exempt income and certain tax credits.

Balance Sheet Review

Largely as a result of the AmericanWest Bank acquisition, but also reflecting organic growth, total assets increased by 87% to $9.80 billion at December 31, 2015, compared to $5.31 billion at September 30, 2015, and increased 107% compared to $4.72 billion a year ago.  The total of securities and interest-bearing deposits held at other banks was $1.54 billion at December 31, 2015, compared to $648.5 million at September 30, 2015 and $637.5 million a year ago.  The increase in securities portfolio is primarily a result of positions held by AmericanWest at the time of the merger.  The average effective duration of Banner's securities portfolio was approximately 3.3 years at December 31, 2015.

“Net loans increased by $2.94 billion, or 69%, during the quarter and increased 93% year-over-year due to both the AmericanWest Bank and Siuslaw acquisitions and strong organic growth.  Loan production remained solid, as did the regional economy, and we continue to see significant potential for growth in our loan origination pipelines,” added Grescovich.

Net loans were $7.24 billion at December 31, 2015, compared to $4.29 billion at September 30, 2015, and $3.76 billion a year ago.  The AmericanWest Bank acquisition accounted for $2.82 billion of the year-end loan portfolio and the Siuslaw acquisition accounted for $236 million, of the year-end loan portfolio.  Commercial real estate and multifamily real estate loans increased 88% to $3.57 billion at December 31, 2015, compared to $1.90 billion at September 30, 2015, and increased 127% compared to $1.57 billion a year ago.  Commercial business loans increased 49% to $1.21 billion at December 31, 2015, compared to $812.1 million three months earlier and increased 67% compared to $724.0 million a year ago.  Agricultural business loans increased 55% to $376.5 million at December 31, 2015, compared to $242.6 million three months earlier and increased 58% compared to $238.5 million a year ago.  Total construction, land and land development loans increased 16% to $574.2 million at December 31, 2015, compared to $493.8 million at September 30, 2015, and increased 40% compared to $411.0 million a year earlier.

Banner’s total deposits increased 84% to $8.06 billion at December 31, 2015, compared to $4.39 billion at September 30, 2015 and increased 107% compared to $3.90 billion a year ago.  The AmericanWest Bank acquisition accounted for $3.54 billion and the Siuslaw acquisition accounted for  $336 million, respectively, of the deposit portfolio at December 31, 2015.  Non-interest-bearing account balances increased 68% to $2.62 billion at December 31, 2015, compared to $1.56 billion three months earlier and increased 102% compared to $1.30 billion a year ago.  Interest-bearing transaction and savings accounts increased 94% to $4.07 billion at December 31, 2015, compared to $2.10 billion three months earlier and increased 122% compared to $1.83 billion a year ago.  Certificates of deposit increased 87% to $1.37 billion at December 31, 2015, compared to $730.7 million at September 30, 2015, and increased 77% compared to $770.5 million a year earlier.  Brokered deposits totaled $162.9 million at December 31, 2015, compared to $10.1 million at September 30, 2015 and $4.8 million a year ago.

Banner’s core deposits represented 83% of total deposits at December 31, 2015, compared to 80% of total deposits a year earlier.  The cost of deposits was 0.15% for the quarter ended December 31, 2015, compared to 0.16% in the preceding quarter, and declined two basis points from 0.18% for the quarter ended December 31, 2014.

At December 31, 2015, total common stockholders' equity was $1.30 billion, or $37.97 per share, compared to $671.2 million at September 30, 2015 and $582.9 million a year ago.  This increase was mostly due to 13.23 million shares of common stock and non-voting common stock issued on October 1, 2015 in connection with the AmericanWest Bank acquisition, which were valued at $47.67 per share and increased stockholders’ equity by $630.7 million.  In addition, on March 6, 2015, Banner issued 1.3 million shares in connection with the Siuslaw acquisition, which were valued at $44.02 per share and added $58.1 million to stockholders’ equity.  At December 31, 2015, tangible common stockholders' equity*, which excludes goodwill and other intangible assets, was $1.02 billion, or 10.68% of tangible assets*, compared to $644.6 million, or 12.20% of tangible assets, at September 30, 2015, and $580.1 million, or 12.29% of tangible assets, a year ago.  Banner's tangible book value per share* increased slightly to $29.66 at December 31, 2015, compared to $29.64 per share a year ago.

Banner Corporation and its subsidiary banks continue to maintain capital levels in excess of the requirements to be categorized as “well-capitalized” under the newly implemented Basel III and Dodd Frank regulatory standards.  At December 31, 2015, Banner Corporation's common equity Tier 1 capital ratio was 12.15%, its Tier 1 leverage capital to average assets ratio was 11.06% and its total capital to risk-weighted assets ratio was 13.66%.

