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): March 1, 2016

Banner Corporation

(Exact name of registrant as specified in its charter)

Washington	0-26584	91-1691604
(State or other jurisdiction	(Commission	(I.R.S. Employer
of incorporation)	File 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 CFR240.13e-4(c))

Item 5.02. Departure of Directors of Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

In connection with Banner Corporation’s (“Banner”) acquisition of Starbuck Bancshares, Inc. (“Starbuck”) and its wholly-owned subsidiary, AmericanWest Bank (“AmericanWest”), which was merged with and into Banner Bank on October 1, 2015 (the “Merger”), the Banner board of directors (the “Board”) has appointed David I. Matson, Roberto R. Herencia and Doyle L. Arnold to the Board, effective March 1, 2016.

Mr. Matson will serve on the Board’s Audit and Executive Committees and Mr. Herencia will serve on the Board’s Compensation Committee.

Mr. Matson and Mr. Herencia were appointed to the Board pursuant to the terms of the Agreement and Plan of Merger, dated as of November 5, 2014, by and among Banner, Elements Merger Sub, LLC, a wholly owned subsidiary of Banner (“Merger Sub”), SKBHC Holdings LLC (“Holdings”) and Starbuck (as amended, the “Merger Agreement”). Mr. Arnold was appointed to the Board pursuant to the terms of the Investor Letter Agreement (the “Oaktree Investor Letter”), dated as of November 5, 2014, between Banner and Oaktree Principal Fund V (Delaware) and certain of its affiliates (collectively, “Oaktree”). Oaktree’s right to designate a board member remains in effect for as long as Oaktree owns at least five percent of Banner’s outstanding voting and non-voting common stock in the aggregate, excluding the dilutive effect of primary issuances of Banner common stock or non-voting common stock (or securities convertible or exchangeable therefor).

In addition to the compensation Banner provides to all non-management directors for service on its Board (as described in Banner’s Annual Proxy Statement on Schedule 14A filed on March 24, 2015 under “Director Compensation” and incorporated herein by reference), Oaktree has agreed to provide additional compensation to Mr. Arnold for his services as a director on the Board pursuant to a letter agreement, dated February 19, 2016, between Oaktree and Mr. Arnold. Other than this letter agreement and as may be disclosed (i) by Oaktree in its filings with the SEC on Schedule 13D, (ii) in the Oaktree Investor Letter and (iii) in the Merger Agreement, Banner is not aware of any arrangement or understanding between Mr. Matson, Mr. Herencia or Mr. Arnold and any other person pursuant to which Mr. Matson, Mr. Herencia or Mr. Arnold was selected as a director or any direct or indirect material interest by Mr. Matson, Mr. Herencia or Mr. Arnold in any prior, existing or proposed transaction or series of transactions with Banner, or any of its subsidiaries or management.

The foregoing description of the Oaktree Investor Letter does not purport to be complete and is qualified in its entirety by reference to the full text of the Oaktree Investor Letter, which was attached as Exhibit 10.1 to Banner’s Current Report on Form 8-K filed on November 12, 2014 and is incorporated herein by reference.

On March 3, 2016, Banner issued a press release announcing the appointment of Mr. Matson, Mr. Herencia and Mr. Arnold to the Board, a copy of which is filed as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit	Description of Exhibit
Exhibit 10.1	Investor Letter Agreement dated as of November 5, 2014 by and between Banner Corporation, and Oaktree Principal Fund V (Delaware), L.P. and certain of its affiliates (incorporated by reference to Exhibit 10.1 of Banner’s Current Report on Form 8-K filed with the SEC on November 12, 2014).
Exhibit 99.1	Press Release dated March 3, 2016, issued by Banner Corporation.

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: March 3, 2016	By:	/s/ Lloyd W. Baker
		Name: Lloyd W. Baker
		Title:   Executive Vice President and Chief Financial Officer

Exhibit Index

Exhibit	Description of Exhibit
Exhibit 10.1	Investor Letter Agreement dated as of November 5, 2014 by and between Banner Corporation, and Oaktree Principal Fund V (Delaware), L.P. and certain of its affiliates (incorporated by reference to Exhibit 10.1 of Banner’s Current Report on Form 8-K filed with the SEC on November 12, 2014).
Exhibit 99.1	Press Release dated March 3, 2016, issued by Banner Corporation.

