BANNER CORP 10-K

ITEM 8 – Financial Statements and Supplementary Data INDEX TO CONSOLIDATED FINANCIAL STATEMENTS BANNER CORPORATION AND SUBSIDIARIES (Item 8 and Item 15(a)(1)) Page Report of Management 65 Management Report on Internal Control Over Financial Reporting 66 Report of Independent Registered Public Accounting Firm ( Baker Tilly US, LLP , Portland, Oregon , PCAOB ID: 23 ) 67 Consolidated Statements of Financial Condition 69 Consolidated Statements of Operations 70 Consolidated Statements of Comprehensive Income 71 Consolidated Statements of Changes in Shareholders’ Equity 72 Consolidated Statements of Cash Flows 73 Notes to the Consolidated Financial Statements 75 64 Table of Contents February 25, 2026 Report of Management To the Shareholders: The management of Banner Corporation (the Company) is responsible for the preparation, integrity, and fair presentation of its published financial statements and all other information presented in this annual report. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and, as such, include amounts based on informed judgments and estimates made by Management. In the opinion of Management, the financial statements and other information herein present fairly the financial condition and operations of the Company at the dates indicated in conformity with accounting principles generally accepted in the United States of America. Management is responsible for establishing and maintaining an effective system of internal control over financial reporting. The internal control system is augmented by written policies and procedures and by audits performed by an internal audit staff (assisted in certain instances by contracted external audit resources other than the independent registered public accounting firm), which reports to the Audit Committee of the Board of Directors. Internal auditors monitor the operation of the internal and external control system and report findings to Management and the Audit Committee. When appropriate, corrective actions are taken to address identified control deficiencies and other opportunities for improving the system. The Audit Committee provides oversight to the financial reporting process. There are inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and circumvention or overriding of controls. Accordingly, even an effective internal control system can provide only reasonable assurance with respect to financial statement preparation. Further, because of changes in conditions, the effectiveness of an internal control system may vary over time. The Audit Committee of the Board of Directors is comprised entirely of outside directors who are independent of the Company’s management. The Audit Committee is responsible for the selection of the independent auditors. It meets periodically with Management, the independent auditors and the internal auditors to ensure that they are carrying out their responsibilities. The Committee is also responsible for performing an oversight role by reviewing and monitoring the financial, accounting, and auditing procedures of the Company in addition to reviewing the Company’s financial reports. The independent auditors and the internal auditors have full and free access to the Audit Committee, with or without the presence of Management, to discuss the adequacy of the internal control structure for financial reporting and any other matters which they believe should be brought to the attention of the Committee. Mark J. Grescovich, Chief Executive Officer Robert G. Butterfield, Chief Financial Officer 65 Table of Contents Management Report on Internal Control over Financial Reporting February 25, 2026 The management of Banner Corporation is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934. The Company’s internal control system is designed to provide reasonable assurance to our Management and Board of Directors regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company’s internal control over financial reporting includes those policies and procedures that: Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets; Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with the authorizations of Management and directors of the Company; and Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, including the possibility of human error and circumvention or overriding of controls, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. This assessment was based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013) . Based on this assessment and those criteria, Management believes that, as of December 31, 2025, the Company maintained effective internal control over financial reporting. The Company’s independent registered public accounting firm has audited the Company’s Consolidated Financial Statements that are included in this annual report and the effectiveness of our internal control over financial reporting as of December 31, 2025, and issued their Report of Independent Registered Public Accounting Firm. The audit report expresses an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. 66 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Banner Corporation and Subsidiaries Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated statements of financial condition of Banner Corporation and Subsidiaries (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2025 and 2024, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO. Basis for Opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 67 Table of Contents Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Allowance for Credit Losses – Loans Critical Audit Matter Description As described in Notes 1 and 4 to the consolidated financial statements, the balance of the Company’s consolidated allowance for credit losses – loans, was $160.3 million at December 31, 2025. The allowance for credit losses – loans is a valuation account that is deducted from the amortized cost basis of loans held for investment to present the net carrying value at the amount expected to be collected on such financial assets. The measurement of expected credit losses is based on relevant information about past events, current conditions, and reasonable and supportable forecasts. The allowance for credit losses – loans is maintained at a level sufficient to provide for expected credit losses based on evaluating historical credit loss experience and making adjustments to historical loss information for differences in the specific risk characteristics in the current loan portfolio. Management considers qualitative and environmental factors for each loan category to adjust for differences between the historical periods used to calculate historical loss rates and expected conditions over the remaining lives of the loans in the portfolio. These factors include, among others, changes in the size and composition of the loan portfolio, differences in underwriting standards, delinquency rates, and economic conditions. We identified the estimation of qualitative and environmental factors used in the allowance for credit losses – loans as a critical audit matter. The qualitative and environmental factors are used to estimate credit losses related to matters that are not captured in the historical loss rates and are based on management’s evaluation of available internal and external data. Auditing management’s judgments regarding the qualitative and environmental factors applied to the allowance for credit losses - loans involved especially challenging and subjective auditor judgment when performing audit procedures and evaluating the results of those procedures. How We Addressed the Matter in Our Audit Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. Our audit procedures related to the estimation of qualitative and environmental factors used in the allowance for credit losses – loans included the following, among others: • Testing the design, implementation, and operating effectiveness of controls relating to management’s calculation of the allowance for credit losses – loans, including controls over the identification and assessment of the qualitative and environmental factors used. • Obtaining management’s analysis and supporting documentation related to the qualitative and environmental factors and testing whether the environmental and qualitative factors used in the calculation of the allowance for credit losses – loans are supported by the analysis provided by management. • Testing the appropriateness of the methodology and assumptions used in the calculation of the allowance for credit losses – loans, testing completeness and accuracy of the data used in the calculation, testing estimation and application of the environmental and qualitative factors determined by management and used in the calculation, and recalculating the balance of allowance for credit losses – loans. /s/ Baker Tilly US, LLP Portland, Oregon February 25, 2026 We have served as the Company’s auditor since 2004. 68 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (in thousands, except shares and per share amounts) December 31, 2025 and 2024 ASSETS December 31, 2025 December 31, 2024 Cash and due from banks $ 182,772 $ 203,402 Interest-bearing deposits 239,868 298,456 Total cash and cash equivalents 422,640 501,858 Securities—available-for-sale; amortized cost $ 2,271,471 and $ 2,460,262 , respectively 2,016,261 2,104,511 Securities—held-to-maturity, net of allowance for credit losses of $ 291 and $ 297 , respectively 961,196 1,001,564 Total securities 2,977,457 3,106,075 Federal Home Loan Bank (FHLB) stock 16,476 22,451 Loans held for sale (includes $ 34,586 and $ 26,185 , at fair value, respectively) 42,902 32,021 Loans receivable 11,721,687 11,354,656 Allowance for credit losses – loans ( 160,276 ) ( 155,521 ) Net loans receivable 11,561,411 11,199,135 Accrued interest receivable 60,525 60,885 Property and equipment, net 111,522 124,589 Goodwill 373,121 373,121 Other intangibles, net 1,491 3,058 Bank-owned life insurance (BOLI) 319,347 312,549 Deferred tax assets, net 127,587 148,858 Operating lease right-of-use assets 32,736 39,998 Other assets 307,273 275,439 Total assets $ 16,354,488 $ 16,200,037 LIABILITIES Deposits: Non-interest-bearing $ 4,489,839 $ 4,591,543 Interest-bearing transaction and savings accounts 7,721,003 7,423,183 Interest-bearing certificates 1,532,304 1,499,672 Total deposits 13,743,146 13,514,398 Advances from FHLB 150,000 290,000 Other borrowings 107,715 125,257 Subordinated notes, net — 80,278 Junior subordinated debentures at fair value (issued in connection with Trust Preferred Securities) 79,151 67,477 Operating lease liabilities 35,755 43,472 Accrued expenses and other liabilities 245,266 258,070 Deferred compensation 47,158 46,759 Total liabilities 14,408,191 14,425,711 COMMITMENTS AND CONTINGENCIES (Note 18) SHAREHOLDERS’ EQUITY Preferred stock - $ 0.01 par value per share, 500,000 shares authorized; no shares outstanding at December 31, 2025 and December 31, 2024 — — Common stock and paid in capital - $ 0.01 par value per share, 50,000,000 shares authorized; 34,097,856 shares issued and outstanding at December 31, 2025; 34,459,832 shares issued and outstanding at December 31, 2024 1,282,505 1,307,509 Common stock (non-voting) and paid in capital - $ 0.01 par value per share, 5,000,000 shares authorized; no shares issued and outstanding at December 31, 2025 and December 31, 2024 — — Retained earnings 871,803 744,091 Carrying value of shares held in trust for stock-based compensation plans ( 5,813 ) ( 6,194 ) Liability for common stock issued to stock related compensation plans 5,813 6,194 Accumulated other comprehensive loss ( 208,011 ) ( 277,274 ) Total shareholders’ equity 1,946,297 1,774,326 Total liabilities and shareholders’ equity $ 16,354,488 $ 16,200,037 See Notes to the Consolidated Financial Statements 69 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except for shares and per share amounts) For the Years Ended December 31, 2025, 2024 and 2023 2025 2024 2023 INTEREST INCOME: Loans receivable $ 702,023 $ 655,590 $ 577,891 Mortgage-backed securities 61,000 66,085 72,352 Securities and cash equivalents 41,932 44,428 51,329 Total interest income 804,955 766,103 701,572 INTEREST EXPENSE: Deposits 200,798 199,465 100,126 FHLB advances 5,774 8,941 10,524 Other borrowings 2,756 4,299 3,376 Subordinated debt 7,708 11,682 11,541 Total interest expense 217,036 224,387 125,567 Net interest income 587,919 541,716 576,005 PROVISION FOR CREDIT LOSSES 13,045 7,581 10,789 Net interest income after provision for credit losses 574,874 534,135 565,216 NON-INTEREST INCOME Deposit fees and other service charges 43,240 43,371 41,638 Mortgage banking operations 13,244 12,207 11,817 BOLI 10,152 9,193 9,245 Miscellaneous 7,188 8,289 5,169 73,824 73,060 67,869 Net gain (loss) on sale of securities 374 ( 5,190 ) ( 19,242 ) Net change in valuation of financial instruments carried at fair value ( 1,384 ) ( 982 ) ( 4,218 ) Total non-interest income 72,814 66,888 44,409 NON-INTEREST EXPENSE: Salary and employee benefits 260,706 250,555 244,563 Less capitalized loan origination costs ( 17,219 ) ( 16,857 ) ( 16,257 ) Occupancy and equipment 48,723 48,771 47,886 Information and computer data services 33,067 29,165 28,445 Payment and card processing services 23,948 22,518 20,547 Professional and legal expenses 9,492 7,858 9,830 Advertising and marketing 4,748 5,149 4,794 Deposit insurance 11,314 11,398 10,529 State and municipal business and use taxes 6,276 5,648 5,260 Real estate operations, net 491 293 ( 538 ) Amortization of core deposit intangibles 1,567 2,626 3,756 Miscellaneous 25,661 24,414 23,723 Total non-interest expense 408,774 391,538 382,538 Income before provision for income taxes 238,914 209,485 227,087 PROVISION FOR INCOME TAXES 43,532 40,587 43,463 NET INCOME $ 195,382 $ 168,898 $ 183,624 Earnings per common share: Basic $ 5.67 $ 4.90 $ 5.35 Diluted $ 5.64 $ 4.88 $ 5.33 Cumulative dividends declared per common share $ 1.94 $ 1.92 $ 1.92 Weighted average number of common shares outstanding: Basic 34,460,854 34,470,057 34,344,142 Diluted 34,656,802 34,628,710 34,450,412 See Notes to the Consolidated Financial Statements 70 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in thousands) For the Years Ended December 31, 2025, 2024 and 2023 2025 2024 2023 NET INCOME $ 195,382 $ 168,898 $ 183,624 OTHER COMPREHENSIVE INCOME, NET OF INCOME TAXES: Unrealized holding gain (loss) on securities—available-for-sale arising during the period 99,330 ( 5,047 ) 54,307 Income tax (expense) benefit related to securities—available-for-sale unrealized holding losses ( 23,839 ) 1,211 ( 13,034 ) Reclassification for net loss on securities—available-for-sale realized in earnings 1,211 5,493 19,242 Income tax benefit related to securities—available-for-sale realized in earnings ( 291 ) ( 1,318 ) ( 4,618 ) Amortization of unrealized loss on securities transferred from available-for-sale to held-to-maturity 2,269 2,296 2,338 Income tax benefit related to amortization of unrealized loss on securities transferred from available-for-sale to held-to-maturity ( 545 ) ( 551 ) ( 561 ) Net unrealized gain on interest rate swaps used in cash flow hedges — 13,929 12,557 Income tax expense related to interest rate swaps used in cash flow hedges — ( 3,343 ) ( 3,014 ) Changes in fair value of junior subordinated debentures related to instrument specific credit risk ( 11,674 ) ( 1,064 ) 8,444 Income tax benefit (expense) related to junior subordinated debentures 2,802 255 ( 2,027 ) Other comprehensive income 69,263 11,861 73,634 COMPREHENSIVE INCOME $ 264,645 $ 180,759 $ 257,258 See Notes to the Consolidated Financial Statements 71 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (in thousands, except shares and per share amounts) For the Years Ended December 31, 2025, 2024 and 2023 Common Stock and Paid in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Shareholders’ Equity Shares Amount Balance, January 1, 2023 34,194,018 $ 1,293,959 $ 525,242 $ ( 362,769 ) $ 1,456,432 Net income 183,624 183,624 Other comprehensive loss, net of income tax 73,634 73,634 Accrual of dividends on common stock ($ 1.92 /share-cumulative) ( 66,691 ) ( 66,691 ) Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered 154,351 5,692 5,692 Balance, December 31, 2023 34,348,369 $ 1,299,651 $ 642,175 $ ( 289,135 ) $ 1,652,691 Balance, January 1, 2024 34,348,369 $ 1,299,651 $ 642,175 $ ( 289,135 ) $ 1,652,691 Net income 168,898 168,898 Other comprehensive income, net of income tax 11,861 11,861 Accrual of dividends on common stock ($ 1.92 /share-cumulative) ( 66,982 ) ( 66,982 ) Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered 111,463 7,858 7,858 Balance, December 31, 2024 34,459,832 $ 1,307,509 $ 744,091 $ ( 277,274 ) $ 1,774,326 Balance, January 1, 2025 34,459,832 $ 1,307,509 $ 744,091 $ ( 277,274 ) $ 1,774,326 Net income 195,382 195,382 Other comprehensive income, net of income tax 69,263 69,263 Accrual of dividends on common stock ($ 1.94 /share-cumulative) ( 67,670 ) ( 67,670 ) Repurchase of common stock ( 499,975 ) ( 31,808 ) ( 31,808 ) Amortization of stock-based compensation related to restricted stock grants, net of shares surrendered 137,999 6,804 6,804 Balance, December 31, 2025 34,097,856 $ 1,282,505 $ 871,803 $ ( 208,011 ) $ 1,946,297 See Notes to the Consolidated Financial Statements 72 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) For the Years Ended December 31, 2025, 2024 and 2023 2025 2024 2023 OPERATING ACTIVITIES: Net income $ 195,382 $ 168,898 $ 183,624 Adjustments to reconcile net income to net cash provided from operating activities: Depreciation 16,441 18,076 17,873 Deferred income and expense, net of amortization ( 10,769 ) ( 7,999 ) ( 4,194 ) Capitalized loan servicing rights, net of amortization 888 1,372 1,830 Amortization of core deposit intangibles 1,567 2,626 3,756 (Gain) loss on sale of securities, net ( 374 ) 5,190 19,242 Net change in valuation of financial instruments carried at fair value 1,384 982 4,218 (Increase) decrease in deferred taxes ( 602 ) 762 1,514 (Decrease) increase in current taxes payable ( 805 ) 6,297 ( 3,170 ) Stock-based compensation 10,343 10,031 9,169 Net change in cash surrender value of BOLI ( 9,434 ) ( 9,032 ) ( 8,742 ) Gain on sale of loans, excluding capitalized servicing rights ( 6,891 ) ( 6,180 ) ( 6,151 ) Loss (gain) on disposal of real estate held for sale and property and equipment, net 831 ( 318 ) ( 352 ) Provision for credit losses 13,045 7,581 10,789 Origination of loans held for sale ( 375,213 ) ( 298,184 ) ( 242,844 ) Proceeds from sales of loans held for sale 461,425 414,807 266,540 Net change in: Other assets ( 24,679 ) ( 35,288 ) ( 8,968 ) Other liabilities ( 15,075 ) 13,566 13,065 Net cash provided from operating activities 257,464 293,187 257,199 INVESTING ACTIVITIES: Purchases of securities—available-for-sale ( 155,841 ) ( 63,170 ) ( 58,173 ) Principal repayments and maturities of securities—available-for-sale 323,577 241,427 173,055 Proceeds from sales of securities—available-for-sale 17,581 70,777 368,945 Principal repayments and maturities of securities—held-to-maturity 40,588 57,656 58,406 Loan (originations) repayments, net ( 477,408 ) ( 686,508 ) ( 643,959 ) Purchases of loans and participating interest in loans ( 10,945 ) ( 4,666 ) — Proceeds from sales of other loans 30,887 20,522 14,038 Purchases of property and equipment ( 9,514 ) ( 13,747 ) ( 14,651 ) Proceeds from sale of real estate held for sale and sale of other property 7,728 4,323 4,669 Proceeds from FHLB stock repurchase program 156,470 146,162 153,397 Purchase of FHLB stock ( 150,495 ) ( 144,585 ) ( 165,425 ) Proceeds from maturity of securities purchased under agreements to resell — — 300,000 Investment in bank-owned life insurance ( 46 ) ( 47 ) ( 66 ) Other 2,680 686 1,693 Net cash (used by) provided from investing activities ( 224,738 ) ( 371,170 ) 191,929 (Continued on next page) 73 Table of Contents BANNER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) (in thousands) For the Years Ended December 31, 2025, 2024 and 2023 2025 2024 2023 FINANCING ACTIVITIES: Increase (decrease) in deposits, net 228,747 484,901 ( 590,562 ) (Repayment) advances of overnight and short-term FHLB borrowings, net ( 140,000 ) ( 33,000 ) 273,000 Decrease in other borrowings, net ( 17,543 ) ( 57,619 ) ( 49,923 ) Repayment of subordinated notes ( 80,500 ) — — Cash dividends paid ( 67,528 ) ( 66,733 ) ( 66,765 ) Cash paid for repurchase of common stock ( 31,575 ) — — Taxes paid related to net share settlement of equity awards ( 3,545 ) ( 2,172 ) ( 3,476 ) Net cash (used by) provided from financing activities ( 111,944 ) 325,377 ( 437,726 ) NET CHANGE IN CASH AND CASH EQUIVALENTS ( 79,218 ) 247,394 11,402 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 501,858 254,464 243,062 CASH AND CASH EQUIVALENTS, END OF YEAR $ 422,640 $ 501,858 $ 254,464 2025 2024 2023 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Interest paid in cash $ 217,049 $ 224,808 $ 110,845 Taxes paid 31,409 24,194 38,671 NON-CASH INVESTING AND FINANCING TRANSACTIONS: Transfer of loans to real estate owned and other repossessed assets 6,400 2,832 1,185 Dividends accrued but not paid until after period end 1,475 1,334 1,084 Loans, held for sale, transferred (from) to portfolio ( 90,203 ) ( 131,294 ) 27,929 Securities, held-for-trading, transferred to available-for-sale — — 25,298 See Notes to Consolidated Financial Statements 74 Table of Contents BANNER CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1: BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business: Banner Corporation (Banner or the Company) is a bank holding company incorporated in the State of Washington. The Company is primarily engaged in the business of planning, directing and coordinating the business activities of its wholly-owned subsidiary, Banner Bank (the Bank). The Bank is a Washington-chartered commercial bank that conducts business from its headquarters in Walla Walla, Washington and its 135 branch offices located in Washington, Oregon, California and Idaho. The Bank also has 15 loan production offices located in Washington, Oregon, California, Idaho, Utah and Nevada. Banner is subject to regulation by the Board of Governors of the Federal Reserve System (the Federal Reserve Board). The Bank is subject to regulation by the Washington State Department of Financial Institutions, Division of Banks (the DFI) and the Federal Deposit Insurance Corporation (the FDIC). Basis of Presentation and Principles of Consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All material intercompany transactions, profits and balances have been eliminated. The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (GAAP) and under the rules and regulations of the U.S. Securities and Exchange Commission (the SEC). At December 31, 2025, the Company had five wholly-owned subsidiary grantor trusts (the Trusts), each of which issued trust preferred securities (TPS) and common securities. The Trusts are not consolidated in the Company’s consolidated financial statements. Operating Segments: The Company’s operations are managed, and financial performance is evaluated, by our chief operating decision maker on a Company-wide basis. The Bank’s primary business is that of a traditional banking institution, gathering deposits and originating loans for portfolio in its primary market areas. The Bank offers a wide variety of deposit products to its consumer and commercial clients. Lending activities include the origination of real estate secured, commercial/agriculture business and consumer loans. The performance of the Company is reviewed monthly by the Company’s executive management and Board of Directors. As resource allocation and performance decisions are not made based on discrete financial information of individual lines of business, the Company considers its current business and operations as a single reportable operating segment. Subsequent Events: The Company has evaluated events and transactions for potential recognition or disclosure subsequent to December 31, 2025, through the date that the consolidated financial statements were issued. Cash and Cash Equivalents: Cash and cash equivalents include cash and due from banks and temporary investments which are federal funds sold and interest-bearing cash balances due from other banks. Cash and cash equivalents generally have maturities of three months or less at the date of purchase. Business Combinations: Business combinations are accounted for using the acquisition method of accounting and, accordingly, assets acquired and liabilities assumed, both tangible and intangible, and consideration exchanged are recorded at acquisition date fair values. The excess purchase consideration over fair value of net assets acquired is recorded as goodwill. If the fair value of net assets acquired exceeds the purchase price, including fair value of liabilities assumed, a bargain purchase gain is recorded on that acquisition. Expenses incurred in connection with a business combination are expensed as incurred, except for those items permitted to be capitalized. Changes in deferred tax asset valuation allowances related to acquired tax uncertainties are recognized in net income after the measurement period. Use of Estimates: In the opinion of Management, the accompanying Consolidated Statements of Financial Condition and related Consolidated Statements of Operations, Comprehensive Income, Changes in Shareholders’ Equity and Cash Flows reflect all adjustments (which include reclassification and normal recurring adjustments) that are necessary for a fair presentation in conformity with GAAP. The preparation of financial statements in conformity with GAAP requires Management to make estimates and assumptions that affect amounts reported in the financial statements. Various elements of the Company’s accounting policies, by their nature, are inherently subject to estimation techniques, valuation assumptions and other subjective assessments. Management has identified several accounting policies that, due to the judgments, estimates and assumptions inherent in those policies, are critical to an understanding of Banner’s consolidated financial statements. These policies relate to (i) determination of the provision and allowance for credit losses, (ii) the valuation of financial assets and liabilities recorded at fair value, and (iii) the valuation or recognition of deferred tax assets and liabilities. Management believes that the judgments, estimates and assumptions used in the preparation of the consolidated financial statements are appropriate based on the factual circumstances at the time. However, given the sensitivity of the consolidated financial statements to these critical accounting estimates, the use of judgments, estimates and assumptions could result in material differences in the Company’s results of operations or financial condition. Further, subsequent changes in economic or market conditions could have a material impact on these estimates and the Company’s financial condition and operating results in future periods. 75 Table of Contents Securities: Debt securities are classified as held-to-maturity when the Company has the ability and positive intent to hold them to maturity. Debt securities classified as available-for-sale are available for future liquidity requirements and may be sold prior to maturity. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Debt securities classified as held-to-maturity are carried at cost, net of the allowance for credit losses - securities, adjusted for amortization of premiums to the earliest callable date and accretion of discounts to maturity. Debt securities classified as available-for-sale are measured at fair value. Unrealized holding gains and losses on debt securities classified as available-for-sale are excluded from earnings and are reported net of tax as accumulated other comprehensive income (AOCI), a component of shareholders’ equity, until realized. Realized gains and losses on sale are computed on the specific identification method and are included in earnings on the trade date sold. Equity securities are measured at fair value with changes in the fair value recognized through net income. Allowance for Credit Losses - Securities: Management measures expected credit losses on held-to-maturity debt securities on a collective basis by major security type. The Company’s held-to maturity portfolio contains mortgage-backed securities issued by U.S. government entities and agencies. These securities are either explicitly or implicitly guaranteed by the U.S. government and have a long history of no credit losses. The Company’s held-to-maturity portfolio also contains municipal bonds that are typically rated by major rating agencies as Aa or better. The Company has never incurred a loss on a municipal bond, therefore the expectation of credit losses on these securities is insignificant. The Company uses industry historical credit loss information adjusted for current conditions to establish the allowance for credit losses on the municipal and corporate bond portfolio. The expected credit losses on these bonds are similar to Banner’s commercial business loan portfolio. Therefore, the Company uses the commercial business loan portfolio loss rates to establish the allowance for credit losses on the collateralized bonds and its own loss history to establish a loss rate on bonds that are not collateralized. For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If the Company intends to sell the security or it is more likely than not that the Company will be required to sell the security before recovering its cost basis, the entire impairment loss would be recognized in earnings. If the Company does not intend to sell the security and it is not more likely than not that the Company will be required to sell the security, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, Management considers the extent to which fair value is less than amortized costs, any changes to the rating of the security by a rating agency and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. Projected cash flows are discounted by the current effective interest rate. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. The remaining impairment related to all other factors, the difference between the present value of the cash flows expected to be collected and fair value, is recognized in AOCI. Changes in the allowance for credit losses - securities are recorded as provision (recapture) for credit losses. Losses are charged against the allowance when Management believes the non-collectability of an available-for-sale or held-to-maturity security is confirmed or when either of the criteria regarding intent or requirement to sell is met. Investment in FHLB Stock: FHLB stock does not have a readily determinable fair value. The Bank’s investment in FHLB stock is carried at cost or par value ($ 100 per share) and evaluated for impairment based on the Bank’s expectations of the ultimate recoverability of the stock’s par value. Ownership of FHLB stock is restricted to the FHLB and member institutions and can only be purchased and redeemed at par, therefore there has been no observable changes in market prices. As a member of the FHLB system, the Bank is required to maintain a minimum level of investment in FHLB stock based on specific percentages of its outstanding FHLB advances. Management periodically evaluates FHLB stock for impairment. Management’s determination of whether these investments are impaired is based on its assessment of the ultimate recoverability of cost rather than by recognizing temporary declines in value. The determination of whether a decline affects the ultimate recoverability of cost is influenced by criteria such as (1) the significance of any decline in net assets of the FHLB as compared to the capital stock amount for the FHLB and the length of time this situation has persisted, (2) commitments by the FHLB to make payments required by law or regulation and the level of such payments in relation to the operating performance of the FHLB, (3) the impact of legislative and regulatory changes on institutions and, accordingly, the client base of the FHLB, and (4) the liquidity position of the FHLB. Based on this assessment, Management has concluded that there was no impairment of the FHLB stock investment as of December 31, 2025 and 2024. Loans Receivable : The Bank originates one- to four-family residential loans for both portfolio investment and sale in the secondary market. The Bank also originates construction and land development, multifamily real estate, commercial real estate, commercial business, agricultural and consumer loans for portfolio investment. Loans receivable not designated as held for sale are recorded at amortized cost, net of the allowance for credit losses. Amortized cost is the principal amount outstanding, net of deferred fees, discounts and premiums. Accrued interest on loans is reported in accrued interest receivable on the Consolidated Statements of Financial Condition. Premiums, discounts and deferred loan fees are amortized to maturity using the effective-yield methodology. 76 Table of Contents Loans Held for Sale: One- to four-family residential loans originated with the intent to be sold in the secondary market are considered held for sale. One- to four-family residential loans under best effort delivery commitments are carried at the lower of aggregate cost or estimated market value. One- to four-family residential loans expected to be delivered under mandatory commitments are carried at fair value to match changes in the value of the loans with the value of the related economic hedges on the loans. Fair values for residential mortgage loans held for sale are determined by comparing actual loan rates to current secondary market prices for similar loans. Net unrealized losses on loans held for sale that are carried at lower of cost or market are recognized through the valuation allowance as charges to income. Non-refundable fees and direct loan origination costs related to loans held for sale carried at the lower of cost or market are recognized as part of the cost basis of the loan. Gains and losses on sales of loans held for sale are determined using the aggregate method and are recorded in the mortgage banking operations component of non-interest income. Loans Acquired in Business Combinations : Loans acquired in business combinations are recorded at their fair value at the acquisition date. Establishing the fair value of acquired loans involves a significant amount of judgment, including determining the credit discount based upon historical data adjusted for current economic conditions and other factors. If any of these assumptions are inaccurate, actual credit losses could vary significantly from the credit discount used to calculate the fair value of the acquired loans. Acquired loans are evaluated upon acquisition and classified as either purchased credit-deteriorated or purchased non-credit-deteriorated. Purchased credit-deteriorated (PCD) loans have experienced more than insignificant credit deterioration since origination. For PCD loans, an allowance for credit losses is determined at the acquisition date using the same methodology as other loans held for investment. The initial allowance for credit losses, determined on a collective basis, is allocated to individual loans. A loan’s fair value is grossed up for the allowance for credit losses and becomes its initial amortized cost basis. The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the allowance for credit losses are recorded through a provision (recapture) for credit losses. For purchased non-credit-deteriorated loans, the difference between the fair value and unpaid principal balance of the loan at the acquisition date is amortized or accreted to interest income over the life of the loan. While credit discounts are included in the determination of the fair value for non-credit-deteriorated loans, since these discounts are expected to be accreted over the life of the loans, they cannot be used to offset the allowance for credit losses that must be recorded at the acquisition date. As a result, an allowance for credit losses is determined at the acquisition date using the same methodology as other loans held for investment and is recognized as a provision for credit losses. Any subsequent deterioration (improvement) in credit quality is recognized by recording a provision (recapture) for credit losses. Income Recognition on Nonaccrual Loans and Securities : Interest on loans and securities is accrued as earned unless Management doubts the collectability of the asset or the unpaid interest. Interest accruals on consumer and one- to four-family residential loans are generally discontinued when loans become 120 days past due for payment of interest or principal and the loans are then placed on nonaccrual status. Interest accruals on all other loans are generally discontinued when loans become 90 days past due for payment of interest or principal and the loans are then placed on nonaccrual status. All previously accrued but uncollected interest is deducted from interest income upon transfer to nonaccrual status. For any future payments collected, interest income is recognized only upon Management’s assessment that there is a strong likelihood that the full amount of a loan will be repaid or recovered. Management’s assessment of the likelihood of full repayment involves judgment, including determining the fair value of the underlying collateral which can be impacted by the economic environment. A loan may be put on nonaccrual status sooner than this policy would dictate if, in Management’s judgment, the amounts owed, principal or interest may be uncollectable. While less common, similar interest reversal and nonaccrual treatment is applied to investment securities if their ultimate collectability becomes questionable. Provision and Allowance for Credit Losses - Loans : The methodology for determining the allowance for credit losses - loans is considered a critical accounting estimate by Management because of the high degree of judgment involved, the subjectivity of the assumptions used, and the potential for changes in the economic environment that could result in changes to the amount of the recorded allowance for credit losses - loans. Among the material estimates required to establish the allowance for credit losses - loans are: a reasonable and supportable forecast; a reasonable and supportable forecast period and reversion period; value of collateral; strength of guarantors; the amount and timing of future cash flows for loans individually evaluated; and determination of the qualitative loss factors. The allowance for credit losses - loans is a valuation account that is deducted from the amortized cost basis of loans to present the net amount expected to be collected on the loans. The Company has elected to exclude accrued interest receivable from the amortized cost basis in their estimate of the allowance for credit losses - loans. The provision for credit losses reflects the amount required to maintain the allowance for credit losses - loans at an appropriate level based upon Management’s evaluation of the adequacy of collective and individual loss reserves. The Company has established systematic methodologies for the determination of the adequacy of the Company’s allowance for credit losses - loans. The methodologies are set forth in a formal policy and take into consideration the need for a valuation allowance for loans evaluated on a collective (pool) basis which have similar risk characteristics as well as allowances that are tied to individual loans that do not share risk characteristics. The Company increases its allowance for credit losses - loans by charging the provision for credit losses. Losses related to specific assets are applied as a reduction of the carrying value of the assets and charged against the allowance for credit losses when Management believes the uncollectibility of a loan balance is confirmed. Recoveries on previously charged off loans are credited to the allowance for credit losses - loans. 77 Table of Contents Management estimates the allowance for credit losses - loans using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The allowance for credit losses - loans is maintained at a level sufficient to provide for expected credit losses over the life of the loan based on evaluating historical credit loss experience and making adjustments to historical loss information for differences in the specific risk characteristics in the current loan portfolio. These factors include, among others, changes in the size and composition of the loan portfolio, differences in underwriting standards, delinquency rates, actual loss experience and current economic conditions. The allowance for credit losses - loans is measured on a collective (pool) basis when similar risk characteristics exist. In estimating the component of the allowance for credit losses for loans that share common risk characteristics, loans are pooled based on loan type and areas of risk concentration. For loans evaluated collectively, the allowance for credit losses is calculated using life of loan historical losses adjusted for economic forecasts and current conditions. For commercial real estate, multifamily real estate, construction, land and land development, commercial business and agricultural loans with risk rating segmentation, historical credit loss assumptions are estimated using a model that categorizes loan pools based on loan type and risk rating. For one- to four- family residential loans, consumer loans, home equity lines of credit, small business loans, and small balance commercial real estate loans, historical credit loss assumptions are estimated using a model that categorizes loan pools based on loan type and delinquency status. These models calculate an expected life-of-loan loss percentage for each loan category by calculating the probability of default, based on the migration of loans from performing to loss by risk rating or delinquency categories using historical life-of-loan analysis and the severity of loss, based on the aggregate net lifetime losses incurred for each loan pool. For credit cards, historical credit loss assumptions are estimated using a model that calculates an expected life-of-loan loss percentage for each loan category by considering the historical cumulative losses based on the aggregate net lifetime losses incurred for each loan pool. For loans evaluated collectively, Management uses economic indicators to adjust the historical loss rates so that they better reflect Management’s expectations of future conditions over the remaining lives of the loans in the portfolio based on reasonable and supportable forecasts. These economic indicators are selected based on the correlation to the Company’s historical credit loss experience and are evaluated for each loan category. The economic indicators evaluated include the unemployment rate, gross domestic product, real estate price indices and growth, industrial employment, corporate profits, the household consumer debt service ratio, the household mortgage debt service ratio, and single family median home price growth. Management considers various economic scenarios and forecasts when evaluating the economic indicators and weighs the probability of various scenarios to arrive at the forecast that most reflects Management’s expectations of future conditions. The allowance for credit losses is then adjusted for the period in which those forecasts are considered to be reasonable and supportable. To the extent the lives of the loans in the portfolio extend beyond the period for which a reasonable and supportable forecast can be made, the adjustments discontinue to be applied so that the model reverts back to the historical loss rates using a straight-line reversion method. Management selected a reasonable and supportable forecast period of 12 months with a reversion period of 12 months. Both the reasonable and supportable forecast period and the reversion period are periodically reviewed by Management. Further, for loans evaluated collectively, Management also considers qualitative and environmental factors for each loan category to adjust for differences between the historical periods used to calculate historical loss rates and expected conditions over the remaining lives of the loans in the portfolio. In determining the aggregate adjustment needed, Management considers the financial condition of the borrowers, the nature and volume of the loans, the remaining terms and the extent of prepayments on the loans, the volume and severity of past due and classified loans as well as the value of the underlying collateral on loans in which the collateral dependent practical expedient has not been used. Management also considers the Company’s lending policies, the quality of the Company’s credit review system, the quality of the Company’s management and lending staff, and the regulatory and economic environments in the areas in which the Company’s lending activities are concentrated. Loans that do not share risk characteristics with other loans in the portfolio are individually evaluated for impairment and are not included in the collective evaluation. Factors involved in determining whether a loan should be individually evaluated include, but are not limited to, the financial condition of the borrower and the value of the underlying collateral. Expected credit losses for loans evaluated individually are primarily measured based on the fair market value of the collateral as of the reporting date, less estimated selling costs, as applicable. Under certain circumstances, the Bank may use observable market value of collateral or the present value of the expected future cash flows discounted at the loan’s original effective interest rate. As a practical expedient, the Bank measures the expected credit loss for a loan using the fair value of the collateral, if repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Bank’s assessment as of the reporting date. If the fair value of the collateral is less than the amortized cost basis of the loan, the Bank will recognize an allowance for the difference between the fair value of the collateral, less costs to sell (if applicable) at the reporting date and the amortized cost basis of the loan. If the fair value of the collateral exceeds the amortized cost basis of the loan, any expected recovery added to the amortized cost basis will be limited to the amount previously charged-off. Subsequent changes in the expected credit losses for loans evaluated individually are included within the provision for credit losses in the same manner in which the expected credit loss initially was recognized or as a reduction in the provision that would otherwise be reported. 