5 Insightful Analyst Questions From Banner Bank’s Q4 Earnings Call

Regional banking company Banner Corporation met Wall Streets revenue expectations in Q4 CY2025, with sales up 6.1% year on year to $173.3 million. Its non-GAAP profit of $1.55 per share was 6.8% above analysts’ consensus estimates.

Banner Bank (BANR) Q4 CY2025 Highlights:

• Revenue: $173.3 million vs analyst estimates of $173 million (6.1% year-on-year growth, in line)
• Adjusted EPS: $1.55 vs analyst estimates of $1.45 (6.8% beat)
• Adjusted Operating Income: $69.22 million vs analyst estimates of $71.06 million (39.9% margin, 2.6% miss)
• Market Capitalization: $2.10 billion

StockStory’s Take

Banner Bank’s fourth quarter results reflected steady progress in core deposit growth and disciplined expense management, with the company meeting Wall Street’s revenue expectations and delivering higher-than-expected non-GAAP earnings per share. Management attributed the quarter’s performance to a resilient deposit base, improved net interest margin, and continued focus on small business lending. CFO Robert Butterfield noted, “Net interest income increased $2.5 million from the prior quarter due to a 5 basis point increase in net interest margin as well as average earning assets increasing $60 million during the quarter.”

Looking ahead, management expects commercial real estate payoffs to remain a challenge, but anticipates that loan growth can reach mid-single digits in 2026 if economic conditions hold steady. CEO Mark Grescovich stated that the addition of new bankers and traction in small business relationships should support both deposit and loan growth. However, Butterfield cautioned that future net interest margin performance will depend heavily on the timing and magnitude of Federal Reserve rate cuts, adding, “If there’s no Fed action, we’d likely expect some NIM expansion… If you get multiple rate cuts in a quarter, then that’s where we would expect some net interest margin compression.”

Key Insights from Management’s Remarks

Management identified several operational factors and external trends impacting both the latest quarter’s performance and the company’s forward trajectory.

• Deposit base resilience: Banner Bank’s core deposits remained stable, representing 89% of total deposits, which management views as a key strength for funding and client retention amid industry uncertainty.
• Loan production and payoffs: Despite an increase in loan originations, overall loan growth was negligible, as higher-than-expected commercial real estate and affordable housing payoffs, along with reduced commercial and industrial (C&I) line utilization, offset new production.
• Small business lending focus: The Community Banking division’s emphasis on small business clients resulted in 8% year-over-year growth in this segment, helping to diversify loan growth and reduce reliance on larger, more volatile commercial credits.
• Expense pressures: Operating expenses rose in the quarter due to increased IT costs from new system rollouts and higher medical claims, which were back-end loaded after unusually low costs earlier in the year. Management expects future expense growth to align with typical inflationary trends.
• Credit quality stability: Credit metrics remained solid, with nonperforming assets at 0.31% of total assets and a loan loss allowance of 1.37% of total loans. While there were modest increases in delinquent and adversely classified loans, management emphasized that these changes were not concentrated in any single industry or segment.

Drivers of Future Performance

Banner Bank’s outlook is shaped by the interplay between loan growth, deposit trends, and interest rate movements.

• Commercial real estate headwinds: Management expects ongoing payoffs in the commercial real estate portfolio to continue as a headwind, likely limiting net loan growth even as pipelines build from new relationship managers.
• Interest rate sensitivity: The company’s net interest margin outlook is highly dependent on Federal Reserve actions. Multiple rate cuts could compress margins, while a stable rate environment would allow for incremental margin expansion as adjustable-rate loans continue to reprice.
• Expense and deposit management: Maintaining core deposit growth, especially in small business banking, is a priority. Management also expects normalized expense increases in 2026 to remain close to inflation, with a focus on controlling discretionary spending and monitoring deposit betas (the rate at which deposit costs adjust to changes in market interest rates).

Catalysts in Upcoming Quarters

As we look to upcoming quarters, the StockStory team will closely watch (1) whether Banner Bank can translate its growing loan pipeline into sustained net loan growth despite ongoing commercial real estate payoffs, (2) the impact of Federal Reserve rate decisions on net interest margin and funding costs, and (3) the company’s ability to maintain core deposit growth through new banker hires and small business initiatives. Expense discipline and credit quality trends will also be important markers of execution.

Banner Bank currently trades at $59.74, down from $66.03 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).

What Happened?