Credit Quality

“No provision for loan losses was required during the current quarter or the full year despite the organic loan growth,” said Grescovich.  “Our credit quality metrics continue to reflect our moderate risk profile and our reserve levels remain strong.”

In accordance with acquisition accounting, loans acquired from AmericanWest Bank and Siuslaw were recorded at their estimated fair value, which resulted in a net discount to the loans' contractual amounts, of which a portion reflects a discount for possible credit losses.  Credit discounts are included in the determination of fair value and as a result no allowance for loan and lease losses is recorded for acquired loans at the acquisition date.  Although the discount recorded on the acquired loans is not reflected in the allowance for loan losses, or related allowance coverage ratios, we believe it should be considered when comparing the current ratios to similar ratios in periods prior to the acquisitions of AmericanWest Bank and Siuslaw.

The allowance for loan losses was $78.0 million at December 31, 2015, or 1.07% of total loans outstanding and 512% of non-performing loans compared to $76.0 million at December 31, 2014, or 1.98% of total loans outstanding.  Banner had net recoveries of $688,000 in the fourth quarter compared to net charge-offs of $9,000 in the third quarter of 2015 and net recoveries of $1.6 million in the fourth quarter a year ago.  If the allowance for loan losses and loans were grossed up for the remaining loan discount the adjusted allowance for loans to adjusted loans would have been 1.67% as of December 31, 2015.  Non-performing loans were $15.2 million at December 31, 2015, compared to $16.0 million at September 30, 2015, and $16.7 million a year ago.  Real estate owned and other repossessed assets increased to $11.6 million at December 31, 2015, compared to $6.4 million at September 30, 2015 and $3.4 million a year ago primarily due to additional real estate owned acquired in the mergers.

Banner's non-performing assets were 0.28% of total assets at December 31, 2015, compared to 0.42% at September 30, 2015 and 0.43% a year ago.  Non-performing assets were $27.1 million at December 31, 2015, compared to $22.4 million at September 30, 2015 and $20.2 million a year ago.  In addition to non-performing assets, purchase credit impaired loans increased to $58.6 million at December 31, 2015 compared to $5.4 million at September 30, 2015 as a result of the acquisition of AmericanWest Bank.

Conference Call

Banner will host a conference call on Thursday, January 28, 2015, at 8:00 a.m. PST, to discuss its fourth quarter and year end results.  To listen to the call on-line, go to  www.bannerbank.com.  Investment professionals are invited to dial (866) 235-9915 to participate in the call.  A replay will be available for one week at (877) 344-7529 using access code 10078834, or at www.bannerbank.com.

About the Company

On October 1, 2015, Banner Corporation completed the acquisition of AmericanWest Bank which was merged into Banner Bank, a transformational merger that brought together two financially strong, well-respected institutions and created a leading Western bank.  Banner Corporation is now a $9.8 billion bank holding company operating two commercial banks in five Western states through a network of branches offering a full range of deposit services and business, commercial real estate, construction, residential, agricultural and consumer loans.  Visit Banner Bank on the Web at www.bannerbank.com.

Forward-Looking Statements

When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date such statements are made and based only on information then actually known to Banner.  Banner does not undertake and specifically disclaims any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.  These statements may relate to future financial performance, strategic plans or objectives, revenues or earnings projections, or other financial information.  By their nature, these statements are subject to numerous uncertainties that could cause actual results to differ materially from those anticipated in the statements and could negatively affect Banner's operating and stock price performance.

Important factors that could cause actual results to differ materially from the results anticipated or projected include, but are not limited to, the following: (1) expected revenues, cost savings, synergies and other benefits from the merger of Banner Bank and Siuslaw Bank and the merger of Banner Bank and AmericanWest Bank might not be realized within the expected time frames or at all and costs or difficulties relating to integration matters, including but not limited to customer and employee retention, might be greater than expected; (2) the credit risks of lending activities, including changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses, which could necessitate additional provisions for loan losses, resulting both from loans originated and loans acquired from other financial institutions; (3) results of examinations by regulatory authorities, including the possibility that any such regulatory authority may, among other things, require increases in the allowance for loan losses or writing down of assets; (4) competitive pressures among depository institutions; (5) interest rate movements and their impact on customer behavior and net interest margin; (6) the impact of repricing and competitors' pricing initiatives on loan and deposit products; (7) fluctuations in real estate values; (8) the ability to adapt successfully to technological changes to meet customers' needs and developments in the market place; (9) the ability to access cost-effective funding; (10) changes in financial markets; (11) changes in economic conditions in general and in Washington, Idaho, Oregon, Utah and California in particular; (12) the costs, effects and outcomes of litigation; (13) new legislation or regulatory changes, including but not limited to the Dodd-Frank Act and regulations adopted thereunder, changes in capital requirements pursuant to the Dodd-Frank Act and the implementation of the Basel III capital standards, other governmental initiatives affecting the financial services industry and changes in federal and/or state tax laws or interpretations thereof by taxing authorities; (14) changes in accounting principles, policies or guidelines; (15) future acquisitions by Banner of other depository institutions or lines of business; (16) future goodwill impairment due to changes in Banner's business, changes in market conditions, or other factors and (17) other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services; and other risks detailed from time to time in our filings with the Securities and Exchange Commission including our Quarterly Reports on Form 10-Q and our Annual Reports on Form 10-K.

