8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):   July 2, 2010

Banner Corporation

(Exact name of registrant as specified in its charter)

Washington	0-26584	91-1691604
(State or other jurisdiction	(Commission File	(I.R.S. Employer
of incorporation)	Number)	Identification No.)

10 S. First Avenue

Walla Walla, Washington  99362

(Address of principal executive offices and zip code)

(509) 527-3636

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions.

[  ]   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure

   On July 2, 2010, Banner Corporation (the “Company”) announced that the underwriters of the Company’s recent public offering of common stock have exercised their over-allotment option for an additional 7,139,000 shares, at a price to the public of $2.00 per share.  Together with the 78,500,000 shares the Company issued on June 30, 2010 (including 3,500,000 shares issued pursuant to the underwriters’ initial exercise of their over-allotment option), the Company has issued a total of 85,639,000 shares in the offering, resulting in estimated net proceeds, after deducting underwriting discounts and commissions and estimated offering expenses, of approximately $162.0 million.  The Company and the underwriters have agreed that there will be no further exercise of the over-allotment option. In total, the underwriters purchased 10,639,000 shares of the 11,250,000 shares available under the over-allotment option.

A copy of the press release is furnished as Exhibit 99.1 to this Form 8-K and incorporated herein by reference.

In accordance with General Instruction B.2. of Form 8-K, the information in Item 7.01 and the press release shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information and exhibit be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits

(d)         Exhibits

99.1 Press Release of Banner Corporation dated July 2, 2010

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

	BANNER CORPORATION
Date:  July 2, 2010	By: /s/Albert H. Marshall
	Albert H. Marshall
	Senior Vice President and Secretary

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EX-99.1

Exhibit 99.1

    Contact:D. Michael Jones, CEO CEO    Mark J. grescovich, President    Lloyd W. Baker, CFO    (509) 527-3636 News Release

BANNER CORPORATION ANNOUNCES ADDITIONAL EXERCISE OF UNDERWRITERS’ OVER-ALLOTMENT

OPTION IN CONNECTION WITH COMMON STOCK OFFERING

Walla Walla, Washington (July 2, 2010) – Banner Corporation (NASDAQ GSM: BANR) (the “Company”), the parent company of Banner Bank and Islanders Bank, today announced that the underwriters of the Company’s recent public offering of common stock have exercised their over-allotment option for an additional 7,139,000 shares, at a price to the public of $2.00 per share.  Together with the 78,500,000 shares the Company issued on June 30, 2010 (including 3,500,000 shares issued pursuant to the underwriters’ initial exercise of their over-allotment option), the Company has issued a total of 85,639,000 shares in the offering, resulting in estimated net proceeds, after deducting underwriting discounts and commissions and estimated offering expenses, of approximately $162.0 million.  The Company and the underwriters have agreed that there will be no further exercise of the over-allotment option.  In total, the underwriters purchased 10,639,000 shares of the 11,250,000 shares available under the over-allotment option.

D. A. Davidson & Co. served as sole book-running manager of the offering, and Sandler O’Neill + Partners, L.P. and McAdams Wright Ragen served as co-managers.

This announcement shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any offer or sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.  Offers will be made only by means of a prospectus and a related prospectus supplement, copies of which may be obtained from D.A. Davidson & Co., 8 Third Street North, Great Falls, MT 59401 (800) 332-5915, Sandler O’Neill + Partners, L.P., 919 Third Avenue, 6th Floor, New York, NY 10022 (800) 635-6859, and McAdams Wright Ragen, 925 4th Avenue, Suite 3900, Seattle, WA 98104 (888) 567-6297.

About the Company

Banner Corporation is a $4.6 billion bank holding company operating two commercial banks in Washington, Oregon and Idaho.  Banner serves the Pacific Northwest region with a full range of deposit services and business, commercial real estate, construction, residential, agricultural and consumer loans.  Visit Banner Bank on the Web at www.bannerbank.com.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements.