DEF 14A of Banner Corp, Apr 9, 2024

DEF 14A of Banner Corp

Filed Apr 9, 2024 · FY20230001193125-24-090905

Open on EDGAR

  1. Annual Meeting Frequently Asked Questions

    | Margot J. Copeland | | | Director Since: 2022 | Committees: | | | • Compensation and Human Capital • Credit Risk | | Key Qualifications: • Extensive banking and executive leadership, philanthropic and community engagement experience • Corporate responsibility expertise, including in relation to diversity, equity and inclusion Margot J. Copeland specializes in developing strategies in the areas of workforce development and management, leadership, diversity and inclusion, philanthropy, and community outreach and engagement. Ms. Copeland has over 20 years of experience, with her previous positions being at KeyBank (a subsidiary of KeyCorp (NYSE: KEY)) and its affiliate, KeyBank Foundation, in Cleveland, Ohio. At KeyBank, she was Executive Vice President and Director Corporate Philanthropy and Community Engagement from 2001 through 2019. During the same period, she served as Board Chair and Chief Executive Officer for KeyBank Foundation. As a corporate officer and leader of corporate philanthropy and civic engagement, Ms. Copeland was a member of KeyBank’s Corporate Social Responsibility Council, which focused on philanthropic investments, corporate citizenship, and regulatory and corporate strategy. She was also a member of the Diversity & Inclusion Council and she served as KeyBank’s Chief Diversity Officer from 2001 through 2013. Prior to joining KeyBank, Ms. Copeland served on the Advisory Board of US Bank (formerly Firstar) from 1998 through 2001. Ms. Copeland is actively involved in her community, having served on a number of advisory boards and boards of directors for educational institutions, health care systems, community organizations and other nonprofit entities. She currently serves on the Board of Trustees for The Cleveland Clinic and the Board of Directors for AARP, among others. Ms. Copeland received a Master’s degree from The Ohio State University, a Bachelor of Science in Physics from Hampton University, Hampton, Virginia and an Honorary Doctorate of Humane Letters from Cuyahoga Community College, Cleveland, Ohio. With her vast experience in social responsibility and her long-tenured connection to banking, the directors believe that Ms. Copeland should continue to serve on the Board of Directors. | |

  2. Annual Meeting Frequently Asked Questions

    | Mark J. Grescovich | | | | President and CEO | | | | Director Since: 2010 | Committees: | | | | • Credit Risk • Executive | • Risk | | Key Qualifications: • Extensive bank leadership experience • Acquisition and strategic planning expertise • Credit and risk management expertise Mark J. Grescovich is President and Chief Executive Officer, and a director, of Banner Corporation and Banner Bank. Mr. Grescovich joined Banner Bank in April 2010 and became Chief Executive Officer in August 2010 following an extensive banking career specializing in finance, credit administration and risk management. Under his leadership, Banner has grown from $4.7 billion in assets in 2010 to more than $15 billion through organic growth as well as selective acquisition. During that time, Mr. Grescovich has guided the expansion of Banner’s footprint to over 135 locations in four states. Prior to joining Banner, Mr. Grescovich was the Executive Vice President and Chief Corporate Banking Officer for Akron, Ohio-based FirstMerit Corporation and FirstMerit Bank N.A. He assumed responsibility for FirstMerit’s commercial and regional line of business in 2007, having served since 1994 in various commercial and | | |

  3. Annual Meeting Frequently Asked Questions

    | Roberto R. Herencia | | | | Board Chair Director Since: 2016 | Committees: | | | | • Compensation and Human Capital • Corporate Governance/Nominating | • Credit Risk • Executive (Chair) | | Key Qualifications: • Extensive bank leadership experience, including as a director and chief executive officer • Acquisition and strategic planning expertise • Credit and risk management expertise Roberto R. Herencia is President and Chief Executive Officer of BXM Holdings, a fund specializing in community bank investments. He is a director and Chairman of the Board of First BanCorp. (NYSE: FBP) and its subsidiary, FirstBank Puerto Rico, positions he has held since October 2011. He has been an independent director and the Chairman of the Board of Byline Bancorp (NYSE: BY) and its subsidiary bank, Byline Bank, since June 2013, and effective February 12, 2021, he assumed the role of Chief Executive Officer of Byline Bancorp. Between 2009 and 2010, Mr. Herencia was President and Chief Executive Officer of Midwest Banc Holdings, Inc. and its subsidiary, Midwest Bank and Trust. Prior to that, he spent 17 years with Popular Inc. as its Executive Vice President and as President of Popular Inc.’s subsidiary, Banco Popular North America. Prior to joining Popular, Mr. Herencia spent 10 years with The First National Bank of Chicago (now J.P. Morgan Chase) in a variety of roles, including Deputy Senior Credit Officer and Head of the Emerging Markets Division. Mr. Herencia previously served on the US International Development Finance Corporation’s Board of Directors, to which he was appointed by President Obama in 2011. He graduated magna cum laude and received his Bachelor of Science in Business Administration degree in finance from Georgetown University and his Master of Business Administration degree from the Kellogg School of Management at Northwestern University. Based on these qualifications, the directors believe that Mr. Herencia should continue to serve on the Board of Directors. | | |

  4. Annual Meeting Frequently Asked Questions

    | David A. Klaue | | | Director Since: 2007 | Committees: | | | • Audit • Corporate Governance/Nominating | | Key Qualifications: • Bank leadership experience • Acquisition, business expansion and strategic planning expertise • Extensive business operational experience • Organizational effectiveness expertise David A. Klaue served as Chairman of the Board of Directors of F&M Bank until its acquisition by Banner Bank in May 2007. He is Chairman of the Board of Empire Lumber Co., a diversified wood products manufacturer with operations in Washington, Idaho and Montana, and of Park Ranch Land & Cattle Co., | |

  5. Annual Meeting Frequently Asked Questions

    | John R. Layman | | | Director Since: 2007 | Committees: | | | • Audit • Risk | | Key Qualifications: • Extensive legal experience, including in mergers and acquisitions and complex litigation matters • Bank leadership and operational experience • Risk management expertise • Strategic planning experience John R. Layman served as Co-Vice Chairman of the Board of Directors of F&M Bank until its acquisition by Banner Bank in May 2007. He is Managing Partner of Layman Law Firm, PLLP, with which he has been associated since 1983. His areas of practice include real estate development, commercial litigation, personal injury and product liability. He also has experience in securities litigation, fiduciary obligations, corporate governance and compliance and reporting requirements. Based on these qualifications, the directors believe that Mr. Layman should continue to serve on the Board of Directors. | |

  6. Annual Meeting Frequently Asked Questions

    | Kevin F. Riordan | | | | Director Since: 2018 | Committees: | | | | • Audit (Chair) • Compensation and Human Capital | • Credit Risk • Executive | | Key Qualifications: • Audit experience; qualifies as an audit committee financial expert • Risk management expertise • Corporate governance best practices and organizational effectiveness expertise Kevin F. Riordan retired as a Banking & Capital Markets audit and client service Partner of PricewaterhouseCoopers LLP (PwC), a global professional services firm, in June 2014, having served in that capacity since 2000. Prior to joining PwC in 1994, Mr. Riordan served various banking and securities trading companies as both an independent auditor and senior financial/accounting executive. During his career at PwC, Mr. Riordan gained significant experience working with the boards and audit committees of publicly traded banking and lending institutions while managing major client relationships across multiple markets. In those roles, Mr. Riordan developed expertise in complex accounting, auditing and financial reporting matters. He has been a Certified Public Accountant since 1983. Mr. Riordan’s qualification as an audit committee financial expert was the primary reason for his nomination to the Board. The directors believe that this qualification, together with his experience with banking entities and financial reporting matters, support Mr. Riordan’s continued service on the Board of Directors. | | |

  7. Annual Meeting Frequently Asked Questions

    | Terry S. Schwakopf | | | Director Since: 2018 | Committees: | | | • Corporate Governance/Nominating • Risk | | Key Qualifications: • Extensive bank regulatory supervision experience • Banking and fintech expertise • Risk management expertise Terry S. Schwakopf is an Independent Senior Advisor to the banking practice of Deloitte & Touche, LLP. Prior to joining Deloitte in 2007, Ms. Schwakopf was Executive Vice President of the Federal Reserve Bank of San Francisco with overall responsibility for banking supervision. In that capacity, she oversaw the supervision of state member banks and bank and financial holding companies in the nine western states that comprise the San Francisco District. During her 23-year career with the Federal Reserve, she had a number of other responsibilities, including oversight of community affairs, public information, the corporate secretary’s function and communications. Before joining the Federal Reserve, she held positions in both the commercial banking and savings and loan industries and worked as a consultant to community banks. Ms. Schwakopf serves on the Board of Directors of IDB Bank and is a member of the Advisory Board of Blockchain Capital, a venture capital fund. She was on the Board of United Way of the Bay Area and is actively involved in a number of international organizations and civic groups. Ms. Schwakopf previously served on the Boards of Directors of Bridge Bank and Bridge Capital Holdings, Nara Bank and Nara Bancorporation, and Rabobank, NA. She was a member of the accreditation cadre for the Conference of State Bank Supervisors and a board advisor for Solar Mosaic, a crowdfunding site for solar energy financing. Ms. Schwakopf was honored as one of WomenInc. magazine’s 2019 Most Influential Corporate Directors. Based on these qualifications, the directors believe that Ms. Schwakopf should continue to serve on the Board of Directors. | |