 
RESULTS OF OPERATIONS Quarters Ended Years Ended
(in thousands except shares and per share data) Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
           
INTEREST INCOME:          
Loans receivable $88,100  $51,749  $46,102  $237,292  $177,541 
Mortgage-backed securities 5,440  1,307  1,403  9,049  5,779 
Securities and cash equivalents 2,955  1,737  1,746  8,092  7,341 
  96,495  54,793  49,251  254,433  190,661 
INTEREST EXPENSE:          
Deposits 3,146  1,738  1,801  8,385  7,578 
Federal Home Loan Bank advances 287  4  16  311  125 
Other borrowings 73  47  40  211  172 
Junior subordinated debentures 890  816  734  3,247  2,914 
  4,396  2,605  2,591  12,154  10,789 
Net interest income before provision for loan losses 92,099  52,188  46,660  242,279  179,872 
PROVISION FOR LOAN LOSSES          
Net interest income 92,099  52,188  46,660  242,279  179,872 
OTHER OPERATING INCOME:          
Deposit fees and other service charges 13,172  9,746  8,317  40,607  30,553 
Mortgage banking operations 4,482  4,426  2,966  17,720  10,249 
Bank owned life insurance 1,056  550  465  2,497  1,809 
Miscellaneous 1,196  489  652  2,821  1,885 
  19,906  15,211  12,400  63,645  44,496 
Net gain (loss) on sale of securities (3)   1  (540) 42 
Net change in valuation of financial instruments carried at fair value (1,547) (1,113) (287) (813) 1,374 
Acquisition bargain purchase gain         9,079 
Total other operating income 18,356  14,098  12,114  62,292  54,991 
OTHER OPERATING EXPENSE:          
Salary and employee benefits 49,225  27,026  23,321  127,282  89,778 
Less capitalized loan origination costs (4,007) (3,747) (3,050) (14,379) (11,730)
Occupancy and equipment 11,533  6,470  5,689  30,366  22,743 
Information / computer data services 5,365  2,219  2,147  12,110  8,131 
Payment and card processing services 5,504  4,168  2,998  16,430  11,460 
Professional services 2,341  951  863  4,828  3,753 
Advertising and marketing 1,882  1,959  1,387  7,649  6,266 
Deposit insurance 1,284  713  595  3,189  2,415 
State/municipal business and use taxes 505  475  415  1,889  1,437 
Real estate operations 207  (2) (187) 397  (446)
Amortization of core deposit intangibles 1,896  286  531  3,164  1,990 
Miscellaneous 6,150  3,972  3,735  17,565  13,619 
  81,885  44,490  38,444  210,490  149,416 
Acquisition related costs 18,369  2,207  2,785  26,110  4,325 
Total other operating expense 100,254  46,697  41,229  236,600  153,741 
Income before provision for income taxes 10,201  19,589  17,545  67,971  81,122 
PROVISION FOR INCOME TAXES 3,308  6,642  5,831  22,749  27,052 
NET INCOME $6,893  $12,947  $11,714  $45,222  $54,070 
Earnings per share available to common shareholders:          
Basic $0.20  $0.62  $0.60  $1.90  $2.79 
Diluted $0.20  $0.62  $0.60  $1.89  $2.79 
Cumulative dividends declared per common share $0.18  $0.18  $0.18  $0.72  $0.72 
Weighted average common shares outstanding:          
Basic 33,842,350  20,755,394  19,374,228  23,801,373  19,359,409 
Diluted 33,934,426  20,821,377  19,441,712  23,866,621  19,402,656 
Increase (decrease)  in common shares outstanding 13,279,955  (8,381) 43  14,670,707  27,779 


FINANCIAL CONDITION 
(in thousands except shares and per share data) Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
       