78 Table of Contents Loan Origination and Commitment Fees: Loan origination fees, net of certain specifically defined direct loan origination costs, are deferred and recognized as an adjustment of the loans’ interest yield using the effective-yield method over the contractual term of each loan, adjusted for actual loan prepayment experience. Loan commitment fees are deferred until the expiration of the commitment period unless Management believes there is a remote likelihood that the underlying commitment will be exercised, in which case the fees are amortized to fee income using the straight-line method over the commitment period. If a loan commitment is exercised, the deferred commitment fee is accounted for in the same manner as a loan origination fee. Deferred commitment fees associated with expired commitments are recognized as fee income. Allowance for Credit Losses - Unfunded Loan Commitments: An allowance for credit losses - unfunded loan commitments is maintained at a level that, in the opinion of Management, is adequate to absorb expected credit losses associated with the contractual life of the Bank’s commitments to lend funds under existing agreements such as letters or lines of credit. The Bank uses a methodology for determining the allowance for credit losses - unfunded loan commitments that applies the same segmentation and loss rate to each pool as the funded exposure adjusted for probability of funding. Draws on unfunded loan commitments that are considered uncollectible at the time funds are advanced are charged to the allowance for credit losses on off-balance sheet exposures. Changes in the allowance for credit losses - unfunded loan commitments are recognized as provision for (or recapture of) credit loss expense and added to the allowance for credit losses - unfunded loan commitments, which is included in other liabilities in the Consolidated Statements of Financial Condition. Real Estate Owned: Property acquired by foreclosure or deed in-lieu-of foreclosure is recorded at the estimated fair value of the property, less expected selling costs. Development and improvement costs relating to the property may be capitalized, while other holding costs are expensed. The carrying value of the property is periodically evaluated by Management and, if necessary, allowances are established to reduce the carrying value to net realizable value. Gains or losses at the time the property is sold are charged or credited to operations in the period in which they are realized. The amounts the Bank will ultimately recover from REO may differ substantially from the carrying value of the assets because of market factors beyond the Bank’s control or because of changes in the Bank’s strategies for recovering the investment. Property and Equipment: Property and equipment is carried at cost less accumulated depreciation. Depreciation is based upon the straight-line method applied to individual assets and groups of assets acquired in the same year over the lesser of their estimated useful lives or the related lease terms of the assets, which are as follows: Buildings and leased improvements 10 – 39 years Furniture and equipment 3 – 10 years Routine maintenance, repairs and replacement costs are expensed as incurred. Expenditures which significantly increase values or extend useful lives are capitalized. The Company reviews buildings, leasehold improvements and equipment for impairment whenever events or changes in circumstances indicate that the undiscounted cash flows for the property are less than its carrying value. If identified, an impairment loss is recognized through a charge to earnings based on the fair value of the property. Property is classified as held for sale when the Company commits to a plan to sell the property and is actively marketing the property for sale. Held for sale property is recorded at the lower of the estimated fair value of the property, less expected selling costs, or the book value at the date the property is transferred to held for sale. Depreciation is not recorded on held for sale property. Leases: The Company leases retail, office and storage space, and equipment under operating leases. Most leases require the Company to pay real estate taxes, maintenance, insurance and other similar costs in addition to the base rent. Certain leases also contain lease incentives, such as tenant improvement allowances and rent abatement. Variable lease payments are recognized as lease expense as they are incurred. We record an operating lease right of use (ROU) asset and an operating lease liability (lease liability) for operating leases with a lease term greater than 12 months. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets are reduced by tenant improvement allowances from landlords plus any prepaid rent. We do not separate lease and non-lease components of contracts. As most of our leases do not provide an implicit rate, we generally use our incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. Many of our leases contain various provisions for increases in rental rates, based either on changes in the published Consumer Price Index or a predetermined escalation schedule which are factored into our determination of lease payments when appropriate. Substantially all the leases provide the Company with the option to extend the lease term one or more times following expiration of the initial term. The ROU asset and lease liability terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. 79 Table of Contents Goodwill: 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 annually or more frequently as current circumstances and conditions warrant, for impairment. The Company completes its annual review of goodwill as of December 31. An assessment of qualitative factors is completed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. The qualitative assessment involves judgment by Management on determining whether there have been any triggering events that have occurred which would indicate potential impairment. If the qualitative analysis concludes that further analysis is required, then a quantitative impairment test would be completed. The quantitative goodwill impairment test is used to identify the existence of impairment and the amount of impairment loss and compares the reporting unit’s estimated fair values, including goodwill, to its carrying amount. If the fair value exceeds the carrying amount, then goodwill is not considered impaired. If the carrying amount exceeds its fair value, an impairment loss would be recognized equal to the amount of excess, limited to the amount of total goodwill allocated to the reporting unit. The impairment loss would be recognized as a charge to earnings. The disposal of a portion of a reporting unit that meets the definition of a business requires goodwill to be allocated for purposes of determining the gain or loss on disposal . Other Intangible Assets: Other intangible assets consist primarily of core deposit intangibles (CDI) which are amounts recorded in business combinations or deposit purchase transactions related to the value of transaction-related deposits and the value of the client relationships associated with the deposits. CDI is being amortized on an accelerated basis over a weighted average estimated useful life of 10 years. These assets are reviewed at least annually for events or circumstances that could impact their recoverability. These events could include loss of the underlying core deposits, increased competition or adverse changes in the economy. To the extent other identifiable intangible assets are deemed unrecoverable, impairment losses are recorded in other non-interest expense to reduce the carrying amount of the assets. Mortgage and Small Business Administration (SBA) Servicing Rights: Servicing assets are recognized as separate assets when rights are acquired through purchase or sale of loans. Generally, purchased servicing rights are capitalized at the cost to acquire the rights. For sales of mortgage and SBA loans, the fair value of the servicing right is estimated and capitalized. Fair values are estimated based on an independent dealer analysis of discounted cash flows. Capitalized mortgage servicing rights are reported in other assets and are amortized into mortgage banking operations in proportion to, and over the period of, the estimated future net servicing income of the underlying financial assets. Capitalized SBA servicing rights are reported in other assets and are carried at fair value. Changes in the fair value of SBA servicing rights are recognized into miscellaneous non-interest income. Mortgage servicing assets are evaluated for impairment based upon the fair value of the rights as compared to amortized cost. Impairment is determined by stratifying rights into tranches based on predominant risk characteristics for the underlying loans, such as interest rate, balance outstanding, loan type, age and remaining term, and investor type. Impairment is recognized through a valuation allowance for an individual tranche, to the extent that fair value is less than the capitalized amount for the tranche. If the Company later determines that all or a portion of the impairment no longer exists for a particular tranche, a reduction of the allowance may be recorded as an increase to income. Servicing fee income is recorded for fees earned for servicing loans. Servicing fee income is reflected in mortgage banking operations for mortgage servicing rights and in miscellaneous non-interest income for SBA servicing rights on the Consolidated Statements of Operations. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. The amortization of mortgage servicing rights is netted against loan servicing fee income. Bank-Owned Life Insurance: The Bank has purchased, or acquired through mergers, life insurance policies in connection with the implementation of certain executive supplemental income, salary continuation and deferred compensation retirement plans. These policies provide protection against the adverse financial effects that could result from the death of a key employee and provide tax-exempt income to offset expenses associated with the plans. It is the Bank’s intent to hold these policies as a long-term investment; however, there may be an income tax impact if the Bank chooses to surrender certain policies. Although the lives of individual, current or former management-level employees are insured, the Bank is the respective owner and sole or partial beneficiary. BOLI is carried at the cash surrender value (CSV) of the underlying insurance contract. Changes in the CSV and any death benefits received in excess of the CSV are recognized as non-interest income. Derivative Instruments: Derivatives are financial instruments whose value depends on the value of underlying assets, such as stocks, bonds, foreign currencies, or reference rates or indices. These instruments include forwards, futures, options, and swaps. The Bank offers an interest rate swap program for commercial loan clients, under which the client receives a variable-rate loan and enters into an interest rate swap to effectively fix their loan interest rate. The Bank matches these client swaps with third-party swaps executed with qualified brokers, dealers, or banks to offset the associated risk. Fair value adjustments for these swaps are recorded in either other assets or other liabilities, as appropriate. 80 Table of Contents Further, as a part of its mortgage banking activities, the Company issues “rate lock” commitments to one- to four-family loan borrowers and obtains offsetting “best efforts” delivery commitments from purchasers of loans. The Company uses forward contracts for the sale of mortgage-backed securities and mandatory delivery commitments for the sale of loans to hedge one- to four-family loan “rate lock” commitments and one- to four-family residential loans held for sale. The commitments to originate mortgage loans held for sale and the related delivery contracts are considered derivatives. The Company recognizes all derivatives as either assets or liabilities in the balance sheet and requires measurement of those instruments at fair value through adjustments to current earnings. None of these residential mortgage loan related derivatives are designated as hedging instruments for accounting purposes. Rather, they are accounted for as free-standing derivatives, or economic hedges, and the Company reports changes in fair values of its derivatives in current period net income. The fair values for these instruments, which generally change as a result of changes in the level of market interest rates, are estimated based on dealer quotes and secondary market sources. Assumptions used include rate assumptions based on historical information, current mortgage interest rates, the stage of completion of the underlying application and underwriting process, the time remaining until the expiration of the derivative loan commitment, and the expected net future cash flows related to the associated servicing of the loan. Transfers of Financial Assets: Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Bank, (2) the transferee has the right to pledge or exchange the transferred assets beyond a trivial benefit, and (3) the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity. Income Taxes: The Company files a consolidated income tax return including all of its wholly-owned subsidiaries on a calendar year basis. Income taxes are accounted for using the asset and liability method. Under this method, a deferred tax asset or liability is determined based on the enacted tax rates which are expected to be in effect when the differences between the financial statement carrying amounts and tax basis of existing assets and liabilities are expected to be reported in the Company’s income tax returns. The effect on deferred taxes of a change in tax rates is recognized in income in the period of change. A valuation allowance is recognized as a reduction to deferred tax assets when Management determines it is more likely than not that deferred tax assets will not be available to offset future income tax liabilities. Accounting standards for income taxes prescribe a recognition threshold and measurement process for financial statement recognition and measurement of uncertain tax positions taken or expected to be taken in a tax return, and provides guidance on the de-recognition of previously recorded benefits and their classification, as well as the proper recording of interest and penalties, accounting in interim periods, disclosures and transition. The Company periodically reviews its income tax positions based on tax laws and regulations and financial reporting considerations, and records adjustments as appropriate. This review takes into consideration the status of current taxing authorities’ examinations of the Company’s tax returns, recent positions taken by the taxing authorities on similar transactions, if any, and the overall tax environment. Stock-Based Compensation: Under the Company’s stock-based incentive plans, the Company compensates employees and directors with time-based restricted stock and restricted stock unit grants. Some restricted stock awards include performance-based and market-based goals that impact the number of shares that ultimately vest based on the level of goal achievement. The Company measures the cost of employee or director services received in exchange for an award of equity instruments based on the fair value of the award, which is the intrinsic value on the grant date. This cost is recognized as expense in the Consolidated Statements of Operations ratably over the vesting period of the award with forfeitures of nonvested awards recognized as they occur. Any tax benefit or deficiency is recorded as income tax benefit or expense in the period the shares vest. Excess tax benefits are classified, along with other income tax cash flows, as an operating activity. The Company issues restricted stock and restricted stock unit awards which vest over a one- or three-year period during which time, the employee or director accrues or receives dividends and may have full voting rights depending on the terms of the grant. Earnings Per Share: Earnings per common share is computed under the two-class method. Pursuant to the two-class method, non-vested stock-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and are included in the computation of earnings per share. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared (or accumulated) and participation rights in undistributed earnings. Application of the two-class method resulted in the equivalent earnings per share to the treasury method. Basic earnings per common share is computed by dividing net earnings allocated to common shareholders by the weighted average number of common shares outstanding during the applicable period, excluding outstanding participating securities. Diluted earnings per common share is computed using the weighted average number of shares determined for the basic earnings per common share computation plus the dilutive effect of stock compensation, using the treasury stock method. Comprehensive Income: Accounting principles generally require that recognized revenue, expenses, gains and losses be included in net income. In addition, certain changes in assets and liabilities, such as unrealized gains and losses on available-for-sale securities, unrealized gains and losses on interest rate swaps used in cash flow hedges and changes in fair value of junior subordinated debentures related to instrument specific credit risk, are reported as a separate component of the equity section of the Consolidated Statements of Financial Condition, and such items, along with net income, are components of comprehensive income which is reported in the Consolidated Statements of Comprehensive Income. Reclassification: Certain reclassifications have been made to the prior years’ consolidated financial statements and/or schedules to conform to the current year’s presentation. These reclassifications may have an impact on certain reported amounts and ratios for the prior periods. These reclassifications had no effect on retained earnings or net income as previously presented and the effect of these reclassifications is considered immaterial. 81 Table of Contents Note 2: ACCOUNTING STANDARDS RECENTLY ISSUED OR ADOPTED Interim Reporting: Narrow-Scope Improvements (Subtopic 270-10) In December 2025, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. The amendments in this ASU clarify the applicability of Topic 270, enhance the navigability of interim reporting requirements, and consolidate existing interim disclosure guidance. The amendments specify the form and content of interim financial statements, provide a comprehensive list of required interim disclosures, and introduce a disclosure principle requiring entities to disclose events occurring after the most recent annual reporting period that have a material impact on the entity. The ASU does not change the fundamental nature or scope of interim reporting requirements. This ASU is effective for all entities for interim periods within annual periods beginning after December 15, 2027, with early adoption permitted. The amendments may be applied either prospectively or retrospectively to any periods presented in the financial statements. The Company is currently evaluating this ASU but does not expect its adoption to have a material impact on the Company’s consolidated financial statements. Derivatives and Hedging: Hedge Accounting Improvements (Subtopic 815-20) In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. The amendments in this ASU are intended to clarify certain aspects of the guidance on hedge accounting and to address several incremental hedge accounting issues arising from the global reference rate reform initiative. The update clarifies and expands guidance in several areas, including allowing groups of forecasted transactions to be hedged based on “similar” rather than “shared” risk exposure, offering greater flexibility in applying cash flow hedges. Overall, the amendments respond to stakeholder concerns following ASU 2017‑12 and address complexities arising from global reference‑rate reform, ultimately facilitating the achievement and maintenance of hedge accounting for highly effective hedging relationships. This ASU is effective for all entities for annual reporting periods beginning after December 31, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted on any date on or after the issuance of this ASU. The Company is currently evaluating this ASU but does not expect its adoption to have a material impact on the Company’s consolidated financial statements. Financial Instruments—Credit Losses: Purchased Loans (Topic 310-10): In November 2025, the FASB issued ASU 2025-08, Financial Instruments—Credit Losses (Topic 326): Purchased Loans. The amendments in this ASU are intended to simplify and improve the accounting for acquired loans by expanding the use of the gross‑up approach, previously limited to purchased credit‑deteriorated (PCD) assets, to a new category of purchased seasoned loans, which encompasses certain acquired non‑PCD loans. Under this approach, entities recognize an allowance for expected credit losses at acquisition with a corresponding increase to the asset’s amortized cost basis, eliminating Day‑1 credit loss expense and promoting greater comparability across acquisitions. This change aims to enhance comparability, consistency, and better reflect the economics of acquiring financial assets. This ASU is effective for all entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. This ASU will impact loans acquired in future periods following adoption. Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The amendments in this ASU are intended to modernize the guidance for accounting software costs that are accounted for under Subtopic 350-40 and remove all references to prescriptive and sequential software development stages. This increases the operability of the cost recognition guidance by considering different methods of software development. The ASU requires that an entity begin capitalizing software costs when both of the following conditions have been met: management has authorized and committed to funding the software project; and it is probable that the project will be completed; and the software will be used to perform the function intended (referred to as the “probable-to-complete recognition threshold”). In addition, this ASU clarifies disclosure requirements for Internal-Use Software. This ASU is effective for all entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The amendments may be applied using the prospective method, the modified transition approach, or retrospectively. The Company is currently evaluating this ASU but does not expect its adoption to have a material impact on the Company’s consolidated financial statements. 82 Table of Contents Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The amendments in the ASU require public companies to disclose, in the notes to financial statements, specified information about certain costs and expenses at each interim and annual reporting period. Specifically, they will be required to: • Disclose the amounts of (a) purchases of inventory; (b) employee compensation; (c) depreciation; (d) intangible asset amortization; and (e) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities (or other amounts of depletion expense) included in each relevant expense caption. • Include certain amounts that are already required to be disclosed under GAAP in the same disclosure as the other disaggregation requirements. • Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. • Disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The amendments should be applied prospectively. The Company does not expect this ASU to have a material impact on the Company’s consolidated financial statements. Note 3: SECURITIES The amortized cost, gross unrealized gains and losses, and estimated fair value of securities at December 31, 2025 and 2024, are summarized as follows (in thousands): December 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale: U.S. Government and agency obligations $ 6,454 $ — $ ( 311 ) $ 6,143 Municipal bonds 169,386 1,070 ( 26,999 ) 143,457 Corporate bonds 115,982 4,646 ( 2,839 ) 117,789 Mortgage-backed or related securities 1,827,227 2,313 ( 233,208 ) 1,596,332 Asset-backed securities 152,422 162 ( 44 ) 152,540 $ 2,271,471 $ 8,191 $ ( 263,401 ) $ 2,016,261 December 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Allowance for Credit Losses Held-to-Maturity: U.S. Government and agency obligations $ 262 $ — $ ( 2 ) $ 260 $ — Municipal bonds 430,571 34 ( 56,311 ) 374,149 ( 145 ) Corporate bonds 2,544 — — 2,398 ( 146 ) Mortgage-backed or related securities 528,110 — ( 90,249 ) 437,861 — $ 961,487 $ 34 $ ( 146,562 ) $ 814,668 $ ( 291 ) 83 Table of Contents December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale: U.S. Government and agency obligations $ 8,492 $ — $ ( 559 ) $ 7,933 Municipal bonds 153,982 453 ( 30,453 ) 123,982 Corporate bonds 131,379 100 ( 6,489 ) 124,990 Mortgage-backed or related securities 1,995,805 383 ( 319,340 ) 1,676,848 Asset-backed securities 170,604 155 ( 1 ) 170,758 $ 2,460,262 $ 1,091 $ ( 356,842 ) $ 2,104,511 December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Allowance for Credit Losses Held-to-Maturity: U.S. Government and agency obligations $ 302 $ — $ ( 4 ) $ 298 $ — Municipal bonds 438,196 36 ( 62,809 ) 375,280 ( 143 ) Corporate bonds 2,658 — ( 6 ) 2,498 ( 154 ) Mortgage-backed or related securities 560,705 — ( 113,253 ) 447,452 — $ 1,001,861 $ 36 $ ( 176,072 ) $ 825,528 $ ( 297 ) Accrued interest receivable on held-to-maturity debt securities was $ 4.1 million and $ 4.2 million as of December 31, 2025 and 2024, and was $ 8.3 million and $ 9.0 million on available-for-sale debt securities at December 31, 2025 and 2024, respectively. Accrued interest receivable on securities is reported in accrued interest receivable on the Consolidated Statements of Financial Condition and is excluded from the calculation of the allowance for credit losses. At December 31, 2025 and 2024, the gross unrealized losses and the fair value for securities—available-for-sale aggregated by the length of time that individual securities have been in a continuous unrealized loss position were as follows (in thousands): December 31, 2025 Less Than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-Sale: U.S. Government and agency obligations $ — $ — $ 6,143 $ ( 311 ) $ 6,143 $ ( 311 ) Municipal bonds — — 94,038 ( 26,999 ) 94,038 ( 26,999 ) Corporate bonds 11,238 ( 31 ) 50,000 ( 2,808 ) 61,238 ( 2,839 ) Mortgage-backed or related securities 50,803 ( 46 ) 1,395,325 ( 233,162 ) 1,446,128 ( 233,208 ) Asset-backed securities 10,000 ( 44 ) — — 10,000 ( 44 ) $ 72,041 $ ( 121 ) $ 1,545,506 $ ( 263,280 ) $ 1,617,547 $ ( 263,401 ) December 31, 2024 Less Than 12 Months 12 Months or More Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-Sale: U.S. Government and agency obligations $ — $ — $ 7,933 $ ( 559 ) $ 7,933 $ ( 559 ) Municipal bonds 15,497 ( 287 ) 91,156 ( 30,166 ) 106,653 ( 30,453 ) Corporate bonds 2,541 ( 59 ) 96,763 ( 6,430 ) 99,304 ( 6,489 ) Mortgage-backed or related securities 44,749 ( 524 ) 1,552,613 ( 318,816 ) 1,597,362 ( 319,340 ) Asset-backed securities 20,000 ( 1 ) — — 20,000 ( 1 ) $ 82,787 $ ( 871 ) $ 1,748,465 $ ( 355,971 ) $ 1,831,252 $ ( 356,842 ) 84 Table of Contents At December 31, 2025, there were 175 securities—available-for-sale with unrealized losses, compared to 201 at December 31, 2024. Management does not believe that any individual unrealized loss as of December 31, 2025 or 2024 resulted from credit loss. The decline in fair market value of these securities was generally due to changes in interest rates and changes in market-desired spreads subsequent to their purchase. The following table presents gross gains and losses on sales and partial calls of securities—available-for-sale (in thousands): For the Year Ended December 31, 2025 2024 2023 Available-for-Sale: Gross Gains $ — $ 36 $ 383 Gross Losses ( 1,211 ) ( 5,529 ) ( 19,625 ) Balance, end of the period $ ( 1,211 ) $ ( 5,493 ) $ ( 19,242 ) There were no securities—available-for-sale in a nonaccrual status at December 31, 2025 and 2024. The Company did not sell any held-to-maturity securities during the years ended December 31, 2025, 2024 and 2023. There were no securities—held-to-maturity in a nonaccrual status at December 31, 2025 and 2024. The following table presents the amortized cost and estimated fair value of securities at December 31, 2025, by contractual maturity and does not reflect any required periodic payments (in thousands). Expected maturities will differ from contractual maturities because some securities may be called or prepaid with or without call or prepayment penalties. December 31, 2025 Available-for-Sale Held-to-Maturity Amortized Cost Fair Value Amortized Cost Fair Value Maturing within one year $ 17,113 $ 17,030 $ 7,338 $ 7,178 Maturing after one year through five years 182,701 169,475 11,542 11,392 Maturing after five years through 10 years 276,335 264,077 33,879 32,607 Maturing after 10 years 1,795,322 1,565,679 908,728 763,491 $ 2,271,471 $ 2,016,261 $ 961,487 $ 814,668 The following table presents, as of December 31, 2025, investment securities which were pledged to secure borrowings, public deposits or other obligations as permitted or required by law (in thousands): December 31, 2025 Carrying Value Amortized Cost Fair Value Purpose or beneficiary: State and local governments public deposits $ 295,566 $ 308,053 $ 266,266 Interest rate swap counterparties 947 947 807 Repurchase transaction accounts 202,906 202,906 167,373 Other 2,470 2,470 2,230 Total pledged securities $ 501,889 $ 514,376 $ 436,676 85 Table of Contents The Company monitors the credit quality of held-to-maturity debt securities using credit ratings which are reviewed and updated quarterly. The Company’s non-rated held-to-maturity debt securities are primarily United States government-sponsored enterprise debentures carrying minimal to no credit risk. The non-rated corporate bonds primarily consist of Community Reinvestment Act related bonds secured by loan instruments from low to moderate income borrowers. The remaining non-rated held-to-maturity debt securities balance is comprised of local municipal debt from within the Company’s geographic footprint and is monitored through quarterly or annual financial review. This municipal debt is predominately essential service or unlimited general obligation backed debt. The following tables summarize the amortized cost of held-to-maturity debt securities by credit rating at December 31, 2025 and 2024 (in thousands): December 31, 2025 U.S. Government and agency obligations Municipal bonds Corporate bonds Mortgage-backed or related securities Total AAA/AA/A $ — $ 422,275 $ 500 $ 15,969 $ 438,744 Not Rated 262 8,296 2,044 512,141 522,743 $ 262 $ 430,571 $ 2,544 $ 528,110 $ 961,487 December 31, 2024 U.S. Government and agency obligations Municipal bonds Corporate bonds Mortgage-backed or related securities Total AAA/AA/A $ — $ 430,158 $ 500 $ 16,218 $ 446,876 Not Rated 302 8,038 2,158 544,487 554,985 $ 302 $ 438,196 $ 2,658 $ 560,705 $ 1,001,861 The following tables present the activity in the allowance for credit losses for held-to-maturity debt securities by major type for the years ended December 31, 2025, 2024 and 2023 (in thousands): Allowance for credit losses – securities Municipal bonds Corporate bonds Total Balance, January 1, 2023 $ 183 $ 196 $ 379 Recapture of provision for credit losses ( 26 ) ( 45 ) ( 71 ) Recoveries — 24 24 Balance, December 31, 2023 157 175 332 Recapture of provision for credit losses ( 14 ) ( 46 ) ( 60 ) Recoveries — 25 25 Balance, December 31, 2024 143 154 297 Recapture of provision (recapture) for credit losses 2 ( 17 ) ( 15 ) Recoveries — 9 9 Balance, December 31, 2025 $ 145 $ 146 $ 291 86 Table of Contents Note 4: LOANS RECEIVABLE AND THE ALLOWANCE FOR CREDIT LOSSES The following table presents the loans receivable at December 31, 2025 and 2024, by class (dollars in thousands): December 31, 2025 December 31, 2024 Amount Percent of Total Amount Percent of Total Commercial real estate: Owner-occupied $ 1,138,298 10 % $ 1,027,426 9 % Investment properties 1,701,413 15 1,623,672 14 Small balance CRE 1,212,357 10 1,213,792 11 Multifamily real estate 850,789 7 894,425 8 Construction, land and land development: Commercial construction 156,021 1 122,362 1 Multifamily construction 514,330 5 513,706 5 One- to four-family construction 607,447 5 514,220 5 Land and land development 433,678 4 369,663 3 Commercial business: Commercial business 1,225,108 11 1,318,333 11 Small business scored 1,187,360 10 1,104,117 10 Agricultural business, including secured by farmland 353,152 3 340,280 3 One- to four-family residential 1,573,191 13 1,591,260 14 Consumer: Consumer—home equity revolving lines of credit 679,489 5 625,680 5 Consumer—other 89,054 1 95,720 1 Total loans 11,721,687 100 % 11,354,656 100 % Less allowance for credit losses – loans ( 160,276 ) ( 155,521 ) Net loans $ 11,561,411 $ 11,199,135 Loan amounts are net of unearned loan fees in excess of unamortized costs of $ 16.5 million as of December 31, 2025, and $ 15.5 million as of December 31, 2024. Net loans include net discounts on acquired loans of $ 2.4 million and $ 3.5 million as of December 31, 2025 and 2024, respectively. Net loans does not include accrued interest receivable. Accrued interest receivable on loans was $ 48.2 million as of December 31, 2025, and $ 47.7 million as of December 31, 2024, and was reported in accrued interest receivable on the Consolidated Statements of Financial Condition. At December 31, 2025 and 2024, the Company had pledged $ 8.2 billion and $ 7.9 billion of loans as collateral for FHLB and other borrowings, respectively. The Company’s loans to directors, executive officers and related entities are on substantially the same terms and underwriting as those prevailing at the time for comparable transactions with unrelated persons and do not involve more than normal risk of collectability. These loans had balances of $ 657,600 and $ 682,600 at December 31, 2025 and 2024 respectively. Purchased credit-deteriorated and purchased non-credit-deteriorated loans. Loans purchased or acquired in business combinations are recorded at their fair value at the acquisition date. Acquired loans are evaluated upon acquisition and classified as either purchased credit-deteriorated (PCD) or purchased non-credit-deteriorated. There were no PCD loans at December 31, 2025 and 2024. 87 Table of Contents Troubled Loan Modifications. Occasionally, the Company offers modifications of loans to borrowers experiencing financial difficulty by providing principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions or any combination of these. When principal forgiveness is provided, the amount of the forgiveness is charged-off against the allowance for credit losses - loans. Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is charged off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses - loans is adjusted by the same amount. The allowance for credit losses on modified loans is measured using similar credit loss estimation methods used to determine the allowance for credit losses for all other loans held for investment. These methods incorporate the post-modification loan terms, as well as defaults and charge-offs associated with historical modified loans. The following tables present the amortized cost basis and financial effect of loans that were experiencing financial difficulty and modified during the year ended December 31, 2025 and 2024 (in thousands): December 31, 2025 Term Extension Total Construction, land and land development: Multifamily construction $ 13,268 $ 13,268 One- to four-family construction 4,605 4,605 Land and land development 1,894 1,894 Agricultural business, including secured by farmland 5,964 5,964 Total $ 25,731 $ 25,731 December 31, 2024 Payment Delay Term Extension Total Commercial business $ 2,889 $ 1,480 $ 4,369 Total $ 2,889 $ 1,480 $ 4,369 The Company had commitments to lend additional amounts totaling $ 1.4 million to the borrowers included in the previous table as of December 31, 2025. The Company closely monitors the performance of loans that are modified for borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. As of December 31, 2025, there were no loans past due or on nonaccrual status that had been modified in the previous 12 months. The following table presents the performance, as of December 31, 2024, of loans that had been modified in the previous 12 months (in thousands). December 31, 2024 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Nonaccrual Total Commercial business $ — $ — $ — $ 2,889 $ 2,889 Total $ — $ — $ — $ 2,889 $ 2,889 The following tables present the financial effect of the loan modifications presented above for borrowers experiencing financial difficulty for December 31, 2025 and 2024: For the Year Ended December 31, 2025 Weighted Average Term Extension (in months) Construction, land and land development: Multifamily construction 9 One- to four-family construction 15 Land and land development 3 Agricultural business, including secured by farmland 12 For the Year Ended December 31, 2024 Weighted Average Payment Delay Period (in months) Weighted-Average Term Extension (in months) Commercial business 9 3 88 Table of Contents Credit Quality Indicators : To appropriately and effectively manage the ongoing credit quality of the Company’s loan portfolio, Management has implemented a risk-rating or loan grading system for its loans. The system is a tool to evaluate portfolio asset quality throughout each applicable loan’s life as an asset of the Company. Generally, loans are risk rated on an aggregate borrower/relationship basis with individual loans sharing similar ratings. There are some instances when specific situations relating to individual loans will provide the basis for different risk ratings within the aggregate relationship. Loans are graded on a scale of 1 to 9. A description of the general characteristics of these categories is shown below. Overall Risk Rating Definitions : Risk ratings contain both qualitative and quantitative measurements and take into account the financial strength of a borrower and the structure of the loan. Consequently, the definitions are to be applied in the context of each lending transaction and judgment must also be used to determine the appropriate risk rating, as it is not unusual for a loan to exhibit characteristics of more than one risk-rating category. Consideration for the final rating is centered on the borrower’s ability to repay, in a timely fashion, both principal and interest. The Company’s risk-rating and loan grading policies are reviewed and approved annually. There were no material changes in the risk-rating or loan grading system for the periods presented. Risk Ratings 1-5: Pass Credits with risk ratings of 1 to 5 meet the definition of a pass risk rating. The strength of credits varies within the pass risk ratings, ranging from a risk rated 1 being an exceptional credit to a risk rated 5 being an acceptable credit that requires a more than normal level of supervision. Risk Rating 6: Special Mention A credit with potential weaknesses that deserves Management’s close attention is risk rated a 6. If left uncorrected, these potential weaknesses will result in deterioration in the capacity to repay debt. A key distinction between Special Mention and Substandard is that in a Special Mention credit, there are identified weaknesses that pose potential risk(s) to the repayment sources, versus well defined weaknesses that pose risk(s) to the repayment sources. Assets in this category are expected to be in this category no more than 9-12 months as the potential weaknesses in the credit are resolved. Risk Rating 7: Substandard A credit with well-defined weaknesses that jeopardize the ability to repay in full is risk rated a 7. These credits are inadequately protected by either the sound net worth and payment capacity of the borrower or the value of pledged collateral. These are credits with a distinct possibility of loss. Loans headed for foreclosure and/or legal action due to deterioration are rated 7 or worse. Risk Rating 8: Doubtful A credit with an extremely high probability of loss is risk rated 8. These credits have all the same critical weaknesses that are found in a substandard loan; however, the weaknesses are elevated to the point that, based upon current information, collection or liquidation in full is improbable. While some loss on doubtful credits is expected, pending events may make the amount and timing of any loss indeterminable. In these situations, taking the loss is inappropriate until the outcome of the pending event is clear. Risk Rating 9: Loss A credit that is considered to be currently uncollectible or of such little value that it is no longer a viable bank asset is risk rated 9. Losses should be taken in the accounting period in which the credit is determined to be uncollectible. Taking a loss does not mean that a credit has absolutely no recovery or salvage value but, rather, it is not practical or desirable to defer writing off the credit, even though partial recovery may occur in the future. 