  8. Annual Meeting Frequently Asked Questions

    | Paul J. Walsh | | | Director Since: 2022 | Committees: | | | • Audit • Risk | | Key Qualifications: • Strong technology, information security, cybersecurity and digital expertise • Leadership and advisory board experience Paul J. Walsh is currently Senior Vice President, Head of Digital, Engineering, and IT at Sony Interactive Entertainment (part of Sony Group Corp, NYSE: SONY) in Kirkland, Washington, which he joined in January 2022. He was an Executive-In-Residence with Adobe (NYSE: ADBE) in Kirkland, Washington, from 2021 to 2022. Mr. Walsh served as Senior Vice President and Global Chief Digital Officer with Lenovo (OTCM: LNVGF) in Kirkland, Washington, from 2018 to 2020. Prior to Lenovo, Mr. Walsh served as Senior Vice President, Platform Strategy & Innovation for Visa Inc. (NYSE: V) in Kirkland, Washington, from 2016 to 2018. Mr. Walsh previously served as the Global Chief Information Officer at Dell (NYSE: DELL) in Austin, Texas, from 2013 through 2015. Mr. Walsh is also an experienced advisory board member. Mr. Walsh received a Bachelor of Science, BSc Computer Science at Griffith College, Dublin, Ireland. He is a technology leader with more than 25 years of experience in both scale and scope with some of the most respected brands in the industry. With his advisory board experience and technical background, the directors believe Mr. Walsh should continue to serve on the Board of Directors. | |

  9. Annual Meeting Frequently Asked Questions

    | Ellen R.M. Boyer | | | | Director Since: 2021 | Committees: | | | | • Audit • Compensation and Human Capital (Chair) | • Executive | | Key Qualifications: • Audit experience; qualifies as an audit committee financial expert • Certified Public Accountant (Active) • Experienced chief financial officer and chief operating officer • Acquisition and strategic planning expertise Ellen R.M. Boyer was Chief Financial Officer of Logic20/20, a business and technology consulting firm headquartered in Seattle, Washington, until her retirement in early April 2024. Ms. Boyer has over 30 years of finance and operational experience in a variety of industries, including technology, financial services and healthcare. Prior to joining Logic20/20 in 2014, Ms. Boyer held chief financial officer and/or chief operating officer roles at several companies in the Seattle area beginning in 1997. Ms. Boyer was previously an Audit Senior Manager at PriceWaterhouseCoopers, where she worked for 12 years. Ms. Boyer has extensive experience in strategic planning, mergers and acquisitions, governance matters, organizational effectiveness, and audit and financial matters. Ms. Boyer graduated from Oregon State University with degrees in Accounting and Spanish and minors in Computer Science and Latin American Affairs. She maintains an active Certified Professional Accountant license. Ms. Boyer is active in her community and has served on several for-profit and not-for-profit boards, including Umpqua Holdings Corporation (now Columbia Banking System, Inc. (Nasdaq: COLB)) from 2014 through 2016 and Sterling Financial Corporation (subsequently Umpqua and now Columbia) from 2007 through 2014. Ms. Boyer qualifies as an audit committee financial expert. This qualification, together with her deep financial expertise and strategic planning experience, adds value to the Board and the directors believe that Ms. Boyer should continue to serve on the Board of Directors. | | |

  10. Annual Meeting Frequently Asked Questions

    | Connie R. Collingsworth | | | | Director Since: 2013 | Committees: | | | | • Compensation and Human Capital • Corporate Governance/Nominating (Chair) | • Executive | | Key Qualifications: • Risk management expertise • Acquisition, business expansion and complex investment experience • Organizational effectiveness and corporate governance best practices leadership • Unique insights regarding environmental, social and governance (“ESG”) issues; diversity, equity and inclusion; and corporate social responsibility | | |

  11. Annual Meeting Frequently Asked Questions

    | John Pedersen | | | | Director Since: 2021 | Committees: | | | | • Audit • Executive | • Credit Risk (Chair) • Risk (Chair) | | Key Qualifications: • Extensive bank leadership experience, including as a chief risk officer • Deep expertise in risk management • Acquisition and strategic planning expertise • Corporate governance best practices and organizational effectiveness expertise John Pedersen was with City National Bank of Los Angeles, California from 2004, serving as Executive Vice President and Chief Risk Officer from 2006 until his retirement in 2019. He has over three decades of progressive commercial banking credit and risk management responsibilities and significant expertise in establishing and managing risk management functions within a regional bank setting. Mr. Pedersen is skilled in strategic planning, including turn-around and growth strategies. He has a thorough understanding of many aspects of banking, including retail, small business, commercial real estate, dealer banking, consumer lending, mortgage banking and middle market lending. Mr. Pedersen began his career in government and held staff and leadership positions with the Office of the Comptroller of the Currency and the Office of Thrift Supervision. After government service, Mr. Pedersen managed a wide range of risk management activities for several financial institutions, including First Interstate Bancorp, KeyCorp, Wachovia and Bank of the West. Active in the community, Mr. Pedersen is involved with various philanthropic organizations that facilitate the micro-financing of small business entrepreneurs domestically and abroad. Mr. Pedersen earned a Bachelor of Business Administration degree in finance and accounting from the University of Oklahoma. Mr. Pedersen’s deep risk management expertise and broad banking experience add value to the Board and the directors believe that Mr. Pedersen should continue to serve on the Board of Directors. | | |

  12. Board of Directors

    Board of Directors The Board of Directors conducts its business through Board meetings and through its committees. During the year ended December 31, 2023, the Board of Directors held 14 meetings. Each director attended more than 75% of the total meetings of the Board and committees on which that director served during this period.

  13. Director Compensation Table

    Director Compensation Table The following table shows the compensation paid to our directors for 2023, with the exception of Mark J. Grescovich, a director and our President and Chief Executive Officer, whose compensation is included in the section entitled “Executive Compensation.” Compensation data below excludes amounts reimbursed for approved business expenses.

  14. Director Compensation Table

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | All Other Compensation ($) | Total ($) | | Ellen R.M. Boyer | 68,583 | 65,308 | 3,350 (2)(3) | 137,242 | | Connie R. Collingsworth | 65,125 | 64,959 | 4,917 (2)(3) | 135,001 | | Margot J. Copeland | 62,583 | 57,897 | 2,818 (2) | 123,299 | | Roberto R. Herencia | 98,667 | 95,061 | 6,524 (2)(3) | 200,252 | | David A. Klaue | 60,500 | 57,897 | 4,317 (2)(3) | 122,715 | | John R. Layman | 61,083(4) | 57,897 | 4,301 (2)(3) | 123,282 | | John Pedersen | 83,628 | 72,674 | 4,999 (2)(3) | 161,302 | | Kevin F. Riordan | 77,083(4) | 67,749 | 6,907 (2)(3) | 151,739 | | Terry S. Schwakopf | 61,625 | 57,897 | 4,732 (2)(3) | 124,254 | | Paul J. Walsh | 61,083 | 57,897 | 2,818 (2) | 121,799 |

  15. Director Compensation Table

    | (1) Represents the aggregate grant date fair value of awards, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, “Compensation – Stock Compensation” (“FASB ASC Topic 718”). For a discussion of valuation assumptions, see Note 1 of the Notes to Consolidated Financial Statements in Banner’s Annual Report on Form 10-K for the year ended December 31, 2023. The directors had the following number of unvested stock awards or restricted stock units outstanding on December 31, 2023: Ms. Boyer, 1,441; Ms. Collingsworth, 1,432; Ms. Copeland, Mr. Klaue, Mr. Layman, Ms. Schwakopf and Mr. Walsh, 1,277 each; Mr. Herencia, 2,091; Mr. Pedersen, 1,604; and Mr. Riordan, 1,495. |

  16. Director Compensation Table

    | (2) Includes dividends and/or dividend equivalents accrued during 2023 on restricted stock and/or restricted stock units. |

  17. Director Compensation Table

    | (3) Includes business and occupation tax reimbursement. Effective July 1, 2010, Washington State subjects directors’ fees to a business and occupation tax, which may be reduced by a small business tax credit allowance. The rate for 2023 was 1.5%. Banner has agreed to reimburse or pay the tax on the director’s behalf. |

  18. Director Compensation Table

    | (4) Fees were deferred pursuant to a deferred fee agreement, as described below. |

  19. Director Compensation Table

    Following a bi-annual review of director compensation supported by research conducted by the Corporation’s independent compensation consultant, we increased the annual cash and equity retainers for directors, the Board Chair, and the Chair of the Corporate Governance/Nominating Committee, as well as the annual cash retainer for members of the Corporate Governance/Nominating Committee, effective August 1, 2023. Non-employee directors receive an annual cash retainer of $50,000, paid monthly, and an annual restricted stock or restricted stock unit award of $60,000. Annual cash retainers for committee members (including the committee chairs) are as follows: Audit Committee, $8,000; Compensation and Human Capital Committee, $6,000; Corporate Governance/Nominating Committee, $6,000; Credit Risk Committee, $6,000; and Risk Committee, $6,000. The Board Chair and various committee chairs receive additional retainers as follows, paid 50% in cash and

  20. Director Compensation Table

    | BANNER CORPORATION 2024 PROXY STATEMENT | 33 |

  21. Director Compensation Table

    Directors’ Compensation | Director Compensation Table 50% in restricted stock or restricted stock units: the Board Chair, $80,000; the Audit Committee Chair, $20,000; the Compensation and Human Capital Committee Chair, the Corporate Governance/Nominating Committee Chair, the Credit Risk Committee Chair and the Risk Committee Chair $15,000 each. These fees compensate the directors for service on the Boards of Directors of both Banner Corporation and Banner Bank and are paid equally by each entity. In order to encourage the retention of qualified directors, we have entered into deferred fee agreements whereby directors may defer payment of all or a portion of their regular fees. Each participant may direct the investment of the deferred fees toward the purchase various investment funds offered under Banner’s nonqualified deferred compensation plan. We have established grantor trusts to hold the investments. The assets of the trusts are considered part of our general assets and the directors have the status of unsecured creditors of Banner with respect to the trust assets. The deferred fee agreements provide pre-retirement death and disability benefits in an amount equal to the value of the director’s account balance upon the occurrence of either event. A director may receive the balance of his or her account in a lump sum or in annual installments over a period as previously elected at the time of enrollment. In connection with its acquisitions, Banner also assumed liability for certain deferred compensation plans for the acquired institutions’ directors. At December 31, 2023, our estimated deferred compensation liability accrual with respect to non-employee directors under these agreements was $3.0 million.