ASSETS      
Cash and due from banks $117,657  $74,695  $71,077 
Federal funds and interest-bearing deposits 144,260  60,544  54,995 
Securities - trading 34,134  37,515  40,258 
Securities - available for sale 1,138,573  418,254  411,021 
Securities - held to maturity 220,666  132,150  131,258 
Federal Home Loan Bank stock 16,057  6,767  27,036 
Loans held for sale 44,712  3,136  2,786 
Loans receivable:      
Held for portfolio 7,314,504  4,369,458  3,831,034 
Allowance for loan losses (78,008) (77,320) (75,907)
  7,236,496  4,292,138  3,755,127 
Accrued interest receivable 29,627  17,966  15,279 
Real estate owned held for sale, net 11,627  6,363  3,352 
Property and equipment, net 167,604  102,881  91,185 
Goodwill 247,738  21,148   
Other intangibles, net 36,762  5,457  2,831 
Bank-owned life insurance 156,865  71,842  63,759 
Other assets 193,520  61,454  53,199 
  $9,796,298  $5,312,310  $4,723,163 
LIABILITIES      
Deposits:      
Non-interest-bearing $2,619,618  $1,561,516  $1,298,866 
Interest-bearing transaction and savings accounts 4,068,019  2,095,476  1,829,568 
Interest-bearing certificates 1,367,431  730,661  770,516 
  8,055,068  4,387,653  3,898,950 
Advances from Federal Home Loan Bank at fair value 133,381  16,435  32,250 
Customer repurchase agreements and other borrowings 98,325  88,083  77,185 
Junior subordinated debentures at fair value 92,480  85,183  78,001 
Accrued expenses and other liabilities 76,511  42,844  37,082 
Deferred compensation 40,474  20,910  16,807 
  8,496,239  4,641,108  4,140,275 
STOCKHOLDERS' EQUITY      
Common stock 1,261,174  628,958  568,882 
Retained earnings 39,615  41,269  14,264 
Other components of stockholders' equity (730) 975  (258)
  1,300,059  671,202  582,888 
  $9,796,298  $5,312,310  $4,723,163 
Common Shares Issued:      
Shares outstanding at end of period 34,242,255  20,962,300  19,571,548 
Common stockholders' equity per share (1) $37.97  $32.02  $29.78 
Common stockholders' tangible equity per share (1) (2) $29.66  $30.75  $29.64 
Common stockholders' tangible equity to tangible assets (2) 10.68% 12.20% 12.29%
Consolidated Tier 1 leverage capital ratio 11.06% 13.85% 13.41%


 (1)Calculation is based on number of common shares outstanding at the end of the period rather than weighted average shares outstanding.
 (2)Common stockholders' tangible equity excludes goodwill and other intangible assets. Tangible assets exclude goodwill and other intangible assets. These ratios represent non-GAAP financial measures.  See also Non-GAAP Financial Measures reconciliation tables on the last two pages of the press release tables.


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands) 
  Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
LOANS:      
Commercial real estate:      
Owner occupied $1,327,807  $635,146  $546,783 
Investment properties 1,765,353  1,062,418  856,942 
Multifamily real estate 472,976  198,874  167,524 
Commercial construction 72,103  47,490  17,337 
Multifamily construction 63,846  72,987  60,193 
One- to four-family construction 278,469  246,715  219,889 
Land and land development:      
Residential 126,773  111,091  102,435 
Commercial 33,179  15,517  11,152 
Commercial business 1,207,944  812,070  723,964 
Agricultural business including secured by farmland 376,531  242,556  238,499 
One- to four-family real estate 952,633  533,189  537,108 
Consumer:      
Consumer secured by one- to four-family real estate 478,420  250,029  222,205 
Consumer-other 158,470  141,376  127,003 
Total loans outstanding $7,314,504  $4,369,458  $3,831,034 
Restructured loans performing under their restructured terms $21,786  $23,981  $29,154 
Loans 30 - 89 days past due and on accrual $18,834  $4,152  $8,387 
Total delinquent loans (including loans on non-accrual) $34,086  $27,682  $25,124 
Total delinquent loans / Total loans outstanding 0.47% 0.63% 0.66%
Purchase credit impaired loans (net) $58,555  $5,409  $ 


GEOGRAPHIC CONCENTRATION              
OF LOANS AT DECEMBER 31, 2015 Washington Oregon California Idaho Utah Other Total
Total loans outstanding     $3,343,112  $1,446,531  $1,234,016  $496,870  $325,011  $468,964  $7,314,504 
Percent of total loans 45.7% 19.8% 16.9% 6.8% 4.4% 6.4% 100.0%