89 Table of Contents The following tables present the Company’s portfolio of risk-rated loans by class and by grade as of December 31, 2025 and 2024 (in thousands). In addition, the tables include the gross charge-offs for the year ended December 31, 2025. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension. December 31, 2025 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2025 2024 2023 2022 2021 Prior Commercial real estate - owner occupied Risk Rating Pass $ 199,049 $ 205,626 $ 171,690 $ 105,779 $ 135,162 $ 226,813 $ 61,016 $ 1,105,135 Special Mention — 558 — 9,603 — 2,806 — 12,967 Substandard — — 288 8,534 — 11,374 — 20,196 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial real estate - owner occupied $ 199,049 $ 206,184 $ 171,978 $ 123,916 $ 135,162 $ 240,993 $ 61,016 $ 1,138,298 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Commercial real estate - investment properties Risk Rating Pass $ 296,157 $ 106,127 $ 131,328 $ 209,997 $ 241,372 $ 642,420 $ 63,376 $ 1,690,777 Special Mention — — — — — 6,652 — 6,652 Substandard — — — — — 3,984 — 3,984 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial real estate - investment properties $ 296,157 $ 106,127 $ 131,328 $ 209,997 $ 241,372 $ 653,056 $ 63,376 $ 1,701,413 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Multifamily real estate Risk Rating Pass $ 44,775 $ 89,961 $ 89,370 $ 233,563 $ 168,171 $ 221,236 $ 1,671 $ 848,747 Special Mention — — — — — — — — Substandard — — — — — 2,042 — 2,042 Doubtful — — — — — — — — Loss — — — — — — — — Total Multifamily real estate $ 44,775 $ 89,961 $ 89,370 $ 233,563 $ 168,171 $ 223,278 $ 1,671 $ 850,789 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — 90 Table of Contents December 31, 2025 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2025 2024 2023 2022 2021 Prior Commercial construction Risk Rating Pass $ 61,803 $ 36,567 $ 35,243 $ 21,666 $ — $ — $ — $ 155,279 Special Mention — — — — — — — — Substandard — — — — 742 — — 742 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial construction $ 61,803 $ 36,567 $ 35,243 $ 21,666 $ 742 $ — $ — $ 156,021 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Multifamily construction Risk Rating Pass $ 190,491 $ 180,871 $ 109,466 $ — $ — $ — $ 9,126 $ 489,954 Special Mention 5,100 — — — — — — 5,100 Substandard 19,276 — — — — — — 19,276 Doubtful — — — — — — — — Loss — — — — — — — — Total Multifamily construction $ 214,867 $ 180,871 $ 109,466 $ — $ — $ — $ 9,126 $ 514,330 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — One- to four- family construction Risk Rating Pass $ 494,781 $ 82,237 $ — $ — $ — $ — $ 22,919 $ 599,937 Special Mention 2,381 — — — — — — 2,381 Substandard 4,391 — 738 — — — — 5,129 Doubtful — — — — — — — — Loss — — — — — — — — Total One- to four- family construction $ 501,553 $ 82,237 $ 738 $ — $ — $ — $ 22,919 $ 607,447 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — 91 Table of Contents December 31, 2025 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2025 2024 2023 2022 2021 Prior Land and land development Risk Rating Pass $ 223,638 $ 104,496 $ 31,388 $ 23,470 $ 18,588 $ 16,033 $ 7,156 $ 424,769 Special Mention 4,472 — — — — — — 4,472 Substandard 638 468 1,338 1,286 99 608 — 4,437 Doubtful — — — — — — — — Loss — — — — — — — — Total Land and land development $ 228,748 $ 104,964 $ 32,726 $ 24,756 $ 18,687 $ 16,641 $ 7,156 $ 433,678 Current period gross charge-offs $ 218 $ — $ — $ — $ — $ — $ — $ 218 Commercial business Risk Rating Pass $ 206,830 $ 114,469 $ 82,152 $ 126,537 $ 68,700 $ 252,020 $ 290,225 $ 1,140,933 Special Mention — — — 213 — — 44,672 44,885 Substandard 17,131 2,648 2,498 1,264 901 3,357 11,491 39,290 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial business $ 223,961 $ 117,117 $ 84,650 $ 128,014 $ 69,601 $ 255,377 $ 346,388 $ 1,225,108 Current period gross charge-offs $ — $ 1,941 $ 908 $ — $ 18 $ 164 $ 567 $ 3,598 Agricultural business, including secured by farmland Risk Rating Pass $ 17,455 $ 12,989 $ 34,593 $ 20,096 $ 21,745 $ 58,558 $ 142,528 $ 307,964 Special Mention 388 — — 648 — 3,289 319 4,644 Substandard 6,289 74 4,445 8,424 1,560 11,565 8,187 40,544 Doubtful — — — — — — — — Loss — — — — — — — — Total Agricultural business, including secured by farmland $ 24,132 $ 13,063 $ 39,038 $ 29,168 $ 23,305 $ 73,412 $ 151,034 $ 353,152 Current period gross charge-offs $ — $ — $ 730 $ 361 $ — $ 1,325 $ — $ 2,416 92 Table of Contents December 31, 2024 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2024 2023 2022 2021 2020 Prior Commercial real estate - owner occupied Risk Rating Pass $ 188,895 $ 171,046 $ 120,470 $ 152,940 $ 107,495 $ 174,221 $ 56,699 $ 971,766 Special Mention 2,452 — — — 9,444 — 1,997 13,893 Substandard — 292 22,020 2,182 — 17,273 — 41,767 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial real estate - owner occupied $ 191,347 $ 171,338 $ 142,490 $ 155,122 $ 116,939 $ 191,494 $ 58,696 $ 1,027,426 Commercial real estate - investment properties Risk Rating Pass $ 128,132 $ 144,473 $ 209,107 $ 270,202 $ 142,808 $ 659,253 $ 51,925 $ 1,605,900 Special Mention — — — — — 2,649 2,027 4,676 Substandard — — 5,724 — — 7,372 — 13,096 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial real estate - investment properties $ 128,132 $ 144,473 $ 214,831 $ 270,202 $ 142,808 $ 669,274 $ 53,952 $ 1,623,672 Multifamily real estate Risk Rating Pass $ 124,675 $ 87,955 $ 206,373 $ 205,964 $ 94,637 $ 170,235 $ 2,461 $ 892,300 Special Mention — — — — — — — — Substandard — — — — — 2,125 — 2,125 Doubtful — — — — — — — — Loss — — — — — — — — Total Multifamily real estate $ 124,675 $ 87,955 $ 206,373 $ 205,964 $ 94,637 $ 172,360 $ 2,461 $ 894,425 93 Table of Contents December 31, 2024 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2024 2023 2022 2021 2020 Prior Commercial construction Risk Rating Pass $ 75,095 $ 34,032 $ 12,481 $ — $ — $ — $ — $ 121,608 Special Mention — — — — — — — — Substandard — — — 754 — — — 754 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial construction $ 75,095 $ 34,032 $ 12,481 $ 754 $ — $ — $ — $ 122,362 Multifamily construction Risk Rating Pass $ 151,244 $ 226,411 $ 121,706 $ — $ — $ — $ 14,345 $ 513,706 Special Mention — — — — — — — — Substandard — — — — — — — — Doubtful — — — — — — — — Loss — — — — — — — — Total Multifamily construction $ 151,244 $ 226,411 $ 121,706 $ — $ — $ — $ 14,345 $ 513,706 One- to four- family construction Risk Rating Pass $ 445,602 $ 50,521 $ 10,744 $ — $ — $ — $ 322 $ 507,189 Special Mention — — — — — — — — Substandard 6,293 738 — — — — — 7,031 Doubtful — — — — — — — — Loss — — — — — — — — Total One- to four- family construction $ 451,895 $ 51,259 $ 10,744 $ — $ — $ — $ 322 $ 514,220 94 Table of Contents December 31, 2024 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2024 2023 2022 2021 2020 Prior Land and land development Risk Rating Pass $ 197,490 $ 85,344 $ 33,283 $ 22,897 $ 9,575 $ 13,871 $ 1,106 $ 363,566 Special Mention — — — — — — — — Substandard 3,764 1,098 396 277 562 — — 6,097 Doubtful — — — — — — — — Loss — — — — — — — — Total Land and land development $ 201,254 $ 86,442 $ 33,679 $ 23,174 $ 10,137 $ 13,871 $ 1,106 $ 369,663 Commercial business Risk Rating Pass $ 168,794 $ 129,476 $ 186,001 $ 97,590 $ 108,881 $ 192,416 $ 365,770 $ 1,248,928 Special Mention 241 — 657 818 — 727 12,022 14,465 Substandard 2,889 1,714 547 947 3,214 2,274 43,355 54,940 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial business $ 171,924 $ 131,190 $ 187,205 $ 99,355 $ 112,095 $ 195,417 $ 421,147 $ 1,318,333 Agricultural business, including secured by farmland Risk Rating Pass $ 22,330 $ 40,228 $ 19,475 $ 22,117 $ 12,746 $ 53,884 $ 127,755 $ 298,535 Special Mention — — 670 — — — 6,684 7,354 Substandard 1,962 8,980 9,999 1,183 3,367 8,850 50 34,391 Doubtful — — — — — — — — Loss — — — — — — — — Total Agricultural business, including secured by farmland $ 24,292 $ 49,208 $ 30,144 $ 23,300 $ 16,113 $ 62,734 $ 134,489 $ 340,280 95 Table of Contents The following tables present the Company’s portfolio of non-risk-rated loans by class and delinquency status as of December 31, 2025 and 2024 (in thousands). In addition, the tables include the gross charge-offs for the year ended December 31, 2025. Revolving loans that are converted to term loans are treated as new originations in the table below and are presented by year of origination. Term loans that are renewed or extended for periods longer than 90 days are presented as a new origination in the year of the most recent renewal or extension. December 31, 2025 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2025 2024 2023 2022 2021 Prior Small balance CRE Past Due Category Current $ 103,382 $ 72,801 $ 85,106 $ 198,097 $ 206,554 $ 543,983 $ — $ 1,209,923 30-59 Days Past Due — — — 1,283 — 113 — 1,396 60-89 Days Past Due — — — — — 513 — 513 90 Days + Past Due — — 66 — 459 — — 525 Total Small balance CRE $ 103,382 $ 72,801 $ 85,172 $ 199,380 $ 207,013 $ 544,609 $ — $ 1,212,357 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Small business scored Past Due Category Current $ 228,509 $ 185,753 $ 146,606 $ 201,580 $ 125,471 $ 152,648 $ 140,156 $ 1,180,723 30-59 Days Past Due 53 122 122 2,394 195 1,403 167 4,456 60-89 Days Past Due 131 — 135 353 6 — 152 777 90 Days + Past Due — — 532 239 226 407 — 1,404 Total Small business scored $ 228,693 $ 185,875 $ 147,395 $ 204,566 $ 125,898 $ 154,458 $ 140,475 $ 1,187,360 Current period gross charge-offs $ 75 $ 181 $ 862 $ 623 $ 149 $ 60 $ — $ 1,950 One- to four- family residential Past Due Category Current $ 111,613 $ 193,605 $ 281,207 $ 496,857 $ 225,148 $ 230,488 $ — $ 1,538,918 30-59 Days Past Due — 1,695 3,034 2,228 1,325 1,433 — 9,715 60-89 Days Past Due — 1,911 — 1,315 453 1,455 — 5,134 90 Days + Past Due 357 4,170 3,079 5,022 4,421 2,375 — 19,424 Total One- to four- family residential $ 111,970 $ 201,381 $ 287,320 $ 505,422 $ 231,347 $ 235,751 $ — $ 1,573,191 Current period gross charge-offs $ — $ — $ — $ — $ — $ 13 $ — $ 13 96 Table of Contents December 31, 2025 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2025 2024 2023 2022 2021 Prior Consumer—home equity revolving lines of credit Past Due Category Current $ 3,526 $ 2,138 $ 2,781 $ 6,796 $ 2,719 $ 8,126 $ 646,536 $ 672,622 30-59 Days Past Due — — 360 908 536 160 1,853 3,817 60-89 Days Past Due — — 208 345 — 300 — 853 90 Days + Past Due — 100 669 345 — 1,083 — 2,197 Total Consumer—home equity revolving lines of credit $ 3,526 $ 2,238 $ 4,018 $ 8,394 $ 3,255 $ 9,669 $ 648,389 $ 679,489 Current period gross charge-offs $ — $ — $ — $ — $ — $ — $ — $ — Consumer-other Past Due Category Current $ 11,532 $ 5,810 $ 3,783 $ 20,899 $ 6,145 $ 19,294 $ 21,054 $ 88,517 30-59 Days Past Due — 6 45 31 — 94 151 327 60-89 Days Past Due — 11 10 — 10 17 77 125 90 Days + Past Due — — — 51 — 34 — 85 Total Consumer-other $ 11,532 $ 5,827 $ 3,838 $ 20,981 $ 6,155 $ 19,439 $ 21,282 $ 89,054 Current period gross charge-offs $ 21 $ 18 $ 57 $ 89 $ 50 $ 189 $ 1,195 $ 1,619 97 Table of Contents December 31, 2024 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2024 2023 2022 2021 2020 Prior Small balance CRE Past Due Category Current $ 66,708 $ 87,829 $ 198,461 $ 209,983 $ 166,244 $ 484,567 $ — $ 1,213,792 30-59 Days Past Due — — — — — — — — 60-89 Days Past Due — — — — — — — — 90 Days + Past Due — — — — — — — — Total Small balance CRE $ 66,708 $ 87,829 $ 198,461 $ 209,983 $ 166,244 $ 484,567 $ — $ 1,213,792 Small business scored Past Due Category Current $ 209,692 $ 172,327 $ 236,769 $ 146,220 $ 69,795 $ 123,250 $ 139,836 $ 1,097,889 30-59 Days Past Due 16 62 1,084 650 104 523 523 2,962 60-89 Days Past Due — 823 75 252 — 88 30 1,268 90 Days + Past Due — 135 1,349 343 5 166 — 1,998 Total Small business scored $ 209,708 $ 173,347 $ 239,277 $ 147,465 $ 69,904 $ 124,027 $ 140,389 $ 1,104,117 One- to four- family residential Past Due Category Current $ 219,254 $ 306,523 $ 537,271 $ 246,070 $ 51,761 $ 207,017 $ — $ 1,567,896 30-59 Days Past Due 1,743 1,731 2,733 762 469 1,818 — 9,256 60-89 Days Past Due 533 570 1,635 270 442 1,099 — 4,549 90 Days + Past Due — 2,000 2,459 2,983 1,156 961 — 9,559 Total One- to four- family residential $ 221,530 $ 310,824 $ 544,098 $ 250,085 $ 53,828 $ 210,895 $ — $ 1,591,260 98 Table of Contents December 31, 2024 Term Loans by Year of Origination Revolving Loans Total Loans By class: 2024 2023 2022 2021 2020 Prior Consumer—home equity revolving lines of credit Past Due Category Current $ 4,551 $ 975 $ 6,884 $ 1,964 $ 2,243 $ 6,582 $ 595,115 $ 618,314 30-59 Days Past Due — 100 1,571 98 — 335 1,532 3,636 60-89 Days Past Due — — 237 561 — 384 136 1,318 90 Days + Past Due — 766 247 190 190 1,019 — 2,412 Total Consumer—home equity revolving lines of credit $ 4,551 $ 1,841 $ 8,939 $ 2,813 $ 2,433 $ 8,320 $ 596,783 $ 625,680 Consumer-other Past Due Category Current $ 9,329 $ 6,333 $ 25,334 $ 8,243 $ 5,390 $ 17,374 $ 23,185 $ 95,188 30-59 Days Past Due 5 — 54 — 3 88 166 316 60-89 Days Past Due 2 15 20 39 — 1 94 171 90 Days + Past Due — — 45 — — — — 45 Total Consumer-other $ 9,336 $ 6,348 $ 25,453 $ 8,282 $ 5,393 $ 17,463 $ 23,445 $ 95,720 99 Table of Contents The following tables provide the amortized cost basis of collateral-dependent loans as of December 31, 2025 and 2024 (in thousands). Our collateral dependent loans presented in the tables below have no significant concentrations by property type or location. December 31, 2025 Real Estate Equipment Inventory Total Commercial real estate: Small balance CRE $ 460 $ — $ — $ 460 Construction, land and land development: One- to four-family construction 2,006 — — 2,006 Land and land development 1,970 — — 1,970 Commercial business: Commercial business 715 — 1,460 2,175 Small business scored 239 — — 239 Agricultural business, including secured by farmland 3,064 1,491 — 4,555 One- to four-family residential 12,466 — — 12,466 Consumer—home equity revolving lines of credit 252 — — 252 Total $ 21,172 $ 1,491 $ 1,460 $ 24,123 December 31, 2024 Real Estate Accounts Receivable Equipment Inventory Total Commercial real estate: Owner-occupied $ 2,182 $ — $ — $ — $ 2,182 Construction, land and land development: One- to four-family construction 1,834 — — — 1,834 Land and land development 1,622 — — — 1,622 Commercial business Commercial business — 1,789 1,660 427 3,876 Small business scored 623 — — — 623 Agricultural business, including secured by farmland 5,013 — 3,447 — 8,460 One- to four-family residential 5,374 — — — 5,374 Consumer—home equity revolving lines of credit 977 — — — 977 Total $ 17,625 $ 1,789 $ 5,107 $ 427 $ 24,948 100 Table of Contents The following tables provide additional detail on the age analysis of the Company’s past due loans as of December 31, 2025 and 2024 (in thousands): December 31, 2025 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Total Past Due Current Total Loans Non-accrual with no Allowance Total Non-accrual (1) Loans 90 Days or More Past Due and Accruing Commercial real estate: Owner-occupied $ 260 $ — $ — $ 260 $ 1,138,038 $ 1,138,298 $ — $ — $ — Investment properties — — — — 1,701,413 1,701,413 — — — Small balance CRE 1,396 513 525 2,434 1,209,923 1,212,357 459 525 — Multifamily real estate — — — — 850,789 850,789 — — — Construction, land and land development: Commercial construction — — — — 156,021 156,021 — — — Multifamily construction — — — — 514,330 514,330 — — — One- to four-family construction 289 — 2,007 2,296 605,151 607,447 738 738 1,268 Land and land development 623 517 3,298 4,438 429,240 433,678 1,970 4,437 — Commercial business: Commercial business 992 — 2,813 3,805 1,221,303 1,225,108 716 3,390 — Small business scored 4,456 777 1,404 6,637 1,180,723 1,187,360 239 3,361 — Agricultural business, including secured by farmland — — 1,546 1,546 351,606 353,152 1,490 4,609 — One- to four-family residential 9,715 5,134 19,424 34,273 1,538,918 1,573,191 10,272 19,855 2,698 Consumer: Consumer—home equity revolving lines of credit 3,817 853 2,197 6,867 672,622 679,489 252 4,559 114 Consumer—other 327 125 85 537 88,517 89,054 — 51 34 Total $ 21,875 $ 7,919 $ 33,299 $ 63,093 $ 11,658,594 $ 11,721,687 $ 16,136 $ 41,525 $ 4,114 101 Table of Contents December 31, 2024 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due Total Past Due Current Total Loans Non-accrual with no Allowance Total Non-accrual (1) Loans 90 Days or More Past Due and Accruing Commercial real estate: Owner-occupied $ — $ — $ 2,182 $ 2,182 $ 1,025,244 $ 1,027,426 $ — $ 2,182 $ — Investment properties — — — — 1,623,672 1,623,672 — — — Small balance CRE — — — — 1,213,792 1,213,792 — 4 — Multifamily real estate — — — — 894,425 894,425 — — — Construction, land and land development: Commercial construction 754 — — 754 121,608 122,362 — — — Multifamily construction — — — — 513,706 513,706 — — — One- to four-family construction — — 738 738 513,482 514,220 1,834 1,834 — Land and land development 1,600 796 1,568 3,964 365,699 369,663 1,622 2,129 — Commercial business: Commercial business 2,025 — 1,012 3,037 1,315,296 1,318,333 123 4,103 — Small business scored 2,962 1,268 1,998 6,228 1,097,889 1,104,117 623 2,964 — Agricultural business, including secured by farmland 190 — 7,077 7,267 333,013 340,280 4,829 8,485 — One- to four-family residential 9,256 4,549 9,559 23,364 1,567,896 1,591,260 5,374 10,016 369 Consumer: Consumer—home equity revolving lines of credit 3,636 1,318 2,412 7,366 618,314 625,680 977 4,790 35 Consumer—other 316 171 45 532 95,188 95,720 — 45 — Total $ 20,739 $ 8,102 $ 26,591 $ 55,432 $ 11,299,224 $ 11,354,656 $ 15,382 $ 36,552 $ 404 (1) The Company did not recognize any interest income on non-accrual loans during the years ended December 31, 2025 and 2024. 102 Table of Contents Management estimates the allowance for credit losses using relevant information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Management considers qualitative and environmental (QE) factors for each loan category to adjust for differences between the historical periods used to calculate historical loss rates and expected conditions over the remaining lives of the loans in the portfolio. Management uses a scale to assign QE factor adjustments based on the level of estimated impact which requires significant judgment. As of December 31, 2025, , Management evaluated each qualitative factor and concluded that the models adequately reflected the significant changes in credit conditions and overall portfolio risk. The qualitative adjustments in the allowance for credit losses during 2025 were primarily related to environmental, forecast model, financial capacity, collateral, maturity and concentration related factors. This evaluation resulted in a 10 basis-point increase in the consumer loan category, while all other loan categories experienced nominal changes in their qualitative factor adjustments. The following tables provide the activity in the allowance for credit losses - loans by portfolio segment for the years ended December 31, 2025, 2024 and 2023 (in thousands): For the Year Ended December 31, 2025 Commercial Real Estate Multifamily Real Estate Construction and Land Commercial Business Agricultural Business One- to Four-Family Residential Consumer Total Allowance for credit losses: Beginning balance $ 40,830 $ 10,308 $ 29,038 $ 38,611 $ 5,727 $ 20,807 $ 10,200 $ 155,521 Provision/(recapture) for credit losses 575 ( 503 ) 5,959 3,612 2,078 ( 1,515 ) 1,431 11,637 Recoveries 194 — 729 1,110 178 273 448 2,932 Charge-offs — — ( 218 ) ( 5,548 ) ( 2,416 ) ( 13 ) ( 1,619 ) ( 9,814 ) Ending balance $ 41,599 $ 9,805 $ 35,508 $ 37,785 $ 5,567 $ 19,552 $ 10,460 $ 160,276 Net loan charge offs as a percent of average outstanding loans during the period — % — % — % ( 0.04 ) % ( 0.02 ) % — % ( 0.01 ) % ( 0.06 ) % For the Year Ended December 31, 2024 Commercial Real Estate Multifamily Real Estate Construction and Land Commercial Business Agricultural Business One- to Four-Family Residential Consumer Total Allowance for credit losses: Beginning balance $ 44,384 $ 9,326 $ 28,095 $ 35,464 $ 3,865 $ 19,271 $ 9,238 $ 149,643 (Recapture)/provision for credit losses ( 5,970 ) 982 1,093 7,139 1,558 1,365 2,396 8,563 Recoveries 2,767 — — 1,963 304 171 476 5,681 Charge-offs ( 351 ) — ( 150 ) ( 5,955 ) — — ( 1,910 ) ( 8,366 ) Ending balance $ 40,830 $ 10,308 $ 29,038 $ 38,611 $ 5,727 $ 20,807 $ 10,200 $ 155,521 Net loan recoveries (charge-offs) as a percent of average outstanding loans during the period 0.02 % — % — % ( 0.04 ) % — % — % ( 0.01 ) % ( 0.02 ) % 103 Table of Contents For the Year Ended December 31, 2023 Commercial Real Estate Multifamily Real Estate Construction and Land Commercial Business Agricultural Business One- to Four-Family Residential Consumer Total Allowance for credit losses: Beginning balance $ 44,086 $ 7,734 $ 29,171 $ 33,299 $ 3,475 $ 14,729 $ 8,971 $ 141,465 (Recapture)/provision for loan losses ( 259 ) 1,592 ( 16 ) 3,532 808 4,354 1,086 11,097 Recoveries 557 — 29 1,283 146 230 543 2,788 Charge-offs — — ( 1,089 ) ( 2,650 ) ( 564 ) ( 42 ) ( 1,362 ) ( 5,707 ) Ending balance $ 44,384 $ 9,326 $ 28,095 $ 35,464 $ 3,865 $ 19,271 $ 9,238 $ 149,643 Net loan recoveries (charge-offs) as a percent of average outstanding loans during the period 0.01 % — % ( 0.01 ) % ( 0.01 ) % — % — % ( 0.01 ) % ( 0.03 ) % 104 Table of Contents Note 5: PROPERTY AND EQUIPMENT, NET Land, buildings and equipment owned by the Company and its subsidiaries at December 31, 2025 and 2024, are summarized as follows (in thousands): December 31 2025 2024 Land $ 25,451 $ 25,616 Buildings and leasehold improvements 136,827 144,480 Furniture and equipment 147,181 147,595 309,459 317,691 Less accumulated depreciation ( 197,937 ) ( 193,102 ) Property and equipment, net $ 111,522 $ 124,589 The Company had no properties held for sale that were included in land and buildings at December 31, 2025, and had $ 29,000 of properties held for sale that were included in land and buildings at December 31, 2024. The Company’s depreciation expense related to property and equipment was $ 16.4 million, $ 18.1 million and $ 17.9 million for the years ended December 31, 2025, 2024 and 2023, respectively. Note 6: DEPOSITS Deposits consist of the following at December 31, 2025 and 2024 (in thousands): December 31 2025 2024 Non-interest-bearing checking $ 4,489,839 $ 4,591,543 Interest-bearing checking 2,609,080 2,393,864 Regular savings accounts 3,723,922 3,478,423 Money market accounts 1,388,001 1,550,896 Total interest-bearing transaction and savings accounts 7,721,003 7,423,183 Certificates of deposit: Certificates of deposit greater than or equal to $250,000 528,102 487,515 Certificates of deposit less than $250,000 1,004,202 1,012,157 Total certificates of deposit 1,532,304 1,499,672 Total deposits $ 13,743,146 $ 13,514,398 Included in total deposits: Public fund transaction accounts $ 373,529 $ 414,413 Public fund interest-bearing certificates 34,431 25,423 Total public deposits $ 407,960 $ 439,836 Total brokered deposits $ 50,002 $ 50,346 Deposits at December 31, 2025 and 2024 included deposits from the Company’s directors, executive officers and related entities totaling $ 3.3 million and $ 10.2 million, respectively. 