  22. Director Compensation Table

    | 34 | BANNER CORPORATION 2024 PROXY STATEMENT |

  23. Executive Summary

    | | What We Do | | | What We Don’t Do | | Regular review of pay versus performance • Ongoing review by the Compensation and Human Capital Committee • Includes both absolute and relative assessment • Involves use of compensation benchmarking peer group (see “Peer Group” section) Rigorous and diversified performance metrics • Annual review by the Compensation and Human Capital Committee • Measurable goals established for both annual and long-term incentive awards • Goals are diversified and rigorous but attainable Clawback of compensation • The Executive and Long-term Incentive Plans both provide that incentive awards are subject to clawback if Banner is required to prepare an accounting restatement due to error, omission or fraud | | Use of double-triggers • Change-in-control severance arrangements and accelerated vesting on equity awards require double-trigger for benefit eligibility • Change-in-control will not automatically entitle an executive to severance benefits or acceleration of vesting in outstanding equity awards • Second trigger involves executive’s loss of job, significant adverse change to employment terms and conditions, or denial of continuation or replacement of outstanding unvested awards by the acquiring company Review of Committee charter • The Compensation and Human Capital Committee reviews its charter annually to incorporate best-in-class compensation oversight practices Independent compensation consultant • The Compensation and Human Capital Committee engages an independent compensation consultant for advice | No repricing or cash buyouts of underwater stock options or stock appreciation rights • Exercise prices may not be reduced • Outstanding awards may not be replaced with stock options or stock appreciation rights with a lower exercise price except in limited circumstances or with shareholder approval • Buyouts of underwater stock options or stock appreciation rights are not permitted No excessive perquisites • Limited executive perquisites consistent with the practices of our peer group and other comparable financial institutions No tax gross-ups • Parachute excise tax reimbursements and gross-ups will not be provided upon a change-in-control | |

  24. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    | • | Attract and retain key executives who are vital to our long-term success and are of the highest caliber |

  25. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    | • | Motivate executives to enhance long-term shareholder value by granting awards tied to the value of our common stock |

  26. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    | • | Integrate the compensation program with our annual and long-term strategic planning and performance measurement processes |

  27. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    Compensation Discussion and Analysis | What Guides Our Program Compensation Governance. The Compensation and Human Capital Committee of the Banner Board of Directors is responsible for setting the policies and compensation levels for Banner directors, officers and employees, while the Compensation and Human Capital Committee of the Banner Bank Board of Directors is responsible for setting the policies and compensation levels for Banner Bank directors, officers and employees. Banner Bank is the primary subsidiary of Banner. Each Committee is responsible for evaluating the performance of the Chief Executive Officer, while the Chief Executive Officer evaluates the performance of other executive officers and makes recommendations to the appropriate Committee regarding compensation levels. The Chief Executive Officer is not permitted to attend Committee meetings during any voting or deliberations regarding his compensation. Use of Compensation Consultants. From time to time, Banner’s Compensation and Human Capital Committee engages outside advisors to assist the Committee with its responsibilities. The Committee has engaged Pearl Meyer & Partners (Pearl Meyer), an independent consulting firm, to serve as the independent consultant to the Committee regarding executive and director compensation matters. The Compensation and Human Capital Committee conducted a competitive request for proposals from independent compensation consultants in 2023. Following a rigorous evaluation process, the Committee determined to continue its relationship with Pearl Meyer. Pearl Meyer is retained by, and reports directly to, the Committee, and provided no other services to Banner in 2023. Based on standards promulgated by the SEC and Nasdaq to assess compensation advisor independence, as well as the analysis conducted by Pearl Meyer in its independence review, the Compensation and Human Capital Committee has concluded that Pearl Meyer is an independent and conflict-free advisor to the Committee. Compensation Benchmarking and the Role of the Peer Group. The Compensation and Human Capital Committee uses comparative executive compensation data publicly available from a designated peer group of companies in combination with executive compensation survey data to evaluate the competitiveness of Banner’s executive compensation program. The Committee’s objective is to set total target compensation and benefit levels within the median range of market pay and benefit levels. Total compensation opportunities are intended to be consistent with market practices as established by the peer group described below to help Banner attract and retain talented executives and incentivize them to produce superior long-term shareholder returns. The Compensation and Human Capital Committee reviews market compensation levels to determine whether total target compensation for our executive officers remains in the market median pay range and makes adjustments when appropriate. This assessment includes evaluation of base salary, annual incentive opportunities and long-term incentives. In addition, the Committee reviews other items of compensation and total rewards such as health benefits and retirement benefits in comparison to market. The Committee also reviews the competitive performance of Banner’s peers to help establish performance targets for incentive plans and to assess appropriate payout levels for performance. In analyzing this information, the Committee compares the pay of individual executives if it believes the positions are sufficiently similar to make meaningful comparisons and considers each executive’s level of responsibility, prior experience, job performance, contribution to Banner’s success and results achieved. When establishing base salaries and target pay opportunities for our named executive officers for 2023, the Compensation and Human Capital Committee in June 2022 reviewed competitive market data prepared by Pearl Meyer based on the 2022 peer group, which consisted of 19 financial institutions headquartered throughout the United States, ranging in total assets from approximately $12 billion to

  28. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    $26 billion as of December 31, 2021. Each year the Compensation and Human Capital Committee, working with its independent compensation consultant, reviews the composition of the peer group and determines when changes should be made. The 2023 peer group was adjusted to include one additional company meeting the desired size or business model criteria, resulting in 20 financial institutions ranging in total assets from approximately $12 billion to $32 billion as of December 31, 2022. In addition to providing benchmark data for the Committee’s consideration when establishing our named executive officers’ base salaries and target pay opportunities for 2024, the 2023 peer group is used for purposes of calculating relative performance under the 2023 Executive Incentive Plan described below. The members of our 2022 and 2023 peer groups are as follows:

  29. PRINCIPLES UNDERLYING OUR EXECUTIVE COMPENSATION POLICIES

    | * Added to peer group in 2023 |

  30. 2023 Compensation Program Decisions in Detail

    | Base Salary | Short-Term Incentive Compensation | Long-Term Incentive Compensation |

  31. 2023 Compensation Program Decisions in Detail

    Incentive Compensation. The Compensation and Human Capital Committee believes that performance-based pay opportunities and stock ownership by our officers are significant factors in aligning the interests of the officers with those of shareholders. Awards granted under our incentive plans are determined based upon the officers’ level of responsibility and expected contributions to Banner and Banner Bank as judged by the Compensation and Human Capital Committee and the Board of Directors. The Compensation and Human Capital Committee considers a number of factors in granting awards. These factors differ from year to year but are fundamentally driven by the Committee’s view on what is necessary to most effectively support Banner’s business and leadership strategies. Short-term Incentive Compensation. The Compensation and Human Capital Committee adopted criteria and rules for awarding and paying annual incentive payments to the named executive officers, as set forth in the Banner Corporation 2023 Executive Incentive Plan (“Executive Incentive Plan”). The purpose of the Executive Incentive Plan is to reward executives for their contributions to the performance and success of Banner and Banner Bank. Each participant is assigned a target award opportunity, which is expressed as a percentage of base salary, and a range of payout opportunities from 0% up to 150% of the target incentive. Awards are determined based on a weighted combination of corporate goals, individual performance goals and, where applicable, line of business goals. These goals and weightings, with the exception of those for the Chief Executive Officer, are established and proposed by the Chief Executive Officer, subject to the approval of the Compensation and Human Capital Committee. The weighted combination of corporate and individual performance goals for the Chief Executive Officer is determined by the Compensation and Human Capital Committee. The annual incentive opportunities for the named executive officers, expressed as a percentage of base salary earned during 2023, were as follows:

  32. 2023 Compensation Program Decisions in Detail

    | Executive | Below Threshold | Threshold (50%) | Target (100%) | Stretch/Max (150%) | | Chief Executive Officer | 0% | 50% | 100% | 150% | | Other Named Executive Officers | 0% | 25-32.5% | 50-65% | 75-97.5% |

  33. 2023 Compensation Program Decisions in Detail

    For 2023, corporate goals were weighted 80% and individual goals were weighted 20% for Executive Incentive Plan participants whose opportunities do not include a line of business component. For those Executive Incentive Plan participants whose incentive opportunities include a line of business component, corporate goals were weighted 70%, line of business goals were weighted 20% and individual goals were weighted 10%. The portion of the Executive Incentive Plan award tied to corporate performance is based on relative and absolute performance measures. If Banner’s financial performance relative to its peer group of financial institutions (see the “Compensation Benchmarking and the Role of the Peer Group” section above) is below the 25th percentile, the payout associated with that measure will not exceed the target payout, regardless of absolute performance, unless the Compensation and Human Capital Committee exercises discretion to waive the threshold requirement. For 2023, the Compensation and Human Capital Committee approved the following corporate performance measures for the named executive officers:

  34. 2023 Compensation Program Decisions in Detail

    | (1) In March 2023, the Compensation and Human Capital Committee selected the participants under the Executive Incentive Plan and established performance goals for all participants. The Community Banking and Commercial Banking Group line of business performance targets were adjusted in February 2024 to appropriately reflect organizational and business model changes that occurred over the course of 2023. |

  35. 2023 Compensation Program Decisions in Detail

    | Absolute Performance Measure | Performance Achieved | Payout Earned as a % of Target | | Pretax Pre-provision Return on Average Assets (“PTPP ROA”) | 1.74% | 75% | | Efficiency Ratio | 57.91% | 76.07% | | Total Operating Revenue ($ in thousands) | $644,151 | 74.51% | | Line of Business PTPP ROA – Community Banking (1) | 3.16% | 84.30% | | Line of Business PTPP ROA – Commercial Real Estate (1) | 1.78% | 148.39%(2) | | Line of Business Efficiency Ratio – Community Banking (1) | 24.88% | 84.06% | | Line of Business Efficiency Ratio – Commercial Real Estate (1) | 32.19% | 150%(3) | | Relative Performance Measure | | | | Ratio of Non-performing Assets to Total Assets (4) | 80th percentile | 150% |

  36. 2023 Compensation Program Decisions in Detail

    | (1) The Community Banking line of business metric was used for Ms. Purcell’s incentive plan performance; and the Commercial Real Estate line of business metric was used for Mr. McLean’s calculation. |

  37. 2023 Compensation Program Decisions in Detail

    | (2) Performance on this metric exceeded the target goal, qualifying for payout at the calculated level. |

  38. 2023 Compensation Program Decisions in Detail

    | (3) Performance on this metric exceeded the stretch goal, but payout was capped at 150% of target per the terms of the Executive Incentive Plan. |

  39. 2023 Compensation Program Decisions in Detail

    | | 2023 Executive Incentive Plan Results | | | | | | | | Name | Target Bonus (% of Base Salary) | Target Bonus Amount ($) | Payout for Corporate Achievement ($) | Payout for Line of Business Achievement ($) | Payout for Individual Performance ($) | Total Incentive Payout ($) | Total Incentive Payout (% of Target) | | Mark J. Grescovich | 100% | 899,887 | 604,877 | N/A | 143,682 | 748,560 | 83% | | Robert G. Butterfield | 60% | 249,000 | 149,763 | N/A | 48,672 | 198,434 | 80% | | Cynthia D. Purcell | 65% | 285,919 | 170,893 | 47,798 | 30,094 | 248,785 | 87% | | James M. Costa | 50% | 212,175 | 142,618 | N/A | 46,771 | 189,389 | 89% | | James P. G. McLean | 50% | 173,363 | 103,619 | 51,365 | 21,948 | 176,932 | 102% | | Peter J. Conner | 65% | 312,829 | 188,213 | N/A | 55,607 | 243,820 | 78% |

  40. 2023 Compensation Program Decisions in Detail

    Please see the discussion beginning on page 41 for more information regarding the Executive Incentive Plan. Long-term Incentive Compensation. Our shareholders have approved the 2014 Omnibus Incentive Plan, the 2018 Omnibus Incentive Plan and the 2023 Omnibus Incentive Plan. These plans provide 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. The Omnibus Incentive Plans are intended to provide us flexibility in our ability to attract, motivate and retain the services of employees and directors upon whose judgment, interest and special effort we depend. We are currently granting awards under the 2014 Omnibus Incentive Plan to the extent sufficient awards remain available for relevant grants, as well as granting awards under the 2018 Omnibus Incentive Plan. The 2023 Omnibus Incentive Plan is strongly focused on pay for performance principles. It emphasizes compensation opportunities that reward our employees and directors when they deliver targeted financial results. Through equity incentives and performance-based compensation, the 2023 Omnibus Incentive Plan also serves to ensure the continuing alignment of the interests of our employees and directors with those of Banner shareholders and the long-term interests of Banner. In March 2023, the Committee determined to grant both time-based and performance-based awards to each of the named executive officers.

  41. 2023 Compensation Program Decisions in Detail

    The Compensation and Human Capital Committee approved target long-term incentive awards expressed as a percentage of base salary which were subsequently denominated in shares based on the average of the closing prices of Banner’s stock on the ten days prior to the date of grant. Target awards for 2023 were allocated between time-based restricted stock units and performance units, illustrated below as a percentage of base salary:

  42. 2023 Compensation Program Decisions in Detail

    | Executive | Total Target Stock-based Award as % of Salary | Time-based Restricted Stock Units as % of Salary | Performance Units as % of Salary | | Chief Executive Officer | 130% | 52% | 78% | | Other Named Executive Officers | 60-80% (1) | 30-40% (1) | 30-40% (1) |

  43. 2023 Compensation Program Decisions in Detail

    The time-based restricted stock units vest ratably on an annual basis over a three-year period, which begins on the grant date of April 3, 2023 and ends on the third anniversary of the grant date. Awards of performance-based restricted stock units (“performance units”) are contingent on attaining pre-established three-year performance goals. The Compensation and Human Capital Committee reviews and approves goals in consultation with management and establishes threshold, target and stretch performance levels and associated payouts. At the end of the performance cycle, resulting payouts are determined based on Banner’s performance relative to the peer financial institutions. The Grants of Plan-Based Awards Table on page 53 provides additional detail relating to the 2023 restricted stock unit awards for the named executive officers. Recipients of time-based restricted stock units and/or performance units accumulate dividend equivalents during the restriction period but are only entitled to these dividend equivalents as and when the shares to which the dividend equivalents are attributable become vested. Recipients of time-based restricted stock units and/or performance units do not have the power to vote unvested units. If Banner is required to prepare an accounting restatement due to error, omission or fraud, executive officers may be required to reimburse Banner for part or all of the incentive award made to the officer on the basis of having met or exceeded specific targets for performance periods. The Compensation and Human Capital Committee has the discretion to adjust awards as needed to reflect the business environment and market conditions that may affect Banner’s performance and incentive plan funding. Performance Units for the 2023-25 Performance Cycle. For the awards made in 2023, the Committee approved the following corporate performance measures, weightings and relative performance goals:

  44. 2023 Compensation Program Decisions in Detail

    | (1) Peer companies for the 2023-25 performance cycle consist of all U.S. commercial banks (or their holding companies) traded on Nasdaq, NYSE or NYSE American over the entire performance cycle with total assets between 50% and 200% of Banner’s total assets as of December 31, 2025. |

  45. 2023 Compensation Program Decisions in Detail

    | (1) Peer companies for the 2021-23 performance cycle consisted of all U.S. commercial banks (or their holding companies) traded on Nasdaq, NYSE or NYSE American over the entire performance cycle with total assets between 50% and 200% of Banner’s total assets as of December 31, 2023. |

  46. 2023 Compensation Program Decisions in Detail

    | | 2021-23 Long-term Incentive Plan – Performance Units Results (1) | | | | | | Performance Metric | 2021-23 Performance Result | Percentile Ranking Relative to Peer Group | Payout Allocation as % of Target | Metric Weighting | Weighted Payout as % of Target | | Return on Average Tangible Common Equity (ROATCE) | 16.62% | 70th | 140% | 50% | 70% | | Total Shareholder Return (TSR) | 26.70% | 57th | 114% | 50% | 57% |

  47. 2023 Compensation Program Decisions in Detail

    | (1) 2021 Long-term Incentive Plan Results as of December 31, 2023. |

  48. Other Practices, Policies and Guidelines

    Other Practices, Policies and Guidelines Stock Ownership Guidelines. Directors and executive officers are required to own shares of Banner’s common stock equal to a multiple of the relevant individual’s base salary or annual cash retainer. Directors and executives are permitted to meet the ownership guidelines over time and are restricted from divesting shares until the requisite ownership level is met. Clawback Policy. In the event Banner is required to prepare an accounting restatement due to error, omission or fraud, each executive officer must reimburse the Bank for part or the entire incentive award made to that executive officer on the basis of having met or exceeded specific targets for performance periods. The Bank may seek to reclaim incentives within a three-year period of the incentive payout. Additionally, in the event any incentive compensation is paid to a plan participant based upon performance results or other criteria that are deemed materially inaccurate, manipulated, or fraudulent in nature, that compensation was not earned by the plan participant and Banner Bank may recover such amounts paid. Banner Bank has the right to offset the amount of the unearned incentive compensation against any current or future amounts due the plan participant, including, but not limited to, salary, bonus, incentive compensation, severance, deferred compensation or any other funds payable to the plan participant by Banner Bank. In addition, Banner adopted a Compensation Recovery Policy, effective December 1, 2023, that is designed to comply with Nasdaq’s listing standards responsive to the SEC’s final rules regarding executive compensation clawback policies and related disclosure requirements. Banner’s Compensation Recovery Policy mandates the recovery of erroneously awarded incentive-based compensation received by executive officers during the three-year period preceding the date on which Banner is required to prepare a restatement. This is in addition to the clawback provision that already existed in our executive incentive plans, and each participant in these plans has acknowledged and agreed in writing that as a condition to receipt of incentive compensation, the plan participant shall, to the extent applicable to such plan participant, comply with the terms of Banner’s Compensation Recovery Policy. Any right of recovery under Banner’s Compensation Recovery Policy is in addition to, and not in lieu of, any other remedies or rights of recovery that may be available to Banner under applicable law, regulation or rule or pursuant to the terms of the relevant executive incentive plan. Insider Trading Policy. The Board of Directors has also adopted a policy governing trading in Banner’s securities by our directors and officers. This wide-ranging policy covers permissible timing of trades, as well as prohibitions on trades. In particular, the policy prohibits short sales, transaction in publicly-traded options and other types of hedging transactions. The policy also prohibits holding Banner securities in margin accounts or pledging Banner securities for any purpose, with the exception of pledges in effect before the policy was adopted. Change-in-Control Agreements. We have entered into employment agreements with change-in-control provisions with Mr. Grescovich and Ms. Purcell, and we established the Executive Severance and Change in Control Plan for certain executive employees, to encourage their full attention and dedication in the event of a change-in-control of Banner, and to provide them with reasonable compensation and benefits in the event of a change-in-control and a subsequent loss of employment. See “Executive Compensation—Potential Payments upon Termination or Change-in-Control” for more information.

  49. Other Practices, Policies and Guidelines

    | • | Nonqualified Deferred Compensation Plan. We have adopted deferred compensation plans which allow executive officers of Banner to defer all or part of their cash compensation or non-qualified stock options until retirement. See “Executive Compensation – Nonqualified Deferred Compensation” for more information. |

  50. Summary Compensation Table

    Summary Compensation Table The following table presents information regarding compensation for our named executive officers.

  51. Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) (1) | Non-equity Incentive Plan Compensation ($) (2) | Change in Pension Value and Non-qualified Deferred Compensation Earnings ($) (3) | All Other Compensation ($) (4) | Total ($) | | Mark J. Grescovich President and Chief Executive Officer | 2023 | 893,547 | — | 1,151,711 | 748,560 | — | 214,501 | 3,008,319 | | | 2022 | 864,179 | — | 1,079,464 | 1,073,311 | — | 106,814 | 3,123,768 | | | 2021 | 844,132 | — | 987,469 | 669,295 | — | 118,073 | 2,618,969 | | Robert G. Butterfield Executive Vice President and Chief Financial Officer (5) | 2023 | 337,379 | — | 206,922 | 198,434 | — | 54,693 | 797,428 | | Cynthia D. Purcell Executive Vice President and Chief Strategy and Administration Officer | 2023 | 436,776 | — | 344,836 | 248,785 | 404,586(6) | 58,436 | 1,493,420 | | | 2022 | 425,000 | — | 333,949 | 405,977 | 503,226(6) | 35,928 | 1,704,080 | | | 2021 | 371,030 | — | 290,574 | 199,076 | 104,677(6) | 37,292 | 1,002,649 | | James M. Costa (7) Executive Vice President and Chief Risk Officer | 2023 | 421,360 | — | 332,729 | 189,389 | | 18,523 | 962,001 | | | 2022 | 410,000 | — | 322,169 | 297,250 | — | 14,753 | 1,044,172 | | James P. G. McLean Executive Vice President and Real Estate | 2023 | 344,282 | — | 203,840 | 176,932 | — | 40,503 | 765,557 | | | 2022 | 325,536 | — | 170,685 | 203,037 | | 28,751 | 728,009 | | | 2021 | 289,573 | 25,000 | 141,729 | 176,480 | | 30,347 | 663,129 | | Peter J. Conner Former Executive Vice President and Chief Financial Officer (8) | 2023 | 427,746 | | 377,303 | 243,820 | — | 67,387 | 1,116,255 | | | 2022 | 456,100 | | 331,829 | 427,503 | — | 40,419 | 1,255,850 | | | 2021 | 422,280 | | 330,743 | 233,753 | — | 41,278 | 1,028,054 |

  52. Summary Compensation Table

    | (1) Represents the aggregate grant date fair value of awards, computed in accordance with FASB ASC Topic 718. For a discussion of valuation assumptions, see Note 1 of the Notes to Consolidated Financial Statements in Banner’s Annual Report on Form 10-K for the year ended December 31, 2023. Includes both time-based and performance-based restricted stock unit awards as described beginning on page 45 of this Proxy Statement under “Long-term Incentive Compensation.” The fair value of the portion of the performance units that is tied to return on average tangible common equity is based on the stock price on the date of grant; the fair value of the portion of the performance units that is tied to total shareholder return is based on a statistical “Monte Carlo simulation” modeling technique that simulates potential stock price movements and all potential outcomes of achievement of the goal. The performance unit awards are reported at the target level of achievement. If the performance unit awards were reported at the maximum level, the 2023 values for performance unit awards- and time-based restricted stock unit awards would have been as follows: for Mr. Grescovich, $1,503,298; for Mr. Butterfield, $259,793; for Ms. Purcell, $432,941; for Mr. Costa $417,741; for Mr. McLean, $255,923; for Mr. Conner, $473,707. |

  53. Summary Compensation Table

    | (2) Cash incentives earned under the Executive Incentive Plan. |

  54. Summary Compensation Table

    | (3) See “Pension Benefits” below for a detailed discussion of the assumptions used to calculate the Change in Pension Value. |

  55. Summary Compensation Table

    | (4) Please see the table below for more information on the other compensation paid to our executive officers in 2023. |

  56. Summary Compensation Table

    | BANNER CORPORATION 2024 PROXY STATEMENT | 51 |

  57. Summary Compensation Table

    Executive Compensation | Summary Compensation Table

  58. Summary Compensation Table

    | (5) Mr. Butterfield was appointed effective October 11, 2023. He was not a named executive officer in 2021 or 2022. |

  59. Summary Compensation Table

    | (6) Represents an increase in the value of Ms. Purcell’s SERP of $404,586 for 2023, $503,226 for 2022, and $104,677 for 2021. |

  60. Summary Compensation Table

    | (7) Mr. Costa was not a named executive officer in 2021. |

  61. Summary Compensation Table

    | (8) Mr. Conner retired effective October 10, 2023. |

  62. Summary Compensation Table

    All Other Compensation. The following table sets forth details of “All Other Compensation,” as presented above in the Summary Compensation Table. The amounts reflected constitute contributions by Banner or Banner Bank for 2023.

  63. Summary Compensation Table

    | Name | Employer 401(k) Matching Contribution ($) | Dividends ($) (1) (2) | Life Insurance Premium ($) | Club Dues ($) | Company Car Allowance ($) | Other ($) (3) | Total ($) | | Mark J. Grescovich | 13,200 | 175,027(4) | 15,595 | 4,818 | 5,562 | 300 | 214,501 | | Robert G. Butterfield | 13,200 | 8,997 | — | 550 | — | 31,946(5) | 54,693 | | Cynthia D. Purcell | 13,200 | 41,814 | 548 | 1,680 | 1,194 | — | 58,436 | | James M. Costa | 13,200 | 4,723 | — | — | — | 600 | 18,523 | | James P. G. McLean | 13,200 | 20,437 | — | 550 | 6,016 | 300 | 40,503 | | Peter J. Conner | 13,200 | 47,337 | — | 550 | 6,000 | 300 | 67,387 |

  64. Summary Compensation Table

    | (1) Consists of dividends and dividend equivalents accrued and paid in 2023 on restricted stock and restricted stock units. |

  65. Summary Compensation Table

    | (2) Also includes dividends earned and paid in relation to performance unit awards granted in 2020 and disbursed to executives in 2023. |

  66. Summary Compensation Table

    | (3) Includes technology allowance, mobile phone allowance and work from home setup allowance. |

  67. Summary Compensation Table

    | (4) Also includes dividend equivalents on vested but deferred restricted stock units. |

  68. Summary Compensation Table

    | (5) Mr. Butterfield received a payout in the amount of $31,346 for accrued vacation time in connection with his appointment to Chief Financial Officer. |

  69. Summary Compensation Table

    Employment Agreements and Perquisites. We have entered into employment agreements with Mr. Grescovich and Ms. Purcell. The initial term of each agreement may be extended annually for an additional year at the discretion of the Board of Directors or a committee appointed by the Board. The employment agreements were extended on July 1, 2023 for each of these named executive officers. The agreements provide that each executive’s annual base salary is reviewed annually and may be adjusted from time to time to reflect amounts approved by the Board or the Compensation and Human Capital Committees. We had entered into an employment agreement with Mr. Conner, which was terminated in connection with his retirement. The executives may participate with other executive officers of Banner Bank in such performance-based and discretionary bonuses, and incentive compensation opportunities, if any, as are authorized by the Board or Board committee. The executives also may be eligible to participate in equity or incentive award programs sponsored by Banner Bank. The executives may participate, to the same extent as executive officers of Banner Bank generally, in all Bank plans relating to pension, retirement, thrift, profit-sharing, savings, group or other life insurance, hospitalization, medical and dental coverage, travel and accident insurance, education, cash bonuses, and other retirement or employee benefits. In addition, the executives are entitled to participate in any other fringe benefit plans or perquisites which are generally available to Banner Bank’s executive officers, including but not limited to supplemental retirement, deferred compensation programs, supplemental medical or life insurance plans, club dues and physical examinations. The executives also may be provided an automobile for their business use, monthly club and/or gym membership dues and other employee benefits such as

  70. Summary Compensation Table

    | 52 | BANNER CORPORATION 2024 PROXY STATEMENT |

  71. Summary Compensation Table

    Executive Compensation | Grants of Plan-Based Awards vacation and sick leave. The agreements also provide that compensation may be paid in the event of disability, death, involuntary termination or a change in control, as described below under “Potential Payments Upon Termination or Change in Control.”

  72. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table shows information regarding grants of plan-based awards made to our named executive officers for 2023.