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands) 
    Quarters Ended Years Ended
CHANGE IN THE Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
ALLOWANCE FOR LOAN LOSSES          
Balance, beginning of period $77,320  $77,329  $74,331  $75,907  $74,258 
Provision          
Recoveries of loans previously charged off:          
Commercial real estate 233  375  843  819  1,507 
Multifamily real estate       113   
Construction and land 578  282  988  1,811  1,776 
One- to four-family real estate 631  42  83  772  618 
Commercial business 143  128  153  948  988 
Agricultural business, including secured by farmland 261  146  328  1,927  1,576 
Consumer 197  91  135  570  528 
  2,043  1,064  2,530  6,960  6,993 
Loans charged off:          
Commercial real estate (537) (352)   (64) (1,239)
Multifamily real estate         (20)
Construction and land       (891) (207)
One- to four-family real estate (292) (12) (253) (419) (885)
Commercial business   (312) (263) (746) (1,344)
Agricultural business, including secured by farmland (161)   (54) (1,225) (179)
Consumer (365) (397) (384) (1,514) (1,470)
  (1,355) (1,073) (954) (4,859) (5,344)
Net (charge-offs) recoveries 688  (9) 1,576  2,101  1,649 
Balance, end of period $78,008  $77,320  $75,907  $78,008  $75,907 
Net (charge-offs) recoveries / Average loans outstanding 0.009% % 0.041% 0.042% 0.045%


ALLOCATION OF      
ALLOWANCE FOR LOAN LOSSES Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
Specific or allocated loss allowance:      
Commercial real estate $20,716  $19,640  $18,784 
Multifamily real estate 4,195  4,363  4,562 
Construction and land 27,131  29,274  23,545 
One- to four-family real estate 4,732  4,937  8,447 
Commercial business 13,856  12,765  12,043 
Agricultural business, including secured by farmland 3,645  3,533  2,821 
Consumer 902  804  483 
Total allocated 75,177  75,316  70,685 
Unallocated 2,831  2,004  5,222 
Total allowance for loan losses $78,008  $77,320  $75,907 
Allowance for loan losses / Total loans outstanding 1.07% 1.77% 1.98%
Allowance for loan losses / Non-performing loans 512% 484% 454%


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands)     
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
NON-PERFORMING ASSETS     
Loans on non-accrual status:     
Secured by real estate:     
Commercial$3,751  $3,899  $1,132 
Construction and land2,260  3,856  1,275 
One- to four-family4,700  4,934  8,834 
Commercial business2,159  980  537 
Agricultural business, including secured by farmland697  228  1,597 
Consumer703  789  1,187 
 14,270  14,686  14,562 
Loans more than 90 days delinquent, still on accrual:     
One- to four-family899  1,285  2,095 
Commercial business8  5   
Consumer45  11  79 
 952  1,301  2,174 
Total non-performing loans15,222  15,987  16,736 
Real estate owned (REO)11,627  6,363  3,352 
Other repossessed assets268    76 
Total non-performing assets$27,117  $22,350  $20,164 
Total non-performing assets / Total assets0.28% 0.42% 0.43%
Purchase credit impaired loans (net)$58,555  $5,409  $ 


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands) 
   Quarters Ended Years Ended
REAL ESTATE OWNED  Dec 31, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
Balance, beginning of period  $6,363  $3,928  $3,352  $4,044 
Additions from loan foreclosures  1,125  427  4,351  3,264 
Additions from acquisitions  5,706    8,231   
Additions from capitalized costs    (5) 298  30 
Proceeds from dispositions of REO  (1,585) (1,291) (4,740) (4,923)
Gain on sale of REO  18  293  351  973 
Valuation adjustments in the period      (216) (36)
Balance, end of period  $11,627  $3,352  $11,627  $3,352 


DEPOSIT COMPOSITION Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
Non-interest-bearing $2,619,618  $1,561,516  $1,298,866 
Interest-bearing checking 1,159,846  482,530  439,480 
Regular savings accounts 1,284,642  1,030,177  901,142 
Money market accounts 1,623,531  582,769  488,946 
Interest-bearing transaction & savings accounts 4,068,019  2,095,476  1,829,568 
Interest-bearing certificates 1,367,431  730,661  770,516 
Total deposits $8,055,068  $4,387,653  $3,898,950 


GEOGRAPHIC CONCENTRATION            
OF DEPOSITS AT DECEMBER 31, 2015 Washington Oregon California Idaho Utah Total
Total deposits $4,219,304  $1,648,421  $1,592,365  $435,099  $159,879  $8,055,068 
Percent of total deposits 52.4% 20.4% 19.8% 5.4% 2.0% 100.0%


INCLUDED IN TOTAL DEPOSITS Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
Public non-interest-bearing accounts $85,489  $48,814  $39,381 
Public interest-bearing transaction & savings accounts 123,941  74,446  63,473 
Public interest-bearing certificates 31,281  27,791  35,346 
Total public deposits $240,711  $151,051  $138,200 
Total brokered deposits $162,936  $10,095  $4,799 


OTHER BORROWINGS Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
Customer repurchase agreements / "Sweep accounts" $93,325  $88,083  $77,185 
Other 5,000     
Total other borrowings $98,325  $88,083  $77,185 


ADDITIONAL FINANCIAL INFORMATION 
(in thousands) 
BUSINESS COMBINATIONS    
ACQUISITION OF STARBUCK BANCSHARES, INC.* October 1, 2015
     
Cash paid   $130,000 
Fair value of common shares issued   630,674 
Total consideration   760,674 
     
Fair value of assets acquired:    
Cash $95,821   
Securities 1,037,238   
Loans receivable 2,997,640   
Real estate owned held for sale 5,706   
Property and equipment 66,549   
Intangible assets 33,500   
Other assets 221,019   
Total assets acquired 4,457,473   
     
Fair value of liabilities assumed:    
Deposits 3,638,596   
Junior subordinated debentures 5,806   
Other liabilities 278,445   
Total liabilities assumed 3,922,847   
Net assets acquired   534,626 
Goodwill   $226,048 


ACQUISITION OF SIUSLAW FINANCIAL GROUP* March 6, 2015
     
Cash paid   $5,806 
Fair value of common shares issued   58,100 
Total consideration   63,906 
     
Fair value of assets acquired:    
Cash $84,405   
Securities - available for sale 12,865   
Loans receivable 247,098   
Real estate owned held for sale 2,525   
Property and equipment 8,127   
Intangible assets 3,895   
Other assets 11,391   
Total assets acquired 370,306   
     
Fair value of liabilities assumed:    
Deposits 316,406   
Junior subordinated debentures 5,959   
Other liabilities 5,183   
Total liabilities assumed 327,548   
Net assets acquired   42,758 
Goodwill   $21,148 

* Amounts recorded in this table are preliminary estimates of fair value.  Additional adjustments to the purchase price allocation may be required.

ADDITIONAL FINANCIAL INFORMATION 
(in thousands) 
     
ACQUISITION OF SIX OREGON BRANCHES June 20, 2014
     
Total consideration   $ 
     
Fair value of assets acquired:    
Cash $127,557   
Loans receivable 87,923   
Property and equipment 3,079   
Intangible assets 2,372   
Other assets 275   
Total assets acquired 221,206   
     
Fair value of liabilities assumed:    
Deposits 212,085   
Other liabilities 42   
Total liabilities assumed 212,127   
Net assets acquired   9,079 
Acquisition bargain purchase gain   $(9,079)


MERGER AND ACQUISITION EXPENSE (1)Quarters Ended Years Ended
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
By expense category:         
Personnel (severance and retention fees in compensation)$6,134  $227  $  $6,577  $ 
Professional services5,757  1,185  2,279  11,169  2,953 
Non-capitalized equipment976  5  6  1,031  105 
Advertising and marketing306  151  197  527  327 
Information and computer data services2,069  301  37  2,875  334 
Payment and processing12  16  119  28  185 
Miscellaneous3,115  322  147  3,903  421 
Total merger and acquisition expense$18,369  $2,207  $2,785  $26,110  $4,325 
          
By acquisition:         
Acquisition of six Oregon branches$  $  $244  $  $1,784 
Siuslaw Financial Group133  340  748  2,000  748 
Starbuck Bancshares, Inc. (AmericanWest)18,236  1,867  1,793  24,110  1,793 
Total merger and acquisition expense$18,369  $2,207  $2,785  $26,110  $4,325 
 
(1) Includes expenses related to preparing and filing a registration statement with respect to the restricted stock issued as consideration for the acquisition of Starbuck  Bancshares, Inc.


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands) 
  Actual Minimum to be
categorized as
"Adequately Capitalized"
 Minimum to be
categorized as
"Well Capitalized"
REGULATORY CAPITAL RATIOS AS OF DECEMBER 31, 2015 Amount Ratio Amount Ratio Amount Ratio
             
Banner Corporation-consolidated:            
Total capital to risk-weighted assets $1,139,554  13.66% $667,551  8.00% $834,438  10.00%
Tier 1 capital to risk-weighted assets 1,057,597  12.67% 500,663  6.00% 667,551  8.00%
Tier 1 leverage capital to average assets 1,057,597  11.06% 382,614  4.00% 478,267  5.00%
Common equity tier 1 capital to risk-weighted assets 1,013,971  12.15% 375,497  4.50% 542,385  6.50%
Banner Bank:            
Total capital to risk-weighted assets 1,030,601  12.63% 652,939  8.00% 816,174  10.00%
Tier 1 capital to risk-weighted assets 950,865  11.65% 489,704  6.00% 652,939  8.00%
Tier 1 leverage capital to average assets 950,865  10.28% 385,126  4.00% 481,408  5.00%
Common equity tier 1 capital to risk-weighted assets 950,865  11.65% 367,278  4.50% 530,513  6.50%
Islanders Bank:            
Total capital to risk-weighted assets 38,448  20.31% 15,146  8.00% 18,932  10.00%
Tier 1 capital to risk-weighted assets 36,227  19.14% 11,359  6.00% 15,146  8.00%
Tier 1 leverage capital to average assets 36,227  13.38% 10,826  4.00% 13,533  5.00%
Common equity tier 1 capital to risk-weighted assets 36,227  19.14% 8,520  4.50% 12,306  6.50%


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands) 
(rates / ratios annualized) 
  Quarters Ended Years Ended
OPERATING PERFORMANCE Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
           
Average loans $7,398,030  $4,313,839  $3,813,606  $4,961,193  $3,679,264 
Average securities 1,500,401  582,701  643,665  818,471  671,634 
Average interest earning cash 129,797  109,445  76,082  122,479  68,696 
Average non-interest-earning assets 870,169  276,761  212,071  413,503  205,378 
Total average assets $9,898,397  $5,282,746  $4,745,424  $6,315,646  $4,624,972 
Average deposits $8,118,825  $4,379,887  $3,942,903  $5,209,350  $3,815,979 
Average borrowings 418,126  226,174  218,170  276,581  246,963 
Average non-interest-bearing other liabilities (1) 54,967  6,731  2,039  17,051  (1,991)
Total average liabilities 8,591,918  4,612,792  4,163,112  5,502,982  4,060,951 
Total average stockholders' equity 1,306,479  669,954  582,312  812,664  564,021 
Total average liabilities and equity $9,898,397  $5,282,746  $4,745,424  $6,315,646  $4,624,972 
Interest rate yield on loans 4.72% 4.76% 4.80% 4.78% 4.83%
Interest rate yield on securities 2.20% 2.01% 1.91% 2.05% 1.92%
Interest rate yield on cash 0.23% 0.35% 0.29% 0.27% 0.30%
Interest rate yield on interest-earning assets 4.24% 4.34% 4.31% 4.31% 4.31%
Interest rate expense on deposits 0.15% 0.16% 0.18% 0.16% 0.20%
Interest rate expense on borrowings 1.19% 1.52% 1.44% 1.36% 1.30%
Interest rate expense on interest-bearing liabilities 0.20% 0.22% 0.25% 0.22% 0.27%
Interest rate spread 4.04% 4.12% 4.06% 4.09% 4.04%
Net interest margin 4.05% 4.14% 4.08% 4.10% 4.07%
Other operating income / Average assets 0.74% 1.06% 1.01% 0.99% 1.19%
Core other operating income / Average assets (2) 0.80% 1.14% 1.04% 1.01% 0.96%
Other operating expense / Average assets 4.02% 3.51% 3.45% 3.75% 3.32%
Core other operating expense / Average assets (2) 3.28% 3.34% 3.21% 3.33% 3.23%
Efficiency ratio (other operating expense / revenue) 90.76% 70.45% 70.15% 77.68% 65.46%
Efficiency ratio (core other operating expense / core operating revenue)(2) 73.11% 66.01% 65.09% 68.80% 66.59%
Return on average assets 0.28% 0.97% 0.98% 0.72% 1.17%
Return on average equity 2.09% 7.67% 7.98% 5.56% 9.59%
Return on average tangible equity (3) 2.68% 7.99% 8.03% 6.24% 9.63%
Average equity / Average assets 13.20% 12.68% 12.27% 12.87% 12.20%


 (1)Average non-interest-bearing liabilities include fair value adjustments related to FHLB advances and Junior Subordinated Debentures.
 (2)Core other operating income excludes net gain (loss) on sale of securities, fair value adjustments and acquisition bargain purchase gain.  Core other operating expense excludes acquisition related costs.  These represent non-GAAP financial measures.  See also Non-GAAP Financial Measures reconciliation tables on the last two pages of these press release tables.
 (3)Average tangible equity excludes goodwill and other intangible assets and represents a non-GAAP financial measure.  See also Non-GAAP Financial Measures reconciliation tables on the last two pages of these press release tables.


ADDITIONAL FINANCIAL INFORMATION  
(dollars in thousands)  
           
* Non-GAAP Financial Measures (unaudited)          
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures.  Management has presented these non-GAAP financial measures in this earnings release because it believes that they provide useful and comparative information to assess trends in Banner's core operations reflected in the current quarter's results and facilitate the comparison of our performance with the performance of our peers.  Where applicable, comparable earnings information using GAAP financial measures is also presented. 
           