EX-99.1

Exhibit 99.1

		CONTACT:	MARK J. GRESCOVICH, PRESIDENT & CEO LLOYD W. BAKER, CFO (509) 527-3636
		NEWS RELEASE

Banner Corporation Announces Election of Directors

WALLA WALLA, WASHINGTON – March 3, 2016 - Banner Corporation (NASDAQ GSM: BANR), the holding company for Banner Bank and Islanders Bank, today announced that in connection with the acquisition of Starbuck Bancshares, Inc. and its wholly-owned subsidiary, AmericanWest Bank, of Spokane, Washington, which was merged with and into Banner Bank on October 1, 2015, the Banner board of directors has appointed David I. Matson, Roberto R. Herencia and Doyle L. Arnold to the Banner board of directors.

David I. Matson is currently a director of First BanCorp PR, where he is Chairman of the Risk and Audit Committees. He previously served as an independent director and Chairman of the Audit Committee of Starbuck Bancshares and AmericanWest Bank. Mr. Matson has more than 34 years of experience as a senior commercial banking executive, beginning his career with UnionBanCal Corporation in 1976. From 2005 until his retirement in 2010, he was the Vice Chairman and Chief Financial Officer of UnionBanCal Corporation and Union Bank of California, N.A. From 1998 to 2005, Mr. Matson was Executive Vice President and Chief Financial Officer. In these capacities, Mr. Matson had direct responsibility for corporate treasury functions, strategic and financial departments, corporate development functions including mergers and acquisitions, the controller’s department, tax department and corporate services. Mr. Matson received dual B.S. degrees in civil engineering and engineering administration from Michigan Technological University and an M.B.A. from Western Michigan University.

Roberto R. Herencia is a financial services industry executive, consultant and thought leader with 30 years of broad experience in the banking industry. He has held the positions of President and Chief Operating Officer of the community banking subsidiary of a top 30 publicly traded bank holding company, CEO of a publicly traded community bank, head of emerging markets at a major domestic and international bank, and consultant to regulators, community banks and private equity investors. Mr. Herencia has been the President and CEO of BXM Holdings, Inc., an investment fund specializing in community banks, since 2010. In 2013, he was elected as Chairman of the Board of Metropolitan Bank Group in Chicago, now Byline Bancorp, and its subsidiary, Byline Bank. In addition, Mr. Herencia serves as Chairman of First Bancorp (NYSE:FBP) and its subsidiary bank, FirstBank Puerto Rico. He also served as an independent director of SKBHC Holdings and was on the board of AmericanWest Bank prior to its merger with Banner. Mr. Herencia was nominated by President Obama to serve as a member of the board of directors of the Overseas Private Investment Corporation (“OPIC”) and was confirmed by the Senate in October 2011 and re-nominated in 2013. He is a Trustee of DePaul University and Northwestern Memorial Foundation in Chicago and serves on the Board of Directors of Junior Achievement of Chicago, the Navy Pier Corporation in Chicago, and Operation Hope in Los Angeles. He is a member of the Finance Council of the Archdiocese of Chicago. Mr. Herencia has received numerous awards for his civic contributions including the Distinguished Corporate Citizenship Award from The Jewish Council on Urban Affairs, the Evy Award from A Silver Lining Foundation and the prestigious Ellis Island Medal of Honor. He graduated magna cum laude and received his B.S.B.A. in finance from Georgetown University and his M.B.A. from the Kellogg School of Management at Northwestern University.

Doyle L. Arnold is a retired executive and board member who has played leadership roles in building several premier financial institutions, including Zions Bancorporation, from which he retired in 2015 as Vice Chairman and Chief Financial Officer. In that role he led the financial and most administrative functions including technology and operations, human resources, and legal services. He oversaw various subsidiary start-up financial technology companies, as well as building and growing the finance, accounting, SEC reporting, investor relations, tax, budgeting, management reporting and acquisitions teams. Mr. Arnold currently serves on the Board of Group 1 Automotive and on the Board of Trustees of Rice University. He is also a board member of The Utah Symphony and Opera. He previously served on and chaired the Board of Identrust, a venture-backed online identity and authentication company. Mr. Arnold was formerly Group Executive Vice President for Corporate Strategy and Development at Bank of America and Director of Corporate Strategy and Director of Internal Audit at Wells Fargo & Company. He also served as Senior Deputy Comptroller of the Currency and executive assistant to the Deputy Secretary of the Treasury during the Reagan administration. Mr. Arnold holds an M.B.A. from Stanford University and a B.A. in economics and mathematics from Rice University.

BANR – Press Release

March 3, 2016

Page 2

About Banner Corporation

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

Transmitted on Globe Newswire on March 3, 2016 at 1:00 p.m. PST.