  73. Grants of Plan-Based Awards

    | | | Estimated future payouts under non-equity incentive plan awards (1) | | | Estimated future payouts under equity incentive plan awards (2) | | | All other stock awards: number of shares of stock or units (#) | Grant date fair value of stock and option awards ($) (3) | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | Mark J. Grescovich | 4/3/23 | 449,943 | 899,887 | 1,349,830 | | | | | | | | 4/3/23 | | | | 6,251 | 12,502 | 18,753 | | 703,175 | | | 4/3/23 | | | | | | | 8,334 | 448,536 | | Robert G. Butterfield | 4/3/23 | 124,500 | 249,000 | 373,500 | | | | | | | | 4/3/23 | | | | 940 | 1,880 | 2,820 | | 105,741 | | | 4/3/23 | | | | | | | 1,880 | 101,182 | | Cynthia D. Purcell | 4/3/23 | 142,959 | 285,919 | 428,878 | | | | | | | | 4/3/23 | | | | 1,567 | 3,133 | 4,700 | | 176,216 | | | 4/3/23 | | | | | | | 3,133 | 168,618 | | James M. Costa | 4/3/23 | 106,088 | 212,175 | 318,263 | | | | | | | | 4/3/23 | | | | 1,512 | 3,023 | 4,535 | | 170,029 | | | 4/3/23 | | | | | | | 3,023 | 162,698 | | James P. G. McLean | 4/3/23 | 86,681 | 173,363 | 260,044 | | | | | | | | 4/3/23 | | | | 926 | 1,852 | 2,778 | | 104,166 | | | 4/3/23 | | | | | | | 1,852 | 99,675 | | Peter J. Conner | 4/3/23 | 156,414 | 312,829 | 469,243 | | | | | | | | 4/3/23 | | | | 1,714 | 3,428 | 5,142 | | 192,808 | | | 4/3/23 | | | | | | | 3,428 | 184,495 |

  74. Grants of Plan-Based Awards

    | (1) Represents the potential range of cash incentive awards payable under our 2023 Executive Incentive Plan, based on annual base salary rate. The performance goals and measurements associated with this Plan that generate the awards set forth above are provided in the “Short-term Incentive Compensation” section beginning on page 41. |

  75. Grants of Plan-Based Awards

    | (2) Represents the potential range of restricted stock unit awards payable under our 2023 Long-term Incentive Plan subject to performance measurements. The performance goals and measurements associated with this Plan that generate the awards set forth above are provided in the “Long-term Incentive Compensation” section beginning on page 45. |

  76. Grants of Plan-Based Awards

    | (3) The fair value of the portion of the performance units that is tied to return on average tangible common equity is based on the stock price on the date of grant at the target performance level. The fair value of the portion of the performance units that is tied to total shareholder return is based on a statistical “Monte Carlo simulation” modeling technique that simulates potential stock price movements and all potential outcomes of achievement of the goal. |

  77. Grants of Plan-Based Awards

    | BANNER CORPORATION 2024 PROXY STATEMENT | 53 |

  78. Grants of Plan-Based Awards

    Executive Compensation | Outstanding Equity Awards

  79. Outstanding Equity Awards

    Outstanding Equity Awards The following information with respect to outstanding stock awards as of December 31, 2023 is presented for the named executive officers. The named executive officers have no stock option awards outstanding.

  80. Outstanding Equity Awards

    | Name | Number of Shares or Units of Stock That Have Not Vested (#) (1) | Market Value of Shares or Units of Stock That Have Not Vested ($) (2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (3) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (2) | | Mark J. Grescovich | 15,633 | 837,303 | 34,361 | 1,840,375 | | Robert G. Butterfield | 3,567 | 191,049 | 1,880 | 100,693 | | Cynthia D. Purcell | 5,908 | 316,432 | 8,623 | 461,848 | | James M. Costa | 5,701 | 305,346 | 5,758 | 308,398 | | James P. G. McLean | 3,250 | 174,070 | 6,894 | 369,243 | | Peter J. Conner | 6,314 | 338,178 | 9,267 | 496,341 |

  81. Outstanding Equity Awards

    | (1) Consists of awards of restricted stock on March 26, 2021, March 31, 2022 and April 3, 2023 which vest pro rata over a three-year period from the grant date, with the first one-third vesting one year after the applicable grant date. |

  82. Outstanding Equity Awards

    | (2) Based on the Banner stock December 30, 2023 closing price of $53.56. |

  83. Outstanding Equity Awards

    | (3) Consists of awards of restricted stock on March 26, 2021, March 31, 2022 and April 3, 2023 which vest after attainment of performance goals. Number of shares represents performance at the target level. |

  84. Option Exercises and Stock Vested

    Option Exercises and Stock Vested The following table shows the value realized upon vesting of stock awards for our named executive officers in 2023. The named executive officers have no option awards outstanding.

  85. Option Exercises and Stock Vested

    | | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) (1) | | Mark J. Grescovich | 32,475 | 1,945,803 | | Robert G. Butterfield | 2,305 | 125,635 | | Cynthia D. Purcell | 9,079 | 537,697 | | James M. Costa | 1,765 | 85,283 | | James P. G. McLean | 4,451 | 263,496 | | Peter J. Conner | 10,195 | 604,467 |

  86. Option Exercises and Stock Vested

    | (1) Reflects fair market value per share as of the vesting date multiplied by the number of shares vesting. |

  87. Option Exercises and Stock Vested

    | 54 | BANNER CORPORATION 2024 PROXY STATEMENT |

  88. Option Exercises and Stock Vested

    Executive Compensation | Pension Benefits

  89. Pension Benefits

    Pension Benefits The following information is presented with respect to the nature and value of pension benefits for the named executive officers at December 31, 2023.

  90. Pension Benefits

    | Name | Plan Name | Number of Years Credited Service (#) | Present Value of Accumulated Benefit ($) (1) | Payments During Last Fiscal Year ($) | | Mark J. Grescovich | N/A | — | — | — | | Robert G. Butterfield | N/A | — | — | — | | Cynthia D. Purcell | Supplemental Executive Retirement Program | 44 | 4,692,290 | — | | James M. Costa | N/A | — | — | — | | James P. G. McLean | N/A | — | — | — | | Peter J. Conner | N/A | — | — | — |

  91. Pension Benefits

    | (1) Amounts shown assume normal retirement age as defined in the agreement and an assumed life based on IRS mortality tables for the recipient and recipient’s spouse, with the projected cash flows discounted at 4% to calculate the resulting present value. |

  92. Pension Benefits

    Supplemental Executive Retirement Program. We have adopted a supplemental executive retirement program (“SERP”) which is intended to encourage retention by ensuring that participants reach a targeted retirement income, recognizing their value to Banner and rewarding a long-term service commitment. Currently, Ms. Purcell is the only executive officer who participates in the SERP. We do not anticipate adding any new participants to the SERP. Banner Bank has purchased life insurance on Ms. Purcell in an amount sufficient to recover the benefits payable under the SERP upon her death. At termination of employment at or after retirement age and achievement of a service requirement, Ms. Purcell’s annual benefit under the SERP, which may be reduced by certain other retirement benefits, would be computed as a percentage of her final average compensation (as defined in the plan) and her annual years of service (called the “supplemental benefit”). The SERP also provides for payments in the event of Ms. Purcell’s disability or death, or termination in the event of a change in control, all as discussed in further detail below, under “Potential Payments Upon Termination or Change in Control.” Ms. Purcell’s receipt of payments under the SERP are subject to confidentiality and non-competition provisions. Ms. Purcell has the status of an unsecured creditor of Banner Bank with respect to the benefits accrued under the SERP.

  93. Pension Benefits

    | BANNER CORPORATION 2024 PROXY STATEMENT | 55 |

  94. Pension Benefits

    Executive Compensation | Nonqualified Deferred Compensation

  95. Nonqualified Deferred Compensation

    Nonqualified Deferred Compensation The following information is presented with respect to plans that provide for the deferral of compensation on a basis that is not tax-qualified in which the named executive officers participated in 2023.

  96. Nonqualified Deferred Compensation

    | Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at FYE ($) (1) | | Mark J. Grescovich | — | — | — | — | — | | Robert G. Butterfield | 73,998 | — | 26,087 | — | 184,789 | | Cynthia D. Purcell | — | — | 8,617 | — | 44,872 | | James M. Costa | — | — | — | — | — | | James P. G. McLean | 170,022 | — | 32,084 | — | 377,014 | | Peter J. Conner | — | — | — | — | — |

  97. Nonqualified Deferred Compensation

    | (1) Includes prior period executive contributions and employer contributions to the deferred compensation plan. |

  98. Nonqualified Deferred Compensation

    We have adopted deferred compensation plans which allow executive officers of Banner to defer all or part of their cash compensation or non-qualified stock options until retirement. Each executive officer may direct the investment of the deferred compensation toward the purchase of life insurance, Banner common stock, mutual fund-style investments or a stable value account. We have established grantor trusts to hold the common stock and mutual fund-style investments. The assets of the trusts are considered part of our general assets and the executive officers have the status of unsecured creditors of Banner with respect to the trust assets. The deferred compensation agreements provide pre-retirement death and disability benefits in an amount based on the value of the executive officer’s account balance upon the occurrence of either event. At retirement, an executive officer, as previously elected, may receive the balance of his or her account in a lump sum or in annual installments over a period not exceeding ten years. At December 31, 2023, our estimated deferred compensation liability accrual with respect to executive officers under these agreements was $1.83 million.

  99. Nonqualified Deferred Compensation

    | 56 | BANNER CORPORATION 2024 PROXY STATEMENT |

  100. Potential Payments Upon Termination or Change in Control

    Potential Payments Upon Termination or Change in Control We have entered into agreements with the named executive officers that provide for potential payments upon disability, termination, early retirement, normal retirement and death. In addition, our equity plans also provide for potential payments upon termination. The following table shows, as of December 31, 2023, the value of potential payments and benefits following a termination of employment under a variety of scenarios.