REVENUE FROM CORE OPERATIONSQuarters Ended Years Ended 
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014 
Net interest income before provision for loan losses$92,099  $52,188  $46,660  $242,279  $179,872  
Total other operating income18,356  14,098  12,114  62,292  54,991  
Total GAAP revenue110,455  66,286  58,774  304,571  234,863  
Exclude net (gain) loss on sale of securities3    (1) 540  (42) 
Exclude change in valuation of financial instruments carried at fair value1,547  1,113  287  813  (1,374) 
Exclude acquisition bargain purchase gain        (9,079) 
Revenue from core operations (non-GAAP)$112,005  $67,399  $59,060  $305,924  $224,368  
    
ACQUISITION ACCOUNTING IMPACT ON NET INTEREST MARGINQuarters Ended Years Ended
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
Net interest income before provision for loan losses (GAAP)$92,099  $52,188  $46,660  $242,279  $179,872 
Exclude discount accretion on purchased loans(2,579) (359) (111) (3,566) (223)
Exclude premium amortization on acquired certificates of deposit(572) (60) (69) (748) (139)
Net interest income before discount accretion (non-GAAP)$88,948  $51,769  $46,480  $237,965  $179,510 
          
Net interest margin (GAAP)4.05% 4.14% 4.08% 4.10% 4.07%
Exclude impact on net interest margin from discount accretion(0.11) (0.03) (0.01) (0.06) (0.01)
Exclude impact on net interest margin from CD premium amortization(0.03)   (0.01) (0.01)  
Net margin before discount accretion (non-GAAP)3.91% 4.11% 4.06% 4.03% 4.06%
    
OTHER OPERATING INCOME/EXPENSE FROM CORE OPERATIONSQuarters Ended Years Ended
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014 Dec 31, 2015 Dec 31, 2014
Total other operating income (GAAP)$18,356  $14,098  $12,114  $62,292  $54,991 
Exclude net (gain) loss on sale of securities3    (1) 540  (42)
Exclude change in valuation of financial instruments carried at fair value1,547  1,113  287  813  (1,374)
Exclude acquisition bargain purchase gain        (9,079)
Other operating income from core operations (non-GAAP)$19,906  $15,211  $12,400  $63,645  $44,496 
          
Total other operating expense (GAAP)$100,254  $46,697  $41,229  $236,600  $153,741 
Exclude acquisition related costs(18,369) (2,207) (2,785) (26,110) (4,325)
Other operating expense from core operations (non-GAAP)$81,885  $44,490  $38,444  $210,490  $149,416 


ADDITIONAL FINANCIAL INFORMATION 
(dollars in thousands except shares and per share data) 
      
 Quarters Ended
 Dec 31, 2015 Sep 30, 2015 Dec 31, 2014
TANGIBLE COMMON STOCKHOLDERS' EQUITY TO TANGIBLE ASSETS     
Stockholders' equity (GAAP)$1,300,059  $671,202  $582,888 
Exclude goodwill and other intangible assets, net284,500  26,605  2,831 
Tangible common stockholders' equity (non-GAAP)$1,015,559  $644,597  $580,057 
      
Total assets (GAAP)$9,796,298  $5,312,310  $4,723,163 
Exclude goodwill and other intangible assets, net284,500  26,605  2,831 
Total tangible assets (non-GAAP)$9,511,798  $5,285,705  $4,720,332 
Tangible common stockholders' equity to tangible assets (non-GAAP)10.68% 12.20% 12.29%
      
TANGIBLE COMMON STOCKHOLDERS' EQUITY PER SHARE     
Tangible common stockholders' equity$1,015,559  $644,597  $580,057 
Common shares outstanding at end of period34,242,255  20,962,300  19,571,548 
Common stockholders' equity (book value) per share (GAAP)$37.97  $32.02  $29.78 
Tangible common stockholders' equity (tangible book value) per share (non-GAAP)$29.66  $30.75  $29.64 
       
RATIO OF ADJUSTED ALLOWANCE FOR LOAN LOSSES TO ADJUSTED LOANS      
Loans receivable (GAAP) 7,314,504  4,369,458  3,831,034 
Net loan discount on acquired loans 44,939  4,329   
Adjusted loans (non-GAAP) 7,359,443  4,373,787  3,831,034 
       
Allowance for loan losses (GAAP) 78,008  77,320  75,907 
Net loan discount on acquired loans 44,939  4,329   
Adjusted allowance for loan losses (non-GAAP) 122,947  81,649  75,907 
       
Adjusted allowance for loan losses / Adjusted loans (non-GAAP) 1.67% 1.87% 1.98%

 


            

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