105 Table of Contents Scheduled maturities and weighted average interest rates of certificates of deposits at December 31, 2025, are as follows (dollars in thousands): December 31, 2025 Amount Weighted Average Rate Maturing in one year or less $ 1,481,008 3.35 % Maturing after one year through two years 35,528 2.15 Maturing after two years through three years 8,876 0.64 Maturing after three years through four years 2,072 0.88 Maturing after four years through five years 4,381 2.59 Maturing after five years 439 0.50 Total certificates of deposit $ 1,532,304 3.30 % Note 7: ADVANCES FROM FEDERAL HOME LOAN BANK Utilizing a blanket pledge, qualifying loans receivable at December 31, 2025 and 2024, were pledged as security for FHLB borrowings and there were no securities pledged as collateral as of December 31, 2025 or 2024. At December 31, 2025 and 2024, FHLB advances were scheduled to mature as follows (dollars in thousands): December 31, 2025 2024 Amount Weighted Average Rate Amount Weighted Average Rate Maturing in one year or less $ 150,000 3.98 % $ 290,000 4.62 % Total FHLB advances $ 150,000 3.98 % $ 290,000 4.62 % The maximum amount outstanding from the FHLB advances at any month end for the years ended December 31, 2025 and 2024 was $ 565.0 million and $ 398.0 million, respectively. The average FHLB advances balance outstanding for the years ended December 31, 2025 and 2024 was $ 126.6 million and $ 160.0 million, respectively. The average contractual interest rate on the FHLB advances for the years ended December 31, 2025 and 2024 was 4.56 % and 5.59 %, respectively. As of December 31, 2025, the Bank has established a borrowing line with the FHLB to borrow up to 45 % of its total assets, contingent on having sufficient qualifying collateral and ownership of FHLB stock. At December 31, 2025, under these credit facilities based on pledged collateral, the Bank had $ 3.65 billion of available credit capacity. Note 8: OTHER BORROWINGS 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 borrowings at December 31, 2025 and 2024, by the period remaining to maturity is as follows (dollars in thousands): December 31, 2025 2024 Amount Weighted Average Rate Amount Weighted Average Rate Repurchase agreements: Maturing in one year or less $ 107,715 2.48 % $ 125,257 1.98 % Total year-end outstanding $ 107,715 2.48 % $ 125,257 1.98 % Average outstanding $ 122,784 2.24 % $ 164,613 2.61 % Maximum outstanding at any month-end $ 138,260 n/a $ 183,928 n/a 106 Table of Contents Note 9: SUBORDINATED DEBT AND MANDATORILY REDEEMABLE TRUST PREFERRED SECURITIES At December 31, 2025, the Company had five wholly-owned subsidiary grantor trusts (the Trusts), which had issued $ 86.5 million of Trust Preferred Securities (TPS) to third parties, as well as $ 2.7 million of common capital securities, carried as other assets, which were issued to the Company. TPS and common capital securities accrue and pay distributions periodically at specified annual rates, as provided in the indentures, based on a spread over SOFR (Secured Overnight Financing Rate). The Trusts used the proceeds from the offerings to purchase a like amount of junior subordinated debentures (the Debentures) of the Company. The Debentures are the sole assets of the Trusts. The Company’s obligations under the debentures and related documents, taken together, constitute a full and unconditional guarantee by the Company of the obligations of the Trusts. The TPS are mandatorily redeemable upon the maturity of the Debentures, or upon earlier redemption as provided in the indentures. The Company has the right to redeem the Debentures in whole on or after specific dates, at a redemption price specified in the indentures plus any accrued but unpaid interest to the redemption date. During the years ended December 31, 2025 and 2024, no debentures were redeemed. At December 31, 2025, the remaining Trusts comprised $ 86.5 million or 4.3 % of the Company’s total risk-based capital. The following table is a summary of TPS at December 31, 2025 (dollars in thousands): Name of Trust Aggregate Liquidation Amount of Trust Preferred Securities Aggregate Liquidation Amount of Common Capital Securities Aggregate Principal Amount of Junior Subordinated Debentures Stated Maturity (1) Current Interest Rate Reset Period Interest Rate Spread (3) Banner Capital Trust V $ 25,000 $ 774 $ 25,774 2035 5.71 % Quarterly Three-month SOFR + 1.83 % Banner Capital Trust VI 25,000 774 25,774 2037 5.67 Quarterly Three-month SOFR + 1.88 % Banner Capital Trust VII 25,000 774 25,774 2037 5.63 Quarterly Three-month SOFR + 1.64 % Greater Sacramento Bancorp Statutory Trust II 4,000 124 4,124 2035 5.66 Quarterly Three-month SOFR + 1.94 % Mission Oaks Statutory Trust I 7,500 232 7,732 2036 5.63 Quarterly Three-month SOFR + 1.91 % Total TPS liability at par $ 86,500 $ 2,678 89,178 5.67 % Fair value adjustment (2) ( 10,027 ) Total TPS liability at fair value (2) $ 79,151 (1) All of the Company’s TPS are eligible for redemption. (2) The Company has elected to use fair value accounting on the Debentures. (3) The interest rate spread includes a 0.26% upward adjustment for the transition from LIBOR to SOFR. On June 30, 2020, Banner issued and sold in an underwritten offering $ 100.0 million aggregate principal amount of 5.00 % Fixed-to-Floating Rate Subordinated Notes due 2030 (Notes) at a public offering price equal to 100% of the aggregate principal amount of the Notes, resulting in net proceeds, after underwriting discounts and estimated offering expenses, of approximately $ 98.1 million. The interest rate on the Notes was fixed at 5.00 % for the first 5 years, after which the rate would reset to a floating rate based on a benchmark rate, which was expected to be the Three-Month Term SOFR, plus a spread of 489 basis points. The balance of our outstanding subordinated notes was paid off during the second quarter of 2025. 107 Table of Contents Note 10: INCOME TAXES 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. 108 Table of Contents The following table presents the reconciliation of the federal statutory rate to the actual effective rate by percent for the year ended December 31, 2023: 2023 Percent Federal income tax statutory rate 21.0 % State Income taxes, net of federal tax offset 2.6 State audits and amended returns — Tax credits ( 2.7 ) Low income housing partnerships, net of amortization 2.0 Nontaxable and nondeductible items: Tax-exempt interest ( 3.6 ) Investment in life insurance ( 0.9 ) Other 0.7 Provision for income taxes and effective income tax rate 19.1 % The following table presents income taxes paid (net of refunds received) for the years ended December 31, 2025 and 2024 (in thousands): Years Ended December 31 2025 2024 U.S. federal $ 25,000 $ 20,000 U.S. state and local: California 4,200 2,705 Oregon 1,615 1,215 Idaho 525 220 Utah 44 39 Montana 25 15 Total $ 31,409 $ 24,194 109 Table of Contents The following table reflects the effect of temporary differences that gave rise to the components of the net deferred tax asset as of December 31, 2025 and 2024 (in thousands): December 31 2025 2024 Deferred tax assets: Loan loss and REO $ 42,131 $ 41,045 Deferred compensation 23,336 22,983 Net operating loss carryforward 8,082 10,482 Federal and state tax credits 758 758 State net operating losses 3,526 3,757 Loan discount 628 379 Lease liability 8,589 10,416 Unrealized loss on securities—available-for-sale, net 65,837 87,709 Other 1,528 1,191 Total deferred tax assets 154,415 178,720 Deferred tax liabilities: Depreciation ( 3,101 ) ( 3,783 ) Deferred loan fees, servicing rights and loan origination costs ( 12,134 ) ( 12,575 ) Intangibles ( 2,720 ) ( 2,922 ) Right of use asset ( 7,864 ) ( 9,583 ) Financial instruments accounted for under fair value accounting ( 825 ) ( 815 ) Total deferred tax liabilities ( 26,644 ) ( 29,678 ) Deferred income tax asset 127,771 149,042 Valuation allowance ( 184 ) ( 184 ) Deferred tax asset, net $ 127,587 $ 148,858 Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recognized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period of enactment. At December 31, 2025, the Company had federal net operating loss (NOL) carryforwards of approximately $ 38.5 million and state NOL carryforwards of $ 49.3 million, against which the Company has established a $ 184,000 valuation reserve. The federal and state NOL carryforwards, if unused, will expire by the end of 2034. The Company also had federal general business credit carryforwards at December 31, 2025, of $ 219,000 , which will expire, if unused, by the end of 2031, and federal alternative minimum tax (AMT) credit carryforwards of $ 538,000 , which are available to reduce future federal regular income taxes over an indefinite period. At December 31, 2024, the Company had federal and state NOL carryforwards of approximately $ 49.9 million and $ 53.0 million, respectively, federal general business credit carryforwards of $ 219,000 , and AMT credit carryforwards of approximately $ 538,000 . As a result of the Company’s 2015 acquisition of Starbuck Bancshares, Inc., the Company experienced a change in control under Section 382 of the Internal Revenue Code. The Section 382 limitations that applied to Starbuck Bancshares, Inc. continue to apply to the Company. The Section 382 limits the ability of a corporate taxpayer to use net operating loss carryforwards, general business credits, and recognized built-in-losses, on an annual basis, incurred prior to the change in control against income earned after the change in control. As a result of the Section 382 limitations, the Company is limited to utilizing $ 21.5 million (after the application of the Section 382 limitations carried over from Starbuck Bancshares, Inc.) on an annual basis (after the application of the Section 382 limitations carried over from Starbuck Bancshares, Inc.) of federal NOL carryforwards, general business credits, and recognized built-in losses. The applicable state Section 382 limitations range from $ 575,000 to $ 21.5 million. The Company has recorded a $ 184,000 valuation reserve against the portion of state NOL carryforwards and tax credits it believes is more likely than not to be unrealizable due to the application of Section 382 limitations at the state level, which are based on future apportionment factors. As a result of Banner’s capital raise in June 2010, the Company experienced a change in control within the meaning of Section 382 of the Internal Revenue Code. Under Section 382, the Company was limited to utilizing $ 6.9 million of pre-existing NOL carryforwards on an annual basis, which were generated prior to the acquisition of Starbuck Bancshares, Inc. Based on its analysis, the Company believes it is more likely than not that the June 2010 change in control will not impact its ability to utilize all of the related NOL carryforwards, general business credits, and recognized built-in losses. As of December 31, 2025, the Company had fully utilized all federal NOL carryforwards and credits subject to the June 2010 limitation. Certain state net operating losses subject to change-in-control limitations remain outstanding. 110 Table of Contents As a result of the Company’s 2019 acquisition of AltaPacific and AltaPacific Bank, the Company did not experience a change in control within the meaning of Section 382 of the Internal Revenue Code. However, the Section 382 limitations that applied to AltaPacific and AltaPacific Bank continue to apply to the Company. Under these limitations, the Company is limited to utilizing $ 110,000 of the federal NOL carryforwards and general business credits acquired from AltaPacific and AltaPacific Bank. Based on its analysis, the Company believes it is more likely than not that these limitations will not impact its ability to utilize the related NOL carryforwards and general business credits. Retained earnings at December 31, 2025 and 2024 included approximately $ 5.4 million in tax basis bad debt reserves for which no income tax liability has been recorded. In the future, if this tax bad debt reserve is used for purposes other than to absorb bad debts or the Company no longer qualifies as a bank or is completely liquidated, the Company will incur a federal tax liability at the then-prevailing corporate tax rate, estimated as $ 1.1 million at December 31, 2025. A reconciliation of the beginning and ending amount of total unrecognized state tax benefits for the years ended December 31, 2025 and 2024, is as follows (in thousands): Years Ended December 31 2025 2024 Balance, beginning of year $ 2,000 $ 2,000 Changes related to prior year tax positions — — Changes related to current year tax positions — — Balance, end of year $ 2,000 $ 2,000 None of the unrecognized tax benefits, if recognized, would materially affect the effective tax rate. The Company does not anticipate that the amount of unrecognized tax benefits will significantly increase or decrease. The Company’s policy is to recognize interest and penalties on unrecognized tax benefits in income tax expense. The amount of interest and penalties accrued for the years ended December 31, 2025, 2024 and 2023 is immaterial. The Company files consolidated income tax returns in Oregon, California, Utah, Montana and Idaho and for federal purposes. The Company is no longer subject to tax examination for tax years before 2022. 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 as 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 Company’s tax credit investments and related unfunded commitments at December 31, 2025 and 2024 (in thousands): December 31, 2025 December 31, 2024 Tax Credit Investments: Total commitments $ 215,688 $ 153,618 Unfunded commitments 118,471 94,416 The following table presents other information related to the Company’s tax credit investments for the years ended December 31, 2025, 2024 and 2023 (in thousands): For the years ended December 31, 2025 2024 2023 Tax credits and other tax benefits recognized $ 17,062 $ 12,072 $ 8,018 Tax credit amortization expense included in provision for income taxes 13,572 9,334 6,449 111 Table of Contents Note 11: EMPLOYEE BENEFIT PLANS 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 Company’s 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 Company’s 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 Bank’s 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 executive’s retirement. In the event of a participant employee’s 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 December 31, 2025, 2024 and 2023, expense recorded for supplemental retirement and salary continuation plan benefits totaled $ 1.4 million, $ 2.2 million, and $ 2.5 million, respectively. At December 31, 2025 and 2024, liabilities recorded for the various supplemental retirement and salary continuation plan benefits totaled $ 32.8 million and $ 34.8 million, respectively, and are recorded in a deferred compensation liability account. Deferred Compensation Plans and Rabbi Trusts: The Company and the Bank also offer non-qualified deferred compensation plans to members of their Boards of Directors and certain employees. The plans permit each participant to defer a portion of director fees, non-qualified retirement contributions, salary or bonuses for future receipt. Compensation is charged to expense in the period earned. In connection with its acquisitions, the Company also assumed liability for certain deferred compensation plans for key employees, retired employees and directors. In order to fund the plans’ future obligations, the Company has purchased life insurance policies or other investments, including Banner common stock, which in certain instances are held in irrevocable trusts commonly referred to as “Rabbi Trusts.” As the Company is the owner of the investments and the beneficiary of the insurance policies, and in order to reflect the Company’s policy to pay benefits equal to the accumulations, the assets and liabilities are reflected in the Consolidated Statements of Financial Condition. Banner common stock held for such plans is reported as a contra-equity account and was recorded at an original cost of $ 5.8 million at December 31, 2025, and $ 6.2 million at December 31, 2024. At December 31, 2025 and 2024, liabilities recorded in connection with deferred compensation plan benefits totaled $ 20.4 million ($ 5.8 million in contra-equity) and $ 18.8 million ($ 6.2 million in contra-equity), respectively, and are recorded in deferred compensation or equity as appropriate. The Bank has purchased, or acquired through mergers, life insurance policies in connection with the implementation of certain executive supplemental retirement, salary continuation and deferred compensation retirement plans, as well as additional policies not related to any specific plan. These policies provide protection against the adverse financial effects that could result from the death of a key employee and provide tax-exempt income to offset expenses associated with the plans. It is the Bank’s intent to hold these policies as a long-term investment. However, there will be an income tax impact if the Bank chooses to surrender certain policies. Although the lives of individual current or former management-level employees are insured, the Bank is the owner and sole or partial beneficiary. At December 31, 2025 and 2024, the cash surrender value of these policies was $ 319.3 million and $ 312.5 million, respectively. The Bank is exposed to credit risk to the extent an insurance company is unable to fulfill its financial obligations under a policy. In order to mitigate this risk, the Bank uses a variety of insurance companies and regularly monitors their financial condition. 112 Table of Contents Note 12: STOCK-BASED COMPENSATION PLANS 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 Company’s 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 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 common stock for issuance under the 2018 Plan in connection with the exercise of awards. As of December 31, 2025, 890,043 restricted stock units have been granted under the 2018 Plan, of which 217,014 were unvested. 