  101. Potential Payments Upon Termination or Change in Control

    | | Death ($) | Disability ($) | Involuntary Termination ($) | Involuntary Termination Following Change in Control ($) | Early Retirement ($) | Normal Retirement ($) | | Mark J. Grescovich | | | | | | | | Employment Agreement | — | 779,887(1) | 3,667,466 | 6,401,086 | — | — | | Equity Plans | 3,597,866(2) | 3,597,866(2) | — | 3,597,866(2) | — | — | | Robert G. Butterfield | | | | | | | | Executive Severance and Change in Control Plan | — | — | 664,643 | 1,577,964 | — | — | | Equity Plans | 342,088(2) | 342,088(2) | — | 342,088(2) | — | — | | Cynthia D. Purcell | | | | | | | | Employment Agreement | — | — | 1,415,099 | 2,498,692 | — | — | | SERP | 170,699(3) | 341,399(3) | 341,399(3) | 341,399(3) | 341,399(3) | 341,399(3) | | Equity Plans | 1,009,204(2) | 1,009,204(2) | — | 1,009,204(2) | — | — | | James M. Costa | | | | | | | | Executive Severance and Change in Control Plan | — | — | 669,978 | 1,535,405 | — | — | | Equity Plans | 767,943(2) | 767,943(2) | — | 767,943(2) | — | — | | James P. G. McLean | | | | | | | | Executive Severance and Change in Control Plan | — | — | 551,329 | 1,260,400 | — | — | | Equity Plans | 420,232(2) | 420,232(2) | — | 420,232(2) | — | — | | Peter J. Conner | | | | | | | | Employment Agreement | — | — | — | — | — | — | | Equity Plans | 1,082,689(2) | 1,082,689(2) | — | 1,082,689(2) | — | — |

  102. Potential Payments Upon Termination or Change in Control

    | (1) Annually through the term of the employment agreement unless the Board exercises an election to discontinue. |

  103. Potential Payments Upon Termination or Change in Control

    | (2) Represents accelerated vesting of restricted stock. Performance-based vesting would be determined based on actual performance; for purposes of this calculation, assumes that all shares vested at the maximum performance level. |

  104. Potential Payments Upon Termination or Change in Control

    | (3) Indicates annual payments. |

  105. Potential Payments Upon Termination or Change in Control

    | BANNER CORPORATION 2024 PROXY STATEMENT | 57 |

  106. Potential Payments Upon Termination or Change in Control

    Employment Agreements. We have entered into employment agreements with Mr. Grescovich and Ms. Purcell that provide for payments in the event of death, disability or termination. In the event of the executive’s death during the term of his or her employment agreement, we will pay to the executive’s estate the compensation due through the last day of the calendar month in which his or her death occurred. The initial term of each agreement may be extended annually for an additional year at the discretion of the Board of Directors or a committee appointed by the Board. The employment agreements were extended on July 1, 2023 for each of these named executive officers. Each executive’s annual base salary is reviewed annually and may be adjusted from time to time to reflect amounts approved by the Board or the Compensation and Human Capital Committee. Mr. Grescovich’s agreement provides that if he becomes entitled to benefits under the terms of the then-current disability plan, if any, of Banner or Banner Bank or becomes otherwise unable to fulfill his duties under his employment agreement, he shall be entitled to receive such group and other disability benefits as are then provided for executive employees. In the event of his disability, the employment agreement is not suspended, except that (1) the obligation to pay Mr. Grescovich’s salary will be reduced by the amount of disability income benefits he receives and (2) upon a resolution adopted by a majority of the disinterested members of the Board of Directors or the Compensation and Human Capital Committee, Banner or Banner Bank may discontinue payment of his salary beginning six months following a determination that he has become entitled to benefits under the disability plan or otherwise unable to fulfill his duties under his agreement. If Mr. Grescovich’s disability does not constitute a disability within the meaning of Section 409A of the Internal Revenue Code, and he is a “specified employee” within the meaning of Section 409A, then disability payments will not begin until the earlier of his death or the sixth month anniversary of his separation from service. The employment agreement with Ms. Purcell provides that if she becomes disabled or incapacitated to the extent that she is unable to perform the duties of her position, she shall receive short-term disability benefits equal to 100% of her monthly compensation beginning on the 15th day of disability and continuing until the 180th day of disability and long-term disability benefits equal to 66% of monthly salary beginning on the 181st day of disability and continuing until she attains age 65. These benefits will be reduced by the amount of any benefits payable to Ms. Purcell under any other disability program of Banner Bank. The Bank currently provides disability benefits with certain limitations to all full-time employees. In addition, during any period of disability, Ms. Purcell and her dependents shall, to the greatest extent possible, continue to be covered under all executive benefits plans of Banner Bank, including without limitation, its retirement plans, life insurance plan and health insurance plans, as if actively employed by Banner Bank. If Ms. Purcell is disabled for a continuous period exceeding six calendar months, Banner Bank may, at its election, terminate the employment agreement. If Ms. Purcell’s disability does not constitute a disability within the meaning of Section 409A of the Internal Revenue Code, and she is a “specified employee” within the meaning of Section 409A, then disability payments will not begin until the earlier of her death or the sixth month anniversary of her separation from service. The employment of Mr. Grescovich and Ms. Purcell is terminable at any time for just cause as defined in the agreements. In addition, the employment of an executive may be terminated without just cause, in which case Ms. Purcell’s agreement provides that she would continue to receive (1) base salary over the remaining term and (2) the executive’s group life insurance, hospitalization, medical, dental, prescription drug and other health benefits, and long-term disability insurance for the remaining term. Mr. Grescovich’s agreement provides that we must pay him a lump sum equal to two times the sum of (1) his annual salary in effect on the date of termination and (2) any unearned performance-based

  107. Potential Payments Upon Termination or Change in Control

    | 58 | BANNER CORPORATION 2024 PROXY STATEMENT |

  108. Potential Payments Upon Termination or Change in Control

    bonus based on the target opportunity on the date of termination. We would also be required to pay to him any earned but unpaid performance-based bonus and continue his group life insurance, hospitalization, medical, dental, prescription drug and other health benefits, and long-term disability insurance for 24 months after the date of termination. The employment agreements also provide for benefits in the event of the termination of Mr. Grescovich or Ms. Purcell in connection with a change in control. For Ms. Purcell, if, within six months prior to a change in control or 24 months after a change in control, we (or our acquiror) terminate the executive’s employment or otherwise change the circumstances in which she is employed, or cause a reduction in responsibilities or authority or compensation or other benefits provided under the employment agreement without consent, other than for just cause, the agreements provide that we must pay to the executive and provide her, or her beneficiaries, dependents and estate, with the following: (1) 2.99 times the executive’s base amount as defined in Section 280G of the Internal Revenue Code; and (2) during the period of 36 calendar months beginning with the event of termination, continued coverage under all Banner employee benefit plans as if the executive were still employed during that period under the employment agreement. If Mr. Grescovich’s employment is terminated within 24 months of a change in control, we must pay him a lump sum equal to three times the sum of (1) his annual salary in effect on the date of termination and (2) any unearned performance-based bonus based on the target opportunity on the date of termination. We would also be required to pay to him any earned but unpaid performance-based bonus and continue his group life insurance, hospitalization, medical, dental, prescription drug and other health benefits, and long-term disability insurance for 36 months after the date of termination. The employment agreements limit these payments and do not allow payments of amounts in excess of the limits imposed by Section 280G of the Internal Revenue Code. Executive Severance and Change in Control Plan. We established the Executive Severance and Change in Control Plan on January 1, 2018 to provide certain executive employees of the Bank with the opportunity to receive severance benefits in connection with certain terminations of employment, including a termination of employment after a change in control of the Banner or Banner Bank. Mr. Butterfield, Mr. Costa and Mr. McLean participate in this plan. The Bank amended and restated the Plan, effective as of July 1, 2023, to update the severance payable upon a termination of employment in connection with a change in control. If, within six months prior to a change in control or 24 months after a change in control (“Covered Period”), we (or our acquiror) terminate the executive’s employment or otherwise change the circumstances in which he or she is employed, or cause a reduction in responsibilities or authority, other than for just cause, the plan provides that we must pay to the executive a lump sum equal to: (1) 2.0 times the executive’s base salary, plus the executive’s target annual cash incentive compensation for the year in which the termination occurs; and (2) a pro-rated annual bonus. During the period of 18 calendar months beginning with the event of termination, we must reimburse the monthly COBRA premium paid by the executive for the executive and his or her eligible dependents until the executive is eligible to receive similar coverage from another employer or is no longer eligible for COBRA continuation coverage. If the termination does not occur within the Covered Period, the plan provides that we must pay to the executive: (1) 1.0 times the executive’s base salary, payable over the one-year period following termination in accordance with the Bank’s normal payroll practices; and (2) during the period of 12 calendar months beginning with the event of termination, reimbursement for monthly COBRA premium paid by the executive for the executive and his or her eligible dependents.