Shares of regional banking company Banner Corporation fell 6.1% in the afternoon session after the company reported mixed fourth-quarter 2025 financial results, where a revenue shortfall overshadowed an earnings beat. 

Banner's revenue for the quarter came in at $167.7 million, which fell short of the $173.23 million analysts had expected. While the company surpassed earnings per share forecasts, reporting $1.55 against an estimate of $1.45, investors appeared to focus on the weaker-than-expected sales. A miss on revenue can raise concerns about a company's core growth and its ability to generate business, often weighing more heavily on investor sentiment than an earnings beat.

What Is The Market Telling Us

Banner Bank’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 5 months ago when the stock gained 5.8% on the news that the major indices rebounded, as Fed Chair Jerome Powell delivered dovish remarks at the much-awaited Jackson Hole symposium. 

Powell suggested that with inflation risks moderating and unemployment remaining low, the Federal Reserve might consider a shift in its monetary policy stance, including potential interest rate cuts. This outlook eased market concerns about prolonged high interest rates and their impact on economic growth. The prospect of lower borrowing costs bolstered investor confidence, particularly in sectors that have lagged, leading to a broad rally across the market.

Banner Bank is down 1.1% since the beginning of the year, and at $61.81 per share, it is trading 13.4% below its 52-week high of $71.35 from February 2025. Investors who bought $1,000 worth of Banner Bank’s shares 5 years ago would now be looking at an investment worth $1,233.

Regional banking company Banner Corporation missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 2.6% year on year to $167.7 million. Its GAAP profit of $1.49 per share was 2.6% above analysts’ consensus estimates.

Banner Bank (BANR) Q4 CY2025 Highlights:

• Net Interest Income: $152.4 million vs analyst estimates of $152.1 million (8.5% year-on-year growth, in line)
• Net Interest Margin: 3.9% vs analyst estimates of 4% (4.2 basis point miss)
• Revenue: $167.7 million vs analyst estimates of $173 million (2.6% year-on-year growth, 3.1% miss)
• Efficiency Ratio: 62.1% vs analyst estimates of 59.2% (291.7 basis point miss)
• EPS (GAAP): $1.49 vs analyst estimates of $1.45 (2.6% beat)
• Tangible Book Value per Share: $46.09 vs analyst estimates of $45.80 (13.6% year-on-year growth, 0.6% beat)
• Market Capitalization: $2.19 billion

Company Overview

Founded in 1890 in Walla Walla, Washington, and evolving through more than a century of economic cycles, Banner Corporation operates Banner Bank, providing commercial banking services, loans, and financial products to individuals and businesses across Washington, Oregon, California, Idaho, and Utah.

Sales Growth

Net interest income and and fee-based revenue are the two pillars supporting bank earnings. The former captures profit from the gap between lending rates and deposit costs, while the latter encompasses charges for banking services, credit products, wealth management, and trading activities. Regrettably, Banner Bank’s revenue grew at a sluggish 2.6% compounded annual growth rate over the last five years. This fell short of our benchmarks and is a rough starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within financials, a half-decade historical view may miss recent interest rate changes, market returns, and industry trends. Banner Bank’s recent performance shows its demand has slowed as its annualized revenue growth of 1% over the last two years was below its five-year trend.

This quarter, Banner Bank’s revenue grew by 2.6% year on year to $167.7 million, falling short of Wall Street’s estimates.

Net interest income made up 86.5% of the company’s total revenue during the last five years, meaning Banner Bank barely relies on non-interest income to drive its overall growth.

Our experience and research show the market cares primarily about a bank’s net interest income growth as non-interest income is considered a lower-quality and non-recurring revenue source.

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Tangible Book Value Per Share (TBVPS)

Banks operate as balance sheet businesses, with profits generated through borrowing and lending activities. Valuations reflect this reality, emphasizing balance sheet strength and long-term book value compounding ability.

Because of this, tangible book value per share (TBVPS) emerges as the critical performance benchmark. By excluding intangible assets with uncertain liquidation values, this metric captures real, liquid net worth per share. Other (and more commonly known) per-share metrics like EPS can sometimes be murky due to M&A or accounting rules allowing for loan losses to be spread out.

Banner Bank’s TBVPS grew at a mediocre 5% annual clip over the last five years. However, TBVPS growth has accelerated recently, growing by 11.5% annually over the last two years from $37.09 to $46.09 per share.

Over the next 12 months, Consensus estimates call for Banner Bank’s TBVPS to grow by 8.9% to $50.19, paltry growth rate.

Key Takeaways from Banner Bank’s Q4 Results

It was good to see Banner Bank narrowly top analysts’ tangible book value per share expectations this quarter. On the other hand, its revenue missed and its EPS slightly exceeded Wall Street’s estimates. Overall, this quarter could have been better. The stock remained flat at $66.03 immediately following the results.

So should you invest in Banner Bank right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).

Regional banking company Banner Corporation will be reporting results this Wednesday after market hours. Here’s what you need to know.

Banner Bank beat analysts’ revenue expectations by 0.6% last quarter, reporting revenues of $172.2 million, up 9.7% year on year. It was a satisfactory quarter for the company, with a beat of analysts’ EPS estimates.

Is Banner Bank a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting Banner Bank’s revenue to grow 5.9% year on year to $173 million, improving from the 2% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.45 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Banner Bank has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 2.4% on average.

Looking at Banner Bank’s peers in the regional banks segment, some have already reported their Q4 results, giving us a hint as to what we can expect. First Horizon delivered year-on-year revenue growth of 8.1%, beating analysts’ expectations by 3.2%, and BOK Financial reported revenues up 12.7%, topping estimates by 7.6%. First Horizon traded up 102% following the results.

Read our full analysis of First Horizon’s results here and BOK Financial’s results here.

Investors in the regional banks segment have had steady hands going into earnings, with share prices up 1.4% on average over the last month. Banner Bank is down 1.5% during the same time and is heading into earnings with an average analyst price target of $72.83 (compared to the current share price of $64.87).

As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q3. Today, we are looking at regional banks stocks, starting with First Hawaiian Bank .

Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.

The 101 regional banks stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.3%.

Thankfully, share prices of the companies have been resilient as they are up 9.7% on average since the latest earnings results.

First Hawaiian Bank

Dating back to 1858 as Hawaii's oldest bank with deep roots in the Pacific island communities, First Hawaiian operates a full-service community bank providing deposit accounts, commercial and consumer loans, credit cards, and wealth management services across Hawaii, Guam, and Saipan.

First Hawaiian Bank reported revenues of $226.4 million, up 7.8% year on year. This print exceeded analysts’ expectations by 3.8%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.

“I’m pleased to report that the third quarter was another period of market-leading performance for First Hawaiian Bank,” said Bob Harrison, Chairman, President, and CEO.

Interestingly, the stock is up 13.7% since reporting and currently trades at $26.91.

Best Q3: Customers Bancorp

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Customers Bancorp reported revenues of $231.8 million, up 38.3% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with a solid beat of analysts’ net interest income estimates and an impressive beat of analysts’ revenue estimates.

The market seems happy with the results as the stock is up 19.5% since reporting. It currently trades at $78.37.

Weakest Q3: The Bancorp

Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.

The Bancorp reported revenues of $174.7 million, up 38.8% year on year, falling short of analysts’ expectations by 9.9%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ net interest income estimates.

The Bancorp delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.6% since the results and currently trades at $69.81.

Read our full analysis of The Bancorp’s results here.

Republic Bancorp

With roots dating back to 1974 and operating across multiple states including Kentucky, Indiana, Florida, Ohio, and Tennessee, Republic Bancorp (NASDAQGS:RBCA.A) is a Kentucky-based financial holding company that operates a bank offering traditional banking, mortgage services, and specialized financial products.

Republic Bancorp reported revenues of $91.52 million, up 11% year on year. This print came in 0.9% below analysts' expectations. Zooming out, it was a mixed quarter as it also logged a narrow beat of analysts’ tangible book value per share estimates but a slight miss of analysts’ revenue estimates.

The stock is up 2% since reporting and currently trades at $69.79.

Read our full, actionable report on Republic Bancorp here, it’s free.

Banner Bank

Founded in 1890 in Walla Walla, Washington, and evolving through more than a century of economic cycles, Banner Corporation operates Banner Bank, providing commercial banking services, loans, and financial products to individuals and businesses across Washington, Oregon, California, Idaho, and Utah.

Banner Bank reported revenues of $172.2 million, up 9.7% year on year. This number surpassed analysts’ expectations by 0.6%. Overall, it was a satisfactory quarter as it also put up a beat of analysts’ EPS estimates.

The stock is up 2.6% since reporting and currently trades at $64.28.

Read our full, actionable report on Banner Bank here, it’s free.