2023 Omnibus Incentive Plan: The 2023 Plan was approved by shareholders on May 24, 2023. The 2023 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 625,000 shares of common stock for issuance under the 2023 Plan in connection with the exercise of awards. As of December 31, 2025, a total of 7,720 restricted stock shares and 123,685 restricted stock units have been granted under the 2023 Plan, of which 2,793 restricted stock shares and 112,868 restricted stock units were unvested. The expense associated with all restricted stock grants (including restricted stock shares and restricted stock units) was $ 10.3 million, $ 10.0 million and $ 9.2 million for the years ended December 31, 2025, 2024 and 2023, respectively. Unrecognized compensation expense for these awards as of December 31, 2025, was $ 13.8 million and will be recognized over a weighted average period of 11 months. A summary of the Company’s Restricted Stock/Unit award activity during the years ended December 31, 2025, 2024 and 2023 follows: Shares/Units Weighted Average Grant-Date Fair Value Unvested at January 1, 2022 382,727 $ 49.98 Granted (203,464 non-voting) 208,273 53.64 Vested ( 217,262 ) 42.87 Forfeited ( 16,158 ) 55.43 Unvested at December 31, 2023 357,580 55.44 Granted (262,222 non-voting) 276,947 47.18 Vested ( 166,144 ) 54.62 Forfeited ( 24,501 ) 53.37 Unvested at December 31, 2024 443,882 50.82 Granted (88,801 non-voting) 207,670 63.53 Vested ( 196,896 ) 55.77 Forfeited ( 29,025 ) 52.45 Unvested at December 31, 2025 425,631 $ 55.45 113 Table of Contents Note 13: REGULATORY CAPITAL REQUIREMENTS Banner is a bank holding company registered with the Federal Reserve. Bank holding companies are subject to capital adequacy requirements of the Federal Reserve under the Bank Holding Company Act of 1956, as amended, and the regulations of the Federal Reserve. Banner Bank, as a state-chartered federally insured commercial bank, is subject to the capital requirements established by the FDIC. The Federal Reserve requires Banner to maintain capital adequacy that generally parallels the FDIC requirements. The following table shows the regulatory capital ratios of the Company and the Bank and the minimum regulatory requirements (dollars in thousands): Actual Minimum for Capital Adequacy Purposes Minimum to be Categorized as “Well Capitalized” Under Prompt Corrective Action Provisions Amount Ratio Amount Ratio Amount Ratio December 31, 2025: Banner Corporation—consolidated: Total capital to risk-weighted assets $ 2,033,807 14.69 % $ 1,107,905 8.00 % $ 1,384,881 10.00 % Tier 1 capital to risk-weighted assets 1,860,667 13.44 830,929 6.00 830,929 6.00 Tier 1 capital to average leverage assets 1,860,667 11.41 652,140 4.00 n/a n/a Tier 1 common equity to risk-weighted assets 1,774,167 12.81 623,197 4.50 n/a n/a Banner Bank: Total capital to risk-weighted assets 1,957,619 14.14 1,107,308 8.00 1,384,135 10.00 Tier 1 capital to risk-weighted assets 1,784,571 12.89 830,481 6.00 1,107,308 8.00 Tier 1 capital to average leverage assets 1,784,571 10.95 651,888 4.00 814,860 5.00 Tier 1 common equity to risk-weighted assets 1,784,571 12.89 622,861 4.50 899,687 6.50 December 31, 2024: Banner Corporation—consolidated: Total capital to risk-weighted assets $ 2,024,046 15.04 % $ 1,076,652 8.00 % $ 1,345,814 10.00 % Tier 1 capital to risk-weighted assets 1,760,065 13.08 807,489 6.00 807,489 6.00 Tier 1 capital to average leverage assets 1,760,065 11.05 636,913 4.00 n/a n/a Tier 1 common equity to risk-weighted assets 1,673,565 12.44 605,616 4.50 n/a n/a Banner Bank: Total capital to risk-weighted assets 1,890,438 14.03 1,077,725 8.00 1,347,157 10.00 Tier 1 capital to risk-weighted assets 1,726,457 12.82 808,294 6.00 1,077,725 8.00 Tier 1 capital to average leverage assets 1,726,457 10.83 637,392 4.00 796,740 5.00 Tier 1 common equity to risk-weighted assets 1,726,457 12.82 606,221 4.50 875,652 6.50 At December 31, 2025, Banner and the Bank each exceeded the requirements to be “well capitalized” and the fully phased-in capital conservation buffer requirement. There have been no conditions or events since December 31, 2025, that have materially adversely changed the Tier 1 or Tier 2 capital of the Company or the Bank. However, events beyond the control of the Bank, such as weak or depressed economic conditions in areas where the Bank has most of its loans, could adversely affect future earnings and, consequently, the ability of the Bank to meet its respective capital requirements. The Company may not declare or pay cash dividends on, or repurchase, any of its shares of common stock if the effect thereof would cause equity to be reduced below applicable regulatory capital maintenance requirements or if such declaration and payment would otherwise violate regulatory requirements. 114 Table of Contents Note 14: GOODWILL, OTHER INTANGIBLE ASSETS AND MORTGAGE SERVICING RIGHTS Goodwill and Other Intangible Assets: At December 31, 2025, intangible assets are comprised of goodwill and CDI acquired in business combinations. Goodwill is not amortized but is reviewed at least annually for impairment. Banner has identified one reporting unit for purposes of evaluating goodwill for impairment. At December 31, 2025, the Company completed an assessment of qualitative factors and concluded that no further analysis was required as it is more likely than not that the fair value of the Bank, the reporting unit, exceeds 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 CDI assets shown in the table below represent the value ascribed to the long-term deposit relationships acquired in various bank acquisitions. The following table summarizes the changes in the Company’s goodwill and other intangibles for the years ended December 31, 2025, 2024 and 2023 (in thousands): Goodwill CDI Total Balance, January 1, 2023 $ 373,121 $ 9,440 $ 382,561 Amortization — ( 3,756 ) ( 3,756 ) 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 — ( 1,567 ) ( 1,567 ) Balance, December 31, 2025 $ 373,121 $ 1,491 $ 374,612 Estimated amortization expense with respect to CDI as of December 31, 2025, for the periods indicated (in thousands): Year ended: Estimated Amortization 2026 $ 904 2027 426 2028 126 2029 35 Net carrying amount $ 1,491 Servicing Rights: Mortgage and SBA servicing rights are reported in other assets. SBA servicing rights are initially recorded and carried at fair value. Mortgage servicing rights are initially recognized at fair value and are amortized in proportion to, and over the period of, the estimated future net servicing income of the underlying financial assets. Mortgage servicing rights are subsequently evaluated for impairment based upon the fair value of the rights compared to the amortized cost (remaining unamortized initial fair value). If the fair value is less than the amortized cost, a valuation allowance is created through an impairment charge to servicing fee income. However, if the fair value is greater than the amortized cost, the amount above the amortized cost is not recognized in the carrying value. In 2025, 2024 and 2023, the Company did not record any impairment charges or recoveries against mortgage servicing rights. Unpaid principal balance of loans for which mortgage and SBA servicing rights have been recognized totaled $ 2.77 billion and $ 2.84 billion at December 31, 2025 and 2024, respectively. Custodial accounts maintained in connection with this servicing totaled $ 13.1 million and $ 12.2 million at December 31, 2025 and 2024, respectively. An analysis of the mortgage and SBA servicing rights for the years ended December 31, 2025, 2024 and 2023, is presented below (in thousands): Years Ended December 31 2025 2024 2023 Balance, beginning of the year $ 13,487 $ 14,649 $ 16,166 Additions—amounts capitalized 2,217 1,802 1,590 Additions—through purchase 2 211 313 Amortization (1) ( 3,339 ) ( 3,304 ) ( 3,325 ) Fair value adjustments (2) 235 129 ( 95 ) Balance, end of the year (2) $ 12,602 $ 13,487 $ 14,649 (1) Amortization of mortgage servicing rights is recorded as a reduction of loan servicing income within mortgage banking operations and any unamortized balance is fully amortized if the loan repays in full. (2) Fair value adjustments relate to SBA servicing rights. These adjustments are estimated based on an independent dealer analysis by discounting estimated net future cash flows from servicing SBA loans. 115 Table of Contents Note 15: FAIR VALUE OF FINANCIAL INSTRUMENTS The following table presents estimated fair values of the Company’s 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 Securities—available-for-sale 2 1,985,990 1,985,990 2,078,826 2,078,826 Securities—available-for-sale 3 30,271 30,271 25,685 25,685 Securities—held-to-maturity 2 955,459 808,965 995,237 819,230 Securities—held-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 borrowings 2 107,715 107,715 125,257 125,257 Subordinated notes, net 2 — — 80,278 78,832 Junior subordinated debentures 3 79,151 79,151 67,477 67,477 Derivatives: Interest rate swaps 2 19,207 19,207 30,184 30,184 Interest rate lock and forward sales commitments 2,3 151 151 2 2 Risk participation agreement 2 5 5 6 6 The Company measures and discloses certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (that is, not a forced liquidation or distressed sale). When measuring fair value, Management will maximize the use of observable inputs and minimize the use of unobservable inputs whenever possible. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s estimates for market assumptions. The estimated fair value amounts of financial instruments have been determined by the Company using available market information and appropriate valuation methodologies. However, considerable judgment is required to interpret data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize at a future date. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. In addition, reasonable comparability between financial institutions may not be likely due to the wide range of permitted valuation techniques and numerous estimates that must be made given the absence of active secondary markets for many of the financial instruments. This lack of uniform valuation methodologies also introduces a greater degree of subjectivity to these estimated fair values. 116 Table of Contents Items Measured at Fair Value on a Recurring Basis: The following tables present financial assets and liabilities measured at fair value on a recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets and liabilities as of December 31, 2025 and 2024 (in thousands): December 31, 2025 Level 1 Level 2 Level 3 Total Assets: Securities—available-for-sale U.S. Government and agency obligations $ — $ 6,143 $ — $ 6,143 Municipal bonds — 143,457 — 143,457 Corporate bonds — 87,518 30,271 117,789 Mortgage-backed or related securities — 1,596,332 — 1,596,332 Asset-backed securities — 152,540 — 152,540 — 1,985,990 30,271 2,016,261 Loans held for sale (1) — 34,586 — 34,586 Equity securities 406 — — 406 SBA servicing rights — — 1,104 1,104 Investment in limited partnerships — — 14,545 14,545 Derivatives Interest rate swaps — 9,978 — 9,978 Interest rate lock and forward sales commitments — — 333 333 $ 406 $ 2,030,554 $ 46,253 $ 2,077,213 Liabilities: Junior subordinated debentures $ — $ — $ 79,151 $ 79,151 Derivatives Interest rate swaps — 19,207 — 19,207 Interest rate lock and forward sales commitments — 83 68 151 Risk participation agreement — 5 — 5 $ — $ 19,295 $ 79,219 $ 98,514 117 Table of Contents December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Securities—available-for-sale U.S. Government and agency obligations $ — $ 7,933 $ — $ 7,933 Municipal bonds — 123,982 — 123,982 Corporate bonds — 99,305 25,685 124,990 Mortgage-backed or related securities — 1,676,848 — 1,676,848 Asset-backed securities — 170,758 — 170,758 — 2,078,826 25,685 2,104,511 Loans held for sale (1) — 26,185 — 26,185 Equity securities 481 — — 481 SBA servicing rights — — 869 869 Investment in limited partnerships — — 13,955 13,955 Derivatives Interest rate swaps — 14,507 — 14,507 Interest rate lock and forward sales commitments — 221 110 331 $ 481 $ 2,119,739 $ 40,619 $ 2,160,839 Liabilities Junior subordinated debentures $ — $ — $ 67,477 $ 67,477 Derivatives Interest rate swaps — 30,184 — 30,184 Interest rate lock and forward sales commitments — — 2 2 Risk participation agreement — 6 — 6 $ — $ 30,190 $ 67,479 $ 97,669 (1) The unpaid principal balance of one- to four family residential loans held for sale carried at fair value on a recurring basis was $ 33.6 million and $ 25.7 million at December 31, 2025 and 2024, respectively. The following methods were used to estimate the fair value of each class of financial instruments above: Securities: The estimated fair values of investment securities and mortgage-backed securities are based on current active market quotes, when available, which are considered Level 1 measurements. For most of the portfolio, matrix pricing based on the securities’ relationship to other benchmark quoted prices is used, which is considered Level 2. Due to limited activity in the TPS markets, which reduces the observability of market spreads for certain TPS securities included in Corporate Bonds, Management has classified these securities as Level 3. Management periodically reviews pricing information from third-party pricing services and validates the reported fair values against other sources. Loans Held for Sale: Fair values for residential mortgage loans held for sale are determined by comparing actual loan rates to current secondary market prices for similar loans. Equity Securities: Equity securities are invested in a publicly traded stock. Fair values are based on daily quoted market prices. SBA Servicing Rights: Fair values are estimated using an independent dealer analysis that discounts estimated net future cash flows from servicing. Key assumptions include prepayment speeds, delinquency and foreclosure rates, discount rates, servicing costs, and timing of cash flows. The SBA servicing portfolio is stratified by loan type, and fair value estimates are adjusted based on the serviced loan interest rates versus current rates on new originations since the most recent independent analysis. Investments in Limited Partnerships: Fair values are estimated using the practical expedient method, based on our ownership interest in partners’ capital, with a proportionate share of net assets attributed to the Company for each limited partnership. Junior Subordinated Debentures: Fair values are estimated using an income approach. Significant inputs include a credit risk–adjusted spread and the three-month SOFR rate. The credit risk–adjusted spread reflects the nonperformance risk of the liability. The Company utilizes an external valuation firm to validate the reasonableness of this spread. The junior subordinated debentures are carried at fair value, representing the estimated amount that would be paid to transfer these liabilities in an orderly transaction among market participants. Due to limited activity in the TPS markets, which reduces the observability of market spreads, these instruments are classified as Level 3 measurements. 118 Table of Contents Derivatives: Derivatives include interest rate swap agreements, interest rate lock commitments to originate loans held for sale, forward sales contracts to sell loans and securities related to mortgage banking activities and risk participation agreements. Fair values are generally based on dealer quotes and secondary market sources. Because interest rate lock commitments use a pull-through rate that is considered an unobservable input, these derivatives are classified as Level 3 measurements. Off-Balance Sheet Items: Off-balance sheet financial instruments include unfunded commitments to extend credit, including standby letters of credit, and commitments to purchase investment securities. The fair value of these instruments is not considered to be material. Limitations: The fair value estimates presented are based on information available to Management as of December 31, 2025 and 2024. The factors used in these estimates are subject to change after the measurement date; therefore, current fair value estimates may differ significantly from the amounts presented herein. Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3): The following table provides a description of the valuation technique, unobservable inputs and quantitative and qualitative information about the unobservable inputs for the Company’s assets and liabilities classified as Level 3 and measured at fair value on a recurring and non-recurring basis at December 31, 2025 and 2024: Weighted Average Rate or Range December 31 Financial Instruments Valuation Technique Unobservable Inputs 2025 2024 Corporate bonds (TPS) Discounted cash flows Discount rate 6.91 % 9.57 % Junior subordinated debentures Discounted cash flows Discount rate 6.91 % 9.57 % Loans individually evaluated Collateral valuations Discount to appraised value 0.00 % to 8.75 % 0.00 % to 75 % Interest rate lock commitments Pricing model Pull-through rate 88.86 % 92.34 % SBA servicing rights Discounted cash flows Constant prepayment rate 18.14 % 18.85 % TPS : Management believes that the credit risk-adjusted spread used to develop the discount rate utilized in the fair value measurement of TPS is indicative of the risk premium a willing market participant would require under current market conditions for instruments with similar contractual rates and terms and conditions and issuers with similar credit risk profiles and with similar expected probability of default. Management attributes the change in fair value of these instruments, compared to their par value, primarily to perceived general market adjustments to the risk premiums for these types of assets subsequent to their issuance. Junior subordinated debentures : Similar to the TPS discussed above, Management believes the credit risk-adjusted spread utilized in the fair value measurement of the junior subordinated debentures is indicative of the risk premium a willing market participant would require under current market conditions for an issuer with Banner’s credit risk profile. Management attributes the change in fair value of the junior subordinated debentures, compared to their par value, primarily to perceived general market adjustments to the risk premiums for these types of liabilities subsequent to their issuance. Future contractions in the risk-adjusted spread relative to the spread currently utilized to measure the Company’s junior subordinated debentures at fair value as of December 31, 2025, or the passage of time, will result in negative fair value adjustments. At December 31, 2025, the discount rate utilized was based on a credit spread of 326 basis points and three month SOFR of 365 basis points. Interest rate lock commitments: The fair value of the interest rate lock commitments is based on secondary market sources adjusted for an estimated pull-through rate. The pull-through rate is based on historical loan closing rates for similar interest rate lock commitments. An increase or decrease in the pull-through rate would have a corresponding, positive or negative fair value adjustment. SBA servicing asset: The constant prepayment rate (CPR) is set based on industry data. An increase in the CPR would result in a negative fair value adjustment, where a decrease in CPR would result in a positive fair value adjustment. 119 Table of Contents The following table provides a reconciliation of the assets and liabilities measured at fair value using significant unobservable inputs (Level 3) on a recurring basis during the years ended December 31, 2025 and 2024 (in thousands): Level 3 Fair Value Inputs TPS Securities Borrowings— Junior Subordinated Debentures Interest Rate Lock and Forward Sales Commitments Investments in Limited Partnerships SBA Servicing Asset Balance, January 1, 2024 $ 25,304 $ 66,413 $ 251 $ 13,475 $ 740 Net change recognized in earnings 115 — ( 143 ) ( 1,013 ) 129 Net change recognized in AOCI 266 1,064 — — — Purchases, issuances and settlements — — — 1,493 — Balance, December 31, 2024 25,685 67,477 108 13,955 869 Net change recognized in earnings 320 — 157 ( 1,309 ) 235 Net change recognized in AOCI 4,266 11,674 — — — Purchases, issuances and settlements — — — 1,899 — Balance, December 31, 2025 $ 30,271 $ 79,151 $ 265 $ 14,545 $ 1,104 Interest income, dividends and amortization related to TPS are recorded as a component of interest income. Interest expense related to the junior subordinated debentures is measured based on contractual interest rates and reported in interest expense. The change in fair value of the junior subordinated debentures, which represents changes in instrument specific credit risk. The change in fair value of the TPS is recorded in other comprehensive income. The change in fair value of the investment in limited partnerships and the SBA servicing asset are recorded as a component of non-interest income. The change in fair value of the interest rate lock and forward sales commitments are included in mortgage banking operations in non-interest income. Items Measured at Fair Value on a Non-recurring Basis The following tables present financial assets and liabilities measured at fair value on a non-recurring basis and the level within the fair value hierarchy of the fair value measurements for those assets at December 31, 2025 and 2024 (in thousands): December 31, 2025 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 5,607 $ 5,607 REO — — 5,578 5,578 December 31, 2024 Level 1 Level 2 Level 3 Total Loans individually evaluated $ — $ — $ 6,590 $ 6,590 REO — — 2,367 2,367 The following table presents the gains and losses resulting from non-recurring fair value adjustments for the years ended December 31, 2025, 2024 and 2023 (in thousands): For the years ended December 31, 2025 2024 2023 Loans individually evaluated $ ( 978 ) $ ( 1,483 ) $ ( 933 ) Loans held for sale (1) — — 2,538 Total loss from non-recurring measurements $ ( 978 ) $ ( 1,483 ) $ 1,605 (1) Gains and losses related to loans held for sale were due to the multifamily real estate loans held for sale until the loans were transferred to loans held in portfolio in the fourth quarter of 2023. 