  109. Potential Payments Upon Termination or Change in Control

    | BANNER CORPORATION 2024 PROXY STATEMENT | 59 |

  110. Potential Payments Upon Termination or Change in Control

    Supplemental Executive Retirement Program. We have adopted a supplemental executive retirement program. Currently, Ms. Purcell is the only executive officer who participates in the SERP. We do not anticipate adding any new participants to the SERP. At termination of employment at or after attaining age 62 and having achieved a service requirement, Ms. Purcell’s annual benefit under the SERP would be computed as the product of 3% her final average compensation (defined as the three calendar years of the Ms. Purcell’s annual cash compensation, including bonuses, which produce the highest average within Ms. Purcell’s final eight full calendar years of employment) and her annual years of service (called the “supplemental benefit”). However, the supplemental benefit would be limited such that the sum of (1) amounts payable from Ms. Purcell’s other retirement benefits from Banner and Banner Bank and (2) the supplemental benefit may not exceed 60% of final average compensation. Payment of the supplemental benefit begins on the first day of the month next following Ms. Purcell’s retirement date and continues monthly for her life, unless Ms. Purcell is a specified employee (as defined in Section 409A of the Internal Revenue Code), in which case payment begins on the first day of the month following the six-month anniversary of her termination of employment. In the event of Ms. Purcell’s death, her surviving spouse, if any, shall receive a spouse’s supplemental benefit. If the death occurs following her retirement date, the surviving spouse shall be entitled to a spouse’s supplemental benefit, payable for life, equal to 50% of the monthly amount of the supplemental benefit payable to Ms. Purcell prior to her death. If the death occurs while Ms. Purcell is actively employed by Banner or any of its affiliates, the surviving spouse shall receive a spouse’s supplement benefit equal to 50% of the amount she would have received as a supplemental benefit if her retirement date had occurred on the date immediately preceding her death. The agreement provides that in the event of Ms. Purcell’s involuntary termination of employment on or after the effective date of a change in control, the date of termination shall be treated as her retirement date and she shall be entitled to receive a supplemental benefit. If Ms. Purcell had reached her retirement date, the supplemental benefit would be calculated as described above for normal retirement and if she had not reached her retirement date but had satisfied the years of service requirement, the supplemental benefit would be calculated as described above for early retirement. Benefit payments for Ms. Purcell will be subject to the delayed distribution requirements if she is a specified employee. The supplemental benefit shall cease to be paid to Ms. Purcell (and rights to the spouse’s supplemental benefit shall terminate) if she (1) discloses material confidential information or trade secrets concerning Banner Bank or any of its subsidiaries without its consent or (2) engages in any activity that is materially damaging to the Bank including engaging in competitive employment during the three-year period beginning on her retirement date. Equity Plans. Our 2014 Omnibus Incentive Plan, as amended, 2018 Omnibus Incentive Plan and 2023 Omnibus Incentive Plan provide that restricted stock, restricted stock units and performance awards will become fully vested and stock options and stock appreciation rights will become fully exercisable only upon completion of a change in control and involuntary separation from employment (including voluntary separation for good reason) of the recipient during the 12-month period following the effective date of the change in control (known as a “double trigger”). The 2014 Omnibus Incentive Plan, 2018 Omnibus Incentive Plan and 2023 Omnibus Incentive Plan also provide for accelerated vesting of awards if a recipient’s service is terminated as a result of death or disability.

  111. Potential Payments Upon Termination or Change in Control

    | 60 | BANNER CORPORATION 2024 PROXY STATEMENT |

  112. Potential Payments Upon Termination or Change in Control

    Executive Compensation | Chief Executive Officer Pay Ratio

  113. Chief Executive Officer Pay Ratio

    Chief Executive Officer Pay Ratio In August 2015 pursuant to a mandate of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the SEC adopted Item 402(u) of Regulation S-K, requiring annual disclosure of the ratio of the annual total compensation of the Chief Executive Officer to the median employee’s annual total compensation. For 2023, this information is as follows:

  114. Chief Executive Officer Pay Ratio

    | Mr. Grescovich, Chief Executive Officer, annual total compensation: | $3,008,319 | | Median employee annual total compensation: | $71,551 | | Ratio of Chief Executive Officer to median employee compensation: | 42 to 1 |

  115. Chief Executive Officer Pay Ratio

    We have concluded that it is appropriate to use the median employee from last year’s disclosure for this year’s disclosure. It is our reasonable belief that doing so will not significantly impact the pay ratio disclosure as there has been no material change to the employee population or employee compensation arrangements during the 2023 calendar year. In determining the median employee for last year’s disclosure, we used a listing of all employees, excluding our Chief Executive Officer, as of December 31, 2022. To identify our median employee, we included all elements of total direct compensation (defined as the total value of salaries, commissions, bonuses, and short- and long-term incentives provided regularly and consistently to the employee base) paid in 2022 as our consistently applied compensation measure. The value of long-term incentive awards issued during 2022 was based on the fair market value of the award at the time of grant. Compensation for full-time employees hired during 2022 was annualized. As a result of the flexibility permitted by Item 402(u), the method we used to determine our median employee may differ from the methods used by our peers, so the ratios may not be comparable.

  116. Chief Executive Officer Pay Ratio

    | BANNER CORPORATION 2024 PROXY STATEMENT | 61 |

  117. Pay Versus Performance

    Pay Versus Performance Pay Versus Performance Disclosure. In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Act, we provide the following disclosure regarding executive “compensation actually paid” (“CAP”), as calculated in accordance with the SEC rules and certain performance measures for the fiscal years listed below. For information regarding Banner’s pay-for-performance philosophy and how Banner aligns executive pay with performance, refer to the “Compensation Discussion and Analysis” (“CD&A”) above.

  118. Pay Versus Performance

    | Year | Summary Compensation Table Total for PEO (1) | Compensation Actually Paid to PEO (2) | Average Summary Compensation Table Total for non-PEO NEOs (1) | Average Compensation Actually Paid to non-PEO NEOs (3) | Value of Initial Fixed $100 Investment based on (4): | | Net Income ($000) | Company- selected Measure: ROATCE (5) | | | | | | | Total Shareholder Return (TSR) | KRX Index Total Shareholder Return (TSR) | | | | 2023 | $3,008,319 | $2,584,884 | $1,026,932 | $855,526 | $110.82 | $115.69 | $183,624 | 16.14% | | 2022 | $3,123,768 | $3,296,615 | $1,197,095 | $1,113,315 | $125.86 | $116.15 | $195,378 | 17.47% | | 2021 | $2,618,969 | $3,388,567 | $868,651 | $976,064 | $117.43 | $124.78 | $201,048 | 16.26% | | 2020 | $2,665,471 | $2,635,857 | $881,251 | $853,575 | $87.46 | $91.32 | $115,928 | 9.95% |

  119. Pay Versus Performance

    | (1) The principal executive officer (“PEO”) for all three years was Mark J. Grescovich. The non-PEO named executive officers (non-PEO NEOs) were as follows: |

  120. Pay Versus Performance

    | 2023: Robert G. Butterfield, Cynthia D. Purcell, James M. Costa, James P. G. McLean, Peter J. Conner |

  121. Pay Versus Performance

    | 2022: Peter J. Conner, Cynthia D. Purcell, James M. Costa, M. Kirk Quillin |

  122. Pay Versus Performance

    | 2021: Peter J. Conner, Cynthia D. Purcell, M. Kirk Quillin, James P. G. McLean, Judith A. Steiner |

  123. Pay Versus Performance

    | 2020: Peter J. Conner, Cynthia D. Purcell, Judith A. Steiner, Keith A. Western, Richard B. Barton |

  124. Pay Versus Performance

    | (2) Adjustments from Summary Compensation Table total for PEO | 2023 | | Deduction for change in actuarial present values reported under the “Change in Pension Value and Non-qualified Deferred Compensation Earnings” column in the Summary Compensation Table | — | | Increase for service cost of pension plans | — | | Increase/deduction for prior service cost of pension plans | — | | Deduction for amounts reported under the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table | (1,151,711) | | Increase based on fair value of awards granted during year that remain unvested as of year-end, determined as of year-end | 1,115,976 | | Increase/deduction for change in fair value from prior year-end to current year-end of awards granted in prior years that were outstanding and unvested as of year-end | (281,083) | | Increase based on fair value of awards granted during year that vested during year, determined as of vesting date | — | | Increase/deduction for change in fair value from prior year-end to vesting date of awards granted in prior years that vested during year | (106,617) | | Deduction of fair value of awards granted prior to year that were forfeited during year | — | | Increase based on dividends or other earnings paid during year prior to vesting date of award that are not otherwise included in total compensation | — | | Increase based on incremental value of awards modified during year | — | | Total Adjustments | (423,435) |

  125. Pay Versus Performance

    | 62 | BANNER CORPORATION 2024 PROXY STATEMENT |

  126. Pay Versus Performance

    | (3) Adjustments from Average Summary Compensation Table total for non-PEO NEOs | 2023 | | Deduction for change in actuarial present values reported under the “Change in Pension Value and Non-qualified Deferred Compensation Earnings” column in the Summary Compensation Table | (80,917) | | Increase for service cost of pension plans | — | | Increase/deduction for prior service cost of pension plans | — | | Deduction for amounts reported under the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table | (293,126) | | Increase based on fair value of awards granted during year that remain unvested as of year-end, determined as of year-end | 285,282 | | Increase/deduction for change in fair value from prior year-end to current year-end of awards granted in prior years that were outstanding and unvested as of year-end | (54,632) | | Increase based on fair value of awards granted during year that vested during year, determined as of vesting date | — | | Increase/deduction for change in fair value from prior year-end to vesting date of awards granted in prior years that vested during year | (28,013) | | Deduction of fair value of awards granted prior to year that were forfeited during year | — | | Increase based on dividends or other earnings paid during year prior to vesting date of award that are not otherwise included in total compensation | — | | Increase based on incremental value of awards modified during year | — | | Total Adjustments | (171,406) |

  127. Pay Versus Performance

    | (4) Total shareholder return (“TSR”) assumes $100 invested in Banner common stock and the KBW Regional Bank Index on December 31, 2019 with all dividends reinvested. |

  128. Pay Versus Performance

    | (5) We determined the return on average tangible common equity (“ROATCE”) to be the most important financial performance measure not otherwise disclosed in the table, that is used to link compensation actually paid to our NEOs to company performance, for the most recently completed fiscal year. ROATCE defined as net income prior to amortization of intangibles and goodwill (tax-adjusted), divided by average tangible common equity. |

  129. Pay Versus Performance: Graphical Description

    Pay Versus Performance: Graphical Description The illustrations below provide graphical descriptions of the relationships between the following:

  130. Pay Versus Performance: Graphical Description

    | • | Compensation Actually Paid and Banner’s cumulative TSR; |

  131. Pay Versus Performance: Graphical Description

    | • | Compensation Actually Paid and Banner’s Net Income; |

  132. Pay Versus Performance: Graphical Description

    | BANNER CORPORATION 2024 PROXY STATEMENT | 63 |

  133. Pay Versus Performance: Graphical Description

    | • | Compensation Actually Paid and Banner’s Selected Measure, which is ROATCE; and |

  134. Pay Versus Performance: Graphical Description

    | • | Banner’s cumulative TSR and the Peer Group’s cumulative TSR. |

  135. Pay Versus Performance: Graphical Description

    | 64 | BANNER CORPORATION 2024 PROXY STATEMENT |