120 Table of Contents Loans individually evaluated : Expected credit losses for loans evaluated individually are measured based on the present value of expected future cash flows discounted at the loan’s original effective interest rate or when the Bank determines that foreclosure is probable, the expected credit loss is measured based on the fair value of the collateral as of the reporting date, less estimated selling costs, as applicable. As a practical expedient, the Bank measures the expected credit loss for a loan using the fair value of the collateral, if repayment is expected to be provided substantially through the operation or sale of the collateral when the borrower is experiencing financial difficulty based on the Bank’s assessment as of the reporting date. In both cases, if the fair value of the collateral is less than the amortized cost basis of the loan, the Bank will recognize an allowance as the difference between the fair value of the collateral, less costs to sell (if applicable) and the amortized cost basis of the loan. If the fair value of the collateral exceeds the amortized cost basis of the loan, any expected recovery added to the amortized cost basis will be limited to the amount previously charged-off. Subsequent changes in the expected credit losses for loans evaluated individually are included within the provision for credit losses in the same manner in which the expected credit loss initially was recognized or as a reduction in the provision that would otherwise be reported. REO: The Company records REO (acquired through a lending relationship) at fair value on a non-recurring basis. Fair value adjustments on REO are based on updated real estate appraisals which are based on current market conditions. All REO properties are recorded at the lower of the estimated fair value of the real estate, less expected selling costs, or the carrying amount of the defaulted loans. From time to time, non-recurring fair value adjustments to REO are recorded to reflect partial write-downs based on an observable market price or current appraised value of property. Banner considers any valuation inputs related to REO to be Level 3 inputs. The individual carrying values of these assets are reviewed for impairment at least annually and any additional impairment charges are expensed. Note 16: BANNER CORPORATION (PARENT COMPANY ONLY) Summary financial information is as follows (in thousands): Statements of Financial Condition December 31 2025 2024 ASSETS Cash $ 69,004 $ 75,712 Investment in trust equities 2,678 2,678 Investment in subsidiaries 1,951,461 1,813,001 Note receivable from subsidiary — 50,000 Other assets 5,694 11,446 Total assets $ 2,028,837 $ 1,952,837 LIABILITIES AND SHAREHOLDERS’ EQUITY Miscellaneous liabilities $ 1,847 $ 6,879 Deferred tax liability, net 1,542 4,377 Subordinated notes, net — 99,778 Junior subordinated debentures at fair value 79,151 67,477 Shareholders’ equity 1,946,297 1,774,326 Total liabilities and shareholders’ equity $ 2,028,837 $ 1,952,837 Statements of Operations Years Ended December 31 2025 2024 2023 INTEREST INCOME: Interest-bearing deposits $ 1,743 $ 2,919 $ 844 Note receivable from subsidiary 1,043 1,559 — OTHER INCOME (EXPENSE): Dividend income from subsidiaries 143,230 87,799 104,004 Equity in undistributed income of subsidiaries 60,324 91,179 92,018 Other income 979 186 1 Interest expense on other borrowings ( 8,193 ) ( 11,764 ) ( 11,568 ) Other expenses ( 6,296 ) ( 5,801 ) ( 5,491 ) Net income before taxes 192,830 166,077 179,808 BENEFIT FROM INCOME TAXES ( 2,552 ) ( 2,821 ) ( 3,816 ) NET INCOME $ 195,382 $ 168,898 $ 183,624 121 Table of Contents Statements of Cash Flows Years Ended December 31 2025 2024 2023 OPERATING ACTIVITIES: Net income $ 195,382 $ 168,898 $ 183,624 Adjustments to reconcile net income to net cash provided by operating activities: Equity in undistributed income of subsidiaries ( 60,324 ) ( 91,179 ) ( 92,018 ) (Increase) decrease in deferred taxes ( 33 ) 114 ( 52 ) Net change in valuation of financial instruments carried at fair value 605 ( 186 ) 253 Share-based compensation 10,343 10,031 9,169 Net change in other assets ( 269 ) ( 793 ) 442 Net change in other liabilities ( 20 ) 374 ( 609 ) Net cash provided from operating activities 145,684 87,259 100,809 INVESTING ACTIVITIES: Other investing activities 256 ( 1,155 ) 488 Decrease (increase) in note receivables from subsidiaries 50,000 ( 50,000 ) — Net cash provided from (used by) investing activities 50,256 ( 51,155 ) 488 FINANCING ACTIVITIES: Repayment of subordinated notes ( 100,000 ) — — Taxes paid related to net share settlement for equity awards ( 3,545 ) ( 2,172 ) ( 3,476 ) Repurchase of common stock ( 31,575 ) — — Cash dividends paid ( 67,528 ) ( 66,733 ) ( 66,765 ) Net cash used by financing activities ( 202,648 ) ( 68,905 ) ( 70,241 ) NET CHANGE IN CASH ( 6,708 ) ( 32,801 ) 31,056 CASH, BEGINNING OF PERIOD 75,712 108,513 77,457 CASH, END OF PERIOD $ 69,004 $ 75,712 $ 108,513 Note 17: CALCULATION OF EARNINGS PER COMMON SHARE The following table reconciles basic to diluted weighted average shares outstanding used to calculate earnings per share data (dollars in thousands, except per share data): Years Ended December 31 2025 2024 2023 Net income $ 195,382 $ 168,898 $ 183,624 Basic weighted average shares outstanding 34,460,854 34,470,057 34,344,142 Dilutive effect of unvested restricted stock 195,948 158,653 106,270 Diluted weighted shares outstanding 34,656,802 34,628,710 34,450,412 Earnings per common share Basic $ 5.67 $ 4.90 $ 5.35 Diluted $ 5.64 $ 4.88 $ 5.33 Anti-dilutive restricted stock excluded from the diluted average outstanding share calculation (1) — 1,929 21,865 (1) Anti-dilution occurs when the unrecognized compensation cost per share of restricted stock exceeds the current market price of the Company’s stock. 122 Table of Contents Note 18: COMMITMENTS AND CONTINGENCIES 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 activities 27,250 37,500 In addition to the commitments disclosed in the table above, the Company is also committed to funding the unfunded portion of its tax credit investments, as discussed previously in Note 10, Income Taxes, as well as the remaining unfunded portion of its investments in limited partnerships. As of December 31, 2025 and 2024, the remaining outstanding commitments related to the unfunded tax credit investments and limited partnership investments were as follows (in thousands): Unfunded commitment balance for: December 31, 2025 December 31, 2024 Tax credit investments $ 118,471 $ 94,416 Limited partnerships investments $ 11,398 $ 14,706 Commitments to extend credit are agreements to lend to a client, as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Many of the commitments may expire without being drawn upon; therefore, the total commitment amounts do not necessarily represent future cash requirements. Each client’s creditworthiness is evaluated on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on Management’s credit evaluation of the client. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, and income producing commercial properties. The Company’s allowance for credit losses - unfunded loan commitments was $ 15.0 million and $ 13.6 million at December 31, 2025 and 2024, respectively. Standby letters of credit are conditional commitments issued to guarantee a client’s performance or payment to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to clients. Under a risk participation agreement, the Bank guarantees the financial performance of a borrower on the participated portion of an interest rate swap on a loan. Interest rates on one- to four-family residential loan applications are typically rate locked (committed) to clients during the application stage for periods ranging from 30 to 60 days, the most typical period being 45 days. Traditionally, these loan applications with rate lock commitments have the pricing for the sale of these loans locked with various qualified investors under a best-efforts delivery program at or near the time the interest rate is locked with the client. The Bank then attempts to deliver these loans before their rate locks expire. This arrangement generally requires delivery of the loans prior to the expiration of the rate lock. Delays in funding the loans may require a lock extension. The cost of a lock extension is sometimes covered by the client and other times by the Bank. These lock extension costs have not had a material impact to the Company’s operations. For mandatory delivery commitments the Company enters into forward commitments at specific prices and settlement dates to deliver either: (1) residential mortgage loans for purchase by secondary market investors (i.e., Freddie Mac or Fannie Mae), or (2) mortgage-backed securities to broker/dealers. The purpose of these forward commitments is to offset the movement in interest rates between the execution of its residential mortgage rate lock commitments with borrowers and the sale of those loans to the secondary market investor. There were no counterparty default losses on forward contracts during 2025 and 2024. Market risk with respect to forward contracts arises principally from changes in the value of contractual positions due to changes in interest rates. The Company limits its exposure to market risk by monitoring differences between commitments to clients and forward contracts with market investors and securities broker/dealers. In the event the Company has forward delivery contract commitments in excess of available mortgage loans, the transaction is completed by either paying or receiving a fee to or from the investor or broker/dealer equal to the increase or decrease in the market value of the forward contract. Changes in the value of rate lock commitments are recorded as assets and liabilities. 123 Table of Contents In the normal course of business, the Company and/or its subsidiaries have various legal proceedings and other contingent matters outstanding. These proceedings and the associated legal claims are often contested and the outcome of individual matters is not always predictable. These claims and counterclaims typically arise during the course of collection efforts on problem loans or with respect to action to enforce liens on properties in which the Bank holds a security interest. Based upon the information known to Management, there were no legal proceedings, pending or threatened, that Management believes would have a material adverse effect on the results of operations or consolidated financial position at December 31, 2025. In connection with certain asset sales, the Bank typically makes representations and warranties about the underlying assets conforming to specified guidelines. If the underlying assets do not conform to the specifications, the Bank may have an obligation to repurchase the assets or indemnify the purchaser against any loss. The Bank believes that the potential for material loss under these arrangements is remote. Accordingly, the fair value of such obligations is not material. Note 19: DERIVATIVES AND HEDGING The Company is party to various derivative instruments that are used for asset and liability management and client financing needs. Derivative instruments are contracts between two or more parties that have a notional amount and an underlying variable, require no net investment and allow for the net settlement of positions. The notional amount serves as the basis for the payment provision of the contract and takes the form of units, such as shares or dollars. The underlying variable represents a specified interest rate, index, or other component. The interaction between the notional amount and the underlying variable determines the number of units to be exchanged between the parties and influences the market value of the derivative contract. The Company’s predominant derivative and hedging activities involve interest rate swaps related to certain term loans and forward sales contracts associated with mortgage banking activities. Generally, these instruments help the Company manage exposure to market risk and meet client financing needs. Market risk represents the possibility that economic value or net interest income will be adversely affected by fluctuations in external factors such as market-driven interest rates and prices or other economic factors. As of December 31, 2025 and 2024, the notional values or contractual amounts and fair values of the Company’s derivatives were as follows (in thousands): Asset Derivatives Liability Derivatives December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 Notional/ Contract Amount Fair Value Notional/ Contract Amount Fair Value Notional/ Contract Amount Fair Value Notional/ Contract Amount Fair Value Interest rate swaps not designated in hedge relationships $ 409,748 $ 19,185 $ 386,995 $ 30,134 $ 409,748 $ 19,207 $ 386,995 $ 30,184 Master netting agreements ( 9,207 ) ( 15,627 ) — — Net interest rate swaps 9,978 14,507 19,207 30,184 Risk participation agreements 583 — 817 — 40,607 5 43,097 6 Mortgage loan commitments 39,895 333 30,085 108 — — 5,427 2 Forward sales contracts 28,405 — 49,628 223 33,793 151 — — Total $ 478,631 $ 10,311 $ 467,525 $ 14,838 $ 484,148 $ 19,363 $ 435,519 $ 30,192 The Company’s asset derivatives are included in other assets, while the liability derivatives are included in accrued expenses and other liabilities on the Consolidated Statements of Financial Condition. Interest Rate Swaps: The Bank offers an interest rate swap program for commercial loan clients, under which a client with a variable-rate loan enters into an interest rate swap to receive a variable-rate payment in exchange for paying a fixed rate. To offset its exposure, the Bank enters into an offsetting interest rate swap with a dealer counterparty for the same notional amount and term, under which the dealer receives a fixed-rate payment in exchange for paying a variable rate. These swaps do not qualify as designated hedges; accordingly, each swap is accounted for as a freestanding derivative. Risk Participation Agreements: In conjunction with the purchase or sale of participating interests in loans, the Company also participates in related swaps through risk participation agreements. The existing credit derivatives resulting from these participations are not designated as hedges as they are not used to manage interest rate risk in the Company’s assets or liabilities and are not speculative. 124 Table of Contents Mortgage Loan Commitments: The Company sells originated one- to four-family residential loans into the secondary mortgage loan markets. During the period of loan origination and prior to the sale of the loans in the secondary market, the Company has exposure to movements in interest rates associated with written interest rate lock commitments with potential borrowers to originate one- to four-family residential loans that are intended to be sold and for closed one- to four-family residential loans held for sale for which fair value accounting has been elected, that are awaiting sale and delivery into the secondary market. The Company economically hedges the risk of changing interest rates associated with these one- to four-family residential loan commitments by entering into forward sales contracts to sell these loans or mortgage-backed securities to broker/dealers at specific prices and dates. Gains (losses) recognized in income within mortgage banking operations on non-designated hedging instruments for the years ended December 31, 2025, 2024 and 2023, were as follows (in thousands): For the Years Ended December 31 2025 2024 2023 Mortgage loan commitments $ 509 $ ( 79 ) $ 263 Forward sales contracts ( 1,584 ) 320 313 $ ( 1,075 ) $ 241 $ 576 The Company is exposed to credit-related losses in the event of nonperformance by the counterparty to these agreements. Credit risk of the financial contract is controlled through the credit approval, limits, and monitoring procedures and Management does not expect the counterparties to fail their obligations. In connection with the interest rate swaps between the Bank and the dealer counterparties, the agreements contain a provision where if the Bank fails to maintain its status as a well or adequately capitalized institution, then the counterparty could terminate the derivative positions and the Bank would be required to settle its obligations. Similarly, the Bank could be required to settle its obligations under certain of its agreements if specific regulatory events occur, such as a publicly issued prompt corrective action directive, cease and desist order, or a capital maintenance agreement that required the Bank to maintain a specific capital level. If the Bank had breached any of these provisions, it could have been required to settle its obligations under the agreements at the termination value. As of December 31, 2025 and 2024, the Company had no obligations to dealer counterparties related to these agreements. The Company generally posts collateral against derivative liabilities in the form of cash, government agency-issued bonds, mortgage-backed securities, or commercial mortgage-backed securities. Collateral posted against derivative liabilities was $ 17.4 million and $ 19.9 million as of December 31, 2025 and 2024, respectively. The collateral posted included restricted cash of $ 16.4 million and $ 18.9 million as of December 31, 2025 and 2024, respectively. Derivative assets and liabilities are recorded at fair value on the balance sheet. Master netting agreements allow the Company to settle all derivative contracts held with a single counterparty on a net basis and to offset net derivative positions with related collateral where applicable. In addition, some interest rate swap derivatives between the Company and the dealer counterparties are cleared through central clearing houses. These clearing houses characterize the variation margin payments as settlements of the derivative’s market exposure and not as collateral. The variation margin is treated as an adjustment to our cash collateral, as well as a corresponding adjustment to our derivative asset or liability. As of December 31, 2025 and 2024, the variation margin adjustment was a positive adjustment of $ 9.2 million and negative adjustment of $ 15.6 million, respectively. 125 Table of Contents The following presents additional information related to the Company’s interest rate swaps, both designated and non-designated as hedged, as of December 31, 2025 and 2024 (in thousands): December 31, 2025 Gross Amounts of Financial Instruments Not Offset in the Consolidated Statement of Financial Condition Gross Amounts Recognized Amounts offset in the Statement of Financial Condition Net Amounts in the Statement of Financial Condition Netting Adjustment Per Applicable Master Netting Agreements Fair Value of Financial Collateral in the Statement of Financial Condition Net Amount Derivative assets Interest rate swaps $ 19,185 $ ( 9,207 ) $ 9,978 $ — $ — $ 9,978 $ 19,185 $ ( 9,207 ) $ 9,978 $ — $ — $ 9,978 Derivative liabilities Interest rate swaps $ 19,207 $ — $ 19,207 $ — $ ( 15,767 ) $ 3,440 $ 19,207 $ — $ 19,207 $ — $ ( 15,767 ) $ 3,440 December 31, 2024 Gross Amounts of Financial Instruments Not Offset in the Consolidated Statement of Financial Condition Gross Amounts Recognized Amounts offset in the Statement of Financial Condition Net Amounts in the Statement of Financial Condition Netting Adjustment Per Applicable Master Netting Agreements Fair Value of Financial Collateral in the Statement of Financial Condition Net Amount Derivative assets Interest rate swaps $ 30,134 $ ( 15,627 ) $ 14,507 $ — $ — $ 14,507 $ 30,134 $ ( 15,627 ) $ 14,507 $ — $ — $ 14,507 Derivative liabilities Interest rate swaps $ 30,184 $ — $ 30,184 $ — $ ( 18,228 ) $ 11,956 $ 30,184 $ — $ 30,184 $ — $ ( 18,228 ) $ 11,956 126 Table of Contents Note 20: REVENUE FROM CONTRACTS WITH CLIENTS 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 fees earned when a credit or debit card issued by the Bank is used to purchase goods or services at a merchant. The merchant’s bank pays the Bank a default interchange rate set by Mastercard on a transaction-by-transaction basis. The merchant acquiring bank can stop accepting the Bank’s cards at any time and the Bank can stop further use of cards issued by them at any time. The performance obligation is satisfied, and the fees are earned, when the cost of the transaction is charged to the Bank’s cardholders’ card. Direct expenses associated with the credit and debit card are recorded as a net reduction against the interchange income. Merchant services income Merchant services income represents fees earned by the Bank for card payment services provided to its merchant clients. The Bank has a contract with a third party to provide card payment services to the Bank’s merchants that contract for those services. The third party provider has contracts with the Bank’s merchants to provide the card payment services. The Bank does not have a direct contractual relationship with its merchants for these services. The Bank sets the rates for the services provided by the third party. The third party provider passes the payments made by the Bank’s merchants through to the Bank. The Bank, in turn, pays the third party provider for the services it provides to the Bank’s merchants. These payments to the third party provider are recorded as expenses as a net reduction against fee income. In addition, a portion of the payment received by the Bank represents interchange fees passed through to the card issuing bank. Income is primarily earned based on the dollar volume and number of transactions processed. The performance obligation is satisfied and the related fee is earned when each payment is accepted by the processing network. 127 Table of Contents Note 21: LEASES 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 sublease income are classified within occupancy and equipment expense on the Consolidated Statements of Operations. Operating cash flows paid for operating lease amounts included in the measurement of lease liabilities were $ 16.0 million for the year ended December 31, 2025, and $ 14.9 million for the year ended December 31, 2024. The Company recorded $ 6.7 million of lease ROU assets in exchange for operating lease liabilities for the year ended December 31, 2025, and $ 8.2 million for the year ended December 31, 2024. The table below reconciles the undiscounted cash flows for each of the first five years beginning with 2026 and the total of the remaining years to the operating lease liabilities recorded on the Consolidated Statements of Financial Position (in thousands): Operating Leases 2026 $ 12,620 2027 10,288 2028 6,179 2029 4,177 2030 2,212 Thereafter 3,426 Total minimum lease payments 38,902 Less: amount of lease payments representing interest ( 3,147 ) Lease obligations $ 35,755 As of December 31, 2025 and 2024, the Company had no undiscounted lease payments under an operating lease that had not yet commenced. 128 Table of Contents Note 22: SEGMENT DISCLOSURES 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. Banner’s 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. 129 Table of Contents ITEM 9 – Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable.